Legislature(2021 - 2022)ADAMS 519
04/21/2021 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB41 | |
| HB47 | |
| HB127 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 69 | TELECONFERENCED | |
| += | HB 71 | TELECONFERENCED | |
| + | HB 41 | TELECONFERENCED | |
| + | HB 47 | TELECONFERENCED | |
| + | HB 127 | TELECONFERENCED | |
| + | TELECONFERENCED |
HOUSE BILL NO. 41
"An Act relating to management of enhanced stocks of
shellfish; authorizing certain nonprofit organizations
to engage in shellfish enhancement projects; relating
to application fees for salmon hatchery permits and
shellfish enhancement project permits; allowing the
Alaska Seafood Marketing Institute to market aquatic
farm products; and providing for an effective date."
1:37:45 PM
REPRESENTATIVE DAN ORTIZ, SPONSOR, reported that the bill
was familiar because it was heard in the prior year and
voted out of committee. He believed that HB 41 was
important because it served to jump start Alaska's economy
and expand the fishing industry. He read the sponsor
statement:
Enhancement of Alaska's shellfish industry holds the
potential of expanded economic opportunities in
Alaska's coastal communities and increased resilience
of the State's fisheries portfolio.
To tap this potential House Bill 41 allows qualified
non-profits to pursue enhancement and/or restoration
projects involving shellfish species including red and
blue king crab, sea cucumber, abalone, and razor
clams.
The bill creates a regulatory framework with which the
Department of Fish & Game can manage shellfish
enhancement projects and outlines criteria for
issuance of permits. It sets out stringent safety
standards to ensure sustainability and health of
existing natural stocks. The commissioner of ADF&G
must also make a determination of substantial public
benefit before a project can proceed.
In addition, the bill allows the Department of Fish &
Game to set the application fee for a shellfish
enhancement project permit and grants the similar
authority over the application fee for a salmon
enhancement project permit. This bill also amends the
statutes governing the Alaska Seafood Marketing
Institute to allow ASMI to market aquatic farm
products including oysters and kelp.
House Bill 41 plays an important role in the
development of mariculture in Alaska by providing a
method to increase the available harvest of shellfish
for public use in an environmentally safe and
responsible manner.
LIZ HARPHOLD, STAFF, REPRESENTATIVE ORTIZ, relayed that the
bill provided the legal framework for the Department of
Fish and Game (DFG) to permit and regulate shellfish
hatcheries. The bill was mirrored off salmon hatchery
statutes that were established decades ago. She shared that
industry stakeholders brought the idea to the sponsors
attention. She indicated that Julie Decker [Chair, Alaska
Fisheries Development Foundation; Member, Alaska
Mariculture Task Force] had been a big proponent of the
bill but was unable to testify. She detailed that
mariculture included farming (i.e., oysters and kelp) and
was a private industry. Statutes allowing mariculture were
already in existence and the bill did not change that
except to allow the Alaska Seafood Marketing Institute
(ASMI) to market aquatic farm products. The bill primarily
pertained to the enhancement and restoration of shellfish
stocks. She noted that certain shellfish stocks were
depleted in some areas of the state like king crab in
Western Alaska. A few groups were researching how to
restore and enhance depleted stocks. The bill provided the
framework to regulate and permit the groups.
1:43:56 PM
Ms. Harphold read the sectional analysis:
Sec. 1: Provides the Alaska Board of Fisheries
authority to direct the department to manage
production of enhanced shellfish stocks, beyond brood
stock needs, for cost recovery harvest.
Sec. 2: Grants the Department of Fish and Game the
authority to set the fee for new private nonprofit
salmon hatcheries based on regulatory costs.
Sec. 3: Conforming language consistent with other fee
structures set and adjusted by regulation, requiring
fees to approximately reflect the cost of
administering the application process, and to be
reviewed and adjusted periodically.
Sec. 4: Adds a new Chapter 12 to Title 16, "Shellfish
Stock Enhancement Projects."
AS 16.12.010: Provides direction to the
commissioner of the Department of Fish and Game
on issuance of permits for private nonprofit
shellfish fishery enhancement projects and grants
the department the authority to set the permit
application fee. States the permit fee will be
accounted for separately as non-general fund
program receipts. This section directs the
commissioner to consult with technical experts in
the relevant areas before permit issuance;
AS 16.12.020: Provides for a hearing and public
notification and input process prior to issuance
of a permit;
AS 16.12.030 Describes terms and conditions for
permit holders to conduct their work, including
cost recovery fisheries, harvest, sale, and
release of enhancement project produced
shellfish, and selection of brood stock sources;
AS 16.12.040: Describes the revocation process
should a permit holder fail to comply with the
terms and conditions of the permit;
AS 16.12.050: Specifies that shellfish produced
under an approved enhancement project are a
common property resource, with provision for
special harvest areas by permit holders. This
section also specifies the Board of Fisheries to
establish regulations relating to this chapter;
AS 16.12.060: Directs the department to advise
and assist permit holders in their planning,
operations, and construction of facilities to a
reasonable and appropriate extent;
AS 16.12.070 provides department authority to
approve source and number of shellfish taken for
use as brood stock.
