Legislature(2011 - 2012)BARNES 124
04/07/2011 08:00 AM House ECON. DEV., TRADE & TOURISM
| Audio | Topic |
|---|---|
| Start | |
| Presentation: Biomass Boiler Heating Systems | |
| HJR27 | |
| HB222 | |
| HB191 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| *+ | HJR 27 | TELECONFERENCED | |
| *+ | HB 222 | TELECONFERENCED | |
| += | HB 191 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
HOUSE SPECIAL COMMITTEE ON ECONOMIC DEVELOPMENT, INTERNATIONAL
TRADE AND TOURISM
April 7, 2011
8:03 a.m.
MEMBERS PRESENT
Representative Bob Herron, Chair
Representative Kurt Olson, Vice Chair
Representative Neal Foster
Representative Cathy Engstrom Munoz
Representative Steve Thompson
Representative Berta Gardner
Representative Chris Tuck
MEMBERS ABSENT
Representative Reggie Joule
Representative Wes Keller
COMMITTEE CALENDAR
PRESENTATION: BIOMASS BOILER HEATING SYSTEMS
- HEARD
HOUSE JOINT RESOLUTION NO. 27
Supporting the relocation of the home port of the Coastal
Villages Region Fund fishing fleet from Seattle to Alaska.
- MOVED HJR 27 OUT OF COMMITTEE
HOUSE BILL NO. 222
"An Act establishing and relating to the Alaska Promotion and
Marketing Board and the Alaska promotion and marketing fund;
relating to marketing tourism contracts and campaigns; and
providing for an effective date."
- HEARD & HELD
HOUSE BILL NO. 191
"An Act establishing a state department of agriculture and food
and relating to its powers and duties; relating to the powers
and duties of the Department of Environmental Conservation and
the Department of Natural Resources; and providing for an
effective date."
- MOVED HB 191 OUT OF COMMITTEE
PREVIOUS COMMITTEE ACTION
BILL: HJR 27
SHORT TITLE: RELOCATE COASTAL VILLAGES REGION FUND
SPONSOR(s): REPRESENTATIVE(s) SEATON
04/04/11 (H) READ THE FIRST TIME - REFERRALS
04/04/11 (H) RES
04/05/11 (H) RES REFERRAL REMOVED
04/05/11 (H) EDT REFERRAL ADDED BEFORE RLS
04/07/11 (H) EDT AT 8:00 AM BARNES 124
BILL: HB 222
SHORT TITLE: AK PROMOTION & MARKETING FUND/BOARD
SPONSOR(s): REPRESENTATIVE(s) AUSTERMAN
04/01/11 (H) READ THE FIRST TIME - REFERRALS
04/01/11 (H) EDT, FIN
04/07/11 (H) EDT AT 8:00 AM BARNES 124
BILL: HB 191
SHORT TITLE: DEPARTMENT OF AGRICULTURE AND FOOD
SPONSOR(s): REPRESENTATIVE(s) THOMPSON BY REQUEST
03/11/11 (H) READ THE FIRST TIME - REFERRALS
03/11/11 (H) EDT, RES, FIN
03/15/11 (H) EDT AT 10:15 AM BARNES 124
03/15/11 (H) Heard & Held
03/15/11 (H) MINUTE(EDT)
04/07/11 (H) EDT AT 8:00 AM BARNES 124
WITNESS REGISTER
KATIE KOESTER, Staff
Representative Paul Seaton
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Introduced HJR 27 on behalf of
Representative Seaton, sponsor.
WILLARD DUNHAM, Mayor
City of Seward
Seward, Alaska
POSITION STATEMENT: Testified in support of HJR 27.
PHILLIP OATES, City Manager
City of Seward
Seward, Alaska
POSITION STATEMENT: Testified in support of HJR 27.
NEIL RODRIGUEZ, Regulatory Manager
Coastal Villages Region Fund
Anchorage, Alaska
POSITION STATEMENT: Testified in support of HJR 27.
