Legislature(1997 - 1998)
03/11/1998 05:04 PM 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
HJR 55 - ALLOCATION OF POLLOCK AND PACIFIC COD Number 0801 CHAIRMAN AUSTERMAN stated that HJR 55, Relating to the allocation of pollock and Pacific cod, is before committee again and he is not aware of any amendments to it. He stated that he would take further testimony. Number 0850 JEROME SELBY, Mayor of Kodiak, testified via teleconference from Kodiak to urge passage of HJR 55 as it is appropriate and in line with a lot of the efforts that have made by coastal communities for a number of years to develop Alaska's economy of the resources. He stated that factory trawlers that hire a few Alaskans does not build an Alaskan economy. An Alaskan economy is built by having Alaskan fishermen deliver fish to the docks and by having the processing plants hire the residents of Alaska's coastal communities. Alaska's transportation system is built up by transporting the fish market. Shore-based processors build up Alaska's economy. He stated that it is ridiculous to have factory trawlers catching the fish and taking it to other countries. He reiterated the need for supporting HJR 55. Number 0967 AL BURCH, testified via teleconference from Kodiak that he urged support of HJR 55 with the understanding that it will be taken up in April by the NPFMC. Number 1027 DAN JAMES, testified via teleconference from Kodiak in support of HJR 55, as processing jobs need to be kept onshore. Number 1057 MITCH KILBORN, testified via teleconference from Kodiak in support of HJR 55, as coastal communities need this protection to keep the economies strong. Number 1081 OLIVER HOLMS, Commercial Fisherman, testified via teleconference from Kodiak in support of HJR 55. He stated that the salmon industry is in tough times and it is necessary to maintain the health of the overall shore-based salmon industry as it is all interconnected. Number 1129 CHRIS BLACKBURN, Alaska Groundfish Databank, testified via teleconference from Seattle in support of HJR 55 as it helps every Alaskan community through local hire. Number 1169 JIM INGRAM, Commercial Fisherman, testified via teleconference from Dillingham against HJR 55. He stated that in Bristol Bay the offshore fleet supports the communities as it employs the residents. He stated that they promote a drug and alcohol free work place. He stated that without the offshore fleet they will be controlled by the Japanese market. American Seafoods is now promoting Alaskan markets. Number 1287 STAN SMALL, Commercial Fisherman, testified via teleconference from Dillingham against HJR 55 because "I think whenever they put it to onshore we're going to get less money for our product." He stated that the offshore sector provides jobs for his kids in the wintertime, otherwise there is no work. Number 1380 KENNY WILSON, Commercial Fisherman, testified via teleconference from Dillingham against HJR 55 because the offshore sector employs the residents and it would hurt the community if they were allocated a greater percentage. Number 1455 CHRIS ARNIM, Manager, Trident Seafoods, testified via teleconference from Sand Point that the plant relies on groundfish and is a major employer. The local fleet and the community are dependant on the plant. He stated that more opportunity in the Bering Sea means greater tax revenue, greater job stability, and he urged support of HJR 55. Number 1522 DAVE AVBASIAN, Assistant Akutan plant Manager, Trident Seafoods, testified via teleconference from Akutan in support of HJR 55. He stated that their combined recovery rate is 38 percent and their goal is to raise it to 40 percent by next year. With the fish meal plants they are able to utilize the bycatch. He stated that they employ up to 800 people a year, of which 200 are employed year- round. More allocation to the onshore sector increases the contributions to the local and state economy through taxes and through the indirect services. Number 1597 JOE BERESKIN, Mayor of Akutan, testified via teleconference from Akutan in support of HJR 55 because the onshore sector provides the greater benefit to Alaska. Number 1644 JUDE HENZLER, Executive Director, Bering Sea Fishermen's Association, testified via teleconference from Anchorage that the rationale for HJR 55 is not compelling and is premature as the North Pacific Fisheries Management Council is still analyzing the bill. Most of the jobs the Bering Sea residents have are offshore. He stated that in general he does not agree with HJR 55. Number 1708 BOB JUETTNER, Representative Aleutians East Borough, testified via teleconference from Anchorage in support of HJR 55. He stated that in 1993 groundfish was valued at $29.9 million and in the past year the value was up to $54.6 million which equals $1.9 million in taxes to the Aleutian East Borough and almost the same amount to the communities. He stated that the onshore sector has created a market and economic gain for local residents. He reiterated that the plants brings in other industries and affects other industries. Number 1870 GRANT YUTRZENKA, Employee, Unisea, testified via teleconference from Unalaska in support of HJR 55. He stated that his family depends on his income made from the resource of the Bering Sea. Unisea employs about 250 year-round residents in Unalaska. He thought the direction, the mobility of the trawlers and future revenues to the state need to be thought of. He stated that the future of the fishery is headed towards comprehensive rationalization, meaning quotas, which will be awarded to those with recent fishing history. With the current, 65/35 split the majority of the fish will go to the factory trawlers. He stated that the factory trawlers are mobile as they have dropped off crew in Unalaska and then headed to Japan to deliver their products. The landing tax from Alaska's resource is then not paid to the state or in the community. He stated that the pollock