Legislature(1993 - 1994)

05/04/1993 03:10 PM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
...TO MEET AT CALL OF CHAIR...
HB 264
HB 275
HJR 27
txt
                                                                               
  CS FOR HOUSE BILL NO. 275(FIN) am:                                           
                                                                               
       An  Act   relating  to  the  Alaska  Seafood  Marketing                 
       Institute and a salmon marketing tax; and providing for                 
       an effective date.                                                      
                                                                               
  Co-chair  Pearce  invited  Kim  Elton,  Executive  Director,                 
  Alaska Seafood Marketing Institute, to join the committee at                 
  the table and speak to CSHB 275(FIN) am.                                     
                                                                               
  KIM  ELTON  spoke  to  the sections  of  CSHB  275(FIN)  am.                 
  Senator Kelly asked what  changes had been made to  the bill                 
  in the  Senate version.   Mr.  Elton  said that  one of  the                 
  changes provided for a separate  salmon committee that would                 
                                                                               
                                                                               
  advise the whole board on the  salmon marketing program.  He                 
  also believed  that a  change had  been made  to the  salmon                 
  enhancement  tax  legislation.   Senator  Kelly  asked  if a                 
  public member had been  reinstated to the board.   Mr. Elton                 
  answered  affirmatively.     Mr.  Elton  said   that  United                 
  Fisherman of Alaska  (UFA) are  interested in amending  this                 
  bill to reestablish  the salmon marketing subcommittee,  and                 
  ASMI board had no objection to that amendment.                               
                                                                               
  REPRESENTATIVE BILL  HUDSON, sponsor  of HB  275, said  that                 
  amendment 1  revised (copy  on file)  had been  forwarded by                 
  UFA.  He said that the concept was in the Senate  version of                 
  the bill but had been removed when it was in  the House.  It                 
  would  establish   the  salmon   marketing  committee   with                 
  representation  from  around the  coast  to advise  the ASMI                 
  board.  It would also delete  the provision that establishes                 
  the executive board which would still  be up to the majority                 
  of the board  members who will  now consist of 12  fishermen                 
  and  12  processors.   He  said that  he  was in  support of                 
  amendment 1 revised.                                                         
                                                                               
  SENATOR JUDITH  SALO spoke in favor of  amendment 1 revised.                 
  She said that it  would make the fishermen in her  area much                 
  more comfortable with the bill.                                              
                                                                               
  Senator  Kelly questioned  setting up  the executive  board.                 
  Representative   Hudson  said   that  the   amendment  would                 
  eliminate  the executive board.   Senator Kelly said that he                 
  was satisfied with the amendment.                                            
                                                                               
  Senator Kerttula MOVED for adoption  of amendment 1 revised.                 
  No objections being heard, amendment 1 revised was ADOPTED.                  
                                                                               
  Senator Jacko asked what part of  the state would contribute                 
  the majority of  the tax money.   Mr. Elton said that  if it                 
  was evaluated by  region, Bristol  Bay would contribute  the                 
  majority of the tax money.                                                   
                                                                               
  In answer to  Senator Kelly,  Representative Hudson said  he                 
  had  introduced separate  legislation  providing  for a  one                 
  percent assessment change.   He felt it was not  appropriate                 
  to include it  in CSHB 275(FIN)  because there had not  been                 
  adequate time to analyze this assessment.                                    
                                                                               
  Senator Jacko  MOVED for  adoption of amendment  2 (copy  on                 
  file).   Co-chair Pearce OBJECTED  for discussion  purposes.                 
  Senator Jacko explained  that since the majority  of the tax                 
  revenue would be realized from  the Bristol Bay area,  there                 
  was  concern  that  this area  was  being  asked  to pay  an                 
  additional tax.   This area already is forced to  pay a good                 
  amount of municipal and  raw fish taxes.  He  explained that                 
  his amendment would  require that  the ASMI  board would  be                 
  comprised  of  13  fishermen from  the  Bristol  Bay, Alaska                 
  Peninsula,  Bering  Sea,  or Yukon-Kuskokwim  region.    One                 
                                                                               
                                                                               
  member of the  board would be a  lay person selected by  the                 
  Governor.  He felt that  this would insure representation by                 
  this area in the decision making  process in regard to where                 
  the  tax  money is  spent.   In  answer to  Co-chair Pearce,                 
  Senator Jacko said the  total number of board members  would                 
  remain at 25  but representation of the  board members would                 
  change.                                                                      
                                                                               
  Representative Hudson voiced his opposition to  amending the                 
  language of  the bill  and requiring  all of the  commercial                 
  fishing members be  from the Bristol Bay,  Alaska Peninsula,                 
  Bering Sea, or Yukon-Kuskokwim region.   He said this  would                 
  mean there would  be no  fishermen from the  balance of  the                 
  state  of  Alaska.   Co-chair  Pearce asked  Senator Jacko's                 
  intent of the amendment.   Senator Jacko answered that since                 
  50 percent of the tax money would be received from that area                 
  that 50  percent of  the board  members should  be from  the                 
  area.                                                                        
                                                                               