REPRESENTATIVE ALAN AUSTERMAN
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Testified in support of HJR 27; introduced
HB 222 as the prime sponsor.
ASTRID LIEVANO, Staff
Representative Alan Austerman
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented a sectional analysis of HB 222 on
behalf of Representative Austerman, prime sponsor.
DEB HICKOK, Chair
Board of Directors
Alaska Travel Industry Association (ATIA)
Anchorage, Alaska
POSITION STATEMENT: Testified during the hearing on HB 222.
JANE PIERSON, Staff
Representative Steve Thompson
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented a sectional analysis of HB 191 on
behalf of Representative Thompson, sponsor by request.
FRANCI HAVEMEISTER, Director
Central Office
Division of Agriculture
Department of Natural Resources (DNR)
Palmer, Alaska
POSITION STATEMENT: Answered questions during the hearing on HB
191.
SIG RESTAD, Master
Northland Pioneer Grange
Palmer, Alaska
POSITION STATEMENT: Testified in support of HB 191.
JOHN POIRRIER, President
Alaska State Grange
North Pole, Alaska
POSITION STATEMENT: Testified in support of HB 191.
BRYCE WRIGLEY, President
Alaska Farm Bureau, Inc.
Delta Junction, Alaska
POSITION STATEMENT: Testified in support of HB 191.
ACTION NARRATIVE
8:03:22 AM
CHAIR BOB HERRON called the House Special Committee on Economic
Development, International Trade and Tourism meeting to order at
8:03 a.m. Representatives Herron, Tuck, Gardner, Thompson, and
Olson were present at the call to order. Representatives Munoz
and Foster arrived as the meeting was in progress.
Representative Austerman was also present.
^Presentation: Biomass Boiler Heating Systems
Presentation: Biomass Boiler Heating Systems
8:04:03 AM
CHAIR HERRON announced that the first order of business would be
a presentation by Representative Thompson on biomass boiler
heating systems.
8:05:03 AM
REPRESENTATIVE THOMPSON provided a PowerPoint presentation
titled, "Biomass Boiler Heating Systems," and dated 9/16/10,
featuring the Delta Greely Biomass project. Representative
Thompson informed the committee the slide program was prepared
by Coffman Engineers in Anchorage. He noted that there are
several biomass boilers in Alaska, Montana, Oregon, and Idaho -
one of the most successful is in Tok - and Coffman Engineers is
dedicated to this and other alternative energy systems, such as
wind farms and windmills. There are residential and commercial
biomass boiler systems available that burn pellets, wood chips,
or cordwood. Coffman Engineers' feasibility assessments of
proposed projects include: evaluation of payback; fuel cost
comparison; sources of fuel; support from state and federal
agencies; cost of construction. Representative Thompson relayed
that one of the key components of a biomass boiler system is the
fuel source, specifically wood chip quality and delivery. Wood
chip quality is directly related to the efficiency of the
boiler, and the availability of pellets in the future is vital
to determining the worthiness of a project. Representative
Thompson displayed a slide which showed wood chips delivered by
truck to a storage facility, which in Alaska may need to be a
warm and covered space. The delivery system continues to the
boiler by different options, such as a belt or screw conveyor.
The boiler system begins with gasification of the biomass by a
fixed, conveyor, or step grate; the boiler itself consists of a
fire tube and hot water under pressure to 30 pound-force per
square inch gauge (psig). He noted that vendors are interested
in supplying and delivering the biomass product to these
systems. A slide titled, "Flue Gasses" displayed a diagram of a
cyclone separator, and Representative Thompson explained that
flue gasses run through a cyclone separator, or an electrostatic
precipitator, which removes all of the "dirty air" and renders
the system environmentally friendly. In large installations,
the stack height is determined by the height of the building and
the effect of wind. Finally, ash is collected and removed from
the facility for use in concrete, farm soil, and garden soil, or
to be disposed of in a landfill. He closed by saying that the
preceding was a brief overview of the system, and that Coffman
Engineers is interested in providing a complete description of
its product.