fishery is very important to the shore-side sector of Alaska. Number 2019 SHIRLEY MARQUARDT, At-sea Processors Association, testified via teleconference from Unalaska that she is unsure why this decision is being made before the analysis of the North Pacific Fisheries Management Council has been finished. There are many questions that need to be answered and taken into account, it is the council's place to make this decision. She stated that there are over 4,000 people living in the community and it is a stable atmosphere, she asked what has changed or what is trying to be fixed. She stated that she was against HJR 55, as it is a premature decision. Number 2150 FRANK KELTY, Plant Manager, Alyeska Seafoods, testifying via teleconference from Unalaska in support of HJR 55. He said that it will send a strong message to the North Pacific Fisheries Council to support an increase of pollock in the Bering Sea to the onshore sector. He stated that at 35 percent for the onshore sector it is not meeting the requirements of the Magnuson-Stevens act. He said "I would also like to remind the committee that the offshore sector controls additional quota through the CDQ program. They control about 90 percent of that 7.5 percent on top of their 65 percent allocation in the Bering Sea." He stated that the onshore sector contributes locally and statewide, through taxes and employment. He stated that Alyeska Seafoods is totally dependant on the resources in the Bering Sea. Number 2250 DON GRAVES, Employee, Unisea, testified via teleconference from Unalaska in support of HJR 55 and is concerned that if reallocation is not done the onshore sector may lose some of the production facilities. He stated that he would like to see the industry become more responsible and add value to the product that they harvest. He stated that Unisea is working with manufacturers to further utilization and increase recovery. He stated that they have developed a process to produce pollock roe and utilize all recoverable meat from the fish to produce fillets or surimi. They are moving towards a 30 percent human consumption recovery product from pollock. He stated that it is not for fish meal. At-sea processors average 15 to 17 percent which is roughly half of the shore-side sector. He stated that the Unisea markets seafood to the lower 48. Number 2365 EMIL BERIKOFF, Commercial Fisherman, testified via teleconference from Unalaska against HJR 55, because it is premature. He stated that the CDQ groups went with the offshore sector because they are getting a better price for the product and good paying jobs. He stated that local people are faced with low wages at the shore-side plants. He stated the longshoreman put in many hours off-loading fish from the trawlers and live in Unalaska year round. He stated with the Japanese ownership of the shore plants the price has been considerably lower at present they are fishing for salmon at the same price that they did 30 years ago. He stated that if the onshore plants receive a higher allocation, the price of pollock and all the other fish are going to go down. TAPE 98-10, SIDE B Number 0007 SINCLAIR WILT, Surimi Plant Manager, Alyeska Seafoods, testified via teleconference from Unalaska in support of HJR 55. He stated that he would like to point out the difference between the onshore and offshore sectors. The National Marine Fisheries Service currently uses surimi recovery rates of 16 percent in the A season and 17 percent in the B season. He stated that Alyeska Seafoods has been above 24 percent each year for the past five years, which means that they have been able to produce 50 percent more surimi from a given amount of fish than a factory trawler. He stated that it comes down to the question of who best could utilize the resource, onshore producers use more of the resource. Number 0070 MR. WILT stated that the economy of the community is dependant on the survival of the shore plants. He stated that in the late 1980s the plant operation for surimi was about 300 days a year, this year it will be less than 100 days. He explained that the build-up of factory trawlers has created a tremendous impact. The full-time employment has gone down to seasonal employment. Number 0135 DON STILES, Chairman, Board of Directors, Norton Sound Economic Development Corporation, testified via teleconference from Nome against HJR 55. The resolution is detrimental to the CDQ interest in Western Alaska and it does not take into consideration the 55 villages which rely on the offshore for employment. He stated that it does not provide jobs for the poorest regions in Alaska and logistically it makes sense to be partnered with the offshore sector. The offshore sector and Glacier Fish provides markets for the local fisheries and the revenue generated stays in the community. Regional residents have brought home $2.7 million in wages since 1992. Number 0245 CHRIS BERNS, testified via teleconference in support of HJR 55 as the dollars from the shore-based plants benefit all communities. It affects property values and stabilizes the economy. He stated that the offshore sector, at first, opposed the fish tax. He pointed out that due to the low price of oil the fishing industry needs to be looked at as a bigger tax base. He asserted that the CDQ groups will still get their 7 percent allocation and reap all the benefits. He stated that this is a political campaign with a lot of misinformation coming from the offshore sector hurting the Western Alaska villages. Number 0379 JOHN IANI, Employee, Unisea, stated that they buy fish from about 30 individual groundfish boats, buy salmon from 80 to 100 boats in Bristol Bay and buy herring from 60 to 70 seiners and gilnetters and buy crab from about 35 crab boats. He stated that the North Pacific Fisheries Management Council passed an onshore allocation which included up to 45 percent of the onshore pollock, but the factory trawlers managed to get