Legislature(2017 - 2018)HOUSE FINANCE 519

04/26/2017 01:30 PM FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Recessed to a Call of the Chair --
+= HB 131 RELOCATION ASSISTANCE FOR FED. PROJ/PROG TELECONFERENCED
Moved HB 131 Out of Committee
+= HB 128 SHELLFISH ENHANCE. PROJECTS; HATCHERIES TELECONFERENCED
Moved HB 128 Out of Committee
+= HB 124 BENEFIT CORPORATIONS TELECONFERENCED
Heard & Held
+= HB 76 MARICULTURE REVOLVING LOAN FUND TELECONFERENCED
Moved CSHB 76(FSH) Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
HOUSE BILL NO. 76                                                                                                             
                                                                                                                                
     "An Act relating to the mariculture revolving loan                                                                         
     fund and loans from the fund; and providing for an                                                                         
     effective date."                                                                                                           
                                                                                                                                
2:02:05 PM                                                                                                                    
                                                                                                                                
Co-Chair  Foster  indicated  there had  been  no  amendments                                                                    
submitted to  his office since  the bill's last  hearing. He                                                                    
invited  the bill  sponsor,  Representative  Ortiz, and  his                                                                    
staff to the table.                                                                                                             
                                                                                                                                
REPRESENTATIVE  DAN ORTIZ,  SPONSOR,  thanked the  committee                                                                    
for  considering  the  legislation.   He  read  the  sponsor                                                                    
statement:                                                                                                                      
                                                                                                                                
     This  bill  amends   the  existing  Alaska  Mariculture                                                                    
     Revolving Loan  Fund to  allow up  to forty  percent of                                                                    
     the fund  to be used  for loans to  permitted shellfish                                                                    
     hatcheries for planning, construction and operation.                                                                       
                                                                                                                                
     Alaska shellfish  farms currently do not  have a stable                                                                    
     supply of seed  for the propagation of  oysters, and no                                                                    
     regular, in-state  source of seed for  resident aquatic                                                                    
     plants and other shellfish. A  stable supply of seed is                                                                    
     one of many hurdles the  industry must overcome to grow                                                                    
     and become a viable Alaskan industry.                                                                                      
                                                                                                                                
     This bill  will amend  the program  to shift  its focus                                                                    
     and eligibility from  individual mariculture farmers to                                                                    
     include  shellfish hatcheries  that would  market stock                                                                    
     to local Alaskan mariculture farmers.                                                                                      
                                                                                                                                
     The  mariculture industry  in Alaska  is not  yet fully                                                                    
     developed,  and   is  extremely   high  risk,   from  a                                                                    
     financial  standpoint.  These  obstacles  make  private                                                                    
     financing  difficult  to  obtain, but  this  bill  will                                                                    
     enable Alaskans  to maintain their businesses  and grow                                                                    
     Alaska's                                                                                                                   
     mariculture industry.                                                                                                      
                                                                                                                                
Representative  Ortiz  reported that  the  bill  had 2  zero                                                                    
fiscal notes. He was happy to answer any questions.                                                                             
                                                                                                                                
Co-Chair Foster  reviewed the list of  available testifiers.                                                                    
Co-Chair  Foster  directed  Vice-Chair Gara  to  review  the                                                                    
fiscal notes.                                                                                                                   
                                                                                                                                
Vice-Chair Gara reviewed two zero fiscal notes:                                                                                 
                                                                                                                                
[Fiscal Note Number: 2]                                                                                                         
                                                                                                                                
Department: Department of Fish and Game                                                                                         
Appropriation: Statewide Support Services                                                                                       
Allocation: Commissioner's Office                                                                                               
OMB Component Number: 2175                                                                                                      
                                                                                                                                
[Fiscal Note Number: 1]                                                                                                         
                                                                                                                                
Department: Department  of Commerce, Community  and Economic                                                                    
Development                                                                                                                     
Appropriation: Investments                                                                                                      
Allocation: Investments                                                                                                         
OMB Component Number: 383                                                                                                       
                                                                                                                                
