03/17/1993 03:40 PM Senate RES

  SENATOR  MILLER  called the  Resources Committee  meeting to                 
  order at  3:40 p.m. and announced SB  132 LOANS FOR IFQ'S to                 
  be up for consideration.  He said they have a CS before them                 
  that adds  a findings  and intent  section and an  effective                 
  date.                                                                        
                                                                               
  JERE  MURRAY,  Seldovia,  testified that  he  had  faxed his                 
  comments  to the  committee  earlier in  the  day and  would                 
  answer questions.                                                            
                                                                               
  LINDA  BEHNKEN,  Alaska  Longline  Fishermen's  Association,                 
  supported  SB  132  and  the  IFQ  program.    It  offers  a                 
  tremendous  opportunity to  Alaskans that  the state  cannot                 
  afford  to miss, she said.  It would allow the fishermen and                 
  coastal communities to continue to prosper and bring revenue                 
  to the state  directly through raw  fish tax and  indirectly                 
  through  enhanced  economic  health.    She thought  it  was                 
  essential to have the loan program in place before IFQ's are                 
  adopted, because a  significant amount of quota  shares will                 
  exchange hands during the early years of the program.                        
                                                                               
  Number 101                                                                   
                                                                               
  NANCY LANDES,  Southcentral Longline Enterprises  in Seward,                 
  testified that she  hadn't had time  to review the  proposed                 
  CS.  She felt this program might be a little premature.  She                 
  commented that it  is hard  to find the  rationale behind  a                 
  loan  program  when the  state  budget  is being  cut.   She                 
  thought whether  the IFQ program  was legal  would affect  a                 
  loan program, because money could be lent and there would be                 
  no  way  of getting  it  back  if the  program  was declared                 
  illegal.                                                                     
                                                                               
  Number 153                                                                   
                                                                               
  PAUL SEATON, Homer,  said he had  faxed his comments to  the                 
  committee.  He  commented that  he appreciated the  findings                 
  section on the  new CS.  He  said since the IFQ  plan itself                 
  says they may  be revoked  or modified at  any time  without                 
  compensation that no bank would touch them.                                  
                                                                               
  Number 187                                                                   
                                                                               
  SENATOR LEMAN moved to adopt the  CS to SB 132.  There  were                 
  no objections and it was so ordered.                                         
                                                                               
  SENATOR ADAMS  asked Greg Winegar,  Division of  Investments                 
  (Juneau  Lending  Branch Manager),  how  he would  deal with                 
                                                                               
                                                                               
  people  getting loans for the  IFQ's and perhaps selling the                 
  shares.  Mr.  WINEGAR said they would  record documents with                 
  Uniform Commercial Code which would perfect the state's lien                 
  position  on  the shares  themselves.   If  they  took other                 
  collateral, other means would be used for that.                              
                                                                               
  SENATOR ADAMS asked  if this loan  program would fall  under                 
  the Commercial  Fishing Loan Fund  and its guidelines.   MR.                 
  WINEGAR said that was correct.  SENATOR ADAMS asked how many                 
  loans an officer  normally can handle.  MR. WINEGAR answered                 
  that  could  vary  quite  a  bit.   He  said  their  average                 
  portfolio is  running  about $60,000  per  loan.   It  would                 
  depend on  the size of  the loans and  how much  funding was                 
  available.    The  loan officers  also  do  collection work,                 
  extension work, etc., he explained.                                          
                                                                               
  MR. WINEGAR said that the eligibility in SB 132 was a little                 
  different than  either the  A or B  programs that  currently                 
  exist.                                                                       
                                                                               
  Number 243                                                                   
                                                                               
  SENATOR FRANK  asked Mr.  Winegar if  he would  make a  loan                 
  unless he was  confident that they could  perfect a security                 
  interest.   MR. WINEGAR  said that  was correct.   They  are                 
  having the Attorney  General's office looking at  this right                 
  now to be sure that is the case.                                             
                                                                               
  Number 256                                                                   
                                                                               
  SENATOR LEMAN  said Dr.  Murray, in  his written  testimony,                 
  suggests that loans be limited to only those individuals who                 
  don't receive initial  allocation of quota shares  under the                 
  plan plus those that receive some initial allocation of some                 
  limit  of perhaps  10,000  lbs.   Was this  a discriminatory                 
  practice, he  asked?   MR. WINEGAR  said he  thought it  was                 
  something  they could  do in  the eligibility  section.   He                 
  wasn't  sure  about  the  legality.    He  said  they  could                 
  administer it  that way.   The  language could  go in  under                 
  Section C.                                                                   
                                                                               
  Number 282                                                                   
                                                                               
  SENATOR JACKO said he had no problems with the CS.                           
                                                                               
  SENATOR  MILLER  stated they  do  have clarification  from a                 
  legislative  attorney regarding  the  question  of the  term                 
  "off-state" which means three miles off-shore to two hundred                 
  miles off-shore,  and the  term  could not  be construed  to                 
  apply to fishing in Washington waters.                                       
                                                                               
  SENATOR ADAMS said he didn't mind moving the bill as long as                 
  Dr. Murray's question is answered.                                           
                                                                               
                                                                               
  SENATOR FRANK moved  to pass CSSB  132 from committee  along                 
  with the fiscal note with individual recommendations.  There                 
  were no objections and it was so ordered.