Legislature(2021 - 2022)ADAMS 519
04/22/2021 01:30 PM House FINANCE
Note: the audio ![]()
and video ![]()
recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.
| Audio | Topic |
|---|---|
| Start | |
| HB92 | |
| HB79 | |
| HB80 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 69 | TELECONFERENCED | |
| += | HB 71 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 79 | TELECONFERENCED | |
| += | HB 80 | TELECONFERENCED | |
| += | HB 92 | TELECONFERENCED | |
HOUSE FINANCE COMMITTEE
April 22, 2021
1:37 p.m.
1:37:18 PM
CALL TO ORDER
Co-Chair Foster called the House Finance Committee meeting
to order at 1:37 p.m.
MEMBERS PRESENT
Representative Neal Foster, Co-Chair
Representative Kelly Merrick, Co-Chair
Representative Dan Ortiz, Vice-Chair
Representative Ben Carpenter
Representative Bryce Edgmon
Representative DeLena Johnson
Representative Andy Josephson
Representative Sara Rasmussen
Representative Adam Wool
Representative Bart LeBon
Representative Steve Thompson
MEMBERS ABSENT
ALSO PRESENT
PRESENT VIA TELECONFERENCE
Lucinda Mahoney, Commissioner, Department of Revenue; Pam
Leary, Director, Treasury Division, Department of Revenue;
Douglas Vincent-Lang, Commissioner, Department of Fish and
Game.
SUMMARY
HB 79 SALTWATER SPORTFISHING OPERATORS/GUIDES
HB 80 SPT FSH HATCHERY FACIL ACCT; SURCHARGE
HB 92 ANTICIPATION OF REVENUE; BORROWING; CREDIT
Co-Chair Merrick reviewed the agenda for the afternoon.
HOUSE BILL NO. 92
"An Act relating to borrowing in anticipation of
revenues; relating to revenue anticipation notes;
relating to line of credit agreements; and providing
for an effective date."
1:37:59 PM
Co-Chair Merrick indicated that the committee last heard
the bill on April 16, 2021.
LUCINDA MAHONEY, COMMISSIONER, DEPARTMENT OF REVENUE (via
teleconference), asked committee members and the public to
seriously consider the bill.
1:38:36 PM
Co-Chair Merrick OPENED public testimony.
1:38:49 PM
Co-Chair Merrick CLOSED public testimony.
Co-Chair Merrick invited Ms. Pam Leary to review the fiscal
note with OMB component number 121.
1:39:35 PM
AT EASE
1:41:32 PM
RECONVENED
Co-Chair Merrick turned to the fiscal note review.
1:41:43 PM
PAM LEARY, DIRECTOR, TREASURY DIVISION, DEPARTMENT OF
REVENUE (via teleconference), reviewed the new
indeterminate fiscal note for the Department of Revenue
(DOR) appropriated to Taxation and Treasury. She explained
that the proposed legislation updated AS 43.08 to clarify
that borrowing in anticipation of revenue collections
included employing other forms of short-term borrowing
strategies such as line of credit agreements in addition to
revenue anticipation notes. Fees paid would be offset by
allowing state funds to continue to be invested, earning
returns, rather than being borrowed to cover cash flow
needs. The new fiscal note was indeterminant. She furthered
that it was currently unknown how much interest the
borrowing mechanisms would carry and the associated costs,
but the division anticipated an offset to the costs.
Representative Thompson deduced that the state would be
paying a fee to access a line of credit. Ms. Leary replied
that he was correct. Representative Thompson asked what the
fees would be. Ms. Leary responded that the information was
provided in the PowerPoint (copy on file) provided on April
16, 2021. The fees ranged from .08 percent to .055 percent
based on a 12 month estimate on a hypothetical amount of
$100 million. There would be some associated costs with the
line of credit no matter what vehicle chosen or terms of
the loan.