8:09:41 AM
REPRESENTATIVE GARDNER asked whether the differences between
cordwood, pellets, and wood chips are density, size, waste, or
heat value.
8:10:06 AM
REPRESENTATIVE THOMPSON advised most systems use pellets because
they are easier to deliver on a conveyor. The wood must be dry
and free of pollutants.
REPRESENTATIVE GARDNER further asked whether there is a greater
heat value from pellets.
REPRESENTATIVE THOMPSON said he was unsure.
REPRESENTATIVE TUCK requested that the House Special Committee
on Energy also hear this presentation, as it was informed that
barley is being grown in Alaska as a source of biofuel.
8:11:52 AM
REPRESENTATIVE THOMPSON pointed out that Fort Greely is
installing a boiler system that will burn barley.
HJR 27-RELOCATE COASTAL VILLAGES REGION FUND
8:13:05 AM
CO-CHAIR HERRON announced that the next order of business would
be HOUSE JOINT RESOLUTION NO. 27, Supporting the relocation of
the home port of the Coastal Villages Region Fund fishing fleet
from Seattle to Alaska.
8:13:18 AM
KATIE KOESTER, Staff, Representative Paul Seaton, Alaska State
Legislature, stated HJR 27 is a resolution to support bringing
the Alaska fishing fleet home. She reminded the committee of
the 3/31/11 presentation by representatives of Seward detailing
the merits of this initiative, and that several committee
members have signed as co-sponsors. Ms. Koester said HJR 27 is
an effort to bring about economic development in all of the
state by encouraging the Coastal Villages Region Fund (CVRF) to
homeport its fleet in Seward. Coastal Villages Region Fund is
one of six Community Development Quota (CDQ) groups that were
developed in the '90s and given "a stake in the Bering Sea
fisheries." The CDQ groups represent 65 Bering Sea communities
and are required to reinvest their profits, bringing economic
development, jobs, and hope to coastal villages in the Bering
Sea region. Coastal Villages Region Fund is the largest
Alaskan-owned and Alaska-based fishery company, with expected
seafood sales in the amount of $75 million in 2011. In
addition, CVRF has an impressive fleet of vessels that spend $5-
$10 million on maintenance each year, $20 million in moorage in
Seattle, and $10 million on crew annually. She relayed that
CVRF wants to return its fleet, crews, and jobs to Alaska. A
survey indicated that the requirements to homeport a fleet of
this size are: a year around ice-free port; road, rail, and air
access; space for harbor and uplands development; a maritime
licensing facility. Nearby Seward is able to provide all of
these services, in addition to a drydock and the Alaska
Vocational Technical Center (AVTEC), which is an educational and
licensing facility. Ms. Koester restated the purpose of the
resolution is about economic development, and she pointed out
the letters of support from around the state and the Alaska
Congressional delegation found in the committee packet.
Furthermore, the City of Seward has funded a preliminary study
in favor of this issue, the U.S. Corps of Engineers (USACE) has
found that the relocation is economically feasible, and CVRF has
determined that Seward is the best choice for an Alaska port.
8:18:00 AM
REPRESENTATIVE GARDNER has heard from a Seward resident
questioning the city's public process prior to the engineering
study on this issue. Also, she asked about any efforts on
Seattle's part to keep the fleet there.
8:19:23 AM
MS. KOESTER said Seward did a small study at a cost of $5,000,
and has submitted a capital budget request for $400,000 to
complete an in-depth study that would incorporate public
testimony. Regarding a response from the Port of Seattle, she
opined it is the legislature's responsibility to advocate for
Alaska.
CHAIR HERRON observed a fleet of this size is important to any
economic region.
8:20:43 AM
CHAIR HERRON opened public testimony.
8:21:55 AM
WILLARD DUNHAM, Mayor, City of Seward, expressed his belief that
this is a unique opportunity in that an industry is interested
in moving its operation to Alaska. The City of Seward has
passed two resolutions and has held public hearings regarding
this issue; in fact, the property involved is a 476-acre tract
zoned for industrial use. He advised the idea for the expansion
of the port has been vetted in the community and is supported by
most residents. Mr. Dunham agreed that there will be a reaction
from the Port of Seattle; furthermore, if all six CDQs decide to
move, that would entail a fleet of 200 vessels.