  Representative Hudson said that the purpose of CSHB 275(FIN)                 
  was to provide broad representation  throughout the maritime                 
  regions of Alaska on the ASMI  board to control not the only                 
  the  domestic  marketing program  but  to control  all other                 
  aspects  of  the  ASMI program.    To  only  draw from  this                 
  specific area to represent the entire  coast of Alaska would                 
  be objectionable by fisherman in  Cook Inlet, Prince William                 
  Sound,   southeast  Alaska  and  other  areas.    Discussion                 
  followed between Co-chair Pearce and Senator Jacko regarding                 
  other members of  the board.   It was  determined that  this                 
  amendment would  say  that all  the fishermen  on the  board                 
  would have to be from Bristol Bay, Alaska Peninsula,  Bering                 
  Sea, or Yukon-Kuskokwim  region.  Co-chair Pearce  said that                 
  she could understand objections to the amendment.                            
                                                                               
                          Recess 3:44pm                                        
                        Reconvene 4:00pm                                       
                                                                               
  Co-chair Pearce announced that amendment 2 had been offered.                 
  Senator  Kelly  OBJECTED  to  amendment  2.   Representative                 
  Hudson said  that amendment 2 would break  the bill's intent                 
  of having an even-handed approach between the processors and                 
  fishermen.   The Governor  makes these  appointments and  to                 
  require  all  fishermen to  come from  one region  in Alaska                 
  would  mean  that  the  rest  of  the  state  would  not  be                 
  represented.    He  said this  amendment  would  destroy the                 
  merits  of  this   bill.    Senator  Kelly   maintained  his                 
  OBJECTION.                                                                   
                                                                               
  JERRY MCCUNE, President, United Fisherman  of Alaska, voiced                 
  his opposition to having  all 13 fishermen from the  Bristol                 
  Bay, Alaska Peninsula, Bering Sea, or Yukon-Kuskokwim region                 
  and asked how the other fishermen  from areas such as Copper                 
  River and Kenai would be represented.                                        
                                                                               
                                                                               
  Co-chair Frank said that there should be fair representation                 
  from  all  areas of  Alaska.   Senator  Jacko said  that the                 
  experience of most  of the  fishermen was that  UFA was  not                 
  that supportive of  fishermen from southwestern Alaska.   If                 
  this legislation was  passed, processors  in 1993 would  pay                 
  $3.2 million and fishermen at 1%  would pay $5 million.  The                 
  majority of the  $5 million would  come from the regions  he                 
  indicated in his amendment.  Senator Jacko would support the                 
  number of processors reduced  on the board in order  to make                 
  room for other fishermen from other areas.                                   
                                                                               
  Mr. Elton said that over the last 15 years, ASMI has gone to                 
  great  lengths to  not only include  regional representation                 
  but gear  type representation as  well to insure  that large                 
  processors  and small  operations  were  included  in  their                 
  program.   He said  that this  tax could  vary from year  to                 
  year.   ASMI  is  Alaska Seafood  Marketing not  just salmon                 
  marketing.  He  said he  understood Senator Jacko's  concern                 
  but a balance  needed to be  maintained for ASMI.   He  felt                 
  assured  that  ASMI  would  listen   to  all  the  different                 
  fishermen and regions regarding ASMI's marketing plans.                      
                                                                               
  Mr.  McCune  said that  he  would  be willing  to  work with                 
  Senator Jacko regarding this amendment but he maintained his                 
  opposition  to  having  all the  fishermen  coming  from one                 
  region.                                                                      
                                                                               
  Representative Hudson suggested  that the words  "commercial                 
  fishermen  members shall  be appointed  proportional  to the                 
  amount  of salmon taxes  by region  to the  extent possible"                 
  added to page  2, line 2.   He said that this  wording would                 
  provide   legislative  intent   to   the  Governor   in  his                 
  appointment  process giving  consideration to  those regions                 
  that pay the highest taxes.                                                  
                                                                               
  End SFC-93 #72, Side 2                                                       
  Begin SFC-93 #74, Side 1                                                     
                                                                               
  Senator  Jacko  said  that he  would  consider  amending his                 
  amendment 2 to  include one fisherman  from another part  of                 
  Alaska.                                                                      
                                                                               
