Legislature(1993 - 1994)
05/04/1994 01:50 PM FIN
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
SB 132 An Act relating to loans for the purchase of individual fishery quota shares. CS SB 132 (RES) am was reported out of Committee with "no recommendations" and with a fiscal note by the Department of Commerce and Economic Development dated 2/04/94 and a Letter of Intent provided by the House Resources Committee. SENATE BILL 132 "An Act relating to loans for the purchase of individual fishery quota shares." BRYCE EDGMON, STAFF, SENATOR GEORGE JACKO, explained that CS SB 132 would expand the Commercial Fisheries Revolving Loan Fund Program to allow Alaskan fishermen to obtain loans to purchase Individual Fisheries Quotas (IFQs). The Commercial Fisheries Revolving Loan Fund Program would service the debt to purchase limited entry permits, purchase or upgrade vessels, and purchase fisheries related gear. Co-Chair MacLean MOVED to report CS SB 132 (RES) am out of Committee with individual recommendations and with the accompanying fiscal notes. She explained that the IFQs are transferrable, which creates a fear that fishermen from out of state will purchase the Alaskan fishing permits. The Division of Investments would provide loan money through the Revolving Loan Fund, whereas Alaskan commercial banks are reluctant to help Alaskan fishermen who do not have sufficient collateral. The legislation would keep Alaskan fishermen in business in Alaskan waters. Representative Brown asked the total amount of money which the State would be distributing. Mr. Edgmon replied that $5 million dollars would be loaned in FY95 and then between $4 and $5 million dollars appropriated in FY96. He pointed out that the qualification requirements are stringent. The Division of Investments does have a regulation priority listing. Representative Brown deliberated on the different loan funding resources available in the State. She spoke against providing commercial opportunity to fishmen over another class of requestors. Mr. Edgmon responded that when the program was established, it was the intent of the State to 7 keep as many limited entry permits in residence ownership. The loan program was established in order to offer that arrangement to as many fishermen as possible. The program allows resident fishermen to compete with nonresident fishermen who have better access to capital. (Tape Change, HFC 94-157, Side 2). Representative Grussendorf commented that the IFQ's would provide collateral for the small fisherman. The program would keep the limited entry permits in the State. Representative Hoffman added that the fishing industry is a renewable resource and will continue to provide jobs to many small rural areas within Alaska. GREG WINEGAR, MANAGER, JUNEAU LENDING BRANCH, DIVISION OF INVESTMENTS, DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT, responded to Representative Navarre's questions regarding the loan requirements for State resident's. He advised that the residency requirement was the same for all eligibility requirements, pointing out that law states in Section #A that a person would have to actively participate for the past five years which would have to include the preceding season. The current legislation would change that to indicate participation for two of the past five years and that it would be necessary to include the preceding season. The borrowing interpretation would be more liberal than that of the past. There being NO OBJECTIONS, to reporting the bill from Committee, it was so ordered. Representative Foster MOVED to adopt the House Resources Committee Letter of Intent. There being NO OBJECTIONS, it was so ordered. CS SB 132 (RES) am was reported out of Committee with "no recommendations", with the House Resources Committee Letter of Intent and with a fiscal note by the Department of Commerce and Economic Development dated 2/04/94.