Legislature(2003 - 2004)

02/24/2003 03:30 PM RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
        SCR  3-EXTEND JT LEG SALMON INDUSTRY TASK FORCE                                                                     
     CSHCR 6(FSH)-EXTEND JT LEG SALMON INDUSTRY TASK FORCE                                                                  
CHAIR  OGAN  explained  to  members   that  although  SCR  3  was                                                               
scheduled,  HCR 6  passed  out of  the House  on  Friday and  was                                                               
referred to  the Senate Resources  Committee earlier in  the day.                                                               
According  to  Tam  Cook,  Director of  the  Legal  and  Research                                                               
Services Division,  HCR 6 can  be heard in  place of SCR  3 since                                                               
the  two resolutions  contain  the same  subject  matter and  the                                                               
committee has  satisfied the notice  requirements. He  then asked                                                               
the sponsor to address the legislation.                                                                                         
SENATOR  GARY STEVENS,  sponsor  of  HCR 6,  told  members he  is                                                               
looking forward  to co-sponsoring  SCR 3.  He then  described the                                                               
measure as follows.                                                                                                             
HCR  6 extends  the life  of  the joint  legislative salmon  task                                                               
force  until  the   end  of  the  second  session   of  the  23rd                                                               
Legislature. This task force was  created by the 22nd Legislature                                                               
out  of concern  for Alaska's  lost  market share  of the  salmon                                                               
industry and expansion  into new markets. The  salmon industry is                                                               
an  enormous   economic  engine  that  drives   Alaska's  coastal                                                               
The  Joint  Salmon Industry  Task  Force  made enormous  progress                                                               
during the course of its meetings.  Its first meeting was held on                                                               
July 22, 2002,  at which time five  subcommittees were appointed.                                                               
Those subcommittees met over 43  times in many communities of the                                                               
state  and  Seattle.  The  task  force  received  279  proposals,                                                               
produced 13  pieces of  draft legislation,  and generated  a huge                                                               
amount  of  discussion   and  material  that  will   have  to  be                                                               
considered  in  the future.  He  hopes,  for those  reasons,  the                                                               
committee will favorably consider extending  the life of the task                                                               
force.   He  added  that the  bill  has a  zero  fiscal note.  He                                                               
pointed  out  that because  Chair  Ben  Stevens spent  the  funds                                                               
appropriated to the task force last  year wisely, it will be able                                                               
to function for at least one  more year on the remainder of those                                                               
CHAIR OGAN  asked if those  funds will have to  be reappropriated                                                               
and carried forward to the next fiscal year.                                                                                    
SENATOR GARY STEVENS said he does not believe so.                                                                               
CHAIR OGAN said he  has watched a lot of task  forces come and go                                                               
over the  last nine  years and  expressed concern  that extending                                                               
this   task  force   will  deluge   the  Legislature   with  more                                                               
legislation and requests for more  funding. He asked Senator Gary                                                               
Stevens what will come out of this extension.                                                                                   
SENATOR  GARY STEVENS  said he  cannot address  whether the  task                                                               
force will ask for more funding,  but he can say that an enormous                                                               
amount  of effort  and time  went into  the process,  made up  of                                                               
fishermen,  processors,  community  leaders and  legislators.  He                                                               
felt  very  good about  the  process.  The resultant  legislation                                                               
provides simple and  effective measures to help  the industry and                                                               
give it more  choice. However, the task force was  unable to deal                                                               
with more far reaching issues in that time frame.                                                                               
CHAIR OGAN  said he would play  the role of devil's  advocate and                                                               
     The bottom line is farmed  fish is kicking our rears up                                                                    
     here. We can  have all of the task forces  in the world                                                                    
     that we  can feel  good about  but, at  the end  of the                                                                    
     day, we're not going to  change that. Is that something                                                                    
     that you  think is going to  - if we invest  more money                                                                    
     and more  time and energy  of Alaskans that's  going to                                                                    
     come out  of this  that could  put the  salmon industry                                                                    
     back on its  feet, short of some kind  of a retaliatory                                                                    
     strike against the fish farmers...?                                                                                        
SENATOR GARY  STEVENS said that  is a fair question.  He believes                                                               
Alaska lost  market share because  the state wasn't  paying close                                                               
attention  to what  the farmed  fish  industry was  doing to  the                                                               
market. However, one positive outcome  is that the consumption of                                                               
salmon  has  increased.  He doesn't  believe  Alaska  salmon  can                                                               
compete on the same price level  as farmed fish, but the handling                                                               
practices of Alaska salmon can be improved to increase quality.                                                                 
In  response to  Chair Ogan's  question about  whether Alaska  is                                                               
likely to lose its fishing industry  after spending a lot of time                                                               
and  money,  he  does  not  believe so.  He  said  that  regional                                                               
marketing plans  are developing to publicize  area-specific fish,                                                               
which he  believes is all for  the good. He told  members that he                                                               
was able  to see  some fish processing  operations in  Europe and                                                               
felt  the strongest  advice he  received was  that Alaska  has to                                                               
stress the  fact that its salmon  is a wild, natural  product and                                                               
its harvest does no damage to the species.                                                                                      
CHAIR  OGAN concurred  that Alaska  needs  to carve  out a  niche                                                               
3:45 p.m.                                                                                                                       
SENATOR WAGONER  pointed out that  he is  a member of  the salmon                                                               
co-op in  Cook Inlet that increased  the value of the  co-op fish                                                               
three times  this year and that  was on a small  market of 10,000                                                               
pounds. The  co-op has committed  to 30,000 pounds next  year. He                                                               
agreed  that  niche  markets  do   exist  but  they  have  to  be                                                               