1:44:22 PM
Representative LeBon referenced the two loan options:
capitol market products and bank market funded products. He
asked whether one product group would be easier to obtain
in terms of the mechanics of placing the line of credit
versus the other. He thought securing a revolving line of
credit would be the quickest and easiest way to secure the
line of credit.
1:45:08 PM
Mr. Leary stated that Representative LeBon was correct. She
indicated that there was a structure that could be accessed
with a bank versus a syndicate that would take time to
develop. Representative LeBon thought that the banking
option would be cheaper, quicker, and easier to establish.
He commented that a revolving line of credit was able to
renew annually. Ms. Leary replied that it was not clear yet
whether the state would choose a line of credit or a
different financing mechanism. However, from a general cash
flow perspective the department would choose a line of
credit with some sort of annual renewal.
Co-Chair Merrick indicated that amendments were due by
6:00pm.
HOUSE BILL NO. 79
"An Act relating to salt water sport fishing operators
and salt water sport fishing guides; and providing for
an effective date."
1:47:03 PM
Co-Chair Merrick indicated that Amendment 1 was adopted
during the prior hearing on April 20, 2021.
Representative Wool MOVED to ADOPT Amendment 2 (copy on
file):
Page 1, line 5:
Delete "a new paragraph"
Insert "new paragraphs"
Page 1, line 6:
Delete "Fishing"
Insert "Resident fishing"
Page 1, line 7:
Delete "Sport"
Insert "Resident sport"
Page 1, line 8:
Delete "Sport"
Insert "Resident sport"
Page 1, line 9:
Delete "Sport"
Insert "Resident sport"
Page 1, following line 9:
Insert a new paragraph to read:
(29) Nonresident fishing services
licenses
(A) Nonresident sport fishing
operator license ........ 400
(B) Nonresident sport fishing
guide license .......... 200
(C) Nonresident sport fishing
operator and guide combined
license .......400."
Page 3, line 26, following "(C)":
Insert "or 16.05.340(a)(29)(B) or (C)"
Page 4, line 2, following "(C)":
Insert "or 16.05.340(a)(29)(A) or (C)"
Page 4, line 3, following "(C)":
Insert "or 16.05.340(a)(29)(A) or (C)"
Representative Rasmussen OBJECTED for discussion.
Representative Wool explained the amendment. He offered
that the amendment doubled the fee for an out of state
guide, guide operator, or operator for fishing. He
delineated that the amendment paralleled AS 08.01.065
relating to big game hunting that allowed for the state to
charge out of state big game guides double the amount of an
Alaska resident. He had consulted with Legislative Legal
Services regarding a constitutional challenge and shared
that it determined that the provision could be challenged
but so far, the big game fees had not been challenged in
court.
1:48:40 PM
Representative Rasmussen relayed her objection.
Representative Rasmussen MOVED to ADOPT Conceptual
Amendment 1 to Amendment 2 (copy on file):
Page 2, line 6, following "AS 16.05.340(a)":
Insert "and the nonresident surcharge, if applicable,
under AS 16.40.274"
Page 3, line 7, following "AS 16.05.340(a)":
Insert "and the nonresident surcharge, if applicable,
under AS 16.40.274"
Page 3, line 13, following "AS 16.05.340(a)":
Insert "and the nonresident surcharge, if applicable,
under AS 16.40.274"
Page 4, following line 11:
Insert a new section to read:
"Sec. 16.40.274. Nonresident surcharge. In
addition to the annual base fee required for
a sport fishing guide license, sport fishing
operator license, or sport fishing operator
and guide combined license under AS
16.05.340(a)(28), a nonresident shall pay an
annual nonresident surcharge for the
issuance or renewal of a license under AS
16.40.262 or 16.40.272. The department shall
establish the annual nonresident surcharge
by regulation at an amount that is as close
as is practicable to the maximum allowed by
law."
Representative Rasmussen explained the amendment. She
voiced that during the previous hearing some concerns were
raised regarding the legality of the amendment and the
definition of resident and non-resident. She shared that
she had consulted the Legislative Legal Services and the
Department of Law (DOL). She was offering her amendment to
clear up some of the issues that were raised.
