Legislature(2007 - 2008)CAPITOL 124
01/31/2007 08:00 AM House FISHERIES
| Audio | Topic |
|---|---|
| Start | |
| Overview: Alaska Seafood Marketing Institute | |
| Overview: Bristol Bay Regional Seafood Development Association | |
| Overview: Prince William Sound Regional Seafood Development Association | |
| Overview: Aleutia Corporation | |
| Overview: Kenai Wild | |
| Overview: Alaska Quality Seafood Certification Program | |
| Overview: Seafood Quality Grant Program - Department of Commerce, Community, & Economic Development | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
HOUSE SPECIAL COMMITTEE ON FISHERIES
January 31, 2007
8:04 a.m.
MEMBERS PRESENT
Representative Paul Seaton, Chair
Representative Kyle Johansen
Representative Gabrielle LeDoux
Representative Peggy Wilson
Representative Bryce Edgmon
Representative Lindsey Holmes
MEMBERS ABSENT
Representative John Harris
COMMITTEE CALENDAR
OVERVIEW(S): SEAFOOD QUALITY AND MARKETING ORGANIZATIONS:
ALASKA SEAFOOD MARKETING INSTITUTE; BRISTOL BAY REGIONAL SEAFOOD
DEVELOPMENT ASSOCIATION; PRINCE WILLIAM SOUND REGIONAL SEAFOOD
DEVELOPMENT ASSOCIATION; ALEUTIA CORPORATION; KENAI WILD; ALASKA
QUALITY SEAFOOD CERTIFICATION PROGRAM; SEAFOOD QUALITY GRANT
PROGRAM - ALASKA DEPARTMENT OF COMMERCE, COMMUNITY & ECONOMIC
DEVELOPMENT
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
RAY RIUTTA, Executive Director
Alaska Seafood Marketing Institute (ASMI)
Juneau, Alaska
POSITION STATEMENT: Presented an overview and responded to
questions.
BOB WALDROP, Acting Executive Director
Bristol Bay Regional Seafood Development Association (BB-RSDA)
Anchorage, Alaska
POSITION STATEMENT: Presented an overview and responded to
questions.
JEFF BAILEY, Board Member
Copper River/Prince William Sound Marketing Association
(CR/PWSMA)
Anchorage, Alaska
POSITION STATEMENT: Presented an overview and responded to
questions.
BOB BARNETT, President
Aleutia Corporation
Sand Point, Alaska
POSITION STATEMENT: Presented an overview and responded to
questions.
RICK ROESKE, Project Manager
Cook Inlet Salmon Brand - Kenai Wild
Soldotna, Alaska
POSITION STATEMENT: Presented an overview and responded to
questions.
HUGH BERTMARING, Business Manager
Center for Alaska Seafood Quality Assurance
Alaska Quality Seafood (AQS)
Anchorage, Alaska
POSITION STATEMENT: Presented an overview and responded to
questions.
GLENN HAIGHT, Fisheries Development Specialist
Office of Economic Development
Department of Commerce, Community, & Economic Development
(DCCED)
Juneau, Alaska
POSITION STATEMENT: Presented an overview and responded to
questions.
ACTION NARRATIVE
CHAIR PAUL SEATON called the House Special Committee on
Fisheries meeting to order at 8:04:18 AM. Representatives
Edgmon, and Wilson were present at the call to order.
Representatives Johansen, Holmes, and LeDoux arrived as the
meeting was in progress.
^OVERVIEW: ALASKA SEAFOOD MARKETING INSTITUTE
8:04:28 AM
CHAIR SEATON announced that today the committee would be hearing
overviews on the production of quality Alaskan seafood, and how
marketing organizations are functioning throughout the state;
beginning with the Alaska Seafood Marketing Institute.
8:06:32 AM
RAY RIUTTA, Executive Director, Alaska Seafood Marketing
Institute (ASMI), explained that ASMI is a public corporation,
founded 25 years ago, to operate as a state-industry partnership
for the worldwide marketing of Alaskan seafood. ASMI does not
sell product, it is strictly a generic marketing organization.
It allows any Alaska based producer, whether an individual
harvester or a large company, to utilize the ASMI brand, in the
marketplace, in order to leverage sales and garner market
opportunities.