that allocation back. He stated that if he had 65 percent of the resource for free he would also say the this resolution was premature and would want to look at this analysis until Jesus came back. He stated that the factory trawlers utilize 15 percent of the fish that they harvest compared to 35 percent with onshore sector. He stated that the allocation should go to the sector that utilizes the resource the best. Number 0525 MR. IANI stated that the offshore sector is unconscionable for whipping up the CDQ communities into a frenzy, by telling them that if the allocation changes they will not pay the communities for the fish that buy from them. He stated that they have had the opportunity to bid for some of the CDQs and have put together a proposal with a factory trawler company, based on a royalty amount to the CDQ group, paying them for their pollock and providing jobs and internships for both of the operations. He stated that the factory trawler company did not indicate that this hinged on the allocation. The proposal went in at a specific number and the allocation had nothing to do with that number. Number 0616 DAVID STANCHFIELD, Owner, Catcher Boat, F/V Morning Star, stated that he has been doing this since 1979 and has been involved with the factory trawler end of the business as well. He stated that he has had his ship in Unalaska, for three years without taking it South as he relies on the local community for services and boat repairs. He stated that when he worked with the factory trawlers, when they were done with there A season and B season they would go back to Seattle to buy their supplies and services. He stated that the onshore sector pays a fish tax on every single pound of fish that they land. The offshore sector only now pays a fish tax on part of the fish that they catch because a good share of it goes to the Seattle area. He explained that he only hires Alaskans. Number 0810 TERRY SHAFF, President, Unisea, that Unisea has been doing business in Alaska for over 25 years. He stated that he would like to represent tonight the three major shore-based processors, Unisea, Westward and Alyeska. He stated that in the A season of this year, Unisea had 2,200 employees and 32 percent were Alaskan residents and that is continuing to grow. The onshore sector can provide a variety of lifestyles from seasonal to permanent work and from processing to administrative jobs. He stated that it is just not employment for the A season because they do not leave when that season is over, they then switch to processing cod, yellow fin sole, halibut, herring, turbot and salmon. They are providing markets for the independent fishermen of Alaska. He stated that it is appropriate for the legislature to pass HJR 55 because the onshore processors have proven to be the best stewards for the resource and the best corporate citizens because they are the permanent seafood processors in the state. Number 1069 DAVE GALLOWAY, Representative, F/V Ocean Phoenix, stated that they are a mother-ship operation and a co-operative. He stated that they are the smallest vessels on the grounds. He stated that they are in support of HJR 55. He stated that they buy the fish and make the best utilization of the fish and produce a higher quality of fish. He asserted that it is critical to show support for this bill as the problem has stemmed from the huge influx of foreign factory trawlers in 1990's that crippled the traditional harvesting fleet and processors. Number 1210 DOUG FORSYTH, Representative, F/V Ocean Phoenix, stated that he has been in the seafood business for 22 years and it is his belief that the best structure of the seafood industry for Alaska is having small boats delivering their catch to processors. It is best in terms of creating jobs for Alaskan residents, for creating the largest possible tax base and is best for the resource. Number 1296 MR. IANI stated that the legislature has always been a strong supporter of the seafood processing industry in Alaska and is grateful for the support and in hearing HJR 55. Number 1314 HEATHER McCARTY, Lobbyist, At-Sea Processors Association (APA), stated that was excellent testimony preceding her. The At-Sea Processors are made up of seven processors, all the major ones with the exception of Tyson Seafoods. She stated that APA supports the status-quo in the allocation battle. She stated that the legislature should reserve their judgment until the council's analysis is done on the impacts of the allocation shift. She stated that the economic well being of the state, as a whole, is the reason to look at this issue and therefore they should have the facts from the council's and the state's analysis on the issue. Number 1444 MS. McCARTY referred to the 1991 allocation decision and stated that the 45/55 percentage was overturned due to overwhelming evidence that such a shift would have resulted in a net loss from the pollock fishery. She stated that the council came up with an alternative of 37.5/62.5 percent which was also turned down. She stated that in 1995 the council unanimously voted to maintain to 35/65 allocation. Number 1557 MS. McCARTY stated that the onshore processors and the offshore processors have both made great contributions to the communities that they serve. Communities that do not have infrastructure to maintain an onshore structure. She stated that competition is healthy. She stated that there is competition between communities because there are communities that support the offshore sector since it is logistically and economically impossible for them to gain from the onshore sector. She asked that the legislature look at the impact their decision will have on those communities. Number 1719 CHAIRMAN AUSTERMAN stated it is an emotional issue, he would like to see 100 percent allocation go to the onshore sector. He stated that he is going to hold the bill over.
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