Legislature(2021 - 2022)BUTROVICH 205

04/12/2021 03:30 PM RESOURCES

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= SB 101 ADVISORY COMMISSION ON FEDERAL MGT AREAS TELECONFERENCED
Moved SB 101 Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
*+ SB 60 SPT FSH HATCHERY FACIL ACCT; SURCHARGE TELECONFERENCED
Heard & Held
-- Invited & Public Testimony --
+= SB 61 OIL/GAS LEASE:DNR MODIFY NET PROFIT SHARE TELECONFERENCED
Moved CSSB 61(RES) Out of Committee
**Streamed live on AKL.tv**
          SB 60-SPT FSH HATCHERY FACIL ACCT; SURCHARGE                                                                      
                                                                                                                                
3:39:22 PM                                                                                                                    
CHAIR   REVAK   reconvened   the  meeting   and   announced   the                                                               
consideration  of SENATE  BILL NO.  60 "An  Act establishing  the                                                               
sport  fishing  hatchery  facilities  account;  establishing  the                                                               
sport fishing facility surcharge;  and providing for an effective                                                               
date."                                                                                                                          
                                                                                                                                
He stated that  this was the first hearing and  his intention was                                                               
to hear invited and public testimony.                                                                                           
                                                                                                                                
3:39:45 PM                                                                                                                    
DOUG VINCENT-LANG,  Commissioner, Alaska  Department of  Fish and                                                               
Game, Anchorage, Alaska, stated that  the department deems SB 60,                                                               
a governor's  bill, as a  legislative priority for  this session.                                                               
To  provide   perspective,  he  explained   that  in   2005,  the                                                               
legislature approved  a bond to  construct both the  William Jack                                                               
Hernandez Sport Fish  Hatchery in Anchorage and  the Ruth Burnett                                                               
Sport  Fish Hatchery  in Fairbanks.  To pay  for the  bond, ADF&G                                                               
added a surcharge to sport  fishing licenses. All but $500,000 of                                                               
the surcharge  went directly  to the repayment  of the  bond. The                                                               
$0.5  million  went to  Southeast  Alaska  annually for  hatchery                                                               
production because  the area was  not serviced by the  two bonded                                                               
hatcheries.  but fishermen  paid  the  surcharge. The  surcharge,                                                               
which was  primarily collected from nonresident  sport fishermen,                                                               
paid off the bond. No general fund dollars were used.                                                                           
                                                                                                                                
COMMISSIONER  VINCENT-LANG said  the program  was so  successful,                                                               
the department paid back the bond  five years early, in 2020. The                                                               
result  was  that  the  surcharge  and  the  associated  statutes                                                               
sunsetted on  12/31/2020. This left  ongoing maintenance  for the                                                               
hatcheries unfunded.  If ADF&G  were to  pay for  the maintenance                                                               
costs,  it would  be at  the  expense of  other projects  because                                                               
department funds  are fully allocated.  Another result  of paying                                                               
off the  bonds is  that Southeast no  longer receives  the annual                                                               
$500,000 that  came from the  surcharge payments. That  money was                                                               
used to  raise and release  more than 1.4 million  Chinook salmon                                                               
and  hundreds  of  thousands  of  coho  smolt  at  release  sites                                                               
targeted  to benefit  sport fishing  in Southeast  inside waters.                                                               
The loss  of this money  will negatively affect  Southeast Alaska                                                               
sport fishermen and charter operators.                                                                                          
                                                                                                                                
3:42:13 PM                                                                                                                    
COMMISSIONER VINCENT-LANG  explained that to address  the loss of                                                               
the  surcharge funds,  the department  worked with  groups across                                                               
the  state  to  propose  a  new,  reduced  surcharge  to  support                                                               
maintenance   and   nonprofit  hatchery   operations   throughout                                                               
Southeast. SB 60  is the result. The original  $9.00 surcharge is                                                               
reduced to  $4.00. Again, nonresidents  would contribute  most of                                                               
the surcharge.  He directed attention  to a document in  the bill                                                               
packets of the surcharge broken  down by license type. Should the                                                               
bill  pass, he  said the  intention is  to deposit  the surcharge                                                               
into a separate subaccount within the  fish and game fund that is                                                               
used  for sport  fish enhancement  programs, sport  fish hatchery                                                               
facilities,  and continued  enhancement activities  in Southeast.                                                               
He  reiterated that  Southeast Alaska  anglers pay  the surcharge                                                               
but  derive no  benefit from  the  two sport  fish hatcheries  in                                                               
Anchorage and Fairbanks.                                                                                                        
                                                                                                                                
