Legislature(1993 - 1994)

03/30/1993 08:40 AM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                                                                               
                                                                               
                     HOUSE FINANCE COMMITTEE                                   
                         MARCH 30, 1993                                        
                            8:40 A.M.                                          
                                                                               
  TAPE HFC 93 - 81, Side 2, #000 - end.                                        
  TAPE HFC 93 - 82, Side 1, #000 - end.                                        
                                                                               
  CALL TO ORDER                                                                
                                                                               
  Co-Chair Ron Larson called the  meeting of the House Finance                 
  Committee to order at 8:40 A.M.                                              
                                                                               
  PRESENT                                                                      
                                                                               
  Co-Chair Larson               Representative Brown                           
  Co-Chair MacLean              Representative Foster                          
  Vice-Chair Hanley             Representative Grussendorf                     
  Representative Hoffman        Representative Therriault                      
  Representative Navarre        Representative Parnell                         
                                                                               
  Representative Martin was not present for the meeting.                       
                                                                               
  ALSO PRESENT                                                                 
                                                                               
  Representative Jerry Mackie;  Representative Bill  Williams;                 
  Representative  Fran  Ulmer;  Representative  Brian  Porter;                 
  Geron Bruce, Special Assistant, Department of Fish and Game;                 
  Eric  Forrer,  Self,  Juneau,  Alaska;  Jerry  McCune,  UFA,                 
  Cordova,  Alaska;  Paul  Fuhs, Commissioner,  Department  of                 
  Commerce  and  Economic  Development;   Kelley  Sharp,  Loan                 
  Manager, Division of Investments, Department of Commerce and                 
  Economic  Development;   Jay  Ginter,  U.S.   Department  of                 
  Commerce,  NOAA/NMFS,  Juneau,   Alaska;  Juanita   Hensley,                 
  Division  of  Motor Vehicles,  Department of  Public Safety;                 
  Gary  Lewis,  AML  Taxation and  Finance  Committee; Crystal                 
  Smith, Alaska Municipal League (AML), Juneau,  Alaska; Linda                 
  Behnken,  E.D.,  Alaska  Longline  Fishermen's  Association,                 
  Sitka, Alaska (testified via teleconference).                                
                                                                               
  SUMMARY INFORMATION                                                          
  HB 123    An  Act  relating  to loans  for  the  purchase of                 
            individual fishery quota shares.                                   
                                                                               
            CS HB 123 (FSH) was reported out of Committee with                 
            a "do pass" recommendation and  with a fiscal note                 
            by  the   Department  of  Commerce   and  Economic                 
            Development dated 3/05/93.                                         
  HB 179    An  Act  relating  to  motor  vehicles and  mobile                 
            homes; and providing for an effective date.                        
                                                                               
                                1                                              
                                                                               
                                                                               
            HB   179  was  held   in  Committee   for  further                 
  discussion.                                                                  
  HB 191    An Act  relating to  cost recovery  by contractors                 
            who operate state-owned hatcheries.                                
                                                                               
            HB 191  was reported out  of Committee with  a "do                 
            pass" recommendation" and with a zero  fiscal note                 
            by the Department of Fish and Game dated 3/17/93.                  
                                                                               
  HOUSE BILL 191                                                               
                                                                               
       "An Act relating  to cost  recovery by contractors  who                 
       operate state-owned hatcheries."                                        
                                                                               
  REPRESENTATIVE BILL WILLIAMS testified in support of HB 191.                 
  The legislation  would address  how a  contractor may  spend                 
  cost recovery  monies generated from a  state-owned hatchery                 
  in which that contractor operates  under a contract with the                 
  State.  The  bill is supported by  aquaculture associations,                 
  fishermen, and the Department of Fish  and Game.  He pointed                 
  out that the bill has a zero  fiscal note and indicated that                 
  the fiscal note  would help  to make the  transition of  the                 
  operation  of  the  state  facilities  by  contractors  more                 
  feasible to  accomplish weaning  of the  hatchery operations                 
  from the State funding.                                                      
                                                                               
