Legislature(2003 - 2004)

05/07/2003 09:00 AM House FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HOUSE BILL NO. 226                                                                                                            
                                                                                                                                
     An   Act  relating   to  the  sale,   offer  for   sale,                                                                   
     representation,   and   labeling   of  food   or   other                                                                   
     agricultural  products  as  organic,  and to  the  state                                                                   
     organic  certification  program;  and providing  for  an                                                                   
     effective date.                                                                                                            
                                                                                                                                
                                                                                                                                
Representative  Stoltze introduced the  bill noting  that Co-                                                                   
Chair  Harris staff  had done  a lot  of work  on this  issue                                                                   
during the past two legislative sessions.                                                                                       
                                                                                                                                
BARBARA BITNEY,  STAFF, REPRESENTATIVE  BILL STOLTZE,  stated                                                                   
that HB 226  was a measure to  bring Alaska in line  with the                                                                   
federal definition  of "organic".   In  2001, the final  rule                                                                   
for the federal definition of  "organic" was adopted; the law                                                                   
allowed  for a transition  period from  mid-2001 to  October,                                                                   
2002,  giving states  14 months  to come into  line with  the                                                                   
federal  definition of  organic.   HB 432  was introduced  in                                                                   
April 2002 with  the language needed to make the  change.  It                                                                   
                          nd                                                                                                    
did not pass before the 22 Legislative session adjourned.                                                                       
                                                                                                                                
HB 226 is back this year, making  it a very simple measure to                                                                   
bring   the  State   of   Alaska's  definition   of   organic                                                                   
agricultural  products in line  with the federal  definition.                                                                   
It  will  create  an  Alaska  organic  certification  program                                                                   
providing  in-state  certification for  organic  agricultural                                                                   
producers, processors and handlers.                                                                                             
                                                                                                                                
At  this time,  operators  are  paying to  fly  certification                                                                   
specialists to Alaska whose fees  may be as high as $1,500 to                                                                   
$3,000 dollars  to verify Alaskan operations  comply with the                                                                   
federal  organic   standards.    With  passage   of  HB  226,                                                                   
qualified inspectors  would complete the  inspection process,                                                                   
with the  final certification  process  being performed  by a                                                                   
designated State official.                                                                                                      
                                                                                                                                
Representative Stoltze  voiced concern with the  fiscal note.                                                                   
He was  not sure  that the  amount was  justified.   He noted                                                                   
that  there  is  a  large  presence  of  United  States  Drug                                                                   
Administration  (USDA) officials,  whom the  State should  be                                                                   
able to  rely upon  for technical  assistance.  Whatever  the                                                                   
decision of the Committee regarding  the note, Representative                                                                   
Stoltze indicated that he wanted  to get the bill through the                                                                   
House.   He added that  Senator Green  was in support  of the                                                                   
bill on the Senate side and that  it was her intent to "trim"                                                                   
the note.                                                                                                                       
                                                                                                                                
Co-Chair Williams asked the responsibilities  associated with                                                                   
the requested position.  Ms. Bitney  explained that the State                                                                   
would continue  to bring outside  inspectors to Alaska.   The                                                                   
State will need  to review all documentation and  sign off on                                                                   
the certification  for it.   It would  be a ½ time  position.                                                                   
She believed that the fiscal note was minimal.                                                                                  
                                                                                                                                
Co-Chair  Harris noted  that he  would like  to zero out  the                                                                   
note.   He asked  if a  part time  person would  be hired  or                                                                   
would they be  using someone already in the  Department.  Ms.                                                                   
Bitney  responded  that  it  would   be  someone  within  the                                                                   
Department.                                                                                                                     
                                                                                                                                
Co-Chair  Harris asked  if  there was  a  program within  the                                                                   
Department where a fee could be  associated with the costs to                                                                   
pay  that   amount.    Ms.   Bitney  responded  that   was  a                                                                   
possibility that had not yet been explored.                                                                                     
                                                                                                                                
Co-Chair  Harris interjected  that  through regulations,  the                                                                   
Department could  impose a  fee for the  users.   He proposed                                                                   
that the  Committee modify  the fiscal  note, taking  the $37                                                                   
thousand  dollars from  general funds  and put  it under  $37                                                                   
thousand dollars from program  receipts, which would zero out                                                                   
the general fund draw.                                                                                                          
                                                                                                                                
