Legislature(1993 - 1994)
01/19/1994 08:30 AM House FSH
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
HOUSE SPECIAL COMMITTEE ON FISHERIES
January 19, 1994
8:30 a.m.
MEMBERS PRESENT
Representative Carl E. Moses, Chair
Representative Harley Olberg, Vice Chair
Representative Gail Phillips
Representative Irene Nicholia
MEMBERS ABSENT
Representative Cliff Davidson
COMMITTEE CALENDAR
HB 134: "An Act relating to temporary transfers of
commercial fisheries entry permits."
HEARD AND HELD OVER
WITNESS REGISTER
FRANK HOMAN, Commissioner
Commercial Fisheries Entry Commission
8800 Glacier Hwy, Suite 109
Juneau, Alaska 99801-8079
Phone: 789-6160
Position Statement: Opposed HB 134
JERRY MCCUNE, President
United Fishermen of Alaska
211 Fourth Street, Suite 112
Juneau, Alaska 99801
Phone: 586-2820
Position Statement: Opposed HB 134
PREVIOUS ACTION
BILL: HB 134
SHORT TITLE: TEMP TRANSFER OF ENTRY PERMITS
SPONSOR(S): REPRESENTATIVE(S) MOSES
JRN-DATE JRN-PG ACTION
02/05/93 236 (H) READ THE FIRST TIME/REFERRAL(S)
02/05/93 236 (H) FISHERIES, RESOURCES, JUDICIARY,
FINANCE
02/15/93 (H) MINUTE(JUD)
02/17/93 (H) FSH AT 09:00 AM CAPITOL 17
03/22/93 (H) FSH AT 08:30 AM CAPITOL 17
03/22/93 (H) MINUTE(FSH)
03/22/93 (H) MINUTE(FSH)
01/19/94 (H) FSH AT 08:30 AM CAPITOL 17
ACTION NARRATIVE
TAPE 94-2, SIDE A
(No tape available for first part of meeting.)
CHAIRMAN CARL MOSES called the meeting to order at 8:35 a.m.
He noted the members in attendance and asked that the
discussion start with HB 134.
HB 134 - TEMP TRANSFER OF ENTRY PERMITS
REPRESENTATIVE PHILLIPS moved for adoption of the CSHB 134.
Hearing no objection, it was so moved.
FRANK HOMAN, COMMISSIONER OF THE COMMERCIAL FISHERIES ENTRY
COMMISSION, ALASKA DEPARTMENT OF FISH AND GAME, outlined the
rules of fishing permits. He said that the permits cannot
be leased, and in the original development of the Limited
Entry Act, the intention was for the permit holders to be
active fishermen. He recognized that some emergency
transfers are necessary and noted that the commission was
unclear if the definition of "temporary" should cover year-
to-year transfers.
Number 000
REPRESENTATIVE G. PHILLIPS noted that the opinion from the
Department of Law, commenting on the definition of
"temporary," is dated 1980 and asked if there is an updated
opinion.
MR. HOMAN advised the committee that the Limited Entry
Commission had not yet asked for an updated opinion. The
emergency transfer provision in the program is designed to
allow the commission to examine each request in a case by
case basis, and to prevent leasing from occurring. If the
permit owner does not agree with the decision, appeals to
the court system are welcome. Equal protection clauses can
be factored into the equation if continuous transfers are
permitted by a group of people; another group can request
the same treatment.
MR. HOMAN further said that some things can be done to
facilitate transfers among fishermen and families in rural
areas. Permits sometimes migrate from rural areas and
families lose their ability to fish. Permits are freely
transferable; the permit holder can give or sell the permit
to anyone they choose. The commission has seen medical
cases where a one year transfer is not enough, and the
transfer is extended. The commission has recently adopted a
regulation that allows a second year transfer for the same
reason if it's requested and documented. This regulation
stretches the attorney general's advice as far as it can.
MR. HOMAN said there is another category for transfers,
called extraordinary circumstances, that helps people with
extreme hardships transfer their permits. Another program
within the Commercial Fisheries and Agricultural Bank (CFAB)
is a "participating loan program" that allows the permit
holder to sell the permit to anyone he chose, then
participate in the loan with CFAB, since CFAB is one of two
institutions that can hold a limited entry permit as
collateral.