Representative Wilson referred to  the last paragraph on the                                                                    
fiscal note  with OMB  component number  383. She  read from                                                                    
the fiscal note (copy on file).                                                                                                 
                                                                                                                                
She asked  if the department  would be absorbing  the costs.                                                                    
She asked for the amount being absorbed.                                                                                        
                                                                                                                                
2:05:32 PM                                                                                                                    
                                                                                                                                
BRITTENY  CIONI-HAYWOOD,  DIVISION   DIRECTOR,  DIVISION  OF                                                                    
ECONOMIC DEVELOPMENT, DEPARTMENT  OF COMMERCE, COMMUNITY AND                                                                    
ECONOMIC DEVELOPMENT,  relayed that  the funding  would come                                                                    
out  of  the fund.  She  noted  that there  was  potentially                                                                    
another regulation package that would be coming out.                                                                            
                                                                                                                                
Representative Wilson  asked what  fund the monies  would be                                                                    
drawn from.  She thought the  amount should be  reflected in                                                                    
the fiscal note and asked Ms. Cioni-Hawood to comment.                                                                          
                                                                                                                                
Co-Chair  Seaton  read  from   the  remainder  of  the  last                                                                    
paragraph on  page 2 of the  fiscal note (copy on  file). He                                                                    
remarked that the regulations  were already being rewritten.                                                                    
He asked for further clarification.                                                                                             
                                                                                                                                
Ms.  Cioni-Haywood understood  that the  department was  not                                                                    
asking for additional money  or an additional appropriation,                                                                    
therefore, the fiscal note was zero.                                                                                            
                                                                                                                                
Representative  Guttenberg pointed  out  that  the note  was                                                                    
from DCCED.  It was  part of the  loan programs,  which they                                                                    
had a significant amount. He pointed  to the top line of the                                                                    
analysis  which  indicated  that the  Mariculture  Revolving                                                                    
Loan Fund program was already  authorized to issue loans. It                                                                    
appeared  the   program  was  expanding  to   include  other                                                                    
projects.                                                                                                                       
                                                                                                                                
Representative Wilson  asked about other  planned regulation                                                                    
projects that would include  this project. Ms. Cioni-Haywood                                                                    
explained  that  the  department   was  also  considering  a                                                                    
regulation project on HB 56  [Legislation introduced in 2017                                                                    
- Short Title: COMMERCIAL  FISHING LOANS] that would include                                                                    
changes for the commercial fishing loan limits.                                                                                 
                                                                                                                                
Representative  Wilson assumed  that HB  56 did  not have  a                                                                    
zero  fiscal note.  Ms. Cioni-Haywood  relayed  there was  a                                                                    
zero fiscal note for HB 56.  She was informed that since the                                                                    
department was  not asking for an  additional appropriation,                                                                    
the fiscal note would be zero.                                                                                                  
                                                                                                                                
Representative Wilson  was asking because the  committee had                                                                    
heard about  the budget  and how much  it had  been reduced.                                                                    
She appreciated that the department  was absorbing the cost.                                                                    
However,  it  would  be  nice   to  know  the  amount  being                                                                    
absorbed.  She  specified  that the  loan  people  would  be                                                                    
paying  for  the  costs.  She   suggested  that  there  were                                                                    
inconsistencies in the absorption  of costs. She asked about                                                                    
the other  fiscal note and  the potential of more  money for                                                                    
the hatchery portion.  She read from the second  page of the                                                                    
fiscal  note from  DFG (copy  on file)  regarding additional                                                                    
operating funds  for operators  of hatcheries.  She realized                                                                    
that she was directing her  question to DCCED and she should                                                                    
be asking  DFG. She asked  if the money for  hatcheries went                                                                    
back into  the hatcheries  themselves. She wondered  if that                                                                    
was the reason  it stated there might be more  money for the                                                                    
hatcheries as opposed to the state.                                                                                             
                                                                                                                                