AS 16.12.080 places restrictions on how monies
received from sale of shellfish may be used only
for operating costs associated with their
facilities;
AS 16.12.090 Relates to Cost Recovery Fisheries
and provides a means by which a shellfish
hatchery may contract to either harvest and sell
shellfish, or to implement a self-assessment from
amongst its membership, for purposes of
recovering operational costs associated with the
hatchery.
AS 16.12.100 Gives the department authority to
inspect facilities at any time while the facility
is in operation;
AS 16.12.110 Requires a permit holder to submit
an annual report to the department;
AS 16.12.199 provides definitions for "facility,"
"genetically modified shellfish," and
"shellfish;"
Sec. 5: Provides the Commercial Fisheries Entry
Commission authority to issue special harvest area
entry permits to holders of private nonprofit
enhancement project permits.
Sec. 6: Defines legal fishing gear for special harvest
area entry permit holders.
Sec. 7: adds marketing and promotion of aquatic farm
products to the powers and duties of the Alaska
Seafood Marketing Institute (ASMI).
Sec. 8: Conforming amendment, prohibiting ASMI from
promoting aquatic farm products not from Alaska, a
specific region of Alaska, or by a specific brand
name.
Sec. 9: Conforming amendment regarding the definition
of "seafood."
Sec. 10: Utilizes the existing definition of "aquatic
farm products" in AS 16.40.199
Sec. 11: Exempts shellfish raised in a private
nonprofit shellfish project from the definition of
"farmed fish."
Sec. 12 Makes application fee revenues received by the
Department of Fish and Game from the salmon hatchery
and shellfish hatchery programs be accounted for
separately. Appropriations from those program receipts
are not made from the unrestricted general revenue
fund.
Sec. 13: Establish state corporate income tax
exemption for a nonprofit corporation holding a
shellfish fishery enhancement permit.
Sec. 14: A technical conforming amendment required by
prior session law and has no impact on the policies
being set in this bill.
Sec. 15: Exempts shellfish harvested under a special
harvest area entry permit from seafood development
taxes.
Sec. 16: Establishes an effective date for the salmon
hatchery permit application fee described in section 2
of this bill.
Sec. 17: Authorizes the Department of Fish and Game to
adopt implementing regulations.
Sec. 18: Establishes an immediate effective date for
section 17 of this bill pursuant to AS 01.10.070(c).
Sec. 19: Establishes an effective date for section 14
of this bill concomitant with sec. 2, Chapter 55, SLA
2013 and has no effect on the policy set forth in this
bill.
1:50:12 PM
Co-Chair Merrick indicated that the committee would hear
invited testimony.
1:50:33 PM
SAM RABUNG, DIRECTOR, DIVISION OF COMMERCIAL FISHERIES,
DEPARTMENT OF FISH AND GAME (via teleconference),
introduced himself. He reported that he was appointed to
the governor's Mariculture Task Force by Governor Bill
Walker and remained a member since its establishment in
2016. He delineated that the DFG mission statement was to
protect maintain, and improve the fish, game, and aquatic
plant resources of the state and manage their use and
development in the best interest of the economy and the
wellbeing of the people of the state consistent with the
sustained yield principle. He cited AS 16.05.092 (2) (3):
(2) encourage the investment by private enterprise in
the technological development and economic utilization
of the fisheries resources;
(3) through rehabilitation, enhancement, and
development programs do all things necessary to ensure
perpetual and increasing production and use of the
food resources of state waters and continental shelf
areas;
Mr. Rabung continued that the work described in the statute
was previously under the purview of the Division of
Fisheries Rehabilitation Enhancement and Development (FRED)
until 1994 when the division was merged with the Division
of Commercial Fisheries (DCF). The division no longer
carried out fisheries restoration, rehabilitation, or
enhancement projects. The Division of Commercial Fisheries
still operated the pathology, gene conservation, mark and
tag, and age labs and contracted out prior FRED hatcheries
to private non-profit aquaculture associations. The
Statewide Aquaculture Planning and Permitting Section
provided salmon hatchery permitting and oversight. The
section was responsible for the salmon hatchery program,
aquatic farming program, and permitting research and
educational projects statewide. He explained the
significant differences between aquatic farming and
fishery enhancement. He expounded that currently the state
limited mariculture to aquatic farming. He defined aquatic
farming as a facility the grows farms or cultivates aquatic
farm products in captivity or under positive control.
