HCS CSSB 124(FIN): "An Act relating to requirements to obtain and maintain a fisheries business license; relating to security required of fish processors and primary fish buyers; and providing for an effective date."
00 HOUSE CS FOR CS FOR SENATE BILL NO. 124(FIN) 01 "An Act relating to requirements to obtain and maintain a fisheries business license; 02 relating to security required of fish processors and primary fish buyers; and providing 03 for an effective date." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05 * Section 1. AS 43.75.020 is amended to read: 06 Sec. 43.75.020. Application for license. (a) Application for a license shall 07 be filed with the department and accompanied by an annual fee of $25. A separate 08 annual fee is required for each plant specified in the application covered by the 09 license. The application must contain the name of the applicant, the line of business to 10 be licensed, place of business, and other facts that the department prescribes. The 11 applicant shall state that the applicant, as a condition of obtaining and maintaining 12 the license, agrees to pay 13 (1) the taxes levied under this title [TAX IMPOSED BY 14 AS 43.75.015 OR 43.75.100], and that the applicant will make a return and pay
01 the taxes [TAX] at the time provided by law; 02 (2) any seafood marketing assessment levied under AS 16.51; 03 (3) contributions imposed under AS 23.20 (Alaska Employment 04 Security Act); 05 (4) any administrative penalties assessed under AS 18.60.093 for a 06 violation of a provision of AS 18.60.010 - 18.60.105; and 07 (5) any applicable fishery sales, use, or severance taxes imposed by 08 a municipality in the state. 09 (b) Upon receipt of an [THE] application in proper form under (a) or (c) of 10 this section, accompanied by the annual fee, the department shall issue the license if 11 the 12 (1) applicant has paid in full, including interest and penalties, the 13 following: 14 (A) taxes levied under this title; and 15 (B) any assessments under AS 16.51; 16 (2) department has not received notification from the Department 17 of Labor and Workforce Development that the applicant has failed to pay in full 18 (A) an assessment of delinquent contributions that is final 19 under AS 23.20.205(c) or 23.20.220(c); or 20 (B) an administrative penalty that is final under 21 AS 18.60.093 or 18.60.097; and 22 (3) department has not received a copy of 23 (A) a final judgment obtained against the applicant for 24 unpaid fishery sales, use, or severance taxes imposed by a municipality in 25 the state; or 26 (B) a final administrative determination against the 27 applicant from a municipality in the state for unpaid fishery sales, use, or 28 severance taxes imposed by the municipality; the administrative 29 determination must be accompanied by a certification by the municipality 30 that the municipal administrative process is consistent with constitutional 31 requirements of due process and that the applicant has exhausted all
01 administrative remedies under the applicable municipal administrative 02 process. 03 (c) Instead of a license issued under (a) of this section, the department may 04 issue a direct marketing fisheries business license to a licensed commercial fisherman 05 who processes fishery resources caught using a vessel that does not exceed 65 feet in 06 overall length and is owned or leased by the commercial fisherman. The licensee may 07 place into commerce in the state and outside of the state processed or unprocessed 08 fishery resources caught using the vessel described in the license. Fishery resources 09 that are caught using the vessel and owned by the licensee from the time of harvest 10 through sale, as defined by the department by regulation, may be processed by the 11 licensee on the vessel, at a shore-based facility, or by means of custom processing 12 services obtained by the licensee. An application for a direct marketing fisheries 13 business license shall be filed with the department and accompanied by an annual fee 14 of $25. A separate direct marketing fisheries business license and annual license fee 15 are required for each vessel on which processing is performed. The application must 16 state the name and address of the applicant, the fishery resources for which the 17 applicant holds a commercial fishing entry permit or interim-use permit or quota 18 share, a description of the vessel and each shore-based facility where the applicant will 19 process fishery resources, and other information that the department prescribes by 20 regulation. The application must state that the applicant, as a condition of obtaining 21 and maintaining the license, agrees to pay the taxes, assessment, employment 22 security contributions, and penalties as set out in (a)(1) - (5) of this section [TAX 23 IMPOSED BY AS 43.75.015(d) OR 43.75.100, AND THAT THE APPLICANT 24 WILL MAKE A RETURN AND PAY THE TAX AT THE TIME PROVIDED BY 25 LAW]. A person who holds a direct marketing fisheries business license may not 26 under that license (1) purchase fishery resources for resale or processing for sale; or 27 (2) process fishery resources for another licensed commercial fisherman or for a 28 fisheries business licensed under this chapter. In this subsection, "licensed 29 commercial fisherman" means a natural person who holds a commercial fishing entry 30 permit or interim-use permit issued under AS 16.43 or a quota share issued under 31 federal law.