  Co-Chair MacLean  asked for  an explanation of  "reasonable"                 
  operating costs and questioned if they would include capital                 
  improvements  at  the  hatchery.    Representative  Williams                 
  advised  that  the  Board  of   Director  submits  a  budget                 
  itemizing the costs to run the facilities.                                   
                                                                               
  Representative Brown inquired  if monies from cost  recovery                 
  would be used at  other hatcheries than that from  which the                 
  cost is recovered.   Representative Williams stated  that HB
  191 will  enable funding of  the Gulkana Hatchery  with Main                 
  Bay Hatchery revenue.                                                        
                                                                               
  GERON BRUCE, SPECIAL ASSISTANT, DEPARTMENT OF FISH AND GAME,                 
  stated the Gulkana  Hatchery is being operated  by the State                 
  using program receipts provided by  the Prince William Sound                 
  Aquaculture Association.   The FY  94 budget proposal  would                 
  turn the facility  over to  a private  firm.   The Board  of                 
  Directors of  each  hatchery  can limit  the  cost  of  each                 
  facility in order that there may  be surplus fish to harvest                 
  by the  users.   The  Department  of Commerce  and  Economic                 
  Development exercises the  authority to determine how  those                 
  funds  are   spent.     Representative  Brown  stated   that                 
  "reasonable" costs vary a lot.                                               
                                                                               
                                                                               
                                2                                              
                                                                               
                                                                               
  Co-Chair MacLean noted her concern  in allowing a contractor                 
  to use State  money for private operations.   Representative                 
  Williams replied  that the  State money  is to  be used  for                 
  State  owned  and  operated  hatcheries.   The  State  owned                 
  hatcheries sometimes do not receive  the cost recovery money                 
  back.                                                                        
                                                                               
  Co-Chair MacLean asked what the profits from the Aquaculture                 
  Corporation are used  for.   Mr. Geron replied,  they are  a                 
  non-profit organization  which does  not make  profit.   The                 
  Department of Commerce and Economic Development allows  them                 
  to build a reserve fund to cushion for catastrophic failure.                 
  Excess fish  provides an opening of the  commercial area for                 
  other fishermen.                                                             
                                                                               
  Representative  Hanley  MOVED  to  report   HB  191  out  of                 
  Committee  with  individual  recommendations  and  with  the                 
  accompanying  fiscal note.  There being NO OBJECTION, it was                 
  so ordered.                                                                  
                                                                               
  HB  191  was reported  out  of  Committee with  a  "do pass"                 
  recommendation and with a zero fiscal note by the Department                 
  of Fish and Game dated 3/17/93.                                              
  HOUSE BILL 123                                                               
                                                                               
       "An  Act  relating   to  loans  for  the   purchase  of                 
       individual fishery quota shares."                                       
                                                                               
  REPRESENTATIVE FRAN ULMER  introduced a new loan  program to                 
  help  Alaska fishermen  living in  the coastal  communities.                 
  The U.S. Secretary of Commerce recently approved  individual                 
  Fishery  Quotas  (IFQ's)  for  the  halibut  and  black  cod                 
  fisheries in Alaska.  If all   goes as planned, by mid-1994,                 
  these fisheries will no longer be open to all those who want                 
  to "wet a line".  Instead, a new permit system will  reserve                 
  catch quotas  for individual  fishermen who  qualify for  an                 
  IFQ.   Gone  will be  the 24  hour openings,  replaced  by a                 
  season which may last from March  through November.  The new                 
  system is  promoted as  a solution  to dangerous  conditions                 
  created by derby style fishing.                                              
                                                                               
  HB 123 provides  financing for the  purchase of IFQ's.   The                 
  legislation authorizes loans of up  to $300 thousand dollars                 
  for IFQ's to Alaska residents who have actively participated                 
  in the  fishery during three  of the last  five years.   She                 
  noted  that  the State  currently  finances the  purchase of                 
  limited entry  permits through  a revolving  loan fund  with                 
  loans of up to  $300 thousand dollars.  The  new legislation                 
  will expand the loan program to include IFQ's.                               
                                                                               
  ERIC FORRER, SELF,  JUNEAU, ALASKA, spoke  in support of  HB
                                3                                              
                                                                               
