Legislature(1997 - 1998)

04/17/1997 01:45 PM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                                                                               
                                                                               
                     HOUSE FINANCE COMMITTEE                                   
                         April 17, 1997                                        
                            1:45 P.M.                                          
                                                                               
  TAPE HFC 97-104, Side 1, #000 - end.                                         
  TAPE HFC 97-104, Side 2, #000 - end.                                         
                                                                               
  CALL TO ORDER                                                                
                                                                               
  Co-Chair  Therriault  called  the  House  Finance  Committee                 
  meeting to order at 1:45 p.m.                                                
                                                                               
  PRESENT                                                                      
                                                                               
  Co-Chair Hanley               Representative Kelly                           
  Co-Chair Therriault           Representative Kohring                         
  Representative Davies         Representative Martin                          
  Representative Davis          Representative Moses                           
  Representative Foster         Representative Mulder                          
  Representative Grussendorf                                                   
                                                                               
  ALSO PRESENT                                                                 
                                                                               
  Representative  Alan  Austerman;  Dave  Helmick,  Petersburg                 
  Charter  Boat Association;  Stan Malcom,  Petersburg Charter                 
  Boat Association; Willi Herff,  Waterfall Resort, Ketchikan;                 
  Kirk Wilson,  Glennallen; Bruce Dickerson,  Glennallen; Mike                 
  Lanegan, Glennallen; Joe  Macinko, Kodiak; Steven Daugherty,                 
  Assistant  Attorney  General,   Department  of  Law;   Bruce                 
  Knowles, Mat-Su; Kurt Wilson, Glennallen.                                    
                                                                               
  SUMMARY                                                                      
                                                                               
  HB 19     "An  Act relating  to licensing  of  sport fishing                 
            services   operators   and  fishing   guides;  and                 
            providing for an effective date."                                  
  HOUSE BILL NO. 19                                                            
                                                                               
       "An Act relating to licensing of sport fishing services                 
       operators  and  fishing  guides; and  providing  for an                 
       effective date."                                                        
                                                                               
  Representative  Mulder  provided  members  with Amendment  1                 
  (copy on file).                                                              
                                                                               
  JOE  MACKINKO,  KODIAK  testified   via  the  teleconference                 
  network in support of HB 19.  He stressed that no management                 
  or conservation is  possible without  good information.   He                 
  spoke against adoption of Amendment 1.  He stressed the need                 
                                                                               
                                1                                              
                                                                               
                                                                               
  for a level playing field.                                                   
                                                                               
  BRUCE DICKERSON, GLENNALLEN testified via the teleconference                 
  network.  He does business in Unit 13.  He noted that he has                 
  $5  to  $7  thousand  dollars  invested  in  licenses  fees,                 
  insurance and landing permits.  He observed that many of the                 
  people  operating  in Unit  13  do  not have  licenses.   He                 
  stressed that without enforcement of  existing laws there is                 
  no  incentive  for  these operators  to  acquire  the proper                 
  permits  and  licenses.     He  maintained  that  commercial                 
  operators using  private property without  permission of the                 
  landowners  is  a  common everyday  business  practice.   He                 
  acknowledged that enforcement  alone is not sufficient.   He                 
  emphasized that there needs to be  a penalty with some teeth                 
  to detour illegal  activity.  He  noted that the local  game                 
  warden receives little state support.   He asserted that 140                 
  game and  fish  violations  were  thrown out  by  the  local                 
  district  attorney.    He  maintained  that  enforcement  is                 
  needed, not more  rules and regulations.   He asserted  that                 
  requirements for service  and guide license  penalizes those                 
  that are already in compliance.   He observed that they have                 
  lost 30  days of  their salmon  season and  Tuesdays due  to                 
  problems in the  Kenai area.   He  stated that  there is  no                 
  evidence to support the closure.                                             
                                                                               
  MIKE LANEGAN,  GLENNALLEN testified  via the  teleconference                 
  network.  He  maintained that  the legislation is  unneeded.                 
  He emphasized the  cost of required insurance,  CPR courses,                 
  and other licenses.  He stated that he already spends $1,500                 
  hundred  dollars  annually  in  addition  to   the  licenses                 
  required by HB 19.                                                           
                                                                               