1:53:18 PM
Mr. Rabung continued that aquatic farm product was
considered private property. He elaborated that in
contrast, the other form of mariculture was fishery
enhancement, which entailed the restoration,
rehabilitation, or enhancement of natural production and
benefitted the common property fisheries where the
organisms were harvested for personal, sport, or commercial
use. The bill would allow mariculture for fishery
enhancement. He noted that restoration and rehabilitation
projects ceased once its targets were achieved. Enhancement
boosted naturally producing stock above what it could
produce in nature to provide harvestable surplus. If the
project ceased, the supplemental harvest was eliminated and
reverted to natural harvest levels.
Mr. Rabung provided an example of a mariculture enhancement
project; the Alaska King Crab Research, Rehabilitation, and
Biology Program (AKCRRB). He elucidated that the program
planted juvenile king crab from nearby stocks into
locations that had previously supported larger stocks.
Fishing closures was the only tool the department had to
try to restore overfished stocks. The bill allowed for
enhancement projects as another tool to try to rebound
depleted stocks. He offered an example of a mariculture
rehabilitation project that was collecting adult razor
clams from the east side of Cook Inlet inducing them to
spawn in a hatchery and replanting them on the same beach.
He mentioned that the same method could work for hard shell
clams in Kachemak Bay or for collecting and aggregating
abalone in Southeast Alaska.
Mr. Rabung highlighted mariculture enhancement projects. He
elucidated that back stocking sea cucumber juveniles
immediately following a dive fishery that occurred on a
three year rotation was a prime example of enhancement and
could allow for a quicker rotation. He added that the
enhancement example could be done with other species, i.e.,
geoduck or king crab to increase the numbers available for
harvest. He indicated that targeting enhanced stocks could
allow for the rebounding of other natural stocks by
reducing their harvest pressure. The passage of a law that
would allow for restoration, rehabilitation, or enhancement
of shellfish stocks was one of the priorities identified in
the Alaska Mariculture Taskforces Mariculture Development
Plan. He shared that if HB 41 passed, the work would be
subject to oversight by DFG. The state was known for the
most stringent aquaculture guidance in the world. He was
confident the department had the ability to carry out the
provisions of HB 41.
1:58:09 PM
JEREMY WOODROW, EXECUTIVE DIRECTOR PRESIDENT, ALASKA
SEAFOOD MARKETING INSTITUTE, JUNEAU (via teleconference),
read from a prepared statement:
Alaska Seafood Marketing Institute (ASMI) fosters
economic development of Alaska's seafood resources. It
plays a key role in positioning Alaska's seafood
industry as a competitive market-driven food
production industry and functions as a brand manager
of the Alaska Seafood family of brands. Recognizing
mariculture is an emerging maritime industry with
tremendous opportunity for Alaska's coastal economies,
ASMI supports HB 41.
Mariculture involves cultivating marine organisms in
the ocean for food and other products such as oysters,
mussels, abalone, or geoducks, as well as seaweeds,
such as kelp. The practice does not require feed,
fertilizers, insecticides, herbicides, or antibiotics,
making it sustainable and inexpensive. Because of its
economic and environmental promise, the Alaska
Mariculture Task Force has identified the goal to
build Alaska's mariculture production into a $100
million per year industry in 20 years.
In order to increase jobs and economic opportunity for
fishermen and Alaskan businesses, the ASMI Board of
Directors unanimously supports HB 41 and legislative
action to allow for the marketing of mariculture
products or "aquatic farm products" as defined in
Alaska Statute 16.40.199, which it is currently
prohibited from doing. It is joined in support of this
bill by the Alaska seafood industry, the Alaska
Mariculture Task Force, and the Alaska Shellfish
Growers' Association, as well as many new Alaskan-
owned and operated businesses.
Not only does mariculture present a significant
economic opportunity for Alaska, it offers the ability
for seafood companies to diversify their existing
product portfolios. With the support and efforts of
the Mariculture Task Force, small family businesses
have already proven products to be commercially viable
by selling boutique products while offering fishermen
opportunities to utilize their vessels and skills on
shoulder seasons.
If passed, ASMI plans to include mariculture products
in its effective and lucrative consumer, retail,
foodservice, and food aid outreach, in domestic and
targeted foreign markets. In efforts to ramp up this
burgeoning industry, ASMI will lend the same expertise
in outreach to this industry as it has to Alaska's
seafood industry for 40 years.
Thank you for recognizing the value of Alaska's
maritime economy and for your consideration of
meaningful legislation to aid economic development
across Alaska's coastal communities.
2:01:06 PM
HEATHER MCCARTY, CHAIR, MARICULTURE TASK FORCE (via
teleconference) introduced herself. She relayed that she
was also the Co-Chair of the AKCRRB program. She also
worked for the Central Bering Sea Fishermens Association
(CBSFA) located on the Priblof Islands. She reiterated the
history of HB 41. She offered that the mariculture
taskforce had two priority recommendations contained in HB
41:
• Allow for shellfish fishery enhancement and
restoration.