                                                                               
  123.  He  added that the IFQ  program would be good  for the                 
  Alaskan  coastal  communities  and  it  would allow  Alaskan                 
  fishermen to retain the quota share  which they were given.                  
                                                                               
                                                                               
  PAUL FUHS, COMMISSIONER, DEPARTMENT OF COMMERCE AND ECONOMIC                 
  DEVELOPMENT, spoke in  support of the  legislation.  HB  123                 
  amends the Commercial Fishing Loan  Program to allow Alaskan                 
  residents to  finance  the purchase  of  individual  fishery                 
  quota shares.  In order to be eligible, an applicant must:                   
                                                                               
       1.   Have been a two-year resident;                                     
                                                                               
       2.   Have  had  a  crew  member or  commercial  fishing                 
            license  for the  year  immediately preceding  the                 
            date of application and any other  two of the past                 
            five years;                                                        
                                                                               
       3.   Have  actively  participated  in  the fishery  for                 
            which the shares  are issued  during three of  the                 
            last five years;                                                   
                                                                               
       4.   Qualify as a transferee under applicable law.                      
                                                                               
  HB 123 also  allows the Department to  prequalify applicants                 
  for the  purchase  of  fishery  quota shares.    Under  this                 
  portion of  the program,  an applicant can  obtain a  60-day                 
  commitment to finance fishery quota shares prior to locating                 
  the  specific  shares  to  be purchased.    The  bill  would                 
  establish a $300  thousand dollars  ceiling that a  borrower                 
  can have outstanding at any point used in purchasing fishery                 
  quota shares.                                                                
                                                                               
  KELLEY  SHARP,  LOAN   MANAGER,  DIVISION  OF   INVESTMENTS,                 
  DEPARTMENT OF COMMERCE AND ECONOMIC  DEVELOPMENT, noted that                 
  the  Division  of  Investments  will  be  administering  the                 
  legislation  if  it  is  passed.     The  legislation  would                 
  represent  an  expansion   of  the  program  to   promote  a                 
  predominately resident fishery.   There  is a fiscal  impact                 
  with the legislation.                                                        
                                                                               
  JAY GINTER, U.S. DEPARTMENT OF  COMMERCE, NOAA/NMFS, JUNEAU,                 
  ALASKA, stated that  the National Marine Fishery  Service is                 
  neutral on the legislation.  He  noted that the Secretary of                 
  Commerce  did approve  the IFQ  program  for sable  fish and                 
  halibut,  but  added  that  the   IFQ  program  is  complex.                 
  Representative  Hanley questioned  if  the  quotas would  be                 
  "lien-able".  Mr. Ginter thought they would.                                 
                                                                               
  JERRY  MCCUNE,   PRESIDENT,  UNITED  FISHERMEN   OF  ALASKA,                 
  CORDOVA, ALASKA, pointed  out that  the United Fishermen  of                 
  Alaska support  the proposed  legislation as  it will  allow                 
                                                                               
                                4                                              
                                                                               
                                                                               
  Alaskans a chance  to be a  part of a  future with a  larger                 
  vision fishing program.                                                      
                                                                               
  LINDA,   BEHNKEN,   E.D.,   ALASKA    LONGLINE   FISHERMEN'S                 
  ASSOCIATION, SITKA, ALASKA, (testified  via teleconference),                 
  spoke in support of the legislation.   [Attachment #1].  She                 
  noted that the  legislation would provide opportunities  for                 
  the entire State.                                                            
                                                                               
  (Tape Change, HFC 93-82, Side 1).                                            
                                                                               
  Representative Hanley  expressed his concern with  the State                 
  becoming involved  in assuming  bank interest  on the  quota                 
  shares.    In  particular, with  the  concept  of  the State                 
  lending to  those persons  who can  not qualify  for a  bank                 
  loan.   Representative Ulmer  stressed that  the funds  will                 
  only be lent  to the "small guys" who would  not have enough                 
  collateral  to receive a  loan from a bank.   She added that                 
  once the  IFQ is  purchased, at  that time  they would  then                 
  become eligible to qualify for the CDQ program.                              
                                                                               