01 * Sec. 2. AS 43.75.055 is amended by adding a new subsection to read: 02 (g) Real property, a surety bond, or other security being used to secure 03 payment of the tax for the year preceding the application year may also be used to 04 secure payment of the estimated tax for the application year if the security is 05 acceptable to the department and the applicant has not failed to pay a tax under this 06 chapter in a timely manner during any of the three years preceding the application 07 year. 08 * Sec. 3. AS 44.25.040 is repealed and reenacted to read: 09 Sec. 44.25.040. Security for certain obligations. (a) A person applying for a 10 license as a fish processor or primary fish buyer shall file with the commissioner of 11 revenue a performance bond, conditioned upon the promise to pay the following: 12 (1) wages owing to all persons employed by the fish processor or 13 primary fish buyer, including contractual employee benefits; 14 (2) independent registered commercial fishermen for the price of the 15 raw fishery resource purchased from them; 16 (3) fees owing for the service of transporting raw fish; 17 (4) contributions imposed under AS 23.20 (Alaska Employment 18 Security Act). 19 (b) A fish processor or primary fish buyer that processes more than 30,000 20 pounds of fish a year or purchases more than $30,000 of fish a year shall file a 21 performance bond with the commissioner in the amount specified in this subsection. 22 The amount of the bond is $10,000 unless, during the five years preceding the 23 application, one of the following has occurred: 24 (1) a final judgment in excess of $10,000 was awarded against the 25 bond required under this section; if the final judgment against the bond was in excess 26 of $10,000 but less than $50,000, the amount of the bond is increased to a total of 27 $50,000; if the final judgment against the bond was $50,000 or more, the amount of 28 the bond is increased to a total of $100,000; 29 (2) the commissioner has determined that the fish processor has 30 engaged in the business of fish processor in the state or the primary fish buyer has 31 engaged in the business of primary fish buyer in the state while not in compliance with
01 this section and has not yet satisfied a final judgment entered against the fish processor 02 or primary fish buyer for payment for labor furnished to, raw fishery resources 03 purchased by, or raw fish transportation services provided to the fish processor or 04 primary fish buyer; if the fish processor has engaged in the business of a fish processor 05 or the primary fish buyer has engaged in the business of primary fish buyer while not 06 in compliance with this section and has not yet satisfied a final judgment for payment 07 for labor furnished to, raw fishery resources purchased by, or raw fish transportation 08 services provided to the fish processor or primary fish buyer, the amount of the bond 09 is increased to a total of $100,000; or 10 (3) the commissioner has determined under (j) of this section that a 11 claim against the bond filed by the Department of Labor and Workforce Development 12 under (i) of this section met the requirements in (i) of this section; if the amount of the 13 claim was in excess of $10,000 but was less than $50,000, the amount of the bond is 14 increased to a total of $50,000; if the amount of the claim was $50,000 or more, the 15 amount of the bond is increased to a total of $100,000; an increase in bond amount 16 under this paragraph may not be imposed until 45 days after the commissioner 17 determines under (j) of this section that the claim of the Department of Labor and 18 Workforce Development met the requirements in (i) of this section. 19 (c) A fish processor or primary fish buyer that processes 30,000 pounds or less 20 of fish a year and purchases $30,000 or less of fish a year shall file a performance 21 bond with the commissioner in the amount specified in this subsection. The amount of 22 the bond is $2,000 unless, during the preceding five years, one of the following has 23 occurred: 24 (1) a final judgment in excess of $2,000 was awarded against the bond 25 required under this section; if the final judgment against the bond was in excess of 26 $2,000 but less than $10,000, the amount of the bond is increased to a total of 27 $10,000; if the final judgment against the bond was $10,000 or more, the amount of 28 the bond is increased to a total of $20,000; 29 (2) the commissioner has determined that the fish processor has 30 engaged in the business of fish processor in the state or that the primary fish buyer has 31 engaged in the business of primary fish buyer in the state while not in compliance with