8:25:30 AM
PHILLIP OATES, City Manager, City of Seward, added that one of
the resolutions passed by Seward was a comprehensive resolution
outlining the merits of the proposed project. The first phase
of the project will be built onto existing infrastructure in an
area that already has been permitted. Dr. Oates assured the
committee Seward will continue to address concerns from its
residents. He advised that members of the Congressional
delegation felt that the Port of Seattle may not have an impact
on the CVRF phase of this project, because federal money is not
involved. In fact, the ultimate funding for the project will be
a combination of general obligation (GEO) bonds at the state
level, revenue bonds at the local level, and public-private
financing. He called attention to documents from the
Congressional delegation and others in full support of HJR 27
that are found in the committee packet.
8:29:01 AM
CO-CHAIR HERRON stated his intent for the committee to visit the
site during interim. He asked Dr. Oates to comment on the
significance of the support from the Congressional delegation.
DR. OATES opined that the support from the Congressional
delegation indicates that they see this as the fulfillment of
the vision of the original purpose of the CDQ groups, which was
to strengthen the American presence in the fishing fleets that
were formally dominated by foreign vessels, and to provide
quotas to the communities surrounding the fishing areas. Also,
CDQ groups allow for the reinvestment of profits into education,
and growth of the local fishing industry. Dr. Oates pointed out
that support for HJR 27 extends from both political parties and
urges other CDQ groups to move their homeports to Alaska.
8:32:05 AM
REPRESENTATIVE FOSTER asked how the resolution would help.
DR. OATES said the resolution indicates there is solid support
at all levels for the project, which always helps with
permitting. In addition, the resolution will indicate to the
Senate and the governor that the House supports Seward's capital
budget request to pay for the full engineering, geotechnical,
and economic analysis of the project and its costs.
8:33:49 AM
MR. DUNHAM added that fishing organizations are supportive of
the project.
NEIL RODRIGUEZ, Regulatory Manager, Coastal Villages Region
Fund, affirmed that moving the fleet is a long-time goal for the
CDQ program and a benefit to the fishing industry.
8:35:52 AM
REPRESENTATIVE ALAN AUSTERMAN, Alaska State Legislature, relayed
his experience as a commercial fisherman in the '60s when he
watched foreign fishing vessels interfere with and destroy his
crab pots. Today, through the Congressional imposition of the
three-mile limit, the fisheries are American, but are not
Alaskan. The value of the fishery in the Bristol Bay region is
between $2.3 billion and $2.5 billion, but 90 percent of the
jobs and profits go to Seattle and Oregon. He opined the value
of keeping fleet jobs and support services in Alaska is "mind
boggling." Representative Austerman strongly supported HJR 27
and the idea of bringing all of the CDQ groups back to Alaska.
8:39:04 AM
CO-CHAIR HERRON closed public testimony.
8:39:13 AM
REPRESENTATIVE TUCK stated that HJR 27 represents a great vision
and plan, and an opportunity to keep money in Alaska. In
addition, the move would create new industries to support the
fishing fleet. He expressed his support for the resolution and
said he would like to participate as a co-sponsor.
REPRESENTATIVE FOSTER observed that the power and impact on
Western Alaska of the CDQ program - which brings an influx of
jobs and money to small villages - has been amazing.
8:40:54 AM
REPRESENTATIVE TUCK moved to report HJR 27, Version 27-LS0780\M,
from committee with individual recommendations and the
accompanying fiscal note. There being no objection, HJR 27 was
reported from the House Special Committee on Economic
Development, International Trade and Tourism.
8:41:42 AM
The committee took an at-ease from 8:41 a.m. to 8:42 a.m.
