Legislature(2015 - 2016)BARNES 124
03/23/2016 01:00 PM House RESOURCES
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| Audio | Topic |
|---|---|
| Start | |
| HB254 | |
| HB177 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 247 | TELECONFERENCED | |
| *+ | HB 254 | TELECONFERENCED | |
| *+ | HB 177 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 177-KING SALMON TAGS AND DESIGNS
2:02:09 PM
CO-CHAIR TALERICO announced that the final order of business is
HOUSE BILL NO. 177, "An Act relating to king salmon tags and
king salmon tag designs."
2:02:21 PM
JIM POUND, Staff, Representative Wes Keller, Alaska State
Legislature, described HB 177 as a small step in looking at
Alaska's economy, in particular fishing. The legislature is
looking for increased funding and this bill would provide an
opportunity to help fish enhancement, an area some people may
eventually start looking at to make cuts to. The bill deals
with the Alaska King Salmon stamps, which are already in
existence, and it would convert today's stamp into an artist's
rendition as a way for artists and collectors to start
maintaining and keeping them in their collections. In addition
to the stamps, he advised, posters and prints are envisioned for
sale and the selling of these items could be handled through the
Alaska Department of Fish & Game (ADF&G), local art stores, and
charter boat captains, the same way as they sell the stamps. He
said that the artist's intellectual property rights would be two
years for the original art, the original art would then go back
to the artist and he/she could sell that art in addition to
whatever the artist was paid by the state. There would be
potential for increasing some funds for fish enhancement in the
state, he noted.
2:04:20 PM
REPRESENTATIVE SEATON requested further information with regard
to the artist being paid by the state.
MR. POUND replied that it would be a contractual agreement,
similar to the Alaska Railroad, almost like going out to bid.
He deferred to Stephanie Wheeler who she handles the Alaska
Railroad, but added that there would be a payment from the state
for the rights to the art.
2:05:02 PM
STEPHANIE WHEELER, Communications Officer, Alaska Railroad,
explained that the Alaska Railroad has an annual art program
whereby it solicits artists, Alaskan artists in particular, to
submit sketches for a piece of artwork featuring the railroad.
Based upon those sketches the Alaska Railroad personnel selects
an artist and that artist is paid $3,000 to provide the artwork.
The Alaska Railroad does retain ownership of the artwork which
is used to create merchandise in addition to posters and prints
and a matching lapel pin. The costs include paying the artist
and printing costs of approximately $10,000. After advertising,
production costs, and artist payment, about $15,000-$20,000 goes
into it each year. The railroad does recoup most of that cost
in the sale of prints, posters, and merchandise through its gift
shop, she said.
REPRESENTATIVE SEATON referred the statement that the railroad
recoups "most" of the cost and asked whether it is a net loss.
MS. WHEELER answered it is not a money maker as it is more of a
public relations benefit and the railroad basically breaks even.
2:07:17 PM
REPRESENTATIVE TARR asked whether the Alaska Railroad has ever
considered doing this as a contest rather than a financial
relationship.
MS. WHEELER replied that artists are typically not wealthy
individuals and therefore paying them some type of stipend for
their artwork seemed to be the right thing to do. The railroad
also gives the artist a few prints and posters for the artist's
use, but the Alaska Railroad owns the artwork so the only value
the artist receives is the $3,000, including the prestige in
creating the Alaska Railroad's annual artwork. She described it
as a show piece that people collect and noted that the Alaska
Railroad's artwork is seen in offices around the state and in
the Lower 48. There is the value of being recognized as an
annual art winner, there is a contest element to it, and the
Alaska Railroad has been at $3,000 for over a decade so it's a
pretty low payment, she related.
REPRESENTATIVE TARR referred to the fiscal note and anticipated
the prints would be sold at $100 each. She asked if amount is
comparable to the price the railroad charges per print.
MS. WHEELER reported that the Alaska Railroad makes 750 prints,
which are signed and numbered, and has sold the prints for $50-
$55 for the last ten years. Posters are typically printed on
smaller less expensive paper and are sold for $25-$30, which
captures a different market such as children. The matching pins
are $5, and merchandise such as mugs and ornaments are sold by
the gift shop for $10-$20.
