Legislature(2021 - 2022)BARNES 124

05/03/2021 01:00 PM House RESOURCES

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01:16:12 PM Start
01:17:01 PM HCR2
01:49:32 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Heard & Held
-- Invited & Public Testimony --
+ Bills Previously Heard/Scheduled TELECONFERENCED
                    ALASKA STATE LEGISLATURE                                                                                  
               HOUSE RESOURCES STANDING COMMITTEE                                                                             
                          May 3, 2021                                                                                           
                           1:16 p.m.                                                                                            
MEMBERS PRESENT                                                                                                               
Representative Josiah Patkotak, Chair                                                                                           
Representative Calvin Schrage                                                                                                   
Representative Sara Hannan                                                                                                      
Representative George Rauscher                                                                                                  
Representative Mike Cronk                                                                                                       
Representative Ronald Gillham                                                                                                   
Representative Tom McKay                                                                                                        
MEMBERS ABSENT                                                                                                                
Representative Grier Hopkins, Vice Chair                                                                                        
Representative Zack Fields                                                                                                      
COMMITTEE CALENDAR                                                                                                            
HOUSE CONCURRENT RESOLUTION NO. 2                                                                                               
Supporting the Alaska Ocean Cluster  in its mission, efforts, and                                                               
vision for a vibrant coastal  economy in the state, its promotion                                                               
of a diversified  and resilient state economy  that creates value                                                               
from ocean resources, and its  building of a statewide integrated                                                               
ecosystem  of innovation  and  entrepreneurship  relating to  the                                                               
state's ocean economy.                                                                                                          
     - HEARD & HELD                                                                                                             
PREVIOUS COMMITTEE ACTION                                                                                                     
BILL: HCR 2                                                                                                                   
SHORT TITLE: SUPPORTING ALASKA OCEAN CLUSTER                                                                                    
SPONSOR(s): REPRESENTATIVE(s) STUTES                                                                                            
02/18/21       (H)       READ THE FIRST TIME - REFERRALS                                                                        
02/18/21       (H)       FSH, RES                                                                                               
04/08/21       (H)       FSH AT 10:00 AM GRUENBERG 120                                                                          
04/08/21       (H)       Heard & Held                                                                                           
04/08/21       (H)       MINUTE(FSH)                                                                                            
04/13/21       (H)       FSH AT 10:00 AM GRUENBERG 120                                                                          
04/13/21       (H)       Moved HCR 2 Out of Committee                                                                           
04/13/21       (H)       MINUTE(FSH)                                                                                            
04/14/21       (H)       FSH RPT 4DP 2NR                                                                                        
04/14/21       (H)       DP: STORY, KREISS-TOMKINS, ORTIZ, TARR                                                                 
04/14/21       (H)       NR: MCCABE, VANCE                                                                                      
05/03/21       (H)       RES AT 1:00 PM BARNES 124                                                                              
WITNESS REGISTER                                                                                                              
REPRESENTATIVE LOUISE STUTES                                                                                                    
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  As prime sponsor, introduced HCR 2.                                                                      
SARA PERMAN, Staff                                                                                                              
Representative Louise Stutes                                                                                                    
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Presented HCR  2 on behalf of Representative                                                             
Stutes, prime sponsor.                                                                                                          
JUSTIN STERNBERG, Program Director                                                                                              
Alaska Ocean Cluster                                                                                                            
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Provided  information and answered questions                                                             
during the hearing on HCR 2.                                                                                                    
ACTION NARRATIVE                                                                                                              
1:16:12 PM                                                                                                                    
CHAIR  JOSIAH  PATKOTAK  called   the  House  Resources  Standing                                                             
Committee meeting to  order at 1:16 p.m.   Representatives McKay,                                                               
Cronk,  Schrage, Gillham,  Hannan, and  Patkotak were  present at                                                               
the  call  to order.    Representative  Rauscher arrived  as  the                                                               