MR. RIUTTA noted that ASMI was reorganized several years ago by
the Joint Legislative Salmon Task Force. The result was that
the number of board members was reduced from twenty-five to
seven, and the initial salmon tax imposed on the harvesters was
eliminated. The processors offset this funding loss by voting
to increase the self-imposed assessment from 0.3 percent to 0.5
percent. This voluntary assessment provides ASMI an annual core
funding of $6-$7 million. Additionally, ASMI receives an annual
federal allocation of $6-$7 million. Mr. Riutta reported that
last year, for the first time in over a decade, the state
allocated $1 million in general funds, effectively renewing the
state-industry partnership, as was originally intended. Mr.
Riutta related that ASMI's original mission was to increase the
worldwide consumption of Alaskan seafood. Two years ago the
mission statement was reviewed and the board realized that all
of the seafood produced was being sold, but not at optimum
value. This prompted the mission statement to be restated as an
endeavor to o increasing the market value of Alaskan seafood.
The committee took an at-ease from 8:11 a.m. to 8:12 a.m.
8:12:49 AM
MR. RIUTTA reported that ASMI operates under a legal mandate to
improve product quality from harvest to center-of-the-plate.
This is the arena which the institute has worked in since its
inception. To improve the harvesting and processing standards,
ASMI has developed and produced self-directed training videos.
This video course enables a trainee to receive a certificate of
completion. Additionally, ASMI has developed product standards,
and produced color guides, for the processing sector, to be used
use when grading fish. Multi-lingual brochures have been
produced and distributed throughout the marketing chain
including: buyer guides, for salmon and white fish; trim
guides, used by stores, restaurants, and processors; and
cleaning and sanitation guides. The ASMI standards have been
used as a foundation for a number of quality programs statewide,
Mr. Riutta said. He also reported that ASMI provides handling
and marketing training to retail stores, restaurants, and Alaska
Airlines, as a means to minimize loss and enhance product value.
8:16:22 AM
MR. RIUTTA noted how these past efforts have been combined into
an Alaska Seafood University. This on-line school is available
to harvesters, processors, retailers, and food service operators
to learn the basics about Alaska seafood. Mr. Riutta was also
pleased to report that the most recent five-year survey of the
fleet and processors indicates that product quality has
improved.
8:17:20 AM
CHAIR SEATON stated that data loggers have been utilized to
analyze product quality, during the transportation process, and
inquired as to whether data loggers were a part of ASMI's
program.
MR. RIUTTA explained that ASMI is involved strictly in handling
techniques, and that data logging is not part of the institute's
purview.
8:17:59 AM
MR. RIUTTA noted that the seven member ASMI board is seated with
five processors and two commercial harvesters. The board, and
the 60 members who comprise the various committees, support ASMI
in its goals to satisfy the industries marketing needs. Alaskan
seafood, he reminded the committee, is a $1.4 billion business
based on a renewable resource that will remain forever, as long
as the state continues to protect its viability. Mr. Riutta
stated that ASMI receives core funding from a voluntary
processor assessment tax. This self imposed assessment is based
on the value at the first point of harvest. He projected pie
chart slides [pages 6 and 7], which indicated the breakout
percentages that contribute to the ASMI budget; comparing value
and volume by species contribution.
8:19:59 AM
MR. RIUTTA explained the threats and opportunities to the
seafood market. Sustainability is a long standing, and
constitutional, aspect of the Alaskan fisheries management.
Other world fish marketing organizations are now identifying
with this criteria, such as Chili, Canada, and Iceland. This
causes some confusion, in the marketplace, regarding how
sustainability is upheld and defined. However, Alaska sets the
"gold standard." How "wild" vs. "organic" is perceived on the
world market is also a challenge. ASMI does not market organic
fish, based on the definition used in the marketplace; focusing
instead on marketing Alaskan Wild Salmon as being a step above
organic.
8:22:10 AM
MR. RIUTTA reported that the Alaskan king crab market is
threatened by the pricing undercuts of the Russian, Barents Sea
King Crab harvest. The Russian product has caused a 50 percent
drop in the market. The projected slide [page 11] presented the
contrast of the Alaskan and Russian King Crab production from
1997-2006, with the volume of Russian King Crab displacing
Alaskan King Crab at a ration of 5:1 at the market.