MR. HOMAN said he appreciated the concept behind the bill,
but he felt HB 134 could lead to a fundamental change in the
program. A change could run the risk of opening the program
up to a legal challenge that would expose the program to
unrestricted leasing. The Commercial Fisheries Entry
Commission (CFEC) cannot support the legislation at the
moment, although there are possible avenues available for
people who face special situations. The CFEC will continue
to be sensitive when a hardship has occurred.
CHAIRMAN MOSES asked how deaths are handled where the permit
becomes part of the estate.
MR. HOMAN said if there is no will, by statute the permit
can be transferred to the surviving spouse. If there is a
will that identifies a specific person, then the permit will
be transferred. If there is no will and the permit goes
into an estate, then until the settlement of the estate, we
can allow the emergency transfer of the permit.
CHAIRMAN MOSES suggested in this case that one is better off
dead rather than having a terrible health problem.
MR. HOMAN said the process allows the survivors some time to
figure out the future of the permit. As long as there is no
settlement, then the permit is held in limbo, but it can be
transferred, as in an emergency, for the benefit of the
survivors.
CHAIRMAN MOSES clarified by suggesting that sometimes the
illness goes on for years.
MR. HOMAN advised that indeed that could happen if an estate
went unsettled for years. Situations like this could be
handled in a special manner.
CHAIRMAN MOSES reminded members that he was in the
legislature when this program was being put together, and it
certainly wasn't the intent to have a problem where people
with long term illnesses could not transfer their permits
year after year. He concluded by noting that it is the duty
of the legislature to find some way around the problem. He
also brought up another issue - to what degree should
someone be able to participate in the fishery? Fifty
percent or two percent? Fishermen with arthritis are in
danger to go on deck if they cannot hang onto the handrail.
MR. HOMAN cited the statute which says that fishermen must
be "actively participating" and there is no degree to which
that is noted.
CHAIRMAN MOSES suggested that there may need to be some
clarification on the selling of permits, or a potential
lawsuit could ensue.
MR. HOMAN was unclear if leases or emergency transfers would
work in an open market situation. Perhaps a bidding process
would work.
CHAIRMAN MOSES asked if there was any record of the number
of permits held by people over 65 years of age.
REPRESENTATIVE PHILLIPS replied that as of April 1992 there
were 1,006 people over 65 years old that held permits.
CHAIRMAN MOSES introduced the next person to testify.
JERRY McCUNE, PRESIDENT OF THE UNITED FISHERMEN OF ALASKA,
noted that although he was sympathetic to the concept of
HB 134, he still had to oppose it because of the delicate
balance now with limited entry. If someone is trying to
sell a permit, the title to a house is sometimes needed as
collateral. Perhaps CFAB should come to Juneau and talk
about their programs; perhaps payments could be spread over
six or seven years so the permit holder can collect a
monthly income off the permit. Ownership would be
maintained, but if the buyer doesn't make payments, then the
permit holder can regain their permit and perhaps sell it to
someone else later. Perhaps this idea could also be used for
the state loan program.
CHAIRMAN MOSES maintained that the issue could still be
contested in court.
MR. McCUNE further noted that the legislature should
maintain the delicate balance with the Limited Entry Permit
program as there are many cases in court currently.
REPRESENTATIVE PHILLIPS inquired about items six and seven
on page 2 of the committee substitute. The phrase "with low
incomes" could present constitutional problems, and the
phrase on line 10, "without restrictions," could raise a
problem if a transferee of a permit is not a low income
person and the permit holder was. This type of mandate
could be challenged constitutionally.
MR. HOMAN suggested that the Department of Law comment on
that issue.
REPRESENTATIVE PHILLIPS suggested a change to the bill to
address the problem. She then asked if the definition on
line 24 of "immediate family" was consistent with the
definition already in law.
ADJOURNMENT
CHAIRMAN MOSES asked members and the public if there were
further comments. Hearing none, he adjourned the meeting at
9:20 a.m.
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