developed, and that his co-op is  focusing on the Lower 48 rather                                                               
than foreign marketing.                                                                                                         
SENATOR SEEKINS  noted that HCR  6 provides that  the Legislative                                                               
Council may, upon request, fund  contracts for research. He asked                                                               
if that would  provide the task force with a  mechanism to use if                                                               
it needs to contract for additional research.                                                                                   
SENATOR GARY STEVENS said that is  correct but the task force did                                                               
not take advantage of that provision this past year.                                                                            
SENATOR BEN STEVENS, the Chair  of the Joint Salmon Industry Task                                                               
Force, explained  that under the Legislative  Council procurement                                                               
rules, the task  force itself cannot expend  over $25,000 without                                                               
full council  approval. When  the task  force was  assembled last                                                               
July, Senate  President Halford and  Speaker Porter asked  him if                                                               
that amount  would be adequate. He  did not know but  thought the                                                               
task force  may want  to enter into  some contracts  for in-depth                                                               
economic analyses of  the proposals on the table.  The task force                                                               
never did  but this  provision will  allow the  task force  to do                                                               
what  the presiding  officers proposed.  During the  interim, the                                                               
task  force will  make requests  for funding  to the  Legislative                                                               
Council.  The   Senate  President,  Speaker  and   Chair  of  the                                                               
Legislative Council can approve the request.                                                                                    
SENATOR  SEEKINS said  he  wanted  to point  out  that a  funding                                                               
mechanism exists  that contains  a check  and balance  system. He                                                               
then  said the  commercial fishing  industry is  in deep  crisis.                                                               
It's the  sole support of many  Alaskan families. He said  he has                                                               
talked  to many  of those  families  in Interior  Alaska who  are                                                               
concerned that  the industry will try  to make up in  volume what                                                               
it is  losing in  price and  that is  a short-term  solution that                                                               
will have a  devastating effect on the wild fish  stocks. He said                                                               
Senator  Ben Stevens  understands the  complexity of  this issue.                                                               
The challenges  will remain unsolved  without a  concerted effort                                                               
by the state  and he believes the task force  is a good mechanism                                                               
to use.                                                                                                                         
SENATOR  GARY STEVENS  said if  the Legislature  does nothing  to                                                               
help  out, the  state  will be  facing  enormous bankruptcies  by                                                               
small  businesses. The  state has  already faced  the closure  of                                                               
processing plants.  Many coastal communities will  also suffer as                                                               
the  fishing  industry   is  an  important  tax   base  in  those                                                               
communities.  He said  volume is  not the  solution; quality  and                                                               
price are.                                                                                                                      
CHAIR  OGAN agreed  that volume  is  not the  answer because  the                                                               
argument in  the past  is if fishermen  cannot make  enough money                                                               
fishing, more  fish need to  be allocated to that  fishery, which                                                               
pits the  commercial and sport  fisheries against each  other. He                                                               
said  allocation  is part  of  the  problem  but not  the  entire                                                               
SENATOR ELTON  commented that  he believes  everyone on  the task                                                               
force understands  that the job of  task force members is  not to                                                               
allocate; that is the job of the  Board of Fish. None of the task                                                               
force   members  are   interested  in   political  solutions   to                                                               
allocation issues.  He agreed that  part of the problem  is price                                                               
related so  the task force  focused on  issues that take  some of                                                               
the costs out of the industry  - on the harvesting and processing                                                               
side. He agreed  that the marketplace has changed  and Alaska now                                                               
has advocates for wild fish.  He said he appreciates that Senator                                                               
Seekins pointed  out there  is a  counterbalance on  spending and                                                               
said, "I'll be stunned if we ever  need it as I think we have one                                                               
of  the most  tight-fisted  Chairman that  we've  ever seen."  He                                                               
maintained that he does not mean  that in a pejorative manner and                                                               
that Chairman Stevens  has given members a high  level of comfort                                                               
in the  way he  has dealt  with issues. He  then pointed  out the                                                               
genesis of  this occurred last  year at the salmon  summit, which                                                               
was co-hosted  by former  Governor Knowles  and U.S.  Senator Ted                                                               
Stevens.  He thinks  the Legislature  has  done a  good job  kick                                                               
starting the process,  however the task force has  only been able                                                               
to  pick off  the low-hanging  fruit right  now. Alaska  has lost                                                               
over $600  million in the  salmon segment of the  industry alone.                                                               
The  challenges  are  great.  He  said  he  is  comfortable  with                                                               
continuation of the task force.                                                                                                 
SENATOR LINCOLN  said she supports  the continuation of  the task                                                               
force but  pointed out  that Senator  Gary Stevens  mentioned the                                                               
financial impact to the coastal  communities and she is concerned                                                               
that the  task force is looking  at the impact on  all of Alaska,                                                               
not just the coastal areas.                                                                                                     
SENATOR GARY STEVENS said it is  and that it is not the intention                                                               
of the task force to concentrate on coastal communities.                                                                        
CHAIR OGAN said he believes  commercial fishermen are some of the                                                               
best free market capitalists around  and the Legislature needs to                                                               
do what it can to help them.                                                                                                    
SENATOR DYSON  moved CSHCR 6(FSH) from  committee with individual                                                               
recommendations and its zero fiscal note.                                                                                       
CHAIR OGAN announced that without  objection, the motion carried.                                                               
He then announced the committee would take up SB 74.                                                                            

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