Co-Chair Merrick OBJECTED for discussion.
Representative Rasmussen furthered that the new language
replaced Amendment 2 and allowed for the department to
implement a non-resident surcharge as necessary for sport
fishing licenses. She noted that legislative legal and DOL
did not find any constitutional issue with Conceptual
Amendment 1. The language was similar to the language in AS
16.43.160 regarding commercial fishing license fees. She
reiterated that the amendment allowed for a non-resident
surcharge by regulation and used existing Department of
Fish and Game (DFG) language for the residency requirement
and definition.
Representative Wool appreciated the conceptual amendment.
He was unclear whether the conceptual amendment amended the
amendment or the bill. He deemed that Conceptual Amendment
1 was amending the bill and not the amendment.
Representative Rasmussen asked for an at ease.
1:50:43 PM
AT EASE
1:52:32 PM
RECONVENED
Representative Rasmussen explained that the conceptual
amendment was lacking a first line that deleted the
material from Amendment 2 and inserted the amended version.
Representative Wool did not care which amendment was used.
He was only concerned that the fees were doubled for non-
residents, which was the maximum allowed by statute. He
read the following from the conceptual amendment:
The department shall establish the annual nonresident
surcharge by regulation at an amount that is as close
as is practicable to the maximum allowed by law."
Representative Wool wondered if use of the word shall
made it something the department could do in regulation.
1:54:09 PM
DOUGLAS VINCENT-LANG, COMMISSIONER, DEPARTMENT OF FISH AND
GAME (via teleconference), read the language from a portion
of the conceptual amendment to Amendment 2 as follows:
In addition to the annual base fee required for a
sport fishing guide license, sport fishing operator
license, or sport fishing operator and guide combined
license under AS 16.05.340(a)(28), a nonresident shall
pay an annual nonresident surcharge for the issuance
or renewal of a license under AS 16.40.262 or
16.40.272. The department shall establish the annual
nonresident surcharge by regulation at an amount that
is as close as is practicable to the maximum allowed
by law."
Commissioner Vincent-Lang surmised that the surcharge
could be set by regulation.
Representative Wool related that he was not party to the
drafting of the conceptual amendment. He wondered if it was
something that the department could accomplish easily and
quickly. Commissioner Vincent-Lang indicated that the
change would go through the Administrative Procedures Act
process, and anyone could comment on the proposed
regulatory change.
Representative Wool asked if the issue was debatable with
the word "shall." Commissioner Vincent-Lang understood that
he shall do it, but the change had to go through the
established regulatory process. He indicated that the
outcome of the regulatory process was dependent on the
public comments. He ascertained that his mandate would be
to establish a regulation as close as is practicable to
the maximum allowed by law. He would need to define the
maximum allowed by law and be as close of possible to the
amount.
Representative Wool asked if someone from Legislative Legal
Services was online.
1:57:09 PM
Alpheus Bullard, Legislative Counsel, Legislative Legal
Services introduced himself and asked Representative Wool
to repeat the question.
Representative Wool reiterated that the conceptual
amendment changed the bill rather than his amendment. He
commented that the conceptual amendment provision was
regulatory and not statutory. He reread the last portion of
the amendment and understood that the maximum was twice the
amount of a residents fee. He was not sure that the
commission could guarantee the outcome due to the
regulatory process. He asked whether establishing the
increased fees was in question if the proposal went through
the regulatory process. Mr. Bullard indicated that the
amendment put the onus on the department to determine what
extra burden non-resident sport fishing guides and sport
fishing operators could contribute. He voiced that the
determination was the legal amount established by the
Alaska Supreme Court. Representative Wool wanted to double
the fees. He referred to AS 08.01.065 that doubled the fee
for non-resident big game guide licenses. His amendment was
paralleling the statute. He was aware that his amendment
could be challenged and doubted anyone would initiate a
lawsuit to save $100 or $200 dollars. He was willing to
accept the risk and go with his amendment rather than the
conceptual amendment. He felt that the amount determined
through the regulatory process would be negligible. He
voiced that the big game statutes simply implemented the
increase through statute. He discerned that the number of
guides was small, and he would rather stick to his
amendment seeing that a statute existed for big game
guides.