COMMISSIONER VINCENT-LANG  informed the committee that  the House                                                               
Fishery  Committee  amended the  House  version  of the  bill  by                                                               
adding an additional $2.50 surcharge  to pay for the work related                                                               
to fisheries  management, research, invasive  species management,                                                               
and habitat  restoration. He opined  that the language  was broad                                                               
enough  to cover  access improvements  for  sport fishermen.  The                                                               
amendment  also requires  separate accounting  of the  additional                                                               
collections.  He referenced  a  fact sheet  in  the packets  that                                                               
shows  the sport  fish enhancement  programs  release nearly  7.2                                                               
million fish  annually in about  270 locations. In  addition, 1.4                                                               
million fish are released annually in Southeast.                                                                                
                                                                                                                                
3:44:28 PM                                                                                                                    
CHAIR  REVAK  asked  Ms.  Hanke to  walk  through  the  sectional                                                               
analysis.                                                                                                                       
                                                                                                                                
3:44:48 PM                                                                                                                    
RACHEL HANKE, Legislative Liaison,  Alaska Department of Fish and                                                               
Game, Anchorage, Alaska, presented  the sectional analysis for SB
60 that read as follows:                                                                                                        
                                                                                                                                
     Section 1                                                                                                              
                                                                                                                                
     Adds new  section AS 16.05.130(h)  which creates  a new                                                                    
     sub-account of the fish and  game fund called the sport                                                                    
     fishing hatchery facilities  account. This section also                                                                    
     restricts  the use  of the  sub-account to  maintenance                                                                    
     and operations of sport  fishing hatchery facilities as                                                                    
     well as sport fishing stock enhancement.                                                                                   
                                                                                                                                
     Section 2                                                                                                              
                                                                                                                                
     Conforming amendment to reference new section.                                                                             
                                                                                                                                
     Section 3                                                                                                              
                                                                                                                                
     Adds new section AS 16.05.340(l) which establishes the                                                                     
     new sport fishing license surcharge fee schedule.                                                                          
                                                                                                                                
     Section 4                                                                                                              
                                                                                                                                
     Effective date July 1, 2021.                                                                                               
                                                                                                                                
3:46:18 PM                                                                                                                    
SENATOR  STEVENS asked  if the  department  continued to  receive                                                               
Dingell-Johnson Act  matching funds after  the bond was  paid off                                                               
and the surcharge sunset.                                                                                                       
                                                                                                                                
COMMISSIONER VINCENT-LANG  replied the  department would  be able                                                               
to use  the surcharge  funds to  match Dingell-Johnson  Act funds                                                               
for  the   maintenance  of  the  two   hatcheries  and  Southeast                                                               
enhancement activities.                                                                                                         
                                                                                                                                
3:47:00 PM                                                                                                                    
SENATOR  BISHOP asked  what the  annual maintenance  expenses are                                                               
for the two hatcheries.                                                                                                         
                                                                                                                                
COMMISSIONER VINCENT-LANG estimated  that the maintenance backlog                                                               
at the Fairbanks hatchery was in  the $4-6 million range, and the                                                               
Anchorage hatchery  was higher,  primarily from  water filtration                                                               
issues. He offered to follow up with the actual data.                                                                           
                                                                                                                                
SENATOR BISHOP  commented that the  finance committee  would look                                                               
into the maintenance/finance package.                                                                                           
                                                                                                                                
3:48:17 PM                                                                                                                    
SENATOR  VON IMHOF  asked the  commissioner to  also provide  the                                                               
finance  committee information  about  when  the hatcheries  were                                                               
built and  if there were  plans for major maintenance  beyond the                                                               
estimated $4-6 million per year.                                                                                                
                                                                                                                                