  KURT  WILSON, GLENNALLEN  testified  via the  teleconference                 
  network.   He agreed  with comments  by Mr.  Dickerson.   He                 
  emphasized that  there is one  game warden in the  area.  He                 
  stressed that the  game warden cannot enforce the  laws that                 
  already exist.                                                               
                                                                               
  DAVE HELMICK, PETERSBURG  CHARTER BOAT ASSOCIATION testified                 
  via the  teleconference network  in support  of HB  19.   He                 
  stressed the need for fish guides to be accountable.                         
                                                                               
  STAN MALCOM, PETERSBURG  CHARTER BOAT ASSOCIATION  testified                 
  via the  teleconference network  in support  of HB  19.   He                 
  emphasized that there was unanimous support for HB 19 at the                 
  last Board of Fisheries' meeting,  in Ketchikan, from active                 
  charter and lodge operators.  He maintained that HB 19 is  a                 
  reasonable  vehicle  for the  Board  of Fisheries  to gather                 
  needed information and provide basic  requirements to obtain                 
  a fishing services operator's or guide's license.                            
                                                                               
  WILLI  HERFF,  KETCHIKAN  testified  via the  teleconference                 
                                                                               
                                2                                              
                                                                               
                                                                               
  network in opposition to HB 19.  He emphasized that all fees                 
  are indirect taxes.  He spoke against more taxes.  He stated                 
  that he wants accountability and  fairness.  He stated  that                 
  more enforcement is needed.  He stated that the non-resident                 
  limit of  four salmon should  also apply to  commercial non-                 
  resident fisherman.                                                          
                                                                               
  STEVE DAUGHERTY,  ASSISTANT ATTORNEY GENERAL,  DEPARTMENT OF                 
  LAW stated that  he represents the  Board of Fisheries.   He                 
  pointed  out  that   the  legislation  contains  a  3  to  1                 
  difference  between residents  and  non-residents fees.   He                 
  observed  that  the State  is in  litigation over  a 3  to 1                 
  differential in the  commercial fisheries.   He stated  that                 
  the  Carlson v.  State case  is still under  litigation, but                 
  that there  have been  two decisions  by the  Alaska Supreme                 
  Court.  He stated that it is clear that the State is  out of                 
  compliance with the Privileges and  Immunities Clause of the                 
  United States  Constitution.   The Clause  states that  "the                 
  citizens  of each state shall  be entitled to all privileges                 
  and immunities  of citizens  of several  states."   He noted                 
  that the intent is to level the playing field between states                 
  so that a resident of one state is not discriminated against                 
  in  business  enterprises  in  another  state.   The  Alaska                 
  Supreme Court has stated that:   "The appropriate inquiry is                 
  whether all fees  and taxes which must be  paid to the state                 
  by a  nonresident to  enjoy the  state-provided benefit  are                 
  substantially equal to those which must be paid by similarly                 
  situated residents; when  the resident's pro rata  shares of                 
  state revenues,  to which nonresidents make no contribution,                 
  are  taken  into  account."   He  stated  that  there is  no                 
  evidence  that  residents are  paying  more than  their fair                 
  share for sport or  guided sport support.  He  observed that                 
  the majority of funding for sport fisheries is federal.                      
                                                                               
  Mr. Daugherty noted that the  Board of Fisheries's authority                 
  is over guided sport  fishermen, not over the guide.   There                 
  is some limited ability to affect the guide as is reasonably                 
  necessary  to implement  restrictions  on  the guided  sport                 
  fisherman.  He observed that the State would prevail against                 
  claims that existing authority was being taken away.                         
                                                                               
  Mr.  Daugherty  referred  to the  expansion  of  the Board's                 
  authority over guided  sport fishing time and  area closures                 
  to  include  the ability  to  prohibit registered  guides or                 
  registered guide vessels from fishing.  He observed that the                 
  Board of Fisheries  currently has time and area closures for                 
  guided  sport  fishing.   He  maintained  that a  guide  can                 
  continue to  fish with  someone on  his boat  and the  State                 
  cannot  get a  conviction because it  cannot prove  that the                 
  person on the boat is paying the guide.                                      
                                                                               