8:23:03 AM
REPRESENTATIVE WILSON asked if the Berants Sea crab are in
danger of over-harvest.
MR. RIUTTA opined that the Russians may not be managing their
stocks carefully, and that depletion will eventually take its
course. In further response Mr. Riutta stated that it is
difficult to speculate on how long the Russian stocks may hold-
up. These crab are not anadromous to the Berants Sea. As an
invasive species they have taken a strong hold, attaining sizes
larger than the Alaskan king crab.
8:24:42 AM
MR. RIUTTA noted that aquaculture of varieties, such as Tilapia
and Pangasius, also pose a threat to the marketability of the
Alaskan whitefish varieties: halibut, cod, pollock, and
sablefish. The worldwide production of these low-cost, easily
produced aquaculture fish, is beginning to have a significant
impact on Alaskan product sales.
8:26:13 AM
MR. RIUTTA stipulated that, despite production volume, on the
world scale Alaskan seafood represents only 1.6 percent of the
market: aquaculture produces 38 percent, and other wild
captured species represent 60 percent. He opined that this is
the primary reason that Alaskan seafood must be marketed as a
superior quality product, that demands a premium price. The
Farmed Salmon Production vs. Alaska Salmon Harvest slide [page
14] illustrated how the farmed salmon production has eclipsed
the Alaskan salmon harvest. He followed this with a slide that
indicated trends of the Bream and Tilapia production, having a
similar effect on the Alaska Pollock harvest.
8:27:16 AM
REPRESENTATIVE WILSON inquired if the argument for farmed salmon
vs. wild salmon could not also be used to market Alaskan
whitefish varieties, over the aquaculture produced whitefish.
MR. RIUTTA pointed out that there is no similarity. The Bream
and Tilapia are raised in freshwater ponds, feeding on natural
vegetation. They do not generate the same consumer perception,
or concern, as a farmed fish. Additionally, Bream and Tilapia
are being marketed in direct competition with Alaskan Pollock.
CHAIR SEATON offered to provide the committee with pictures from
his current visit to a Bodega Bay, California, seafood market
where all of these species were being marketed together.
8:28:47 AM
MR. RIUTTA summarized that the industry is successful;
increasing from a $1 billion industry, two years ago, to $1.4
billion last year. The salmon market has increased
tremendously, due to the marketing strategies being utilized by
ASMI and the other marketing organizations located throughout
the state. Despite the challenges, Alaskan seafood sales are on
the rise.
^OVERVIEW: BRISTOL BAY REGIONAL SEAFOOD DEVELOPMENT ASSOCIATION
8:29:40 AM
CHAIR SEATON announced that the next order of business would be
a presentation from the Bristol Bay Regional Seafood Development
Association.
8:30:19 AM
BOB WALDROP, Acting Executive Director, Bristol Bay Regional
Seafood Development Association (BB-RSDA), opined that the RSDA
is one of the most promising opportunities to "hit" Bristol Bay
since limited entry. He explained that BB-RSDA is a tax exempt
organization, and is not requesting any action from the
legislature by testifying before this committee.
CHAIR SEATON stipulated that today's presentations will carry
that tenor throughout.
8:32:32 AM
nd
MR. WALDROP explained how the 2004, 22 Legislature, provided
for the establishment of RSDAs, in response to recommendations
from the Joint Legislative Salmon Industry Task Force, and
fishermen's requests to have a regional emphasis in the state's
seafood marketing program. This legislation also eliminated the
one percent fisherman's salmon tax, which supported ASMI.
Partner legislation, at the time, caused a reduction in the ASMI
board membership. The RSDA law identified 12 regions with the
potential to develop seafood associations. Each region was
provided the opportunity to develop an RSDA. The association
would represent all gear groups willing to pay a self imposed
tax assessment, for its support; backed by tax collection
authority.
8:33:50 AM
MR. WALDROP stated that the RSDA statute identifies twelve
goals, key of which are: product quality improvements,
infrastructure investments, new product development, and
marketing and promotion following the ASMI model. An RSDA is
prohibited from owning inventory, selling products, or creating
brand name products. The association's marketing efforts stress
the regional aspect of the products involved. He reported that
the BB-RSDA is becoming a focal point for other seafood
development initiatives, activities, and grants.