01 this section and has not yet satisfied a final judgment entered against the fish processor 02 or primary fish buyer for payment for labor furnished to, raw fishery resources 03 purchased by, or raw fish transportation services provided to the fish processor or 04 primary fish buyer; if the fish processor has engaged in the business of fish processor 05 or primary fish buyer has engaged in the business of primary fish buyer while not in 06 compliance with this section and has not yet satisfied a final judgment for payment for 07 labor furnished to, raw fishery resources purchased by, or raw fish transportation 08 services provided to the fish processor or primary fish buyer, the amount of the bond 09 is increased to a total of $20,000; or 10 (3) the commissioner has determined under (j) of this section that a 11 claim against the bond filed by the Department of Labor and Workforce Development 12 under (i) of this section met the requirements in (i) of this section; if the amount of the 13 claim was in excess of $2,000 but was less than $10,000, the amount of the bond is 14 increased to a total of $10,000; if the amount of the claim was $10,000 or more, the 15 amount of the bond is increased to a total of $20,000; an increase in bond amount 16 under this paragraph may not be imposed until 45 days after the commissioner 17 determines under (j) of this section that the claim of the Department of Labor and 18 Workforce Development met the requirements in (i) of this section. 19 (d) If a fish processor who has filed a performance bond under (c) of this 20 section processes more than 30,000 pounds of fish in a year or purchases more than 21 $30,000 of fish in a year, the fish processor shall, within seven days after the day on 22 which the 30,000 pound threshold or the $30,000 threshold is exceeded, notify the 23 commissioner and comply with (b) of this section. If a fish processor who has filed a 24 performance bond under (c) of this section processes more than 30,000 pounds of fish 25 in a year or purchases more than $30,000 of fish in a year, and does not comply with 26 (b) of this section within seven days after the date on which the 30,000 pound 27 threshold or the $30,000 threshold is exceeded, the fish processor shall suspend 28 processing fish until a bond has been filed under (b) of this section. 29 (e) If a primary fish buyer who has filed a performance bond under (c) of this 30 section purchases more than $30,000 of fish in a year, the primary fish buyer shall, 31 within seven days after the day on which the $30,000 threshold is exceeded, notify the
01 commissioner and comply with (b) of this section. If a primary fish buyer who has 02 filed a performance bond under (c) of this section purchases more than $30,000 of fish 03 in a year, and does not comply with (b) of this section within seven days after the date 04 on which the $30,000 threshold is exceeded, the primary fish buyer shall suspend 05 purchases of fish until a bond has been filed under (b) of this section. 06 (f) A fish processor or primary fish buyer may use only a surety bond, cash 07 deposit, or other negotiable security as a performance bond under this section. The 08 surety must be satisfactory in the determination of the commissioner. The use of other 09 negotiable security as a performance bond must be in a form acceptable to the 10 commissioner. The commissioner shall waive the filing of a performance bond under 11 this section if 12 (1) the fish processor or primary fish buyer has more than $10,000 in 13 lienable real property located in the state and provides proof of the property in a form 14 satisfactory to the commissioner; 15 (2) the fish processor or primary fish buyer is not required under (b) or 16 (c) of this section to post a bond in excess of $10,000; and 17 (3) within the five years preceding the application under AS 43.75.020, 18 an employee, fisherman, or contracted raw fish transporter has not obtained a final 19 judgment against the fish processor's or primary fish buyer's bond under this section. 20 (g) If an applicant for a license as a fish processor or primary fish buyer has 21 complied with this section, the Department of Revenue may issue that applicant a 22 license to engage in the business of fish processor or primary fish buyer. 23 (h) A claim against a fish processor or primary fish buyer for failing to pay an 24 employee for wages or contractual benefits owed, for failing to pay an independent 25 registered fisherman for the price of raw fishery resource purchased from the 26 fisherman, or for failing to pay an independent contractor for the transportation of raw 27 fish may be brought upon the bond filed under this section in the superior court of the 28 judicial district in which the work was done or in any judicial district in the state in 29 which jurisdiction may be obtained. If an action is brought upon the bond, a copy of 30 the complaint shall be served by registered or certified mail upon the commissioner at 31 the time the suit is filed. The commissioner shall transmit a copy of the complaint and