8:42:40 AM
HB 222-AK PROMOTION & MARKETING FUND/BOARD
8:42:56 AM
CO-CHAIR HERRON announced that the next order of business would
be HOUSE BILL NO. 222," An Act establishing and relating to the
Alaska Promotion and Marketing Board and the Alaska promotion
and marketing fund; relating to marketing tourism contracts and
campaigns; and providing for an effective date."
8:43:08 AM
REPRESENTATIVE ALAN AUSTERMAN, Alaska State Legislature, stated
that his experience on the House Finance Committee led him to
understand that Alaska is not marketed as a business
destination; in fact, new businesses are not encouraged to come
to the state and bring jobs and income. He opined a board or
fund within the Department of Commerce, Community & Economic
Development (DCCED) tasked to work on promoting Alaska would
accomplish this by including all industries such as seafood,
tourism, mining, and agriculture. However, because the
legislature cannot "tell the department what to do," the initial
concept of the bill will be addressed next year, thus HB 222 is
a starting point for: A methodology to bring all of the
industries to the table and determine how to fund a marketing
effort for each individual industry. Representative Austerman
anticipated that changes will be made to the proposed
legislation, and he expressed his hope that testimony from the
affected industries will be heard.
8:46:27 AM
ASTRID LIEVANO, Staff, Representative Alan Austerman, Alaska
State Legislature, said HB 222, Section 1, adds the Alaska
Promotion and Marketing Board to the list of boards and
commissions that are subject to the public official financial
disclosure chapter. Section 2 adds new sections to create the
Alaska Promotion and Marketing Fund and the Alaska Promotion and
Marketing Board. Section 44.33.950 creates the fund, and
directs DCCED to administer the fund in consultation with the
board. Section 44.33.955 identifies the money that is to be in
the fund and states that the fund is not a dedicated fund.
Section 44.33.960 states the purpose of the fund, which is to
promote and market industries that broaden the economic base of
the state and provide jobs and business opportunities for Alaska
residents. Section 44.33.965 states that the fund money shall
be used, subject to appropriation, to make grants to private
entities for projects that promote the fund purpose, and to pay
administration costs for the new sections. Section 44.33.970
establishes certain requirements for grants from the fund,
addresses the type of entity that may be a grant recipient,
addresses the matching requirements of 50 percent of the grant
amount, and sets a maximum amount of 75 percent per fiscal year
for grants to entities in established industries. Section
44.33.975 establishes the board, including the number of
members, and the appointment of members by the governor.
Section 44.33.980 lists the board's duties including developing
a methodology for prioritizing projects; identifying criteria
for evaluation achievement of the fund purpose by proposed
projects; determining grant applicant eligibility criteria.
Section 44.33.985 authorizes the board and DCCED to adopt
regulations for the new sections. Section 44.33.990 defines the
terms for the new sections. Section 3 repeals certain sections
relating to marketing tourism contracts and campaigns. Section
4 establishes a sunset date of 7/1/19. Section 5 provides for
the appointment of the first members of the board within one
month of the effective date and with staggered terms. Section 6
makes the Act effective 1/1/12, unless changed.
8:52:32 AM
REPRESENTATIVE GARDNER asked whether Section 3 repeals the
funding structure for the Alaska Travel Industry Association
(ATIA).
REPRESENTATIVE AUSTERMAN clarified that it does repeal the
current funding methodology through ATIA and DCCED, and moves
the qualified trade association concept over to a new board that
is created by the bill. In further response to Representative
Gardner, he explained that the change would apply to any trade
association or group that wants to market Alaska, such as the
Alaska Seafood Marketing Institute (ASMI). Details will be
worked out during the interim by the committee, after hearing
from industry.
8:55:09 AM
REPRESENTATIVE GARDNER recalled a meeting in Sitka of a group of
rural communities interested in promoting tourism with a focus
different from that of ATIA. She asked whether this group
could apply to the new board for a grant.
REPRESENTATIVE AUSTERMAN said yes, and added that there will be
a lot of discussion about the scope of tourism that would be
included. He opined all groups can come to the board after its
criteria is established.
