Legislature(1995 - 1996)
03/06/1996 03:10 PM L&C
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HB 118 - SEAFOOD MARKETING / AQUATIC PRODUCT TAX AMY DAUGHERTY, Legislative Assistant to Representative Alan Austerman, Alaska State Legislature, explained CSHB 118(FSH) brings two new sources of revenue to the Alaska Seafood Marketing Institute (ASMI). First, the bill imposes an aquatic farm product marketing assessment at .3 percent on the value of oysters. She explained Representative Austerman was approached by Roger Painter, and he wanted, on behalf of the mariculture industry, to be assessed this amount to contribute to ASMI at the rate of .3 percent. Ms. Daugherty explained that also incorporated in the bill is the 1 percent ASMI assessment to apply to cost recovery salmon. According to information from the Department of Revenue these fish are not currently assessed or taxed whatsoever. She noted she has been assured that is the case by Paul Dick and Bob Bartholomew. Ms. Daugherty pointed out according to the fiscal note, it will only bring in $120,000 to ASMI. It is not a big money maker and it is something that the fishermen approached Representative Austerman on. Number 931 BRUCE SCHACTLER, a fisherman from Kodiak, came before the committee. He informed committee members he is testifying on behalf of United Fishermen of Alaska. He said his organization is getting towards the end of their annual legislative board meeting. He explained he is a member of the Marketing Committee as well as a member of the Aquaculture Committee, both of which have voted unanimously to support HB 118. He said the Aquaculture Committee as well as the entire board voted unanimously to support the bill. Mr. Schactler pointed out that not all the hatcheries in the state do cost recovery, but nearly all of them do. Those fish are caught and sold on the open market to the same people who are buying all the rest of the fish. The monies are used for the cost of running the hatchery. He said he doesn't know where the $128,000 figure came from because according to the Department of Commerce and Economic Development there was $19.23 million worth of fish cost recovered last year. At 1 percent, that comes out to $192,300. The fishermen all support HB 118. Cook Inlet Aquaculture Association and Prince William Sound Aquaculture Association are neutral on the bill. Mr. Schactler pointed out that all the members of all the aquaculture associations are represented on the Board of United Fishermen of Alaska. MR. SCHACTLER referred to a previous hearing on the bill and said there was opposition to the bill coming from the executive directors of the aquaculture associations. Since that time, there has been a lot of discussion. He said he didn't think any of the corporations had met with their fishermen before the previous hearing on the bill. He said the fishermen support this bill. He urged that the committee talk with the people who are opposing the bill, if any. Mr. Schactler said if anyone still opposes the bill, it would probably be someone from management and not the people who would actually be paying the bill. He said in Western Alaska, which he considers the Kodiak area, there is an aquaculture association where they do not do cost recovery. They are in the black so they don't need to. MR. SCHACTLER said, "The people from out West, I've spoken with the people from Sand Point and King Cove. We feel that we're subsidizing this batch of fish. Nineteen million dollars worth of fish that is being put on the market and the other fish from Alaska, from Nome all the way to the first guys in Cook Inlet that do cost recovery, are paying for the marketing of those fish through ASMI. So I believe this is a bill that is a winner for everybody and I don't think you'll find any body in opposition of it." Number 1194 REPRESENTATIVE KUBINA referred to a provision in the bill and said he thinks it is a foolish provision because it is just going to take more fish and money out of fishermen's pockets. The hatcheries can get as many fish as they need to run. He said it doesn't make sense to tax nonprofit organizations. MR. SCHACTLER said, "My only response is when we first brought this to the floor, that was exactly the response we got from several people from Southern Southeastern Aquaculture Association, in fact, a representative of that organization. When you look at it from a strictly regional point of view, that is correct. It is sort of like just take it from this hand, put it in this hand. But when you look at it on a statewide level from the perspective of my presentation just now, you stood back and said, `You're right, I'm wrong, I stand corrected.' Because it is -- we're dealing with a worldwide market of fish and you have people in Alaska that are supporting the marketing of those fish that are getting absolutely no benefit from those fish. And the marketing, as you all know, is in such sad shape that it needs all the help we can get." Number 1372 There being no further testimony, REPRESENTATIVE ELTON made a motion to move CSHB 118, Version O, with attached fiscal notes and individual recommendations out of committee. CHAIRMAN KOTT asked if there was an objection. Hearing none, CSHB 118(FSH) moved out of the House Labor and Commerce Committee.