  Representative Parnell questioned the residency requirements                 
  to participate in the program.   Representative Ulmer stated                 
  it would be two years, the same as the existing permits.                     
                                                                               
  Representative Therriault  strongly urged  the State  not to                 
  become involved in  the "banking" business.   Representative                 
  Ulmer stressed that  if the legislation  is not passed,  the                 
  small  fishermen in  Alaska will  become locked  out of  the                 
  fisheries which will  be bought  out by larger  out-of-state                 
  groups, particularly in  the black cod and  halibut fishery.                 
  Commissioner Fuhs warned  that sixty percent of  the current                 
  shares will change  hands if the legislation  does not pass.                 
  He  emphasized  that this  fishery  will greatly  impair the                 
  coastal communities in Alaska.  The legislation is important                 
  as it will lower the price of limited entry.                                 
                                                                               
  Representative Hanley asked  the balance  of the loan  fund.                 
  Commissioner  Fuhs  stated  amount  is  $5  million dollars.                 
  Representative  Parnell  questioned the  anticipated default                 
  rate of the  proposed loans.   Commissioner Fuhs  reiterated                 
  that these loans will  be secured.  He was  assured that the                 
  quotas  will  be  met.    Representative Hanley  voiced  his                 
  concern that the Division of Investments has not developed a                 
  relationship  between  the  supply and  the  demand  of such                 
  proposed legislation.                                                        
                                                                               
  Representative Foster MOVED to report CS HB 123 (FSH) out of                 
  Committee  with  individual  recommendations  and  with  the                 
  accompanying fiscal  note.  There being NO OBJECTION, it was                 
  so ordered.                                                                  
                                                                               
                                                                               
                                5                                              
                                                                               
                                                                               
  CS HB 123  (FSH) was reported  out of  Committee with a  "do                 
  pass"  recommendation  and   with  a  fiscal  note   by  the                 
  Department  of  Commerce   and  Economic  Development  dated                 
  3/05/93.                                                                     
  HOUSE BILL 179                                                               
                                                                               
       "An Act relating  to motor  vehicles and mobile  homes;                 
       and providing for an effective date."                                   
                                                                               
  REPRESENTATIVE BRIAN PORTER testified in  support of HB 179.                 
  He stated that  under current law, municipalities  are given                 
  the option of  participating in  a registration tax  program                 
  administered by the Division of  Motor Vehicles, or electing                 
  to levy  local use  taxes.   Because of  the difficultly  in                 
  collecting  information  on  ownership  of  motor  vehicles,                 
  several Alaskan municipalities have  opted to participate in                 
  the  state administered program.  The program collects a tax                 
  based on a  schedule established  in statute in  1978.   The                 
  Division  of Motor  Vehicles retains  5 percent  of the  tax                 
  collected as an  administrative fee and refunds  the balance                 
  to the municipality from which it was collected.                             
                                                                               
  GARY LEWIS,  ALASKA MUNICIPAL  LEAGUE, TAXATION  AND FINANCE                 
  COMMITTEE, ALASKA, spoke in support of the legislation.                      
                                                                               
  Representative Brown asked if the administrative costs would                 
  exceed five percent.                                                         
                                                                               
  JUANITA  HENSLEY,  DIRECTOR,  DIVISION  OF  MOTOR  VEHICLES,                 
  DEPARTMENT  OF  PUBLIC  SAFETY,  noted   that  it  would  be                 
  increased to eight percent.  She added, an additional fee of                 
  $10 would be  attached to those  persons not using the  mail                 
  for  renewing  auto  registration.   Representative  Navarre                 
  stated  the  costs  to  the  Department would  exceed  eight                 
  percent.                                                                     
                                                                               
  Co-Chair  Larson provided  the Committee  with Amendment  1.                 
  [Attachment #2].  No action was  taken on the amendment.  HB
  179 was HELD in Committee for further discussion.                            
  ADJOURNMENT                                                                  
                                                                               
  The meeting adjourned at 10:05 A.M.                                          
                                                                               