8:56:21 AM
REPRESENTATIVE MUNOZ asked for confirmation that ASMI would be
eligible to compete for funds.
REPRESENTATIVE AUSTERMAN indicated yes; ASMI currently qualifies
for marketing funding, although it is funded differently and at
a lower percentage than ATIA. Marketing funds are an annual
argument for the legislature, and this board would work with the
industry to identify funding. The legislature would still fund
the marketing fund each year, which could mean more money for
marketing in the long-term, with the addition of new businesses.
8:58:23 AM
REPRESENTATIVE FOSTER pointed out the board will determine what
constitutes an "emerging market," and inquired about that
process.
REPRESENTATIVE AUSTERMAN said he did not know. He recalled how
- during past troubled times for the seafood industry - matching
funds and federal money was used to bring the fishing industry
back from a period of low prices with incentives on new and
developing products.
CO-CHAIR HERRON opened public testimony.
9:00:21 AM
DEB HICKOK, Chair, Board of Directors, Alaska Travel Industry
Association (ATIA), said the ATIA board shares Representative
Austerman's passion for growing and diversifying Alaska's
economy. She relayed that the ATIA board of directors works
with its 11,000 member businesses to develop and market Alaska
as a travel destination; in fact, the board supports a marketing
committee structure because it gives large and small businesses
a direct voice in the marketing program. However, the ATIA
board also seeks to scrutinize the proposed marketing process
for possible improvements. Ms. Hickok offered that the board
will collaborate with the legislature and the administration,
and suggested an independent audit of the marketing committee
structure and programs during the interim discussions regarding
the proposed legislation. Referring to the bill, she opined
Section 3 - that repeals the qualified trade association (QTA) -
is premature, and has negative consequences to the travel
industry. Ms. Hickok urged for more collaboration with the
travel industry during interim.
9:04:43 AM
REPRESENTATIVE AUSTERMAN recently heard that an audit of ATIA
was under consideration; however, this bill does not have
anything to do with ATIA and its ability to perform its task.
He stressed that HB 222 does not relate to the operations of
ATIA; in fact, this legislation creates a new structure for how
marketing is funded by the state.
[HB 222 was heard and held.]
9:06:11 AM
Chair Herron turned the gavel over to Vice Chair Olson.
9:06:21 AM
HB 191-DEPARTMENT OF AGRICULTURE AND FOOD
9:06:36 AM
VICE CHAIR OLSON announced that the final order of business
would be HOUSE BILL NO. 191," An Act establishing a state
department of agriculture and food and relating to its powers
and duties; relating to the powers and duties of the Department
of Environmental Conservation and the Department of Natural
Resources; and providing for an effective date."
9:06:55 AM
JANE PIERSON, Staff, Representative Steve Thompson, Alaska State
Legislature, reminded the committee the purpose of HB 191 was to
create a new department of agriculture and food. Although the
bill had been previously introduced to the committee, she
provided a sectional analysis. Sections 1-18 of the bill
address AS Title 3 - AGRICULTURE AND ANIMALS, and specifically,
Chapter 5, which is the duties of the commissioners, and puts
the duties relating to agriculture and food under the purview of
the commissioner of the department of agriculture and food. The
sections in Chapter 5 also address the powers and duties of the
commissioner of the Department of Environmental Conservation
(DEC) and puts retail food establishments and fish products
establishments under the purview of DEC. The new department of
agriculture will have duties overseeing animals and animal
products, the state veterinarian, noxious weeds, invasive
plants, agricultural pest management, the grading and
classification of agricultural products, inspections, product
violations, elk farming, and food security. In addition, under
AS Title 17, the new department of agriculture and food will
assume duties over federal crop insurance contributions,
agricultural and industrial fairs, the Farm to School Program,
the Plant Materials Center, controlled livestock districts,
brand-marking, beekeeping, and organic food. Sections 19-20
direct the commissioner of the department of agriculture and
food to appoint an employee of the department as the director of
the board of agriculture and conservation; this board oversees
the Agricultural Revolving Loan Fund (ARLF). Sections 39-75
deal with AS Title 17, which is Alaska Food and Drug; Chapter 20
is the Alaska Food, Drug, and Cosmetic Act and applies to the
commissioner of the department of agriculture and food having
the duty to set standards, regulate, label, inspect, embargo,
condemn, re-label, enforce, and fine related food products with
the exceptions of fish and fisheries products, and retail
establishments, which remain under the purview of DEC. Sections
76-77 make conforming changes. Section 78 deals with the
clearing and draining of agricultural land. Sections 79-82
also make conforming amendments. Section 83 adds a new chapter
to establish the new department of agriculture and food.