meeting was in progress.                                                                                                        
             HCR 2-SUPPORTING ALASKA OCEAN CLUSTER                                                                          
1:17:01 PM                                                                                                                    
CHAIR PATKOTAK  announced that the  only order of  business would                                                               
be  HOUSE CONCURRENT  RESOLUTION  NO. 2,  "Supporting the  Alaska                                                               
Ocean Cluster in  its mission, efforts, and vision  for a vibrant                                                               
coastal economy in the state,  its promotion of a diversified and                                                               
resilient state economy that creates  value from ocean resources,                                                               
and  its   building  of  a  statewide   integrated  ecosystem  of                                                               
innovation  and entrepreneurship  relating to  the state's  ocean                                                               
1:17:43 PM                                                                                                                    
REPRESENTATIVE LOUISE STUTES, Alaska  State Legislature, as prime                                                               
sponsor,  introduced  HCR 2.    She  described the  Alaska  Ocean                                                               
Cluster (AOC)  and its work developing  Alaska's ocean resources,                                                               
characterizing   it  as   an  economic   incubator  focusing   on                                                               
innovation   in  commercialization   in  ocean   products-related                                                               
industries.   She said that supporting  HCR 2 would send  a clear                                                               
message acknowledging  Alaska's strategic  position in  the ocean                                                               
1:19:24 PM                                                                                                                    
SARA  PERMAN, Staff,  Representative  Louise Stutes,  paraphrased                                                               
the Sponsor  Statement on behalf of  Representative Stutes, prime                                                               
sponsor, which read as follows [original punctuation provided]:                                                                 
     Alaska  is   poised  to  be  the   nation's  leader  in                                                                    
     mariculture and  ocean-based business  development. Our                                                                    
     state is  home to  half of  the nation's  coastline and                                                                    
     approximately  one-third  of   the  nation's  exclusive                                                                    
     economic zone. Major marine  and inland aquatic Alaskan                                                                    
     industries  include offshore  oil and  gas exploration,                                                                    
     fisheries, shipping, and  tourism. Alaska's substantial                                                                    
     ocean  economy  its  "blue economy"   will continue  to                                                                    
     grow as  significant climate and political  shifts open                                                                    
     the state  for more  opportunities. Globally,  the blue                                                                    
     economy  is  expected  to  double  to  an  estimated  3                                                                    
     trillion  dollars  by   2030.  Alaska's  importance  is                                                                    
     undeniable, with the state producing  60% of the United                                                                    
     States' seafood  and possessing well  over half  of the                                                                    
     nation's   coastline   and   potential   ocean   energy                                                                    
     In  2017,   the  Bering  Sea   Fisherman's  Association                                                                    
     launched the  Alaska Ocean Cluster to  enhance maritime                                                                    
     growth and  development in the state.  The Alaska Ocean                                                                    
     Cluster  actively  promotes  Alaska's blue  economy  by                                                                    
     leveraging our  current strengths while  bolstering new                                                                    
     and emerging innovative  opportunities to diversify our                                                                    
     economy. The Alaska Ocean  Cluster focuses on expanding                                                                    
     ocean     energy    production,     mariculture,    and                                                                    
     transportation  opportunities.  Modeled  after  similar                                                                    
     successful similar ventures from  around the world, the                                                                    
     Alaska  Ocean Cluster  brings together  a coalition  of                                                                    
     private, public,  and academic shareholders  to support                                                                    
     each other  through cooperative  research and  a shared                                                                    
     The  recent decline  in financial  resources in  Alaska                                                                    
     warrants a renewed effort to  develop a diversified and                                                                    
     resilient economy  and workforce in the  state. In this                                                                    
     regard,  Alaska Ocean  Cluster will  help position  the                                                                    
     state to  grow Alaska's  blue economy into  the future.                                                                    
     This  resolution   proclaims  the  32nd   Alaska  State                                                                    
     Legislature's  support for  the efforts  of the  Alaska                                                                    
     Ocean    Cluster   in    developing   a    sustainable,                                                                    
     collaborative ocean economy in our state.                                                                                  
MS. PERMAN noted  that AOC receives funding  from several sources                                                               