                                                                               
                     HOUSE FINANCE COMMITTEE                                   
                         MARCH 30, 1993                                        
                            8:40 A.M.                                          
                                                                               
  TAPE HFC 93 - 81, Side 2, #000 - end.                                        
  TAPE HFC 93 - 82, Side 1, #000 - end.                                        
                                                                               
                                6                                              
                                                                               
                                                                               
  CALL TO ORDER                                                                
                                                                               
  Co-Chair Ron Larson called the meeting of the House  Finance                 
  Committee to order at 8:40 A.M.                                              
                                                                               
  PRESENT                                                                      
                                                                               
  Co-Chair Larson               Representative Brown                           
  Co-Chair MacLean              Representative Foster                          
  Vice-Chair Hanley             Representative Grussendorf                     
  Representative Hoffman        Representative Therriault                      
  Representative Navarre        Representative Parnell                         
                                                                               
  Representative Martin was not present for the meeting.                       
                                                                               
  ALSO PRESENT                                                                 
                                                                               
  Representative Jerry Mackie;  Representative Bill  Williams;                 
  Representative  Fran  Ulmer;  Representative  Brian  Porter;                 
  Geron Bruce, Special Assistant, Department of Fish and Game;                 
  Eric  Forrer,  Self,  Juneau,  Alaska;  Jerry  McCune,  UFA,                 
  Cordova, Alaska;  Paul  Fuhs,  Commissioner,  Department  of                 
  Commerce  and  Economic   Development;  Kelley  Sharp,  Loan                 
  Manager, Division of Investments, Department of Commerce and                 
  Economic  Development;   Jay  Ginter,  U.S.   Department  of                 
  Commerce,  NOAA/NMFS,  Juneau,   Alaska;  Juanita   Hensley,                 
  Division  of  Motor Vehicles,  Department of  Public Safety;                 
  Gary  Lewis,  AML  Taxation and  Finance  Committee; Crystal                 
  Smith, Alaska Municipal League (AML), Juneau,  Alaska; Linda                 
  Behnken,  E.D.,  Alaska  Longline  Fishermen's  Association,                 
  Sitka, Alaska (testified via teleconference).                                
                                                                               
  SUMMARY INFORMATION                                                          
                                                                               
  HB 123    An  Act  relating  to loans  for  the  purchase of                 
            individual fishery quota shares.                                   
                                                                               
            CS HB 123 (FSH) was reported out of Committee with                 
            a "do pass" recommendation and  with a fiscal note                 
            by  the   Department  of  Commerce   and  Economic                 
            Development dated 3/05/93.                                         
                                                                               
  HB 179    An  Act  relating  to  motor  vehicles and  mobile                 
            homes; and providing for an effective date.                        
                                                                               
            HB  179   was  held   in  Committee   for  further                 
  discussion.                                                                  
                                                                               
  HB 191    An Act  relating to  cost recovery by  contractors                 
            who operate state-owned hatcheries.                                
                                                                               
                                                                               
                                7                                              
                                                                               
                                                                               
            HB 191 was  reported out of  Committee with a  "do                 
            pass" recommendation" and with a zero  fiscal note                 
            by the Department of Fish and Game dated 3/17/93.                  
                                                                               
  HOUSE BILL 191                                                               
                                                                               
       "An Act relating  to cost  recovery by contractors  who                 
       operate state-owned hatcheries."                                        
                                                                               
  REPRESENTATIVE BILL WILLIAMS testified in support of HB 191.                 
  The legislation  would address  how a  contractor may  spend                 
  cost recovery  monies generated from a  state-owned hatchery                 
  in which that contractor operates under a contract with  the                 
  State.  The  bill is supported by  aquaculture associations,                 
  fishermen, and the Department of Fish  and Game.  He pointed                 
  out that the bill  has a zero fiscal note and indicated that                 
  the fiscal note  would help  to make the  transition of  the                 
  operation  of  the  state  facilities  by  contractors  more                 
  feasible to  accomplish weaning  of the  hatchery operations                 
  from the State funding.                                                      
                                                                               