8:35:14 AM
MR. WALDROP provided further history on the establishment of the
BB-RSDA including: formation of an interim board; approval
through appropriate state departments; the vote of the driftnet
permit holders to tax their harvest by one percent; and the
setnetters decision not to join the RSDA. He pointed out that
the drift-net fleet represents approximately 85 percent of the
total BB salmon harvest market. Further, he said BB-RSDA is
still being governed by the interim board. However, the ballots
are now being gathered for the April, 2007, election of a member
board. The elected board will begin conducting the afore
mentioned business, as well as appoint a permanent executive
director. An operational plan will be in place, when the 2006
tax revenue funding arrives in October/November of 2007. It is
expected, Mr. Waldrop opined, that marketing efforts will be
coordinated with ASMI. The BB-RSDA will expand on ASMI's
marketing strategies to create a non-competitive boost for the
BB sockeye salmon market. Because the assessment funds will not
be received until autumn of 2007, the RSDA has been operating,
for the last three years, "on its own money." He reported that
costs of approximately $125,000, have been covered by a grant
received from the Bristol Bay Economic Development Corporation
(BBEDC), as well as a one time legislative appropriation and a
pending grant from the Alaska Fisheries Marketing Board.
MR. WALDROP summarized, stating that the opportunity for the BB-
RSDA is staged, with good organization and management, to create
a difference in the market value of seafood in BB, particularly
the sockeye salmon catch. He opined that one of the most
notable points, thus far, is the optimism and sense of
responsibility by the fishermen who have voted to tax themselves
in support of the RSDA. He reiterated that the set-netters
remain non-supportive of the RSDA.
^OVERVIEW: PRINCE WILLIAM SOUND REGIONAL SEAFOOD DEVELOPMENT
ASSOCIATION
8:43:40 AM
CHAIR SEATON announced that the next order of business would be
an overview from the Prince William Sound Regional Seafood
Development Association.
8:43:46 AM
JEFF BAILEY, Board Member, Copper River/Prince William Sound
Marketing Association (CR/PWSMA), stated that CR/PWSMA is
distinguished for being the first established RSDA. He thanked
various people who have been instrumental in the start-up of
this RSDA, and for their support through the first revenue year.
He explained that the organization is currently a 501(c)(6) non-
profit organization, for marketing purposes, with the goal to
become a 501(c)(3) organization to include an educational
component. The focus has been towards marketing, with an
emphasis on authenticating and identifying Copper River salmon
in the marketplace. This has been done via a tagging program,
which was implemented with the cooperation of five of the six
CR/PWS salmon processors. Due to the late in-season access to
funds, the 2006 year promotion focused on the fall coho harvest.
Mr. Bailey described the promotion techniques utilized. This
created a demand for the coho beyond the RSDAs ability to
satisfy the market; resulting in an increased value for the
coho, and generating growth to the economy. As a first endeavor
in the direct marketing of a regional product, he judged the
program to be very successful.
8:48:58 AM
MR. BAILEY presented marketing strategies for the 2007 salmon
harvest. He reminded the committee that, although this is not
one of the states larger fisheries, it does provide a
significant value to the state, and the local economies. Two
priorities for the coming year are to: 1)hire a permanent
executive director, and 2)develop and implement a strategic
marketing plan to "carry this organization into the future." He
stated that CP/PWSRSDA expects to continue and maintain a
partnership with ASMI; who represent a major support, and
provide an established, working infrastructure.
8:51:08 AM
MR. BAILEY explained a resolution, which CP/PWSRSDA passed to
request that state and federal fishery managers consider the
broad spectrum of the industry. The expectation is that this
resolution will help to bring about better coordination of in-
season management closures, to include regard for the economic
impacts, as well as the need to meet the necessary escapement
goals. He stressed that if marketing is effective, but the
product cannot be delivered due to fish management closures, the
result is a waste of effort and commitment. In closing, Mr.
Bailey reviewed the funding activity, beginning in FY05, when
the RSDA was conceived. Advance marketing begins four months
prior to the harvest season, making timely, or advance, receipt
of assessment funds critical.