including large federal grants like  those from the U.S. Economic                                                               
Development Administration  (EDA), and  that AOC is  working with                                                               
Alaska's   congressional    delegation   to    increase   federal                                                               
appropriation  opportunities.   She said  that passage  of HCR  2                                                               
would send  a message to  federal agencies that the  Alaska State                                                               
Legislature supports  Alaska's maritime economy.   She emphasized                                                               
that Alaska leads the nation in maritime access and industries.                                                                 
1:23:04 PM                                                                                                                    
JUSTIN  STERNBERG,   Program  Director,  Alaska   Ocean  Cluster,                                                               
provided information  and answered  questions during  the hearing                                                               
on HCR 2.   He described the  background of AOC, which  is in its                                                               
third year,  and noted that  it receives fiscal  sponsorship from                                                               
the Bering  Sea Fishermen's  Association (BSFA),  with additional                                                               
funds  being developed  through fee-for-service  and memberships.                                                               
He said  that in  2020 AOC  was awarded the  $2 million  Build to                                                               
Scale Industry Challenge  Grant from EDA and used it  to fund the                                                               
Blue  Pipeline Venture  Studio, which  scales early-stage  ocean-                                                               
based  businesses.     He  noted  AOC's   key  management  Taylor                                                               
Holshouser,  Director   of  Business  Development,   and  Garrett                                                               
Evridge, who  had previously been  the chief  fisheries economist                                                               
at McKinley  Research Group.   He described the targets  of AOC's                                                               
entrepreneurship  program, including  mariculture and  a research                                                               
and  development program  focused on  using 100  percent of  each                                                               
fish caught.                                                                                                                    
1:27:39 PM                                                                                                                    
REPRESENTATIVE RAUSCHER asked for more information on clusters.                                                                 
MR. STERNBERG explained  that there's a need  and opportunity for                                                               
investment  in   ocean-based  businesses,  especially   in  rural                                                               
Alaska,  with  opportunities  in innovation,  job  creation,  and                                                               
engagement with  existing industries.   He said that the  work in                                                               
the Blue Pipeline Venture Studio  differs from a regular business                                                               
incubator  in   that  AOC  staff  actively   work  alongside  the                                                               
fledgling  businesses instead  of simply  providing support.   He                                                               
noted that  AOC has  been working with  the University  of Alaska                                                               
(UA)  in  developing  the  Alaska Blue  Economy  Center  and,  in                                                               
cooperation   with  established   ocean   clusters  in   Seattle,                                                               
Washington, San Diego, California,  and Iceland, is learning from                                                               
their successes and "borrowing their  best practices" to apply in                                                               
REPRESENTATIVE   RAUSCHER   asked  about   AOC's   organizational                                                               
MR.  STERNBERG replied  that AOC  currently  has three  full-time                                                               
staff  and some  contractors, with  each person  tasked with  the                                                               
responsibility  of their  specific area  of expertise.   He  said                                                               
that the  organization is  run as a  nonprofit with  support from                                                               
BSFA, which has functioned as a business incubator in the past.                                                                 
1:34:19 PM                                                                                                                    
REPRESENTATIVE GILLHAM asked, "What is a blue pipeline?"                                                                        
MR.  STERNBERG described  "blue  pipeline" as  the branding  name                                                               
representing   the   ocean   and   its   associated   stream   of                                                               
opportunities  and development.    He said  the branding  imagery                                                               
represents "creating a pipeline" of jobs and new businesses.                                                                    
REPRESENTATIVE  GILLHAM  expressed that  "maritime  partnerships"                                                               
seem to  be partnerships between commercial  fishermen, crabbers,                                                               
and shrimpers.                                                                                                                  
MR. STERNBERG  said that a  maritime partnership  could encompass                                                               
many  areas  of  the  economy   including  commercial  and  sport                                                               
fishing, coastal tourism,  ocean energy, mariculture development,                                                               
industry academia,  entrepreneurs, and  investors.  He  noted the                                                               
amount of capital  flowing into the "blue economy"  and said that                                                               
at the current  pace, the worldwide ocean economy  will grow from                                                               
$1.5  trillion  in  2016  to  $3  trillion  by  2030.    He  said                                                               
technology  is developing  rapidly and  in need  of locations  in                                                               