  Co-Chair MacLean  asked for  an explanation of  "reasonable"                 
  operating costs and questioned if they would include capital                 
  improvements  at  the  hatchery.    Representative  Williams                 
  advised  that  the  Board  of   Director  submits  a  budget                 
  itemizing the costs to run the facilities.                                   
                                                                               
  Representative Brown inquired  if monies from cost  recovery                 
  would be used at  other hatcheries than that from  which the                 
  cost is recovered.   Representative Williams stated  that HB
  191 will enable  funding of the  Gulkana Hatchery with  Main                 
  Bay Hatchery revenue.                                                        
                                                                               
  GERON BRUCE, SPECIAL ASSISTANT, DEPARTMENT OF FISH AND GAME,                 
  stated  the Gulkana Hatchery is being  operated by the State                 
  using program receipts provided by  the Prince William Sound                 
  Aquaculture Association.   The FY  94 budget proposal  would                 
  turn the  facility over  to a  private firm.   The Board  of                 
  Directors  of  each  hatchery  can limit  the  cost  of each                 
  facility in order that there may  be surplus fish to harvest                 
  by  the users.    The Department  of  Commerce and  Economic                 
  Development exercises the  authority to determine how  those                 
  funds  are   spent.     Representative  Brown  stated   that                 
  "reasonable" costs vary a lot.                                               
                                                                               
  Co-Chair MacLean noted her concern  in allowing a contractor                 
  to use State  money for private operations.   Representative                 
  Williams replied  that the  State money  is to  be used  for                 
  State  owned  and  operated  hatcheries.   The  State  owned                 
  hatcheries sometimes do not receive  the cost recovery money                 
  back.                                                                        
                                                                               
                                                                               
                                8                                              
                                                                               
                                                                               
  Co-Chair MacLean asked what the profits from the Aquaculture                 
  Corporation are used  for.   Mr. Geron replied,  they are  a                 
  non-profit organization  which does  not make  profit.   The                 
  Department of Commerce and Economic Development allows  them                 
  to build a reserve fund to cushion for catastrophic failure.                 
  Excess fish provides  an opening of the  commercial area for                 
  other fishermen.                                                             
                                                                               
  Representative  Hanley  MOVED  to  report   HB  191  out  of                 
  Committee  with  individual  recommendations  and  with  the                 
  accompanying fiscal note.  There  being NO OBJECTION, it was                 
  so ordered.                                                                  
                                                                               
  HB  191  was reported  out  of  Committee with  a  "do pass"                 
  recommendation and with a zero fiscal note by the Department                 
  of Fish and Game dated 3/17/93.                                              
                                                                               
  HOUSE BILL 123                                                               
                                                                               
       "An  Act  relating   to  loans  for  the   purchase  of                 
       individual fishery quota shares."                                       
                                                                               
  REPRESENTATIVE FRAN ULMER  introduced a new loan  program to                 
  help  Alaska fishermen  living in  the coastal  communities.                 
  The U.S. Secretary of Commerce recently approved  individual                 
  Fishery  Quotas  (IFQ's)  for  the  halibut  and  black  cod                 
  fisheries in Alaska.   If all  goes as planned, by mid-1994,                 
  these fisheries will no longer be open to all those who want                 
  to "wet a line".  Instead, a new  permit system will reserve                 
  catch quotas  for individual  fishermen who  qualify for  an                 
  IFQ.   Gone will  be the  24  hour openings,  replaced by  a                 
  season which may last from March  through November.  The new                 
  system is  promoted as  a solution  to dangerous  conditions                 
  created by derby style fishing.                                              
                                                                               
  HB 123 provides  financing for the  purchase of IFQ's.   The                 
  legislation authorizes loans of up  to $300 thousand dollars                 
  for IFQ's to Alaska residents who have actively participated                 
  in the  fishery during three  of the  last five years.   She                 
  noted  that  the State  currently  finances the  purchase of                 
  limited entry  permits through  a revolving  loan fund  with                 
  loans of up to  $300 thousand dollars.  The  new legislation                 
  will expand the loan program to include IFQ's.                               
                                                                               