  SENATOR  BERT  SHARP asked  if there  was  any other  tax in                 
  statutes  that required fishermen  other than the processors                 
  to contribute a salmon  tax.  Mr. Elton said there  had been                 
  discussion about having  1 percent across  the board on  all                 
  different types of fishing.   Mr. Elton said there  are some                 
  groups that are in favor  of that tax.  The  biggest problem                 
  facing  the  seafood  market  is  the  salmon  market.   The                 
  decision was made to see how this tax works in this bill and                 
  then another tax  could be added later  for other fisheries.                 
  Mr. Elton said  that problems in  the halibut and king  crab                 
  market  were being faced but at this time salmon is the main                 
  problem.                                                                     
                                                                               
                                                                               
  Representative  Hudson said that  ASMI markets  its products                 
  worldwide and millions of federal dollars have  been used to                 
  try and  enhance the marketplace of Alaskan  products.  This                 
  money can only  be used for  overseas marketing.  Mr.  Elton                 
  said that  $8.5 million of  federal dollars were  spent this                 
  year, partially matched by the state.  Representative Hudson                 
  said that one part of salmon marketing that has been missing                 
  for years  is the  fresh and  frozen salmon.   This  present                 
  challenge is to increase the consumption of Alaska salmon in                 
  the domestic market.  Alaska is  not alone in its efforts to                 
  look to the domestic market.  Japan,  Chile, the Norwegians,                 
  New Zealanders, etc.  are all looking  at the U.S.  domestic                 
  market.  If this legislation would pass, ASMI should be able                 
  to bring the fishermen and  processors together, moving them                 
  into the domestic market with more  knowledge.  He wanted to                 
  emphasize that the  goal of  increasing the domestic  market                 
  for all fishermen  and processors must  not be lost in  side                 
  issues.  He asked  the committee to consider the  wording he                 
  had suggested for amending the bill.                                         
                                                                               
                          Recess 4:15pm                                        
                        Reconvene 4:50pm                                       
                                                                               
  Co-chair Pearce announced that amendment  2 was still before                 
  the committee.  Senator Kelly maintained his objection.  Co-                 
  chair Pearce  called for  a show  of hands  and amendment  2                 
  FAILED on a  vote of 6  to 1.   Co-chairs Pearce and  Frank,                 
  Senators  Rieger,  Sharp,  Kerttula, and  Kelly  opposed the                 
  amendment.  Senator Jacko voted in support of amendment 2.                   
                                                                               
  Senator  Jacko MOVED  for adoption  of amendment 3  (copy on                 
  file).  Senator Kelly  OBJECTED.  Senator Kelly said  he was                 
  opposed to the  word majority  in the  amendment.   Co-chair                 
  Frank said that this amendment would assure that there would                 
  be proportional representation on the  board.  Senator Kelly                 
  said that he  was not sure that "majority" was proportional.                 
  Co-chair Frank said that it was  not the number of fishermen                 
  but it should be proportionally based  upon the value of the                 
  product.     Senator  Kelly  maintained  his   objection  to                 
  amendment 3.  Co-chair Pearce called for a show of hands and                 
  amendment 3 passed on a vote of 4 to 3.  Co-chairs Frank and                 
  Pearce,  Senators  Jacko,  and  Sharp  voted in  support  of                 
  amendment  3.    Senators Kerttula,  Rieger  and  Kelly were                 
  opposed.                                                                     
                                                                               
  DEAN PADDOCK, Bristol Bay Driftnetters Association, spoke in                 
  support of  the  original bill,  HB  275.   His  association                 
  believed  that Alaska  was in desperate  need of  a domestic                 
  marketing program.   He voiced his opposition to amendment 3                 
  and  would  have  preferred  the  wording  as  submitted  by                 
  Representative  Hudson.    He   said  that  getting  Alaskan                 
  fishermen  to  work  together  was   a  difficult  thing  to                 
  accomplish.  He  feared that amendment 3 would  polarize the                 
                                                                               
                                                                               
  fishermen and the  processors.  He reiterated  that everyone                 
  needed  to work  together.   He  said  that after  attending                 
  meetings of the ASMI  board and after contact with  them, he                 
  had never had any problems.   He hoped that this legislation                 
  would work for the good of all.                                              
                                                                               
  Senator Kerttula MOVED  for passage  of SCSCSHB 275(FIN)  as                 
  amended with  individual recommendations  and a fiscal  note                 
  for the Department  of Commerce  & Economic Development  for                 
  $5,640.3 and  a fiscal  note for  Department of Revenue  for                 
  $109.7 with revenue of $5,750.  Senator Jacko OBJECTED.  Co-                 
  chair Pearce called for show  of hands and SCSCSHB  275(FIN)                 
  as  amended  was   REPORTED  OUT   of  committee  with   the                 
  accompanying fiscal notes on  a vote of  4 to 3.   Co-chairs                 
  Frank  and  Pearce  signed  "do   pass."    Senators  Sharp,                 
  Kerttula,   Rieger,    Kelly,   and    Jacko   signed    "no                 
  recommendation."                                                             
                                                                               

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