Co-Chair Merrick reported that the committee had been
joined by Representative Edgmon. She asked Mr. Bullard for
comment.
Mr. Bullard responded that in terms of the legal analysis
it was irrelevant what else existed in statute, it was the
appraisal of what the court would do if the statute was
challenged that mattered. The language that was used in the
conceptual amendment was the same as the language used for
non-resident commercial fishing guides. The language was
the result of previous legal challenges. He concluded that
the language in the conceptual amendment had a greater
chance of being upheld in court rather than a statute that
simply stated the fee was doubled.
Commissioner Vincent-Lang was concerned with the language
stating the department shall establish the non-resident
surcharged annually. He thought it would require an annual
review process.
Mr. Bullard responded that the fee would be an annual
surcharge. He thought that if the department believed that
nothing had changed regarding the cost posed by non-
residents there was no reason the department would have to
change it. He could not speak to the burden the process
placed on the department.
Representative Rasmussen thought that the burden placed on
the department was being exaggerated. She believed that it
was relatively simple for the department to establish the
fee and mirror the process for the commercial fishing
license fees. She was not comfortable supporting an
amendment that might draw a lawsuit.
2:04:39 PM
Representative Josephson deduced that when the department
established the surcharge as required in AS 16.43. 160, the
test the commissioner would apply would be the Carlson test
from a prior case. He wondered if he was correct. Mr.
Bullard responded affirmatively. Representative Josephson
surmised that DFG needed funding to administer the logbook
program that was obligated under treaties. He asked if the
bill, as amended, provided the amount of funding necessary
to carry out the logbook program. Commissioner Vincent-Lang
replied that it did not entirely. However, the department
had secured federal grants from the Halibut Commission to
make up the difference. He was uncertain whether the
funding was sufficient if freshwater fishing was added to
the program. He was not familiar with how the Commercial
Fisheries Entry Commission (CFEC) set its fees for non-
residents.
2:07:15 PM
Representative Wool asked about the case challenge that
Representative Josephson was referring to. He wondered if
the case had to do with non-resident fees for licenses. Mr.
Bullard responded that there were three cases regarding
non-resident fees for commercial fishing entry permits and
interim use entry permits. Representative Wool understood
that there were different fees non-resident commercial
fishers established under the CFEC. He deduced that it was
somehow determined that it cost more to administer licenses
to non-residents. He found himself in a quandary, he did
not want to jeopardize the bill, but the big game guide
statute had not been challenged. He believed that
ultimately, every law was subject to potential lawsuits.
2:09:01 PM
Representative Carpenter asked how many out of state guides
were licensed in 2019 or 2021. He deemed that the
information would help determine the amount of potential
revenue raised by increased fees. Commissioner Vincent-Lang
reported that in 2020 the number of resident licenses by
businesses was 90, the combination was 904, and the guides
amounted to 922. He specified that for the same year for
non-residents there were 29 businesses, 133 combinations
and 726 guides. The average over 5 years was 103 resident
businesses, 950 combination and guides were 1,153. In terms
of non-resident licenses, there were 33 businesses, 150
combinations, and 976 guides.
2:10:58 PM
AT EASE
2:14:45 PM
RECONVENED
Representative Carpenter referred to a document provided by
Commissioner Vincent-Lang [copy of an email to the
commissioner (copy on file)] and pointed to the chart
titled Non-Resident Licenses/Registrations Issued by Type
and Year, 2016 - 2020 and noted the total revenue amount
of $268,240 thousand. He calculated that the increase would
be 50 percent because it reflected the $400 fee contained
in the bill.
