Legislature(1993 - 1994)
03/26/1993 08:30 AM House FSH
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 230: VESSEL FEES Number 144 FRANK HOMAN, COMMISSIONER, COMMERCIAL FISHERIES ENTRY COMMISSION (CFEC), presented an analysis showing some of the impact of HB 230, which had been requested. (A copy of the analysis may be found in the House Special Committee on Fisheries' Committee Room, and after the adjournment of the second session of the 18th Alaska State Legislature, in the Legislative Reference Library.) He noted the CFEC had taken a neutral position on HB 230 because of concern about recent court cases involving some dispute on the resident/non- resident fee structure which had not yet been resolved. The CFEC also felt there was a policy question that as a revenue generating measure, the legislature was the more appropriate body to determine the need for revenue than the CFEC. MR. HOMAN explained the Limited Entry Commission currently collects an annual vessel fee of $20, and HB 230 would change the system to one which would be based on the tonnage of the vessel. The commission would charge $2 per ton and there would be a $20 minimum. In order to show the impact, he stated in 1992, 17,194 vessels were licensed and $340,000 was collected. Based on changing to a gross tonnage fee, calculations of total revenue collected would be $860,000. MR. HOMAN further explained the current system of the flat $20 fee is an automatic system and there is very little administrative costs involved. An analysis of the administrative impact of going to a tonnage fee system is still being worked on, he advised, because records would have to be verified or some official Coast Guard documentation would have to be sent in with the vessel license application. MR. HOMAN commented on the second part of HB 230 which has to do with the annual fee. The current annual fee formula for a limited entry permit is 1/4 of one percent of the value of the limited entry permit and the unlimited fisheries formula is 1/4 of one percent of the average gross earnings of that fishery during the last three years. Currently the cap for residents is $250 and the cap for non- resident is $750. By removing the cap as HB 230 would do, there would be a substantial increase in revenue collected. Number 385 PHIL BRUDIE from Homer, testified via teleconference that fishing seasons in Cook Inlet have not been very good and fees are increasing, meanwhile Kodiak had no increase in fees and better fishing. He wanted to know if there was a specific reason for the fee increase in Cook Inlet, and mentioned the fish catch has decreased considerably since the oil spill. He saw no justification to be singled out for a fee increase, and suggested an error must have been made. Number 400 CHAIRMAN MOSES responded that it was certainly not the intent of HB 230. It was designed to make all the fees more equitable, he advised. Number 412 AL RAY CARROLL, PRESIDENT, COOK INLET SEINERS ASSOCIATION, testified regarding a media release from Representative Moses which said the increases would be felt by only the higher value fisheries with nearly 80 percent coming from the non-residents. Mr. Carroll pointed out there are 74 resident permits and two non-resident permits. He agreed with Mr. Brudie that an error must have been made, and asked the committee to look over the figures. Number 440 LINDA KOZAK, KODIAK LONG LINE VESSEL ASSOCIATION, asked to go on record as opposing HB 230. Worried because the revenue generated from these fees cannot be dedicated to the fishing industry, she stated the Kodiak Long Line Vessel Association was not opposed to a slight increase, but felt the fishermen are already paying enough taxes and fees. She would rather see a more broad base type of tax or fee increase. MAURICE INGMAN on teleconference from Ketchikan opposed HB 230. He stated it would increase his fees by four times, and expressed concern that the additional revenue would go into the state's general fund and be used to build roads or something in other communities. Number 514 ALVIN OSTERBACK, PRESIDENT, PENINSULA MARKETING ASSOCIATION, testified from Sand Point and asked to be on record as opposing HB 230. He had many of the same concerns as previous speakers. Number 547 ALVIN OSTERBACK, SR. of Sand Point said prices are going down and insurance is going up. He felt the state income tax should be reinstated. Number 569 BRUCE EAGLE of Wrangell expressed concern of a lack of a cap in section 3 of HB 230. He felt it should be changed but not deleted, and was opposed to any more fee increases for fishermen. NORMAN ANDERSON of Naknek testified via teleconference. He wanted to go on record opposing HB 230, and felt the state should be more involved with the adverse price fluctuations of salmon. Number 598 ADELHEID HERRMANN, a commercial fisherman from Naknek, had concerns with HB 230. If the money were to go back to the ADF&G she would have no problem, but since there is no such thing as dedicated funds, she has a problem with it. Fishing fee increases at the same time as Coast Guard requirements are coming on line is quite a concern to fishermen, she noted, and more money needs to go to fish and wildlife protection where many people go unfined. She was inclined to support a 1% marketing increase if a system was set up where fishermen had equal say with the processors. Number 628 DICK JACOBSEN, of Sand Point commented on HB 230's fee structure. He felt western Alaska had been singled out to pay higher fees, and asked to go on record as being opposed to HB 230 in its present form. Number 665 BRUCE FOSTER of Sand Point felt the fee increase on fishermen would be too hard. TAPE 93-14, Side B Number 027 BETH STEWART, DIRECTOR, NATURAL RESOURCES DEPARTMENT, ALEUTIANS EAST BOROUGH (AEB), testified in opposition to HB 230. The AEB suggested the committee increase all vessel licenses by five, ten, or twenty dollars rather than having fees based on vessel capacity. She stated there is currently litigation regarding the issue of differential permit fees for residents and non-residents and believed some of the increases proposed would bring additional litigation. Additionally, the AEB felt if additional revenue was being looked at from the Exclusive Economic Zone fisheries, there would be Magnuson Act conflicts that would result in losing the current revenues the state is collecting. MS. STEWART, on behalf of the AEB, asked that the legislature investigate the issue through the National Oceanic and Atmospheric Administration's general council. The AEB felt if the intent of HB 230 is to capture more non- resident revenue, a more effective way to do that would be to reinstate a state income tax. Number 090 JERRY McCUNE, PRESIDENT, UNITED FISHERMEN OF ALASKA (UFA), stated fishermen are already paying their fair share in fees and taxes. Since there is no way to dedicate funds, the UFA was concerned that the additional revenue would go to fund someone else's programs instead of fisheries. Number 116 KATE TROLL, EXECUTIVE DIRECTOR, SOUTHEAST ALASKA SEINERS ASSOCIATION, opposed HB 230 because of cost and fairness. In order to stay viable many fishermen have had to diversify. There is no correlation between the money going to support the fishing industry and the money brought in by the industry. Not all industries are being asked to pay increases, and a state income tax should be looked at in all fairness, she concluded. ADJOURNMENT Number 168 CHAIRMAN MOSES asked for further testimony or discussion. Hearing none he stated his intent to hold both HB 218 and HB 230 for further consideration. He then adjourned at 9:40 a.m.
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