Section 84 adds the department of agriculture and food to the
agencies enforcing AS 17.20. Section 85 repeals certain laws.
Section 86 authorizes the department of agriculture and food,
DEC, and DNR to begin adopting, amending, and repealing
regulations as necessary to implement this Act. Sections 88-89
set forth the effective date. Ms. Pierson stated that
Representative Thompson's office has been in contact with
farmers, DEC, and the Department of Natural Resources (DNR), and
the concerns from all of the interested parties are being
addressed; for example, farmers were concerned about mandatory
programs to inventory food supplies. Also, DEC requested a
change in language regarding the processing of food, and the
Alaska Department of Fish and Game (ADF&G) was concerned about
language related to fish. In Section 18, the definition of
retail food will be expanded and moved from Title 3 into Title
17. In Section 41, DEC will provide a definition of non-
agricultural food. The definition of food establishment will be
moved to Section 49, and changes related to retail food and
agricultural food processors are forthcoming. Ms. Pierson noted
that DNR feels the Division of Agriculture belongs in its
department; however, Representative Thompson believes the
creation of a new department is sound policy.
9:13:13 AM
REPRESENTATIVE GARDNER referred to the letters of support and
opposition that were provided in the committee packet and asked
for the authors' contact information.
9:14:04 AM
REPRESENTATIVE TUCK asked for a copy of the most current
sectional analysis.
MS. PIERSON will respond to both requests. In response to Vice
Chair Olson, she deferred to the Division of Agriculture for
information on ARLF.
9:16:10 AM
REPRESENTATIVE THOMPSON asked whether the Board of Agriculture &
Conservation (BAC) is responsible for managing ARLF and its
assets.
9:16:33 AM
FRANCI HAVEMEISTER, Director, Central Office, Division of
Agriculture, Department of Natural Resources (DNR), said yes.
In further response to Representative Thompson, she said she was
unsure whether the BAC passed a resolution requesting that ARLF
be recapitalized; however, the loan fund continues to revolve
and BAC is "looking for future requests, ... currently we are
able to meet the need of the Ag community."
9:17:05 AM
REPRESENTATIVE THOMPSON asked for an explanation of the sudden
drop in projected loan activity from $3,285,000 in fiscal year
2010 (FY 10), to $2,400,000 in FY 11, and to $1,500,000 FY 12.
[These figures were from an undated document titled,
"Agricultural Revolving Loan Fund Cash Flow Projection," from an
unknown source.]
MS. HAVEMEISTER opined the projections are based on historical
information that does not reflect ARLF lower loan rates that led
to refinances and "which shows activity but it's not actual cash
out of the fund."
9:17:48 AM
VICE CHAIR OLSON asked whether there is a description of the
"difference between the two sets of numbers."
[Included in the committee packet was an undated document
titled, "Agricultural Revolving Loan Fund (ARLF), Financial
Summary as of February 28, 2011, Fiscal Year July 1-June 30,"
from an unknown source.]
9:18:08 AM
MS. HAVEMEISTER said:
No, I have not. We just had an error that was
submitted through this office that did not go through
support services, so we requested support services do
a new financial projection, and that, that is the one
that is currently in the packet.
MS. HAVEMEISTER, in further response to Vice Chair Olson, said
Cris Cowles-Brunton, Revenue Officer, Central Office, Division
of Support Services, DNR, prepared the second document.