Representative Ortiz asked what she was referring to.                                                                           
                                                                                                                                
Representative Wilson  was speaking to the  fiscal note with                                                                    
the OMB  component number  2175. She  pointed to  the second                                                                    
page.  The language  mentioned  potential  revenue going  to                                                                    
hatcheries rather than to the state.                                                                                            
                                                                                                                                
2:11:02 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
2:11:27 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Representative Ortiz deferred to his staff, Ms. Bolling.                                                                        
                                                                                                                                
ELIZABETH   BOLLING,   STAFF,  REPRESENTATIVE   DAN   ORTIZ,                                                                    
explained that hatcheries would be  able to apply for grants                                                                    
through  the reshaped  loan fund.  Although the  grants were                                                                    
small, it would be possible  for operators to get some small                                                                    
grant money  through the program  that they  might otherwise                                                                    
receive  from DFG.  All that  the fiscal  note conveyed  was                                                                    
that  a  portion  of  the   amount  they  paid  out  to  the                                                                    
hatcheries to operate might be  offset slightly by the grant                                                                    
program.                                                                                                                        
                                                                                                                                
Representative Guttenberg highlighted  that the loan program                                                                    
was  sustainable as  a  revolving loan  fund  and was  self-                                                                    
sustained. The  legislation was expanding who  could use the                                                                    
funds and  how the  funds would  be used.  The loan  fund by                                                                    
itself was essentially a bank.                                                                                                  
                                                                                                                                
Representative Wilson clarified that  her point was that the                                                                    
money would  be designated general  funds (DGF) and  DGF was                                                                    
shown  in state  fiscal  notes. She  wanted the  information                                                                    
provided on fiscal notes.                                                                                                       
                                                                                                                                
Co-Chair  Seaton  MOVED  to  report CSHB  76  (FSH)  out  of                                                                    
Committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal notes.                                                                                                      
                                                                                                                                
There being NO OBJECTION, it was so ordered.                                                                                    
                                                                                                                                
CSHB  76 (FSH)  was REPORTED  OUT  of Committee  with a  "do                                                                    
pass" recommendation and with  two previously published zero                                                                    
fiscal notes: FN1 (CED) and FN2 (DFG).                                                                                          
                                                                                                                                
2:14:47 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
2:15:49 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                

Document Name Date/Time Subjects
HB 177 Supporting Document-Letter Kenai Borough 4.15.17.pdf HFIN 4/26/2017 1:30:00 PM
HB 177
HB177 Supporting Document-Article News Miner 4.15.17.PDF HFIN 4/26/2017 1:30:00 PM
HB 177
HB177 Sponsor Statement 4.15.17.pdf HFIN 4/26/2017 1:30:00 PM
HB 177
HB177 Supporting Document-Article NOAA 4.15.17.PDF HFIN 4/26/2017 1:30:00 PM
HB 177
HB177 Supporting Document-Article Peninsula Clarion 4.15.17 (2).PDF HFIN 4/26/2017 1:30:00 PM
HB 177
HB177 Supporting Document-Article Peninsula Clarion 4.15.17.PDF HFIN 4/26/2017 1:30:00 PM
HB 177
HB177 Supporting Document-News KTUU 4.15.17.PDF HFIN 4/26/2017 1:30:00 PM
HB 177
HB177 Supporting Documents - Example AIS and Pamphlets 4.15.17.PDF HFIN 4/26/2017 1:30:00 PM
HB 177
HB177 Supporting Documents - Letter NIPM 4.15.17.PDF HFIN 4/26/2017 1:30:00 PM
HB 177
HB177 Supporting Document-Support Letter-CIAA 4.15.17.pdf HFIN 4/26/2017 1:30:00 PM
HB 177
HB177Supporting Document-Letter RCAC 4.15.17.PDF HFIN 4/26/2017 1:30:00 PM
HB 177
HB 124 Amendment 1 Foster v.D.1.pdf HFIN 4/26/2017 1:30:00 PM
HB 124