Representative Rasmussen WITHDREW Conceptual Amendment 1 to
Amendment 2.
2:15:44 PM
Representative Edgmon determined that the committee could
not determine what the legal risk could be, even if more
legal entities were consulted. He thought that Alaska would
not be the only state that has a resident versus non-
resident differential. He voiced that he was willing to
take the risk of adopting Amendment 2. He asked whether the
commissioner could comment on other states having a
resident versus non-resident licensing structure.
Commissioner Vincent-Lang responded that other states had
differential rates. He guessed that if the law was
challenged that the non-resident portion would be repealed.
Representative Edgmon recalled that the Carlson case
required the state to reimburse the licensees.
2:17:57 PM
Representative Wool cited the document distributed by the
commissioner and asked whether the charts were accurate or
if it was a projection of what it would be under the
legislation. Commissioner Vincent-Lang responded that it
reflected what the amount would be under the legislation at
a 2 to 1 ratio. Representative Wool deduced that the
difference was $60 thousand and as high as calculated in
the prior discussion. He indicated that the Carlson Case
denied a three times higher non-resident surcharge, not a
twice higher surcharge. He wanted to offer his amendment
since it asked for a doubling of the resident fee.
Co-Chair Merrick WITHDREW her OBJECTION.
Representative Rasmussen thought that her amendment was
more appropriate, and the committee should consider the
legality of the statute and avoid any risk of a lawsuit.
Representative Wool appreciated the comments made by
Representative Rasmussen. He worried that it was unknown
how the department would justify the surcharge and that it
could be less than 50 percent. He believed that it was
simpler to double the fee and that there was precedent
for his proposal.
Representative LeBon asked the commissioner whether he had
stated that there were sufficient revenues to administer
the program without a fee increase. Commissioner Vincent-
Lang answered that he stated there would be insufficient
revenue without any surcharge and if the differential was
eliminated, he would need to make up the difference with
federal funding sources.
2:21:58 PM
Representative LeBon surmised that the commissioner had
federal funding to fall back on and guessed that the need
for the additional revenue included in the amendments was
not compelling. Commissioner Vincent-Lang agreed only if
it applied to the saltwater program. The authority to add a
surcharge for a freshwater logbook program was contained in
the bill. Representative LeBon wanted guidance from the
commissioner and asked if the commissioner wanted the
amendment. Commissioner Vincent-Lang responded that it was
entirely the legislatures decision. He refused to provide
a definitive answer.
Representative Wool commented that he was surprised to
learn that there were almost equal numbers of resident and
non-resident guides. In addition, the amendment would
authorize a surcharge for a freshwater logbook program,
therefore both reasons compelled him to offer his
amendment.
Representative Edgmon asked about the impacts of non-
resident participation with the passage of the amendment.
Commissioner Vincent-Lang replied that when the licensing
fees were raised for sportfishermen, licenses declined by 5
to 10 percent. He thought that the impact to the guide
license would be negligible, since it was a profession, and
the licenses were paid for by their service fees.
Representative Carpenter asked how close Amendment 1 came
to fully funding the logbook program for non-residents.
Commissioner Vincent-Lang replied that it got the
department much closer; almost fully funded.
Representative Rasmussen WITHDREW her OBJECTION.
There being NO OBJECTION, it was so ordered. Amendment 2
was adopted.
Representative Rasmussen WITHDREW Amendment 3.
2:26:28 PM
Co-Chair Foster MOVED to report CSHB 79 (FIN) out of
Committee with individual recommendations and the
accompanying fiscal note.
Representative Johnson OBJECTED.
A roll call vote was taken on the motion.
IN FAVOR: Foster, Merrick, Ortiz, Carpenter, Edgmon,
Josephson, Rasmussen, Wool, LeBon, Thompson
OPPOSED: Johnson
The MOTION PASSED (10/1).
CSHB 79 (FIN) was REPORTED out of committee with a "do
pass" recommendation and with one new fiscal impact note by
the Department of Fish and Game.