  Mr.  Daugherty  observed   that  the  legislation   contains                 
                                                                               
                                3                                              
                                                                               
                                                                               
  statewide reporting requirements.   He noted that  the Board                 
  also needs the authority to require  reporting on an area by                 
  area basis.                                                                  
                                                                               
  Mr.  Daugherty   noted  that  the  Board  has  a  number  of                 
  regulations  restricting  fishing  and retention  by  guides                 
  while  they  have  clients  on  board   their  vessel.    He                 
  maintained that the  current language  would give the  Board                 
  statutory authority for these restrictions.                                  
                                                                               
  Mr. Daugherty  commented on requests  for more  enforcement.                 
  He pointed  out  that there  is not  sufficient funding  for                 
  enforcement.  He emphasized that most fishing violations are                 
  minor penalties.  Taking an excess  of king salmon or taking                 
  a king salmon on  a day that is closed to  fishing is a $100                 
  hundred  dollar  violation.    The   bill  will  provide  an                 
  enforcement tool.  Guides can lose their licenses under some                 
  provisions  of the  bill.   More  substantial fines  will be                 
  available against guides that are  guiding without a license                 
  than are currently available.                                                
                                                                               
  In  response  to  a  question  by Co-Chair  Therriault,  Mr.                 
  Daugherty  clarified that under  the statutes  of commercial                 
  fishing, anyone who  is involved  in the taking  of fish  is                 
  liable for a commercial fishing violation.  Both the skipper                 
  and crew would be  liable for any violations.   Charter boat                 
  operators  would not be  liable since they  are not actively                 
  engaged in fishing.  Co-Chair Therriault observed that it is                 
  a fine line.   Mr. Daugherty pointed out that  any ambiguity                 
  is made by the court in favor of the defendant.                              
                                                                               
  In  response  to  comments  by  Representative  Mulder,  Mr.                 
  Daugherty  clarified  that  the  Privileges  and  Immunities                 
  Clause  only  applies to  commercial  activities.   Some fee                 
  differentials can be justifiable based  on the contributions                 
  made by residents  through general fund revenues.   He added                 
  that he does not have information that would support any fee                 
  differential in this situation.                                              
                                                                               
  Representative Mulder maintained that  fees for out-of-state                 
  guides on the  Kenai River are  three times as great  as the                 
  fee  for in-state guides.  Mr. Daugherty did not know of any                 
  challenge to that  regulation.  He  acknowledged that it  is                 
  possible  that  this  regulation  is  unconstitutional.   He                 
  observed that there are general funds that go into the parks                 
  budget.  He  stated that a  fact specific analysis would  be                 
  necessary  to  determine  if  it  is unconstitutional.    He                 
  reiterated that there is no support for  a fee differential.                 
  He  observed that  language  could  be  added to  allow  the                 
  Department to adopt,  by regulation,  a fee differential  to                 
  the maximum extent  allowable by  law.  This  would allow  a                 
  differential at sometime in the future as changes in funding                 
                                                                               
                                4                                              
                                                                               
                                                                               
  occur.                                                                       
                                                                               
  Representative Mulder asked what happens  if the current fee                 
  structure  is  maintained.   Mr.  Daugherty stated  that the                 
  worst analysis would be that the  State would have to refund                 
  the money that  has been  paid in excess  of what  residents                 
  pay.  The State would also have to pay legal fees.                           
                                                                               
  REPRESENTATIVE ALAN AUSTERMAN observed that no  studies have                 
  been done to demonstrate that there is not a difference.  He                 
  expressed  reluctance  to  change  the  fee structure.    He                 
  pointed  out  that the  studies  would  have to  be  done if                 
  litigation  occurs.   The  State  would have  to  prove what                 
  constitutes the amount of money spent by the State.                          
                                                                               
  In  response  to  a question  by  Representative  Davis, Mr.                 
  Daugherty  clarified  that  sport  fishing  guides  are  not                 
  included under  the definition  of commercial  fishing.   He                 
  noted that any  type of commercial activity would be covered                 
  by the Clause.                                                               
                                                                               