COMMISSIONER  VINCENT-LANG  restated  that  the  funds  would  be                                                               
placed  in  a subaccount  of  the  fish  and  game fund  for  the                                                               
hatcheries to  use for  long-term maintenance.  The notion  is to                                                               
build  the  fund  enough  to  be able  to  tap  it  for  deferred                                                               
maintenance, he said.                                                                                                           
                                                                                                                                
3:49:15 PM                                                                                                                    
SENATOR  KAWASAKI  highlighted  that  the fiscal  note  does  not                                                               
indicate  that the  surcharge  would be  used  to match  Dingell-                                                               
Johnson Act funds. He asked for an explanation.                                                                                 
                                                                                                                                
COMMISSIONER VINCENT-LANG replied he did  not have an answer, but                                                               
from his  perspective it would  be unwise  to spend the  fish and                                                               
game fund without  taking advantage of the 3:1  federal match. He                                                               
related  his intention  to use  the funds  collected through  the                                                               
surcharge as a match.                                                                                                           
                                                                                                                                
SENATOR STEVENS asked if the  department had plans for additional                                                               
hatcheries.                                                                                                                     
                                                                                                                                
COMMISSIONER  VINCENT-LANG   replied  most  of  the   sport  fish                                                               
stocking  needs  are  met through  the  Anchorage  and  Fairbanks                                                               
hatcheries  and   the  private   non-profit  (PNP)   hatchery  in                                                               
Southeast. He  noted that  the hatchery  in Southeast  is Crystal                                                               
Lake, which is  state-owned and operated by  a private non-profit                                                               
hatchery.                                                                                                                       
                                                                                                                                
3:51:56 PM                                                                                                                    
CHAIR REVAK opened public testimony  on SB 60, and encouraged the                                                               
testifiers to submit their written comments to sres@akleg.gov.                                                                  
                                                                                                                                
3:52:18 PM                                                                                                                    
RON  SOMERVILLE, representative,  Territorial Sportsmen,  Juneau,                                                               
Alaska, stated the Territorial Sportsmen  strongly support SB 60.                                                               
He related that some of the  money from the surcharge has gone to                                                               
support the local  Douglas Island Pink and  Chum (DIPAC) hatchery                                                               
Chinook  salmon  programs on  the  Taku  and Stikine  rivers.  He                                                               
reported that the  wild stocks have been suppressed  to the point                                                               
that there  has not  been any  early king  salmon fishing  in the                                                               
area for more  than seven years. Thus,  the Territorial Sportsmen                                                               
support any stocking programs to support early runs.                                                                            
                                                                                                                                
MR.  SOMERVILLE   noted  the  substantial  written   support  for                                                               
reinstating the  surcharge and  highlighted that  much of  it was                                                               
coming  from  people  who  are  willing  to  pay  for  using  the                                                               
resource.  He  also   pointed  out  that  there   have  been  few                                                               
complaints  from  residents  or nonresidents  about  paying  this                                                               
surcharge.  On behalf  of  the  more than  1,300  members of  the                                                               
Territorial Sportsmen, he restated support for SB 60.                                                                           
                                                                                                                                
3:54:31 PM                                                                                                                    
DAVID  LANDIS,  General   Manager,  Southern  Southeast  Regional                                                               
Aquaculture Association (SSRAA),  Ketchikan, Alaska, related that                                                               
SSRAA is one  of the private non-profits  (PNP) that Commissioner                                                               
Vincent-Lang  referenced that  work with  ADF&G to  enhance sport                                                               
fish in  Southeast. As such,  the Crystal Lake hatchery  is owned                                                               
by  the state  and  operated  under contract  to  SSRAA. Thus,  a                                                               
portion of the surcharge revenue  allocated to Southeast would go                                                               
to SSRAA programs. He noted that  this funding is critical to the                                                               
continued   operation  of   the  hatchery.   He  referenced   the                                                               
commissioner's comments on hatchery  maintenance and advised that                                                               
there  is a  critically needed  project  at Crystal  Lake to  fix                                                               
leaking raceways. While  SSRAA is worried about the  issue, it is                                                               
willing to  hold off on  fixing the  raceways until the  fund has                                                               
built  a reserve.  At this  point,  the project  is designed  and                                                               
shovel ready.                                                                                                                   
                                                                                                                                
