Legislature(2001 - 2002)
03/06/2002 01:14 PM House RES
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 390-ASMI SALMON MARKETING CO-CHAIR SCALZI announced that the first order of business would be HOUSE BILL NO. 390, "An Act extending the termination dates of certain activities and salmon marketing programs of the Alaska Seafood Marketing Institute and of the salmon marketing tax; expanding the allowable use of that tax for the salmon marketing programs of the Alaska Seafood Marketing Institute; relating to the Alaska Seafood Marketing Institute's salmon marketing committee; and providing for an effective date." [There was a motion to adopt HB 390 as the working document, but it was already before the committee.] Number 0120 REPRESENTATIVE McGUIRE, speaking as the sponsor, explained that HB 390 simply extends the sunset date for five years so the Alaska Seafood Marketing Institute (ASMI) can carry on its business. Representative McGuire commented, "They've certainly done a good job, I think, of looking to the people who are going to benefit from it the most, expecting from them a reasonable tax and then using that tax to ... market our seafood and bring dollars back to the State of Alaska." REPRESENTATIVE McGUIRE pointed out that the bill contains one substantive change. She'd chosen to remove the domestic salmon marketing language in order to allow ASMI flexibility to choose to market its seafood as it sees fit. She explained that she believes ASMI shouldn't be given a tool that is then micromanaged. She said ASMI, with its board, is capable of making decisions in response to the various marketing demands. REPRESENTATIVE McGUIRE informed the committee that in discussions with Barbara Belknap of ASMI, she'd understood that ASMI doesn't intend to simply shift "all those dollars" away from domestic marketing. Furthermore, ASMI believes [the domestic market] is an important part of the market. However, this flexibility may be utilized in reaching out to the international markets. Representative McGuire noted that the committee packet should include letters of support. Number 0468 SUE ASPELUND, Executive Director, Cordova District Fisherman United (CDFU), testified via teleconference. Ms. Aspelund informed the committee that CDFU has been involved with the successful promotion of Copper River salmon and thus feels qualified to comment on seafood marketing in Alaska. MS. ASPELUND announced that CDFU fully supports the 1-percent salmon assessment reauthorization this year. She emphasized that passage this year is very important for project planning and program stability. Furthermore, CDFU supports lifting the domestic marketing restrictions, since it would provide ASMI the flexibility to adapt to changing market conditions. For example, had ASMI had this flexibility during the mad cow disease outbreak, "we" would've been better poised to take advantage of that potential market opportunity overseas. Additionally, lifting the domestic marketing restrictions will allow access to more matching dollars. MS. ASPELUND turned to the concerns regarding decreasing the domestic marketing program. She highlighted that [the fishing industry] has enjoyed a $5-million boost in domestic marketing through the "Northwest TAT (ph) grants." Currently, an excellent domestic marketing program is in place, she said. MS. ASPELUND testified briefly on behalf of herself and her daughter, as Bristol Bay fishermen. Ms. Aspelund said she and her daughter support reauthorization and lifting of the domestic marketing authorization. Number 0608 RODGER PAINTER, Shellfish Farmer, testified in support of HB 390. Mr. Painter informed the committee that he has been a board member of ASMI for the past eight to ten years. Although [HB 390 refers to] a tax on salmon harvesters, he stressed that it's critical to ASMI. He related his belief that without the 1-percent tax, ASMI wouldn't have a viable program in the U.S. marketplace. Mr. Painter also pointed out that ASMI does much for the entire [fishing] industry. Although the dollars coming in for salmon marketing are directed at the salmon program, he said they create "tremendous coattails for the rest of us to ride on." Mr. Painter urged the committee to support HB 390. Number 0743 BARBARA BELKNAP, Executive Director, Alaska Seafood Marketing Institute (ASMI), Department of Community & Economic Development (DCED), explained that ASMI is supported by industry assessments and federal grants. The salmon fishermen's 1 percent amounted to $2 million for this fiscal year, and the .3-percent processor tax on all seafood contributed $2.8 million. She explained that in fiscal year 2000, the salmon tax constituted 51 percent of ASMI's tax [receipts], whereas the processor tax constituted 40 percent. Next fiscal year, the portion from the processor tax will rise to 61 percent, while the portion from the salmon tax will decrease to 38 percent. Those figures illustrate the decline in salmon prices. MS. BELKNAP informed the committee that the ASMI Board of Directors had voted to support the removal of the restriction on the 1-percent [tax] for domestic marketing. Furthermore, the Salmon Marketing Committee that oversees the 1-percent tax also supported the removal of the domestic restriction as well as allowing the ASMI Board of Directors to determine where those funds are spent overall. She noted that the [Salmon Marketing Committee] will continue to be present as a oversight committee. Number 0873 REPRESENTATIVE STEVENS inquired as to the impact if [HB 390] isn't [passed]. MS. BELKNAP answered that ASMI wouldn't be able to match grants. Currently, ASMI is in the second year of a $5-million grant that is a dollar-for-dollar match. That grant was spread over three years in order that it could be matched with the 1-percent dollars. Without the 1-percent tax, ASMI wouldn't be able to try for other grants. Furthermore, there wouldn't really be a viable program. She remarked that at a certain point, either more money must be put in or the method of operation would have to change. Number 1008 KATHY HANSEN, Executive Director, Southeast Alaska Fishermen's Alliance, testified in support of HB 390. She explained the importance of passing the 1-percent tax this year so ASMI doesn't get into the same crunch as the last time the 1-percent ASMI tax was renewed. The last time, ASMI proceeded into the summer without knowing that the 1-percent tax was renewed; thus no planning could be done. She felt that a summer's worth of promotion was lost. MS. HANSEN also announced support for lifting the domestic restriction. She emphasized that ASMI has had an incredible ability to obtain matching funds. For instance, ASMI has leveraged as much as $9-$12 per $1. [Through] the ability to free up a small amount of domestic marketing and leverage it as mentioned, the marketing ability is greatly increased, and it benefits everyone. Number 1120 GERALD (JERRY) McCUNE, Lobbyist for United Fishermen of Alaska (UFA), testified in support of HB 390. He expressed the importance of getting HB 390 moving in order to make plans for the future. Number 1186 ROBIN SAMUELSEN, Bristol Bay Economic Development Corporation (BBEDC), testified via teleconference in support of HB 390. He related the belief that this assessment is necessary, especially in light of salmon farming. CO-CHAIR SCALZI closed public testimony on HB 390. Number 1258 REPRESENTATIVE FATE moved to report HB 390 out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, HB 390 was moved out of the House Resources Standing Committee.
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