02/20/1995 05:50 PM House FSH

 HFSH - 02/20/95                                                               
 HB 140 - SMALL FISH PROCESSOR SURETY BONDS                                  
                                                                               
 Number 061                                                                    
                                                                               
 CHAIRMAN AUSTERMAN called for a ten minute recess.                            
                                                                               
 Number 062                                                                    
                                                                               
 CHAIRMAN AUSTERMAN reopened the meeting at 6:05 p.m., noting that             
 Representative Ogan was present.                                              
                                                                               
 Number 076                                                                    
                                                                               
 ANDY GOLIA, testified via teleconference from Dillingham, in                  
 support of HB 140.  He stated for the record, "I believe HB 140               
 will increase the economic opportunities for small processors or              
 operators who want to market salmon.  It is estimated that the                
 Bristol Bay permit holder, has paid about $1.4 million in the 1994            
 season, towards the 1 percent marketing tax.  I expect the domestic           
 market to open up for Alaska salmon and HB 140 will help to                   
 facilitate that."                                                             
                                                                               
 Number 155                                                                    
                                                                               
 JEROME SELBY, Mayor, Kodiak Island Borough, testified via                     
 teleconference from Kodiak, in support of HB 140.  He stated, "HB
 was drafted in response to a resolution passed by the Southwest           
 Alaska Municipal Conference.  It is orientated towards trying to              
 make it a little easier for some of the smaller communities to                
 develop an economy, geared towards processing specialty packs of              
 fish products.  The purpose of this bill to allow these people to             
 reduce their start up costs and build this type of economic                   
 venture.  The marketing analysts seem to think that there is a                
 viable market for this kind of specialty product."                            
                                                                               
 Number 215                                                                    
                                                                               
 JERRY McCUNE, President, United Fishermen of Alaska, testified in             
 support of HB 140.  He stated, "This bill would be very helpful to            
 the small outfits starting up, because it drops the $10,000 bonding           
 requirement, for processing under 30,000 pounds."                             
                                                                               
 Number 231                                                                    
                                                                               
 REPRESENTATIVE SCOTT OGAN asked, "What is the cost difference                 
 between a $10,000 surety bond and a $2,000 surety bond?"                      
                                                                               
 MR. McCUNE wasn't sure what a company charges.                                
                                                                               
 MR. SELBY stated, "There is no hard set fee.  Each case is treated            
 on an individual basis.  The surety bond companies consider the               
 product, the risk involved and circumstantial information."                   
                                                                               
 Number 251                                                                    
                                                                               
 REPRESENTATIVE KIM ELTON moved an amendment forward.  The amendment           
 takes place on page 2, line 10, insert the words that are the same            
 as on page 1 where it says if the money is insufficient as a bond,            
 then the bond will double over time if a processor has a claim                
 against him or a judgment resulting from a claim.  Basically, it              
 takes Section 1 and inserts it into Section 2.                                
                                                                               
 MR. SELBY stated he had no objection to the amendment.                        
                                                                               
 MR. GOLIA said he did not object to the amendment.                            
                                                                               
 Number 295                                                                    
                                                                               
 CHAIRMAN AUSTERMAN asked if there was any opposition from the                 
 committee.  Hearing no objection, Amendment Number 1 passed.                  
                                                                               
 REPRESENTATIVE ELTON made a motion to move CSHB 140(FSH) out of               
 committee with individual recommendations, and a zero fiscal note.            
                                                                               
 Hearing no objection, CHAIRMAN AUSTERMAN announced that CSHB
(FSH) moved out of the House Special Committee on Fisheries.