  Representative Davies questioned if general fund dollars for                 
  the management and regulation support of fish and game would                 
  count as state  contribution.  Mr. Daugherty  responded that                 
  the state general fund  contribution could be counted  if it                 
  could be broken out.  He stressed difficulty  of identifying                 
  state support.    He  noted  that  State  support  is  small                 
  compared  to the federal contribution  to sport fishing.  He                 
  added  that  only the  pro  rata  share of  the  individuals                 
  involved can be considered.                                                  
                                                                               
  Co-Chair Hanley  asked if  a severability  clause should  be                 
  included.     Mr.  Daugherty  observed  that   statutes  are                 
  considered severable  without a  severability  clause.   The                 
  court would probably invalidate that portion of the fee that                 
  is in excess of what residents pay.  The Department of  Fish                 
  and Game may decide not to enforce  the fee if so advised by                 
  the Department of Law.                                                       
                                                                               
  Co-Chair Therriault noted that  the legislative intent would                 
  be  that  the  fee  be  collected  from  nonresidents.    He                 
  suggested  that  the  Court  would  not  eliminate  the  fee                 
  completely.                                                                  
                                                                               
  Representative Mulder  MOVED to  Divide Amendment  1 between                 
  lines 6 and  7.   He explained  that the first  half of  the                 
  amendment refers  to the "broad brush"  regulatory authority                 
  that  the  Board  would be  given.    The  remainder of  the                 
  legislation pertains to occupational licensing regulation as                 
  it pertains to sport fish operators and guides.  There being                 
  NO OBJECTION, Amendment 1 was divided.                                       
                                                                               
                                                                               
                                5                                              
                                                                               
                                                                               
  Representative Mulder MOVED  to adopt Amendment 1B  (copy on                 
  file).    He  noted  that the  amendment  would  delete  the                 
  language in subsection (4)  on page 4 and subsection  (6) on                 
  page 5,  "satisfies additional requirements  adopted by  the                 
  Board of  Fisheries that the  Board finds necessary  for the                 
  conservation,  development,  utilization   of  the   fishery                 
  resources of the state,  the safety of clients of  the sport                 
  fishing  services  industry,  or   the  protection  of   the                 
  integrity  of  the  sport fishing  services  industry."   He                 
  maintained that the Board  would have occupational licensing                 
  powers.  He asserted that  the requirements should be turned                 
  over to the Board of Occupational Licensing.                                 
                                                                               
  Representative Grussendorf noted that there  is a sport fish                 
  representative on the Board of  Fisheries.  He observed that                 
  the  amendment  would make  it  difficult for  the  Board of                 
  Fisheries to regulate an industry "that has basically gotten                 
  out of control."  He noted  that, in Sitka, guided fishermen                 
  are catching more than resident sport fishermen.                             
                                                                               
  Representative Mulder expressed  fear that  the bill can  be                 
  used  as  a  weapon by  commercial  fishermen  against sport                 
  fisherman, through the Board of  Fisheries.  He acknowledged                 
  respect  for  the   current  Board.    He   maintained  that                 
  commercial  fishermen  believe  that   sport  fishermen  are                 
  catching  too  much  fish.    He  asserted  that  commercial                 
  fishermen want to diminish sport fish opportunities.                         
                                                                               
  Representative Grussendorf reiterated concerns that resident                 
  sport fishermen  in Alaska  are concerned  about the  guided                 
  sport  fisheries  that are  dealing  with nonresidents.   He                 
  stressed  that  conservation  of  the  resource  should   be                 
  considered.                                                                  
                                                                               
  Representative  Davis observed  that  the legislation  would                 
  require a report.  He noted that the Board would not be able                 
  to react to recommendations by the report.  He stressed that                 
  any changes would have to be made in statute.                                
                                                                               
  Representative  Mulder  stated   that  the  amendment   only                 
  pertains  to licensure.   He  asked if there  are additional                 
  requirements that should be included.   He stressed that the                 
  Board  would   have  "broad  brush"  authority  to  restrict                 
  licensure.                                                                   
                                                                               
  Co-Chair Hanley pointed  out that if  Amendment 1A does  not                 
  pass the Board would  still have authority.  He  referred to                 
  page 3, lines 14 and 15.   He noted that the Board would  be                 
  able to  "regulate the  sport fishing  services industry  as                 
  need for the conservation,  development, and utilization  of                 
  fishery resources.                                                           
                                                                               