2:29:54 PM
AT EASE
2:33:40 PM
RECONVENED
HOUSE BILL NO. 80
"An Act establishing the sport fishing hatchery
facilities account; establishing the sport fishing
facility surcharge; and providing for an effective
date."
Co-Chair Merrick called the meeting back to order. The
committee would take up HB 80. There were 3 amendments for
the bill.
2:33:49 PM
Vice-Chair Ortiz WITHDREW Amendment 1 (copy on file).
Representative Carpenter WITHDREW Amendment 2 (copy on
file).
2:34:28 PM
Vice-Chair Ortiz MOVED to ADOPT Amendment 3 (copy on file):
Page 1, line 8:
Delete "shall allocate"
Insert "may use"
Delete the first occurrence of "to"
Insert "only for"
Page 1, line 10:
Delete "to fisheries management,"
Insert "for sport fisheries management, sport"
Page 1, lines 12 - 14:
Delete all material and insert:
"(2) of the remainder of each surcharge
collected, (A) 30 percent to be deposited
into a subaccount within the sport fishing
enhancement account to be known as the
Southeast sport fishing enhancement
subaccount; money in the subaccount may be
used only in the Southeast region of the
state for sport fishing stock enhancement
projects and the maintenance and operation
of hatchery facilities; and (B) 70 percent
for use in other regions of the state for
sport fishing stock enhancement projects and
the maintenance and operation of state
hatchery facilities."
Co-Chair Merrick OBJECTED for discussion.
Vice-Chair Ortiz reviewed the amendment. He indicated that
the amendment was a good faith effort to try to address
the concerns raised by committee members and the
commissioner. The amendment changed language in Section 1,
line 8 of the bill from shall allocate with may use.
The change was requested by the department and provided DFG
more flexibility with account funds. He added that the next
part of the amendment specified that funds generated by
sport fish license sales would benefit sport fishery
management and research. He elaborated that the final part
of the amendment created a subaccount within the sport fish
enhancement account that set aside 30 percent of the
surcharge after the $2.50 was taken for invasive species
management research and habitat restoration and would be
deposited for use in the Southeast Region. The remaining
amount would be available for other regions of the state.
The provisions alleviated the concern DFG had regarding
being prohibited from using the funding elsewhere. The
legislature maintained the authority to change the
distribution of the surcharge in the future.
2:36:13 PM
Representative Wool asked if the charge was the additional
$4.00 surcharge. He wondered if the allocation would
inhibit DFGs traditional spending pattern of moving money
to different regions as needed.
2:37:21 PM
Vice-Chair Ortiz replied that the intent of the amendment
changing the language was to afford more flexibility for
the department. He deferred to the commissioner for further
answer.
Representative Wool asked if that was the reason for the
choice of the word "may." Commissioner Vincent-Lang
responded in the affirmative. He pointed to the following
amendment language and the maintenance and operation of
hatchery facilities; and state hatchery facilities" and
informed the committee that DFG could only spend money for
hatcheries that supported sport fisheries.
2:38:52 PM
Representative LeBon referred to the bottom of the
amendment where it referenced 30 percent deposited into the
subaccount and concluded that it was targeted for the
Southeast region and 70 percent was for other regions. He
wondered if Fairbanks and Anchorage were the other regions.
Commissioner Vincent-Lang responded in the affirmative.
Representative LeBon inquired whether it was up to the
commissioner to decide how the 70 percent was divided among
hatcheries and it left 30 percent dedicated to Southeast,
which was not subject to change. Commissioner Vincent-Lang
interpreted the amendment to mean that 30 percent from the
subaccount would be spent on Southeast Alaska. He
communicated that currently, DFG spent roughly $860
thousand in Southeast Alaska between the existing surcharge
and Pittman-Robertson (PR) and Dingell-Johnson (DJ) funds.