  ERIC  FORRER, SELF, JUNEAU,  ALASKA, spoke in  support of HB
  123.  He  added that the IFQ  program would be good  for the                 
  Alaskan  coastal  communities  and it  would  allow  Alaskan                 
  fishermen to retain the quota share  which they were given.                  
                                                                               
                                                                               
  PAUL FUHS, COMMISSIONER, DEPARTMENT OF COMMERCE AND ECONOMIC                 
  DEVELOPMENT, spoke in  support of the  legislation.  HB  123                 
                                                                               
                                9                                              
                                                                               
                                                                               
  amends the Commercial Fishing Loan  Program to allow Alaskan                 
  residents to  finance  the purchase  of  individual  fishery                 
  quota shares.  In order to be eligible, an applicant must:                   
                                                                               
       1.   Have been a two-year resident;                                     
                                                                               
       2.   Have  had  a  crew  member or  commercial  fishing                 
            license  for the  year  immediately preceding  the                 
            date  of application and any other two of the past                 
            five years;                                                        
                                                                               
       3.   Have  actively  participated  in the  fishery  for                 
            which the shares  are issued  during three of  the                 
            last five years;                                                   
                                                                               
       4.   Qualify as a transferee under applicable law.                      
                                                                               
  HB 123 also  allows the Department to  prequalify applicants                 
  for the  purchase  of  fishery quota  shares.    Under  this                 
  portion of  the program,  an applicant  can obtain  a 60-day                 
  commitment to finance fishery quota shares prior to locating                 
  the  specific  shares  to  be  purchased.    The  bill would                 
  establish a $300  thousand dollars  ceiling that a  borrower                 
  can have outstanding at any point used in purchasing fishery                 
  quota shares.                                                                
                                                                               
  KELLEY  SHARP,   LOAN  MANAGER,  DIVISION   OF  INVESTMENTS,                 
  DEPARTMENT OF COMMERCE AND ECONOMIC  DEVELOPMENT, noted that                 
  the  Division  of  Investments  will  be  administering  the                 
  legislation  if  it  is  passed.     The  legislation  would                 
  represent  an  expansion   of  the  program  to   promote  a                 
  predominately resident fishery.   There  is a fiscal  impact                 
  with the legislation.                                                        
                                                                               
  JAY GINTER, U.S. DEPARTMENT OF  COMMERCE, NOAA/NMFS, JUNEAU,                 
  ALASKA, stated that  the National Marine Fishery  Service is                 
  neutral on the legislation.  He  noted that the Secretary of                 
  Commerce  did approve  the IFQ  program for  sable fish  and                 
  halibut,  but  added  that  the   IFQ  program  is  complex.                 
  Representative  Hanley questioned  if  the  quotas would  be                 
  "lien-able".  Mr. Ginter thought they would.                                 
                                                                               
  JERRY  MCCUNE,  PRESIDENT,   UNITED  FISHERMEN  OF   ALASKA,                 
  CORDOVA, ALASKA, pointed  out that  the United Fishermen  of                 
  Alaska support  the proposed  legislation as  it will  allow                 
  Alaskans a chance  to be a  part of a  future with a  larger                 
  vision fishing program.                                                      
                                                                               
  LINDA,   BEHNKEN,   E.D.,   ALASKA    LONGLINE   FISHERMEN'S                 
  ASSOCIATION, SITKA, ALASKA, (testified  via teleconference),                 
  spoke in support of the legislation.   [Attachment #1].  She                 
  noted that  the legislation would provide  opportunities for                 
                                                                               
                               10                                              
                                                                               
                                                                               
  the entire State.                                                            
                                                                               
  (Tape Change, HFC 93-82, Side 1).                                            
                                                                               
  Representative Hanley  expressed his concern with  the State                 
  becoming involved  in assuming  bank interest  on the  quota                 
  shares.    In  particular, with  the  concept  of the  State                 
  lending to  those persons  who can  not qualify  for a  bank                 
  loan.   Representative Ulmer  stressed that  the funds  will                 
  only be lent to the "small  guys" who would not have  enough                 
  collateral to  receive a loan from  a bank.  She  added that                 
  once the  IFQ is  purchased, at  that time  they would  then                 
  become eligible to qualify for the CDQ program.                              
                                                                               