MR.  LANDIS   cited  an  ADF&G   publication  to   emphasize  the                                                               
importance  of  keeping  Crystal  Lake  intact  with  operational                                                               
maintenance  funding.  The  department reported  that  nearly  50                                                               
percent  of   all  Alaska  hatchery  king   salmon  harvested  in                                                               
Southeast Alaska originate from Crystal Lake.                                                                                   
                                                                                                                                
He  concluded   that  SB  60   is  important  to   residents  and                                                               
nonresidents  alike  and  to  keep   harvests  active  under  the                                                               
auspices  of  the Pacific  Salmon  Treaty  between the  U.S.  and                                                               
Canada.                                                                                                                         
                                                                                                                                
3:57:13 PM                                                                                                                    
BEN   MOHR,   Executive   Director,  Kenai   River   Sportfishing                                                               
Association (KRSA),  Soldotna, Alaska,  stated he  was testifying                                                               
to  register  KRSA's  support  for  SB 60.  He  pointed  out  the                                                               
longstanding support  for a  user-pay model  by both  hunters and                                                               
sportfishermen for fish  and game conservation. In  the U.S. this                                                               
support goes  back over  100 years.  KSRA supports  users funding                                                               
operations  and maintenance.  The  sportfishing community  across                                                               
the  state  uses  these   hatchery  facilities  for  recreational                                                               
purposes and  it makes sense that  they pay their own  way. SB 60                                                               
is the vehicle for that to happen.                                                                                              
                                                                                                                                
3:58:20 PM                                                                                                                    
KATIE  HARMS, Executive  Director, Douglas  Island Pink  and Chum                                                               
(DIPAC),  Juneau, Alaska,  stated that  DIPAC is  a private  non-                                                               
profit  corporation  whose  primary  mission is  to  sustain  and                                                               
enhance the  salmon resources in  the state for the  economic and                                                               
cultural benefit  of all citizens.  She stated support for  SB 60                                                               
and  gave  a brief  history  of  the sportfishing  program  DIPAC                                                               
operates  through  funds from  ADF&G's  Division  of Sport  Fish.                                                               
These programs currently  are nearly 90 percent  supported by the                                                               
sport fishing licensee surcharge.                                                                                               
                                                                                                                                
MS.  HARMS explained  that prior  to 1994,  ADF&G raised  Chinook                                                               
salmon at its  Snettisham hatchery and released  them at selected                                                               
sites in the Juneau area. In  1994, the hatchery was converted to                                                               
produce sockeye  salmon and the  Chinook program  was transferred                                                               
to  DIPAC. Since  then, DIPAC  has  received a  little more  than                                                               
$300,000  annually  from  the  Sport  Fish  Hatchery  Enhancement                                                               
Program.  Without the  revenue from  the  surcharge, the  Chinook                                                               
program at  DIPAC would never  have come to fruition.  This ADF&G                                                               
funded, DIPAC produced Chinook program  has become a stable sport                                                               
fishery  for residents  and  nonresidents  fishing shoreside  and                                                               
from  a  boat.  This  hatchery fishery  has  become  increasingly                                                               
important  as   wild  Chinook  stocks  continue   to  decline  in                                                               
Southeast. She relayed that  the financial uncertainty associated                                                               
with poor  salmon returns  in Southeast will  likely result  in a                                                               
greatly reduced  DIPAC Chinook  program next year  if SB  60 does                                                               
not  pass  this  session.  She  thanked  the  committee  for  its                                                               
consideration of this important issue.                                                                                          
                                                                                                                                