8:54:22 AM
CHAIR SEATON stated that the funding cycle is an issue for this
committees to discuss. He asked which gear groups support the
CR/PWSRSDA, and if there is interaction between the RSDA and the
regional aquaculture association; does the wild salmon
designation have an impact, or cause a conflict.
MR. BAILEY responded that the driftnet is the only gear group in
the area which supports the RSDA, although the setnet fleet may
join. Thus far, he reported, there has not been involvement
with the Prince William Sound Aquaculture Corporation (PWSAC) in
regard to marketing, neither does the wild fish market
development by PWSAC appear to represent a conflict. Marketing
objectives should continue to provide different niche targets
for CR/PWSRSDA products. Responding to a follow-up question
from Chair Seaton, he reiterated the status of the gear groups,
their relationship to the RSDA, and that the 2006 focus was for
the marketing of the Copper River coho run. He opined that,
because the processors are not currently discriminating, "The
setnetters will be getting a free ride, at this point on the
marketing efforts. We're hoping we can capture some of their
revenue for that."
8:59:17 AM
CHAIR SEATON inquired how the fish are tagged or identified for
marketing purposes.
MR. BAILEY responded that a pneumatic air gun is used to tag the
headed and gutted (H&G) fish; for both the fresh and frozen
market. A significant portion of the H&G market carries a
plastic tag that identifies it as genuine Copper River salmon,
with processor coding. Additionally, retail ready vacuum bagged
fillets are identified with a yellow sticker providing the same
information. He estimated that 60-70 percent, of the shipped
fish are tagged, but this does not preclude retailers from
removing the tags, at the marketplace. The tagging is an
expensive program, and combines with the cost of producing and
distributing promotional material. The processors support the
effort by employing the taggers. He opined that, contrary to
the drawbacks, this is a successful program and worth
continuing.
9:01:53 AM
REPRESENTATIVE HOLMES asked how the RSDA program is expected to
increase the value and share of the Alaskan salmon market non-
competitively.
CHAIR SEATON interjected that the direct charge of ASMI is to
maintain the generic aspect and market balance in each region.
He assured the committee that oversight exists to protect
pitting regional fisheries against each other.
^OVERVIEW: ALEUTIA CORPORATION
9:04:34 AM
CHAIR SEATON announced that the next order of business would be
an overview from the Aleutia Corporation.
BOB BARNETT, President, Aleutia Corporation, stated that this
corporation began as a grass roots, non-profit, marketing
effort, in 2002. Currently, ten percent of the active fleet
participates with financial support, representing approximately
40 paying members. The market niche being developed is for high
quality, sockeye salmon products, harvested by Alaska Native
fishing families, of the Eastern Aleutian Islands and Western
Alaska Peninsula. The products harvested for the Aleutia label
must meet rigorous quality requirements. Customer defined
specifications, as well as the industry grading standard, are
used in harmony to produce the highest quality product. The
two, local, participating processors are Peter Pan Seafoods and
Trident Seafoods. The processors perform custom packing for the
Aleutia label, adhering to the required standards as overseen by
locally based, Aleutia employed, third party inspectors. The
marketing and public relations activities are centered on the
salmon's premium quality, and the Aleut Native family
harvesters.
9:08:58 AM
MR. BARNETT explained that this project was spearheaded by the
Alaska Fisheries Development Foundation and the Aleutians East
Borough. Continuing, he highlighted Aleutia's experiences and
successes, since 2002, paraphrased from a statement, which read
as follows [original punctuation provided]:
Aleutia and the Aleutians East Borough agreed to work
together to explore developing a high-end niche market
for the seafood harvested around the communities of
Sand Point, King, Cove, False Pass, and Nelson Lagoon.
Sand Point and King Cove fishermen joined the
Aleutians East Borough several times at the Los
Angeles and Boston Seafood shows. Buyer interest
continues to be high at each of these shows.
Trained the entire Aleutia fleet in quality harvest
techniques, and continue to do so every year.
Continued to inspect every fish to ensure that it
meets the most stringent quality standards in the
state. Trained quality inspectors in our communities
to increase local employment and save money.
Contracted and trained local residents to handle
project management, bookkeeping, and general
administration.