The department would pay with the surcharge and would be
able to build up enough over time to have funding to pay
for the maintenance of the hatcheries that were producing
the fish. Representative LeBon asked if the amendment
should be 35 percent to the Anchorage Hatchery and 35
percent to the Fairbanks. Commissioner Vincent-Lang
responded that he would like the language to remain as it
was written reflecting 70 percent for Anchorage and
Fairbanks. He noted that there were different maintenance
and operational costs. He indicated that the 30 percent
number was derived from the percentage of licenses
purchased by Southeast residents from the total number of
sport fishing licenses sold. He reported that the license
holders in Southeast were not getting a direct benefit from
the two hatcheries as those in Anchorage and Fairbanks.
Representative LeBon thought the amendment was to protect
the interests of Southeast. He clarified that the
commissioner would allocate the remaining amount comingled
from one pot between Anchorage and Fairbanks. Commissioner
Vincent-Lang replied in the affirmative.
Vice-Chair Ortiz spoke to the intent of the amendment. He
recounted that the original fees that were charged for the
licenses were set to repay bonds for construction of the
two facilities in Anchorage and one in Fairbanks. He
elucidated that the historical spending of the fees went
mostly to the Fairbanks region. Since the bonds were
repaid, the reasoning was to direct close to one third of
the revenue to the region where one third of the license
sales originated.
2:43:40 PM
Representative LeBon asked about the commissioner's
confidence level regrading the split. He wondered whether
the 30 percent was locked into the Southeast Region.
Commissioner Vincent-Lang replied that he interpreted the
provision to allow the funding in the subaccount to be used
in other areas if it was not needed in Southeast. He
emphasized the use of the word may. Commissioner Vincent-
Lang ascertained that currently DFG was spending about $800
thousand a year and 30 percent was $1.4 million per year.
The remaining $400 thousand in the subaccount each year
could grow and be directed towards the $2.5 million
deferred maintenance need at Crystal Lake. The subaccount
would be used to pay for maintenance of the infrastructure
used to produce the fish. He believed that the percentage
was the right amount and would address longer term deferred
maintenance needs.
2:45:52 PM
Representative LeBon voiced his concerns over the breakdown
in the amendment. He noted the Fairbanks hatchery was in
his district and the sport fishing interest of the Interior
was supported by the hatchery. He wondered how he could
protect the sport fishing interest of Interior Alaska also
without dedicating a certain amount to the Fairbanks
hatchery. Commissioner Vincent-Lang responded that
Representative LeBon needed to rely on the commissioners
assurances that DFG would maintain the hatchery and the
infrastructure. He added that the Fairbanks hatchery was
the most complicated in maintaining water quality and he
was aware of the short and long term maintenance needs of
the facility. Representative LeBon felt that there was a
little bit of "Apples-to-Oranges." He reiterated that there
was no dedication of funds to the two remaining regions.
2:47:54 PM
Representative Johnson was attempting to envision how the
split would work. She wondered whether the split would
result in excess money in one fund that would be unable to
be used for another region. Commissioner Vincent-Lang
answered that the difference had to do with how fish was
produced in Southeast Alaska versus the rest of the state.
He explained that in the rest of the state two hatcheries
were built and run by the department. In Southeast Alaska,
the state did not build hatcheries. The hatcheries were run
by private non-profit partners and received state funding
to operate. He opined that the approach seemed to fit the
Southeast region better. As a result of establishing a
surcharge to build the two hatcheries in Anchorage and
Fairbanks it left an understandable desire by Southeast
legislators that their regions sport fishers were paying
for something they were not getting a direct benefit.
Therefore, the department apportioned part of the surcharge
to use in Southeast Alaska. He pointed out that the methods
used to benefit sport fishers were different and in
Southeast Alaska it was accomplished via contract. The
surcharge split was one way to ensure that each year all
the surcharge funding was not allocated to Anchorage and
Fairbanks leaving insufficient funding to maintain the
contractual obligation to produce fish in Southeast.