4:00:14 PM                                                                                                                    
FORREST  BRADEN,  Executive   Director,  Southeast  Alaska  Guide                                                               
Organization  (SAGO), Ketchikan,  Alaska, stated  SAGO is  a non-                                                               
profit trade group that represents  about 300 guided sportfishing                                                               
businesses that  operate in Southeast  Alaska. On  SAGO's behalf,                                                               
he  stated  full support  for  SB  60.  He explained  that  these                                                               
businesses  rely  heavily  on hatchery  produced  king  and  coho                                                               
salmon.  He reported  that about  25 percent  of the  king salmon                                                               
caught by  the sport  fleet are  Southeast hatchery  produced, as                                                               
are  about half  the sport  fish  caught in  inside waters.  This                                                               
fishery  is clearly  important to  the sport  fish industry;  the                                                               
terminal harvest  areas are often  the only access  sport anglers                                                               
have to  these returning  fish. He pointed  out that  even though                                                               
outside fisheries  catch less hatchery  fish, they  are important                                                               
in  maintaining  the balance  between  inside  and outside  sport                                                               
fisheries that are managed as a  whole. He asked the committee to                                                               
advance the bill.                                                                                                               
                                                                                                                                
4:02:44 PM                                                                                                                    
SUSAN  DOHERTY,  Executive  Director,  Southeast  Alaska  Seiners                                                               
Association  (SEAS), Ketchikan,  Alaska, stated  that while  SEAS                                                               
agrees with  the intent of  SB 60 and  the comments of  the SSRAA                                                               
general manager, SEAS would like  assurance that the Crystal Lake                                                               
sport fish hatchery  is included in ADF&G's  priority funding for                                                               
desperately  needed  maintenance  along with  the  hatcheries  in                                                               
Anchorage   and   Fairbanks    that   Commissioner   Vincent-Lang                                                               
mentioned.                                                                                                                      
                                                                                                                                
4:04:19 PM                                                                                                                    
KEVIN  BURCHFIELD,   President,  Juneau  Charter   Boat  Operator                                                               
Association (JCBOA), Juneau, Alaska, stated  support for SB 60 on                                                               
behalf of  the 14 businesses  in Juneau represented by  JCBOA. He                                                               
mentioned  the declining  wild salmon  stocks and  emphasized the                                                               
need to augment Chinook salmon production.                                                                                      
                                                                                                                                
4:05:12 PM                                                                                                                    
CHAIR REVAK closed public testimony on SB 60.                                                                                   
                                                                                                                                
He  asked Commissioner  Vincent-Lang  to comment  on the  Crystal                                                               
Lake hatchery.                                                                                                                  
                                                                                                                                
4:05:45 PM                                                                                                                    
COMMISSINER   VINCENT-LANG  said   that   in   addition  to   the                                                               
maintenance at the Anchorage and  Fairbanks hatcheries, it is the                                                               
department's  intent   to  pay   for  the  backlog   of  deferred                                                               
maintenance  at the  Crystal Lake  hatchery. It  is important  in                                                               
ensuring  that   hatchery  production  in  Southeast   Alaska  is                                                               
sustained  at  current  levels.   He  reiterated  that  Southeast                                                               
anglers pay  part of the  surcharge and therefore  should receive                                                               
some benefit.                                                                                                                   
                                                                                                                                
4:06:28 PM                                                                                                                    
CHAIR REVAK  found no questions  or comments and stated  he would                                                               
hold SB 60 in committee for further consideration.                                                                              

Document Name Date/Time Subjects
SB 60 Fiscal Note dated 1.28.21.pdf SRES 4/12/2021 3:30:00 PM
SB 60
SB 60 Sectional Analysis - ver. A 2.3.21.pdf SRES 4/12/2021 3:30:00 PM
SB 60
SB 60 Sponsor Statement 1.28.21.pdf SRES 4/12/2021 3:30:00 PM
SB 60
SB 60 Support Doc - Surcharge Revenue Breakdown 1.27.21.pdf SRES 4/12/2021 3:30:00 PM
SB 60
SB 60 Support Letters 4.10.21.pdf SRES 4/12/2021 3:30:00 PM
SB 60
SB 60 Support Letters Group II 4.12.21.pdf SRES 4/12/2021 3:30:00 PM
SB 60
SB 101 Letter of Support AMA 4.12.21.pdf HRES 5/14/2021 1:00:00 PM
SFIN 4/20/2021 9:00:00 AM
SRES 4/12/2021 3:30:00 PM
SB 101