Legislature(2011 - 2012)CAPITOL 120
02/08/2011 05:00 PM House FISHERIES
| Audio | Topic |
|---|---|
| Start | |
| Overview(s): Division of Subsistence, Alaska Department of Fish and Game | |
| Overview(s): Division of Habitat, Alaska Department of Fish and Game | |
| HB121 | |
| HB59 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| *+ | HB 121 | TELECONFERENCED | |
| *+ | HB 59 | TELECONFERENCED | |
HB 59-COMMERCIAL FISHING LOAN ACT
6:25:29 PM
CHAIR THOMPSON announced that the final order of business would
be HOUSE BILL NO. 59, "An Act relating to loans made to
commercial fishermen under the Commercial Fishing Loan Act for
product quality improvements and energy efficiency upgrades; and
providing for an effective date."
6:25:39 PM
REPRESENTATIVE SEATON paraphrased from the sponsor statement,
which read as follows:
HB 59 allows the Department of Commerce Community and
Economic Development to give Commercial Fishing Loan
Fund borrowers a reduction in the interest rate on
their loan if 50 percent of the loan is spent on a
product produced or manufactured in the State of
Alaska. The Commercial Fishing Loan Fund was created
by the State of Alaska to aid commercial fishermen in
securing new equipment, quota shares and upgrades to
their vessels. The Department already allows
reductions in interest rates for borrowers who pay on
time, and make engine and fuel efficiency upgrades or
product quality improvements.
To be eligible for the rate reduction under HB 59 at
least 50 percent of borrower's purchases with the loan
fund have to be manufactured in the State of Alaska.
The definition of manufacture is "processing,
developing, or making an item into a new item with a
distinct character and use."
HB 59 does not make the rate reduction mandatory
because the Department needs to have the discretion to
institute it when the market allows. For example, in
today's market the interest rates are so low, if the
Department were required to issue the interest rate
discount it would create a loss for the fund.
HB 59 promotes economic development in Alaska by
encouraging Alaska fisherman to purchase equipment
manufactured in the State of Alaska when using
Commercial Fishing Loan Fund dollars.
6:29:06 PM
REPRESENTATIVE MILLER directed attention to the bill, page 1,
line 7, to read "the department may," and asked what criteria
the department would use to accept or reject an application.
REPRESENTATIVE SEATON answered that the financial condition of
the fund would be the guiding factor; it is necessary that prime
interest rates be high enough to generate an income that covers
the service cost of the loan. All applicants would be eligible
during times of a healthy economy.
6:30:41 PM
REPRESENTATIVE PRUITT inquired whether competition, within the
industry, is being served by passage of HB 59.
REPRESENTATIVE SEATON stated his understanding that no
discrimination is being made regarding new versus existing
businesses; nothing that would advantage a current manufacturer
over someone new to the industry. The difference is that the
loan would provide an incentive to purchase locally. The intent
of the bill is to create and sustain jobs in Alaska, he said.
REPRESENTATIVE PRUITT queried what constitutes/defines made in
Alaska.
REPRESENTATIVE SEATON referred to the bill page 1, line 13, and
read:
In this subsection, 'manufactured or produced' means
processing developing, or making an item into a new
item with a distinct character and use.
REPRESENTATIVE SEATON said the Department of Commerce, Community
& Economic Development contributed to the bill language, to
ensure an accurate, and adequate, definition.
6:34:53 PM
CHAIR THOMPSON opened public testimony and announced that the
bill would be held in committee for further consideration.