2:50:33 PM
Representative Carpenter asked how many hatcheries would be
supported with the 30 percent portion. Commissioner
Vincent-Lang responded that the funding was distributed on
a case by case basis as to how the fish was produced at the
private non-profit hatcheries. The department let the
hatcheries decided where the facilities should be to
produce the fish. The state paid the hatcheries to keep the
production ongoing. Representative Carpenter understood the
concept of fairly distributing the money. He thought there
was other risks that should be considered. He wanted to
know about the legality of splitting the money and the
constitutionality of subaccounts in terms of dedicated
funds.
2:52:14 PM
AT EASE
2:55:39 PM
RECONVENED
Co-Chair Merrick indicated Mr. Bullard was online.
Representative Carpenter had concerns and questions
regarding the 30/70 allocation split, the creation of a
subaccount and the legality of designated funds.
Mr. Bullard responded that the amendment would create a
dedicated subaccount within a dedicated account within a
dedicated fund called the Fish and Game Fund. He explained
that the fund was a constitutionally dedicated fund because
it was required for participation in federal programs. The
federal government did not require the state to further
dedicate the revenue within the Fish and Game fund for
particular purposes. He stated that both the account and
the subaccount were unconstitutional, but the fund was
constitutional. Representative Carpenter asked for clarity.
Mr. Bullard reiterated that the original account and the
subaccount within the fund were unconstitutional.
Representative Josephson asked whether Mr. Bullard was
stating that he drafted an unconstitutional amendment for
Representative Ortiz. Mr. Bullard restated that it was his
legal opinion that if the federal government did not
require that the Fish and Game Fund have dedicated funds
for purposes other than what the fund was designed for then
the accounts were unconstitutional. Representative
Josephson was aware that the fund was a dedicated fund
because it predated statehood. Mr. Bullard responded that
it was permissible because its existence was required by
the federal government. Representative Josephson stated
that the subaccount did not mean the money could not be
distributed for different use by a future legislature. He
believed that the state was compliant with the dedicated
provision if the resources were used for fisheries. He
asked whether he was correct.
Commissioner Vincent-Lang interjected that when the DJ and
PR funds were made available there was a requirement that
license fees had to be used to match the funds. The Fish
and Game Fund was a dedicated fund voted on by the people
of Alaska and was an amendment to the constitution. The
money in the fund was dedicated to DFG and could not be
used for other purposes.
3:01:37 PM
Representative Josephson recommended that the bill be held
to revisit Mr. Bullards opinion. He needed more clarity
regarding his statements.
Vice-Chair Ortiz explained that rather than hold up the
bill any longer he would withdraw the amendment and address
the issue in the other body.
Vice-Chair Ortiz WITHDREW Amendment 3.
3:02:34 PM
Co-Chair Merrick WITHDREW her OBJECTION.
Co-Chair Foster MOVED to report CSHB 80 (FSH) out of
Committee with individual recommendations and the
accompanying fiscal note.
There being NO OBJECTION, it was so ordered.
CSHB 80 (FSH) was REPORTED out of committee with a "do
pass" recommendation and with one new fiscal impact note by
the Department of Fish and Game.
3:04:32 PM
AT EASE
3:07:22 PM
RECONVENED
Co-Chair Merrick reviewed the agenda for the following
meeting.
ADJOURNMENT
3:07:49 PM
The meeting was adjourned at 3:07 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 80 Amendment 3 Ortiz 042221.pdf |
HFIN 4/22/2021 1:30:00 PM |
HB 80 |
| HB 79 SEAGO Comment Wool Amendment 2 042221.pdf |
HFIN 4/22/2021 1:30:00 PM |
HB 79 |
| HB 79 Conceptual Amendment 1 to Amendment 2 042221.pdf |
HFIN 4/22/2021 1:30:00 PM |
HB 79 |
| HB 79 DFG Backup to Amendments 2 3 022221.pdf |
HFIN 4/22/2021 1:30:00 PM |
HB 79 |