which to operate.                                                                                                               
1:37:53 PM                                                                                                                    
MS.  PERMAN interjected  to describe  the concept  of a  "startup                                                               
incubator" as  an organization working  with a business  that has                                                               
the technology,  or an idea  for a business innovation,  but they                                                               
don't  know how  to get  capital or  the means  to develop  their                                                               
organization.   Through  working with  groups like  the AOC,  she                                                               
explained, a business may  develop internal leadership structures                                                               
and funding sources  to grow the business from  a conceptual idea                                                               
to a contributing member of the economy.                                                                                        
1:39:29 PM                                                                                                                    
REPRESENTATIVE HANNAN asked Mr.  Sternberg whether ocean clusters                                                               
could have  a relationship with  the U.S. Department  of Defense,                                                               
especially  considering Alaska's  strategic location,  or whether                                                               
that would be outside the scope of development.                                                                                 
MR. STERNBERG replied that AOC  is involved in collaborating with                                                               
government  agencies and  noted  that the  Build  to Scale  Grant                                                               
included a  partnership with the Arctic  Domain Awareness Center,                                                               
which is  part of  the U.S. Department  of Homeland  Security and                                                               
hosted  through UA.   He  said  that many  technologies, such  as                                                               
those used  for monitoring  for vessels  or submarines,  could be                                                               
applied in  other areas.   He said that  one of the  companies in                                                               
the   Blue   Pipeline   Venture  Studio   is   using   artificial                                                               
intelligence to map present and future sea ice locations.                                                                       
1:41:42 PM                                                                                                                    
REPRESENTATIVE MCKAY  asked how AOC  could work with the  oil and                                                               
gas industry,  and what oil  and gas entities are  currently part                                                               
of the cluster.                                                                                                                 
MR.  STERNBERG   replied  that  oil   and  gas   exploration  has                                                               
traditionally been  a part of  discussions of the  ocean economy;                                                               
however, with a  staff of only three people, AOC  has not engaged                                                               
in that area.  He  noted efforts and technological innovations in                                                               
oil cleanup, and  said that Alaska's economy has  been so focused                                                               
on  oil  that AOC  is  working  towards diversifying  into  other                                                               
offshore businesses such  as seaweed farming, which  would have a                                                               
net benefit  to the environment  because it's cleaning  the ocean                                                               
as well  as providing the  resource.   He stressed the  desire to                                                               
develop industries  that could grow  a sustainable  ocean economy                                                               
with renewable resources.                                                                                                       
REPRESENTATIVE  MCKAY said  that since  AOC isn't  advocating for                                                               
oil  and  gas   exploration,  it  should  be   removed  from  the                                                               
documentation.   He said, "I  think this is a  little misleading,                                                               
if  you're  not  even  working  on oil  and  gas  exploration  or                                                               
development in the Alaska offshore."                                                                                            
MS.  PERMAN  interjected  and said  that  the  sponsor  statement                                                               
simply said  that major maritime  industries include oil  and gas                                                               
exploration, rather than specifically  referring to the work done                                                               
by AOC.                                                                                                                         
1:47:04 PM                                                                                                                    
CHAIR  PATKOTAK  opened  public  testimony   on  HCR  2.    After                                                               
ascertaining  that no  one wished  to testify,  he closed  public                                                               
1:47:55 PM                                                                                                                    
CHAIR PATKOTAK announced that HCR 2 was held over.                                                                              
1:49:32 PM                                                                                                                    
There being no  further business before the  committee, the House                                                               
Resources Standing Committee meeting was adjourned at 1:50 p.m.                                                                 

Document Name Date/Time Subjects
HCR 2 Letter of Support Alaska Research Consortium 5.3.2021.pdf HRES 5/3/2021 1:00:00 PM
HCR 2 Letter of Support Bering Sea Fishermen's Association 5.3.2021.pdf HRES 5/3/2021 1:00:00 PM
SRES 2/21/2022 3:30:00 PM
HCR 2 Letter of Support SWAMC 5.3.2021.pdf HRES 5/3/2021 1:00:00 PM
SRES 2/21/2022 3:30:00 PM
HCR 2 Sponsor Statement 5.3.2021.pdf HRES 5/3/2021 1:00:00 PM
HCR 2 Supplemental Document Alaska Ocean Cluster Overview 5.3.2021.pdf HRES 5/3/2021 1:00:00 PM