Continued to develop a number of sales materials,
including a website which will soon allow buyers to
match each fish with the harvest family that caught
it.
The project now includes Sand Point, King Cove. We
hope to have False Pass and Nelson Lagoon online
within a few years.
We have involved all three separate gear types.
Aleutia is being carried in high-end grocery stores
and restaurants throughout the United States.
Aleutia is a CQE [Community Quota Entity], which will
allow us to purchase halibut and sablefish quota from
our local fisherman. Unfortunately the price of the
quota is too expensive for this to be a viable fishery
at this time.
MR. BARNETT stated that Aleutia also holds the right of first
refusal on the Crab Rationalization Program. In summary, he
stated that this is a young organization with definite goals to
provide a consistent, high quality product to the consumer,
while protecting the interests of the fishing families, and
supporting the local employment and economy.
9:11:25 AM
REPRESENTATIVE WILSON referred to the Aleutia membership fleet,
and asked whether the catch, which these 40 fishermen deliver,
are of a higher quality than fish harvested by the remainder of
the fleet. Also, who is assessed for funding purposes.
MR. BARNETT answered that the stringent standards adhered to are
above what the rest of the fleet utilizes. These live-bled fish
are handled individually for the best results, as opposed to
fish that are held in the boat holds, in refrigerated sea water;
possibly incurring scale loss, bruising and other depreciative
effects. The group does not tax itself, as the higher price
received at the market provides the operating funds, with some
grant receipts. Further, he responded that the organization
operates on volunteer staff and two seasonal employees.
9:14:05 AM
CHAIR SEATON observed that the main expenses are the 3rd party
quality inspectors, and inquired who pays their salary.
MR. BARNETT responded that the inspector's wages are provided
from the product earnings, and through the grants from the
Aleutian East Borough and the Aleutian Pribilof Island Community
Development Association, which are active and involved partner
organizations for Aleutia. These grants have been a necessary
support, however, the corporation is becoming more self
sufficient and building to the breakeven point.
^OVERVIEW: KENAI WILD
CHAIR SEATON announced that the next order of business would be
and overview from Kenai Wild, as part of the Alaska Quality
Seafood program.
RICK ROESKE, Project Manager, Cook Inlet Brand, Kenai Wild,
stated that he began eight months ago with the non-profit
organization, Cook Inlet Salmon Brand, which markets Kenai Wild.
The organization has been in operation for four years, is
supported by 200 fisherman, cooperates with 4 processors, and
will be expanding the brand to include both sockeye and coho.
Outreach marketing has been conducted at chef shows in Chicago
and Las Vegas, with good response. Support from the state came
via the salmon revitalization program, which funded the purchase
of ice machines, and insulated totes. The certifier and
independent verifier for Kenai Wild products is Alaska Quality
Seafood (AQS).
9:17:18 AM
MR. ROESKE explained that the Department of Commerce, Community,
& Economic Development (DCCED) contacted Kenai Wild regarding
establishing an RSDA. Due to the structure and timeline for the
set up of an RSDA, Kenai Wild has not elected to pursue the
opportunity. The possibility did appeal to two other
organizations in the area, however. Also, he reported that
Kenai Wild is solvent with plans for expansion. In response to
a question from Chair Seaton, he stated that 10 cents per pound,
and 12 1/2 cents per fillet pound, is assessed to fund the
organization. The assessment is assumed by the processors;
Kenai Wild acts as a go-between for the processor and the buyer.
In further explanation he said that the customer contacts Kenai
Wild with their requirements, and Kenai Wild solicits bids from
the processors. The bids are brought back to the buyer, in a
blind format. The buyer selects the bid, completes the
transaction with the processor, and, at the end of the season,
the processor pays Kenai Wild for the poundage produced. The
benefit to the fishermen is that a higher ground price is paid
by the processor, for a premium quality product to deliver to
the marketplace. Strict handling measures are imposed on the
fishermen to produce a product of the highest quality. The
success is evident in the increase of fishermen who are
participating, 250 up from 200, with contracts large enough to
accommodate 300-325.
9:21:00 AM
CHAIR SEATON asked for the difference in the ground price paid
for the Kenai Wild salmon and other salmon purchased by the
processors.