                                                                               
                                6                                              
                                                                               
                                                                               
  Mr.  Daugherty  noted  that   the  Board's  authority   with                 
  Amendment 1A would not be as  broad as it would be with  the                 
  inclusion of Amendment 1B.   He clarified that Amendment  1B                 
  applies to the actual issuance of the license.  Amendment 1A                 
  applies to the general regulation of fisheries.                              
                                                                               
  (Tape Change, HFC 97-104, Side 2)                                            
                                                                               
  Mr. Daugherty  explained  that  if  someone  had  a  lot  of                 
  violations,  such as  not turning  in their  reports  to the                 
  Board, they would be unable to  get a license.  Amendment 1B                 
  would take away  the authority of  the Board of set  general                 
  licensing  guidelines.   The  Board  could not  require that                 
  guides know how to safely release  a fish, identify fish, or                 
  require  experience in  an area  if they  determined it  was                 
  necessary for conservation.   The  Board's ability to  adopt                 
  general regulations regarding gear would remain if Amendment                 
  1A is not adopted.                                                           
                                                                               
  Representative Kohring spoke in support of Amendment 1B.  He                 
  maintained that  the  Department of  Fish and  Game has  not                 
  managed  fish  stocks well.    He  added that  the  Board of                 
  Fisheries has not been responsive.                                           
                                                                               
  Representative Austerman noted  that the amendment  pertains                 
  to the guide not the overall industry.                                       
                                                                               
  In response to a question by Representative Grussendorf, Mr.                 
  Daugherty clarified  that some  members of  the Board  would                 
  like to impose substantive requirements that would encourage                 
  respect for  the resource  and to  set a  basic standard  of                 
  knowledge.    The  Board  has  not  discussed  any  specific                 
  revisions.  The Board has some regulations regarding how the                 
  resource is handled once it is caught.  These regulations do                 
  not apply just to  guides.  The Board has  expressed concern                 
  with guiding operations that are processing fish.                            
                                                                               
  Representative Mulder spoke in support  of Amendment 1B.  He                 
  spoke against allowing the Board broad authority.                            
                                                                               
  Representative Davis noted that different types of fisheries                 
  need to  be addressed differently.   He maintained  that the                 
  industry will be  regulated.   He stated that  if the  Board                 
  cannot regulate guides on the Kenai River then there will be                 
  shorter days or days closed.                                                 
                                                                               
  Representative Davies  observed that  the legislation  would                 
  not generate additional  paperwork.  He emphasized  that the                 
  Board is not being  given broad powers.  He pointed out that                 
  the Board  must find  that the  additional requirements  are                 
  necessary for the conservation, development, and utilization                 
  of the fishery resources.                                                    
                                                                               
                                7                                              
                                                                               
                                                                               
  Representative Moses spoke against the amendment.                            
                                                                               
  Co-Chair Hanley asked if the Board could limit the number of                 
  licenses.   Mr.  Daugherty  clarified  that the  legislation                 
  would not  allow the Board  to adopt regulations  that would                 
  limit entry.  He  noted that a constitutional  amendment may                 
  be needed before the Board could limit the number of guides.                 
                                                                               
  A roll call vote was taken on the MOTION Amendment 1B.                       
                                                                               
  IN FAVOR: Davis,  Foster,  Kelly,  Kohring, Martin,  Mulder,                 
            Therriault,  Hanley                                                
  OPPOSED:  Davies Grussendorf, Moses                                          
                                                                               
  The MOTION PASSED (8-3).                                                     
                                                                               
  Representative Mulder MOVED  to adopt Amendment 1A  (copy on                 
  file).  Co-Chair Therriault OBJECTED.  Representative Mulder                 
  stressed that the guides are not the problem.  He maintained                 
  that the Board  already has the power.  He asserted that the                 
  Board  is  allowing a  wedge between  the  user groups.   He                 
  referred to regulations that would limit guide activity.  He                 
  maintained  that  regulations   reduce  sport  fish  angular                 
  effort.  He asserted that sport fish has taken a subservient                 
  role in  relation to commercial  fishing.  He  stressed that                 
  Alaskan  residents hire guides.   He stated  that guides are                 
  not  commercial  fishermen.     He  concluded  that   it  is                 
  inappropriate to give  the Board  of Fisheries authority  to                 
  reduce sport fish angular effort.                                            
                                                                               