Representative Stoltze  commented that it had  been difficult                                                                   
to  get a  "straight answer"  from  the federal  bureaucracy.                                                                   
Co-Chair Williams  encouraged that Co-Chair Harris  work with                                                                   
Representative  Stoltze  and  the Department  on  the  fiscal                                                                   
note.  Co-Chair  Harris advised that it would  be appropriate                                                                   
to  move  the bill  out  with  the fiscal  note  changed  and                                                                   
placing the $37  thousand dollars under general  fund program                                                                   
receipts.                                                                                                                       
                                                                                                                                
Co-Chair  Harris   MOVED  that   MOTION.    There   being  NO                                                                   
OBJECTION, the fiscal note was revised.                                                                                         
                                                                                                                                
Representative Hawker  inquired if that change  would need to                                                                   
be reflected in the bill.                                                                                                       
                                                                                                                                
RIVER  BEAN,   (TESTIFIED  VIA  TELECONFERENCE),   PRESIDENT,                                                                   
ALASKA  ORGANIC ASSOCIATION,  PALMER, commented  that in  the                                                                   
past, his  company had been  certifying organic farms  in the                                                                   
State of Alaska.  Under the organic  program rule, they could                                                                   
no longer do that.  The federal  government took that over as                                                                   
of October  22, 2002.  The State  can no longer use  the word                                                                   
"organic"  without  certification,   which  affects  a  large                                                                   
number of farmers in the State.   These farmers cannot afford                                                                   
to go to  the State of Washington  to certify.  On  behalf of                                                                   
all  the organic  farmers in  the State,  Mr. Bean  requested                                                                   
support  for  coming  in line  with  the  federal  government                                                                   
standards so  that Alaska can  call their produce  "organic".                                                                   
Mr. Bean  agreed to pay  a user fee  to maintain  the organic                                                                   
status.                                                                                                                         
                                                                                                                                
Representative Croft asked about  the federal criteria and if                                                                   
each state  had to  separately meet the  criteria.   Mr. Bean                                                                   
replied  that  anyone  that  applies  for  accreditation  can                                                                   
certify.  The Alaska Organic Association  cannot afford to be                                                                   
accredited with  the federal government.   There are  over 30                                                                   
states  that have  state  programs and  a  number of  private                                                                   
companies that  are accredited  with the federal  government.                                                                   
The  federal government  does not  provide the  certification                                                                   
but rather the accreditation.                                                                                                   
                                                                                                                                
Representative Croft  asked if that needed to  be done either                                                                   
through  private industry  or  through the  government.   Mr.                                                                   
Bean  stated that  was  correct.   He  reiterated that  their                                                                   
association couldn't afford to do it on their own.                                                                              
                                                                                                                                
GERALD  DEVILBISS,  (TESTIFIED  VIA  TELECONFERENCE),  ALASKA                                                                   
ORGANIC  ASSOCIATION,  WOLVERINE  FARMS,  PALMER,  encouraged                                                                   
Committee   members  to   pass  the   bill.    He   supported                                                                   
implementing a  user fee to help  cover costs.   He mentioned                                                                   
that  there is  a  big part  of  Alaska agriculture  that  is                                                                   
getting "swept  under the rug".   He voiced his  appreciation                                                                   
to  Representative Stoltze  for  bringing this  issue to  the                                                                   
State Legislature's awareness.                                                                                                  
                                                                                                                                
SHANE HERR,  (TESTIFIED VIA  TELECONFERENCE), ALASKA  ORGANIC                                                                   
ASSOCIATION,   ORGANIC  FARMER,   WOLVERINE  FARMS,   PALMER,                                                                   
encouraged  passage of  the bill.   He stressed  it would  be                                                                   
advantageous  to the  State of  Alaska.   Mr. Herr  commented                                                                   
that  tourism  capitalizes on  Alaskan  grown  products.   He                                                                   
believed  that there could  be federal  funding available  to                                                                   
help  the  State  with  the receipts.    The  farmers  cannot                                                                   
support  the entire  tab but would  be supportive  of a  user                                                                   
fee.                                                                                                                            
                                                                                                                                
Representative  Stoltze  voiced  his appreciation  for  those                                                                   
people  that testified.   He recognized  how labor  intensive                                                                   
the work they do is.                                                                                                            
                                                                                                                                
Representative  Stoltze  MOVED   to  report  HB  226  out  of                                                                   
Committee with  individual recommendations  and with  the new                                                                   
adjusted fiscal  note.  There  being NO OBJECTION, it  was so                                                                   
ordered.                                                                                                                        
                                                                                                                                
HB  226  was  reported  out  of   Committee  with  "do  pass"                                                                   
recommendation  and  with  a   revised  fiscal  note  by  the                                                                   
Department of Natural Resources.                                                                                                

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