MR. ROESKE reported that last year the ground price on the Kenai
sockeye harvest was $1.10, for standard handling, and $1.60 for
AQS handled fish. He pointed out the 50 cent differential.
^OVERVIEW: ALASKA QUALITY SEAFOOD CERTIFICATION PROGRAM
9:21:45 AM
CHAIR SEATON announced that the next order of business would be
an overview from the Alaska Quality Seafood certification
program.
9:22:07 AM
HUGH BERTMARING, Business Manager, Center for Alaska Seafood
Quality Assurance, Alaska Quality Seafood(AQS), stated that this
is an independent non-profit organization, located in Anchorage,
and funded in part by the United States Department of
Agriculture (USDA). Services are provided to the seafood
industry, primarily to mid-size, and smaller, producers and
direct marketers. These services include the AQS audit,
oversight for the Marine Stewardship Council (MSC), and seafood
inspection services. The quality system utilized is based
originally on criteria, as established by ASMI. These standards
are overseen by inspectors in the field to assure that
procedures are followed and that the end product meets all claim
standards.
9:24:58 AM
CHAIR SEATON clarified that the inspection service is for the
buyer, who may be located out of state, and is contacting AQS
for quality assurance on the fish being marketed.
MR. BERTMARING confirmed that the local inspections are to
assure the buyers confidence in the processing of the product.
He explained that the successful participants in this program
produce a consistent product, both fresh and frozen.
9:25:58 AM
MR. BERTMARING explained that the quality system follows a path
of pre-assessment. The inspectors do an inspection, of the each
facility, prior to the season. This is followed-up by training
sessions, in which the inspector provides direction for proper
handling. In-season inspections are also conducted, and an end
of season audit is performed on the facility, as well. Upon
successful completion of each of these steps, a certification is
issued to the facility, authorizing the use of a quality product
seal. The seal identifies the product in the marketplace,
effectively increasing the value. In response to a question, he
clarified that it takes a year for a facility to qualify for
certification and receive the authorization to include the
quality seal on its products.
9:27:53 AM
REPRESENTATIVE WILSON asked about the four grades of quality:
premium, choice, select and standard.
MR. BERTMARING answered that the grades were originated with the
Alaska Manufacturer's Association, utilizing criteria
established by ASMI. However, the quality assurance seal
relates to the processing of the product, not the grade being
produced. The grades are a guideline for the end product. When
the processing facility follows the AQS certification program
procedures, the buyer is assured that the requirements have been
met for a consistent product of whatever grade that product
meets.
9:31:12 AM
REPRESENTATIVE JOHANSEN asked if the AQS inspection process
overlaps with federal inspectors.
MR. BERTMARING responded that there is no duplicity of effort.
9:32:07 AM
MR. BERTMARING described the MSC, its development and goals. He
said, "Alaska enjoys a ... portion of these [MSC] certified
sustainable fisheries for salmon, halibut, ling cod, and
pollock." When a fishery has been certified sustainable, by
MSC, subsequent audits are performed by AQS to assure continued
compliance; this is the only organization based in Alaska
conducting these ongoing inspections. He provided the ways and
means used to market the services of AQS, which includes:
maintenance of an internet website; direct contact and mail;
trade publication advertisements; and trade show participation,
including the international seafood show in Boston, and the
worlds largest natural and organic trade show, being hosted this
year in Germany.
^OVERVIEW: SEAFOOD QUALITY GRANT PROGRAM - DEPARTMENT OF
COMMERCE, COMMUNITY, & ECONOMIC DEVELOPMENT
CHAIR SEATON announced that the final order of business would be
an overview from the Seafood Quality Grant Program, as
administered through DCCED.
9:36:14 AM
GLENN HAIGHT, Fisheries Development Specialist, Office of
Economic Development, Department of Commerce, Community, &
Economic Development (DCCED), referred to an earlier committee
question and emphasized that the RSDAs operate under a mandate
to cooperate throughout the industry in order to minimize the
competition between marketing schemes. Further, each
organization understands the importance, and benefits, of
presenting a unified effort in the promotion of Alaskan seafood
products on the world market. Directing attention to the
committee packet handout, he indicated the granting activity
provided in the various regions. He suggested that the question
of whether improved quality oversight increases the market value
should be put directly to the industry, as it an important
component to be answered.