  Co-Chair Hanley  spoke against  Amendment 1A.   He  stressed                 
  that there is  a difference between someone  who makes their                 
  money taking  others fishing  versus someone  who fishes  on                 
  their  own.   He  stated that  the Board  should be  able to                 
  regulate for  the conservation, development  and utilization                 
  of the fishery.                                                              
                                                                               
  Representative Davies emphasized that guides are involved in                 
  a commercial activity.  He noted that there is a distinction                 
  in statute between commercial and sport fishing.                             
                                                                               
  Representative  Grussendorf  observed  that  resident  sport                 
  fishermen in his district are concerned about the activities                 
  of  guided fishing.  He stated sport fishermen recognize the                 
  problem  and  are  concerned  with  their  reputation.    He                 
  stressed  that  90  percent  of   the  clientele  of  guided                 
  fisheries  are nonresidents.   He noted  that the  number of                 
  sport fish caught by nonresidents  exceed, the amount caught                 
  by residents in some communities.                                            
                                                                               
  Representative  Davis recognized  sport  fish  guiding as  a                 
                                                                               
                                8                                              
                                                                               
                                                                               
  commercial  activity.    He maintained  that  management has                 
  benefited the Kenai salmon  run.  He spoke in  opposition to                 
  Amendment 1A.                                                                
                                                                               
  Representative Austerman  spoke in  opposition to  Amendment                 
  1A.  He stressed that the  Board needs to have the authority                 
  to regulate the   guided sport  fish industry.  He  proposed                 
  that section  17 on  page 3,  lines 13  - 15  be moved  into                 
  section  12 on page  3, line 22.   He stressed  the issue of                 
  equity.  He  stated that as long  as one industry  is making                 
  money off of a resource then the second industry should fall                 
  within  the overall guidelines  of how the  resource is used                 
  and conserved.  He noted that commercial fishermen are  told                 
  how many days and hours they can fish, and how many fish can                 
  be caught.   He stressed that there should be the ability to                 
  control the whole system.                                                    
                                                                               
  Representative Mulder expressed  frustration with the issue.                 
  He stated  that he  would not  oppose a Commercial  Services                 
  Fish Guiding Board.  He reiterated that he fears the unknown                 
  of the Board of Fisheries.                                                   
                                                                               
  A roll call vote was taken on  the MOTION to adopt Amendment                 
  1A.                                                                          
                                                                               
  IN FAVOR: Kelly, Kohring, Martin, Mulder, Foster                             
  OPPOSED:  Grussendorf,  Moses,  Davies,  Davis,  Therriault,                 
  Hanley                                                                       
                                                                               
  The MOTION FAILED (5-6).                                                     
                                                                               
  Co-Chair  Therriault  MOVED to  adopt  Amendment 2  (copy on                 
  file).   Amendment 2 moves section 17 on  page 3, lines 13 -                 
  15 into  section 12  on page  3, line  22.   There being  NO                 
  OBJECTION, it was so ordered.                                                
                                                                               
  Co-Chair  Therriault  MOVED to  adopt  Amendment 3  (copy on                 
  file).  He noted that Amendment 3 deletes page 8, lines 17 -                 
   28.     This  section   was  inadvertently   left  in   the                 
  legislation.  There being NO OBJECTION, it was so ordered.                   
                                                                               
  Co-Chair  Therriault  referred  to  the  fiscal  note.    He                 
  suggested  that  if  the nonresident  fee  was  found to  be                 
  invalid that it would be lowered to the resident rate.                       
                                                                               
  Representative Davis MOVED  to report CSHB  19 (FIN) out  of                 
  Committee  with  individual  recommendations  and  with  the                 
  accompanying fiscal notes.  There being NO OBJECTION, it was                 
  so ordered.                                                                  
  ADJOURNMENT                                                                  
                                                                               
                                                                               
                                9                                              
                                                                               
                                                                               
  The meeting adjourned at 3:20 p.m.                                           
                                                                               
                                                                               
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