  Representative Parnell questioned the residency requirements                 
  to participate in the program.   Representative Ulmer stated                 
  it would be two years, the same as the existing permits.                     
                                                                               
  Representative Therriault  strongly urged  the State  not to                 
  become involved in  the "banking" business.   Representative                 
  Ulmer  stressed that if  the legislation is  not passed, the                 
  small fishermen  in Alaska  will  become locked  out of  the                 
  fisheries which will  be bought  out by larger  out-of-state                 
  groups, particularly in  the black cod and  halibut fishery.                 
  Commissioner Fuhs warned  that sixty percent of  the current                 
  shares  will change hands if the  legislation does not pass.                 
  He  emphasized  that this  fishery  will greatly  impair the                 
  coastal communities in Alaska.  The legislation is important                 
  as it will lower the price of limited entry.                                 
                                                                               
  Representative Hanley asked  the balance  of the loan  fund.                 
  Commissioner  Fuhs  stated  amount  is  $5  million dollars.                 
  Representative  Parnell  questioned the  anticipated default                 
  rate of the  proposed loans.   Commissioner Fuhs  reiterated                 
  that  these loans will be secured.   He was assured that the                 
  quotas  will  be  met.    Representative Hanley  voiced  his                 
  concern that the Division of Investments has not developed a                 
  relationship  between  the  supply and  the  demand  of such                 
  proposed legislation.                                                        
                                                                               
  Representative Foster MOVED to report CS HB 123 (FSH) out of                 
  Committee  with  individual  recommendations  and  with  the                 
  accompanying fiscal note.  There being  NO OBJECTION, it was                 
  so ordered.                                                                  
                                                                               
  CS HB  123 (FSH) was  reported out of  Committee with  a "do                 
  pass"  recommendation  and   with  a  fiscal  note   by  the                 
  Department  of  Commerce   and  Economic  Development  dated                 
  3/05/93.                                                                     
                                                                               
  HOUSE BILL 179                                                               
                                                                               
                                                                               
                               11                                              
                                                                               
                                                                               
       "An Act relating  to motor  vehicles and mobile  homes;                 
       and providing for an effective date."                                   
                                                                               
  REPRESENTATIVE BRIAN PORTER testified in  support of HB 179.                 
  He stated that  under current law, municipalities  are given                 
  the option of  participating in  a registration tax  program                 
  administered by the Division of  Motor Vehicles, or electing                 
  to levy  local use  taxes.   Because of  the difficultly  in                 
  collecting  information  on  ownership  of  motor  vehicles,                 
  several Alaskan municipalities have  opted to participate in                 
  the state administered program.   The program collects a tax                 
  based on a  schedule established  in statute in  1978.   The                 
  Division of  Motor Vehicles  retains  5 percent  of the  tax                 
  collected as an  administrative fee and refunds  the balance                 
  to the municipality from which it was collected.                             
                                                                               
  GARY LEWIS,  ALASKA MUNICIPAL  LEAGUE, TAXATION  AND FINANCE                 
  COMMITTEE, ALASKA, spoke in support of the legislation.                      
                                                                               
  Representative Brown asked if the administrative costs would                 
  exceed five percent.                                                         
                                                                               
  JUANITA  HENSLEY,  DIRECTOR,  DIVISION  OF  MOTOR  VEHICLES,                 
  DEPARTMENT  OF  PUBLIC  SAFETY,  noted   that  it  would  be                 
  increased to eight percent.  She added, an additional fee of                 
  $10 would be  attached to those  persons not using the  mail                 
  for  renewing  auto  registration.   Representative  Navarre                 
  stated  the  costs  to  the  Department would  exceed  eight                 
  percent.                                                                     
                                                                               
  Co-Chair  Larson provided  the Committee  with Amendment  1.                 
  [Attachment #2].   No action was taken on the amendment.  HB
  179 was HELD in Committee for further discussion.                            
                                                                               
  ADJOURNMENT                                                                  
                                                                               
  The meeting adjourned at 10:05 A.M.                                          
                                                                               
                                                                               
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