VICE CHAIR OLSON then asked whether the future sale of Matanuska
Maid Diary (Mat-Maid) was a variable included in the cash flow
projections.
MS. HAVEMEISTER said she was unsure; however, the difference
between the initial projection and the second projection was
that revenue was not included in the initial projection. In
further response to Vice Chair Olson, she said she did not
believe any refinancing of bad debts was included.
9:19:46 AM
MS. PIERSON, in response to Representative Gardner, explained
the original projection by DNR was corrected. She said she will
provide the corrected document to the committee.
9:21:20 AM
VICE CHAIR OLSON opened public testimony.
9:21:45 AM
SIG RESTAD, Master, Northland Pioneer Grange, expressed the
Grange's support of the bill at its present "stage of
development." The bill improves communication between the
agricultural community and local and national agencies, and
there is ample time to work on further revisions; in fact,
Northland Pioneer Grange has been involved in this issue since
1934. Speaking on his own behalf, he recalled his experience as
the Director of Agriculture from 1962-1968, and said state
agricultural programs with department-level status are more
productive and cost efficient. In addition, farmers benefit
from seeking answers from one department organized in a
structure similar to that of the U.S. Department of Agriculture.
Mr. Restad offered his experience.
9:27:38 AM
JOHN POIRRIER, President, Alaska State Grange, stated that the
Alaska State Grange supports HB 191 based on two principles, the
first of which is that the development of agriculture moved
human society from a nomadic hunting and gathering lifestyle to
a community lifestyle. Although Alaskans are dependent on
natural resources and its regulatory approach to management,
agriculture results from the efforts of people to produce food
products to support a general population. He strongly urged
further efforts in Alaska to provide its own food supply.
Secondly, a department-level governmental agency should be
involved in such an important element of the state's economy.
The bill consolidates existing governmental functions into a
single department in the best interests of the state.
9:29:57 AM
BRYCE WRIGLEY, President, Alaska Farm Bureau, Inc., stressed
that HB 191 is not an "indictment" of DNR or the Division of
Agriculture. He pointed out that all Alaskans can be affected
by transportation breakdowns and there is a serious need to
address food security in Alaska by raising more food in the
state. The new department of agriculture should have the
freedom to strive for this goal of food security, independent of
influence from DNR; in fact, the key to reaching this goal is to
develop a business climate to support small- and medium-sized
farms to grow and process food. A more focused agency will be
capable of working with farmers to develop a food source in
Alaska for its rural and urban populations. Mr. Wrigley
endorsed the previous testimony of others.
9:31:55 AM
VICE CHAIR OLSON closed public testimony.
9:32:05 AM
REPRESENTATIVE THOMPSON questioned whether the FY 12 projected
personnel expenditures in the amount of $512,375 are really
needed to administer a loan fund of $1,500,000.
MS. PIERSON said she was also interested in looking into these
and other "numbers" pertaining to ARLF.
VICE CHAIR OLSON, in response to Representative Foster, advised
that the next committee of referral is the House Resources
Standing Committee, which intends to work on the bill during
interim.
9:34:29 AM
REPRESENTATIVE TUCK relayed that historically there was a
surplus of food in the U.S., but now there is not. Because of
the remote location of Alaska, it is important to have an
agricultural base, especially since there is only a three to
eight day supply of food in case of a catastrophe.
Representative Tuck acknowledged that there is a lot of work to
be done on the bill, but it emphasizes the importance of
agriculture as the foundation of the economy, and he offered his
assistance and support.
9:36:48 AM
REPRESENTATIVE FOSTER moved to report HB 191, Version 27-
LS0458\M, out of committee with individual recommendations and
the accompanying fiscal note. There being no objection, HB 191
was reported from the House Special Committee on Economic
Development, International Trade and Tourism.
9:37:19 AM
ADJOURNMENT
There being no further business before the committee, the House
Special Committee on Economic Development, International Trade
and Tourism meeting was adjourned at 9:37 a.m.