9:38:57 AM
MR. HAIGHT explained that the department has been involved in
the last three to four years with the Alaska Fisheries
Revitalization Strategy (Strategy). Salmon values have
increased, he opined, primarily due to the actions of the
industry for improvements. The Strategy was originally funded
in 2003, via a combination of federal disaster funds and the
Pacific Coastal Salmon Recovery Fund (PCSRF). The Fish Cabinet
charged with developing the Strategy was comprised of members
from the Governor's Office, DCCED, the Department of Labor, and
Alaska Department of Fish & Game (ADF&G).
9:40:13 AM
MR. HAIGHT named the programs that were allocated funds from the
Strategy receipts, as provided on page 2 of the handout. This
included: Alaska seafood development strategy; Aid to
individuals; Aid to communities; Alaska salmon marketing grant
program; Fisheries economic development grant program; Targeted
fisheries assistance program; Rural development initiative fund;
Research and development; Alaska fisheries business assistance
project; and General and specialty event marketing.
9:41:41 AM
MR. HAIGHT elaborated on the three quality related programs,
from this group: 1) Fisheries Economic Development Program,
that provided an infrastructure for salmon processing
improvements; 2) Targeted Fisheries Assistance Program, which
encompassed the Cook Inlet Chilling Program, Western Alaska
Salmon Set Net and Upper Yukon River Salmon Fish Wheel
Improvement Program, Southeast Alaska Salmon Shelf-Life
Extension Program, and the Salmon Vessel Quality Upgrade Program
(SAVQUP); and 3)funding for ASMI to complete a quality handling
survey. Full details of these three matching grant programs are
mapped out on pages six and seven of the handout. Grants of
approximately $8.4 million, were utilized for these quality
seafood production related projects. He elaborated on the goals
of the SAVQUP including: improvements of refrigeration
techniques, generator upgrades, hold upgrades, hold insulation,
slush bags, bleed equipment, and hatch and deck upgrades.
9:44:29 AM
CHAIR SEATON recalled that many applicants were unable to
receive improvement grants, due to the high demand, and asked
for clarity in that regard.
MR. HAIGHT explained the criteria that applied to the review of
each application. He concurred that many fishermen who applied
did not receive a grant, and pointed out that the grants were
made on a first come first serve basis. The average award
distributed was $13,000. Additional grant funds have been made
available for distribution in Southeast, non-federal disaster
funds, and applications are currently being received for those
awards.
9:48:39 AM
CHAIR SEATON asked if PCSRF are received for this grant process.
MR. HAIGHT explained that PCSRF are directed through the U. S.
Department of Commerce, then to ADF&G, where they are dispersed
for the state's purposes. Typically, of the $20-$25 million
received by ADF&G, 60 percent is utilized for habitat
restoration projects, and the remainder is provided for economic
development projects.
9:50:37 AM
MR. HAIGHT presented a slide indicating the 2005 survey results
of the SAVQUP recipients. Of the 132 surveyed, 53 have
responded. These responses serve to validate the effectiveness
of this program; possibly increasing the value of the catch, and
the realized economic investment opportunity that was created.
In response to a committee member, he reiterated that the
federal disaster funds were a one-time receipt, however, PCSRF
are an on-going annual appropriation through the Pacific Salmon
Treaty, for the purpose of habitat restoration and fisheries
economic development. Further, he clarified that these funds
are only available to the Southeast region.
9:55:17 AM
CHAIR SEATON stated that there is another federally funded
salmon economic disaster relief appropriation under development,
and asked whether any of those funds would be directed to
Alaska.
MR. HAIGHT answered that he would defer that question to the
appropriate person at ADF&G.
9:56:26 AM
CHAIR SEATON invited Mr. Riutta to make further comments.
MR. RIUTTA responded from his seat in the gallery, [inaudible].
CHAIR SEATON stated that the committee would look forward to
receiving that information from ASMI, as well as the McDowell
Group survey, if available.
9:57:21 AM
ADJOURNMENT
There being no further business before the committee, the House
Special Committee on Fisheries meeting was adjourned at 9:57:30
AM.
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