01 any judgment to the surety or holder of the negotiable security. If a judgment is 02 entered against cash deposited with the commissioner, the commissioner, upon receipt 03 of a certified copy of a final judgment, shall pay the judgment from the amount of the 04 deposit. The commissioner shall maintain a record, available for public inspection, of 05 all suits commenced under this subsection. 06 (i) A claim against a fish processor or primary fish buyer for failing to pay 07 contributions imposed under AS 23.20 may be brought by the Department of Labor 08 and Workforce Development against the bond filed under this section by filing a claim 09 against the bond with the commissioner, along with proof, satisfactory to the 10 commissioner, that the fish processor or primary fish buyer 11 (1) received a notice of assessment under AS 23.20.205; 12 (2) did not pay the amount specified in the notice of assessment within 13 30 days after receiving the notice of assessment or, if the assessment was contested 14 under AS 23.20.220, within 30 days after receiving the department's final decision 15 under AS 23.20.220(c); and 16 (3) did not file an appeal of the assessment under AS 23.20.220 or 17 filed an appeal but did not initiate a proceeding for judicial review under 18 AS 23.20.445 within 30 days after the department's final decision under 19 AS 23.20.220(c). 20 (j) If the commissioner determines that the Department of Labor and 21 Workforce Development has met the claim requirements in (i) of this section, the 22 commissioner shall forward the claim and supporting documents to the surety or 23 holder of the negotiable security. If the fish processor or primary fish buyer has 24 deposited cash with the commissioner, the commissioner shall pay the claim of the 25 Department of Labor and Workforce Development from the amount of the deposit. If 26 the commissioner determines that the Department of Labor and Workforce 27 Development has not met the claim requirements in (i) of this section, the 28 commissioner shall provide the Department of Labor and Workforce Development 29 with written notice of the deficiency of its claim. 30 (k) If a performance bond is insufficient to satisfy all claims filed against it 31 under this section, claims brought against the bond under (h) of this section have
01 priority over a claim filed against the bond under (i) of this section. The Department 02 of Labor and Workforce Development shall return to the commissioner money 03 received from a claim filed against a fish processor's or primary fish buyer's 04 performance bond under (i) of this section if an employee, fisherman, or contracted 05 raw fish transporter obtains a final judgment under (h) of this section against that fish 06 processor's or primary fish buyer's bond and the 07 (1) fish processor or primary fish buyer has not replenished the bond 08 after it was used to cover the claim filed under (i) of this section; or 09 (2) final judgment obtained by the employee, fisherman, or contracted 10 raw fish transporter is more than the amount of the bond available under (b) or (c) of 11 this section. 12 (l) The term of a performance bond expires two years after the fish processor 13 or primary fish buyer is no longer licensed in this state, except that if, during that two- 14 year period, a claim has been asserted against the bond, the term of the bond is five 15 years. If the surety on the bond wishes to cancel the bond, the surety may do so by 16 giving the commissioner written notice of intention to cancel. The cancellation is 17 effective 30 days after the notice is delivered to the commissioner. 18 * Sec. 4. AS 44.25.042 is amended by adding a new subsection to read: 19 (h) If the commissioner determines under AS 44.25.040(j) that a claim filed 20 under AS 44.25.040(i) is sufficient to allow collection against the performance bond 21 filed under AS 44.25.040, the fish processor's or primary fish buyer's license shall be 22 suspended until the amount of the claim under AS 44.25.040(i) is paid in full and the 23 performance bond is replenished. 24 * Sec. 5. This Act takes effect immediately under AS 01.10.070(c).