• Amend the ASMI statutes to allow marketing of
aquatic farm products.
Ms. McCarty continued that the CBSFA had a great deal of
interest in shellfish mariculture. She explained that
until 40 years ago a viable blue crab fishery existed
around the Priblof Islands. So far, the only tool to
restore the fishery has been to close the fishery. She
described a similar situation with the depletion of red
king crab near Kodiak that collapsed at the same time. She
related that citizens from Kodiak and the Priblofs formed
the AKCRRB program with the hope of rehabilitating crab
stocks. The program was in existence for 15 years and
undertook research to understand the crab lifecycle. The
program was successful in rearing crab in captivity and the
next step was to produce more crab stock and release it
into the wild. The crab rearing technology was transferable
to other crab species. She described the strong support for
the bill, especially for the rehabilitation of crab stocks.
She spoke to the marketing portion of the bill and felt
that it was also extremely important.
2:06:15 PM
GINNY ECKERT, CO-CHAIR, STEERING COMMITTEE, ALASKA KING
CRAB RESEARCH, REHABILITATION, AND BIOLOGY PROGRAM (via
teleconference), shared that she was also a fisheries
professor at the University of Alaska Fairbanks and
Director of Alaska Sea Grant. She also served as the
Science Director for the AKCRRB program. She had worked in
many shellfish fisheries. She spoke to the need for the
rehabilitation of shellfish. She related that many of the
shellfish had declined in abundance and were important
fishery resources. She elaborated that the king crab
fishery crashed in the early 1980s due to overfishing in
the 1960s and 1970s. The populations depressed so low
that they were not able to recover on their own. Over the
last decade many scientists had studied king crab and
published papers regarding their lifecycle. Enough is now
known to move king crab rehabilitation forward in a
responsible manner. She illuminated that the research
revealed the population was bottlenecked and struggling to
recover on its own. They performed a test model of planting
crabs in the wild and were able to recover planted animals
one year later. She reported that genetic concerns
accompanied the type of rehabilitation, but genetic studies
were undertaken. The scientists understood the genetics of
the wild population so they could appropriately culture the
planted stock to minimize impacts on the wild stocks. Ms.
Eckert along with colleagues also surveyed 17 traditional
abalone sites and found abalone in only 4 sites; Abalone
was also overfished. She emphasized that there was
potential for restoration in Alaska based on efforts in
Washington state. The bill was needed to move forward with
any of the restoration projects.
2:10:48 PM
Co-Chair Merrick OPENED Public Testimony.
2:11:08 PM
Co-Chair Merrick CLOSED Public Testimony.
Co-Chair Merrick asked Mr. Woodrow to review published Zero
Fiscal Note 1 from the Department of Commerce, Community
and Economic Development [FN 1 CED] appropriated to ASMI.
Mr. Woodrow indicated that ASMI did not anticipate any
fiscal impact if HB 41 was adopted.
2:11:50 PM
Co-Chair Merrick invited Mr. Rabung to review Fiscal Note 2
[FN 2 DFG] and Fiscal Note 3 [FN 3 DFG] from DFG that were
both zero and were appropriated to the Division of
Commercial Fisheries. Mr. Rabung shared that the division
would utilize existing staff in its aquaculture section to
administer the program. The department would absorb any
costs related to the bill.
2:12:45 PM
Co-Chair Merrick requested a review of the Special
Appropriations published Fiscal Note 4 appropriated to
Shared Taxes.
KYLE SCHERRER, PROGRAM BUDGET ANALYST, OFFICE OF MANAGEMENT
AND BUDGET (via teleconference), reported that the fiscal
note was indeterminate. He furthered that because the
Department of Revenues (DOR) revenue estimate was
indeterminate the appropriation to the hatchery permit
holder is also indeterminate.
Co-Chair Merrick asked DOR to review published Fiscal Note
5 from DOR [FN 5 DOR] appropriated to Taxation and
Treasury.
2:13:37 PM
CHRIS BECKER, AUDITOR, TAX DIVISION, DEPARTMENT OF REVENUE
(via teleconference), reported that Fiscal Note 5 was
indeterminant. He expounded that it was not currently
possible to determine the revenue impact because the number
of fishers and hatcheries that would participate was
unknown. He added that implementation costs were zero.
2:14:16 PM
Representative Thompson asked if the committee would be
moving out the bill today. Co-Chair Merrick responded in
the affirmative. Representative Thompson indicated he had
an amendment currently being drafted.
Co-Chair Merrick set the bill aside.
HB 41 was HEARD and HELD in committee for further
consideration.