2:10:20 PM
REPRESENTATIVE SEATON asked whether it would make any difference
in the way the Alaska Railroad conducts its business if it
didn't retain ownership of the artwork and the licensing
agreement did not exceed two years.
MS. WHEELER answered that the Alaska Railroad retains ownership
of the artwork so that it can create merchandise well into the
future. She reiterated that the artist receives $3,000 in
compensation and the Alaska Railroad keeps the artwork. The
railroad does not license the artwork for two years like what is
being proposed under HB 177.
REPRESENTATIVE SEATON questioned that if the Alaska Railroad
were to agree to a license not to exceed two years, whether that
would make a difference in its potential revenue stream.
MS. WHEELER replied that the Alaska Railroad has found value in
the manner in which it has been doing things because it does
have gift shops. The railroad is free to use that artwork in
other ways from year to year, as opposed to going back to the
artist and paying more if it wants to use the artwork. She said
she is unsure whether it would make a difference but suspects
that the railroad came to do it in this manner because this way
has the most benefit to the Alaska Railroad.
REPRESENTATIVE SEATON noted he is trying to balance the version
[proposed by HB 177].
2:13:05 PM
REPRESENTATIVE HERRON asked why the state wouldn't want to keep
the art design such that in the future the fish and game fund
could have anniversary prints and collections.
MR. POUND replied he went with two years because he estimated
that was the shelf life for prints and posters and, after
speaking with local artists they are used to that type of
timeframe. He opined that it was a way that the actual bid
could be much lower than $3,000, initially.
REPRESENTATIVE HERRON asked why the state would want to let go
of property that could be valuable in a few years for
collections. He asked whether the state wants to create an
archive that could be valuable years in the future.
MR. POUND answered he is not married to the two-year clause.
2:15:09 PM
REPRESENTATIVE CHENAULT asked whether the discussion is about an
actual salmon stamp or a postage stamp.
MR. POUND responded that it is a stamp attached to the fishing
license.
REPRESENTATIVE CHENAULT noted it does say U.S. postage stamp.
MR. POUND explained that it was an example of what the stamp
might look like without the U.S. postal reference to it as it
may read the State of Alaska King Fishing Stamp.
REPRESENTATIVE CHENAULT noted he likes the first example, but
cannot see where the other two examples have anything to do with
salmon. He then addressed the fiscal note and asked whether
there is an estimate as to what the income might be.
MR. POUND replied he does not have an estimate but posited it
would be higher than that of the Alaska Railroad primarily
because there are tourists from the tour ships getting on the
charter boats, as well as tourists fishing on the Kenai River
with charter boats with an opportunity to sell the posters.
Unlike the Alaska Railroad, the state would not be confined to a
gift shop.
2:17:03 PM
REPRESENTATIVE TARR observed from the fiscal note that it is a
breakeven proposition and surmised that the state would have to
sell at least 500 prints to get to the cost. She offered
concern as to whether that number would be sold and surmised the
railroad has other smaller items in addition to the prints. She
asked whether that would be an option and whether the
legislature needs to specifically give that option. In the
event there is a good design but it is not necessarily selling
many prints, she said she would want the ability to make it into
something such as a greeting card or magnet or other gifts to be
certain it is not a money loser.
MR. POUND agreed and said it is something that is negotiated
between the artist and the department. Once the department owns
the art, he explained, it can do with it as it pleases for the
next two years, as the bill is currently written.
REPRESENTATIVE CHENAULT observed the costs for services in the
fiscal note would include a contract with an artist receiving
between [$2,500 and $5,000] per year, and surmised that that is
a guess by not having the program in place and not knowing the
actual costs. He pointed out that that is more than the $3,000
the Alaska Railroad usually pays its artists.
2:19:22 PM
REPRESENTATIVE JOHNSON asked whether the discussion is the
actual stamp that goes on the back of a license.
MR. POUND answered correct.
REPRESENTATIVE JOHNSON surmised it is similar to a duck stamp.
MR. POUND agreed.
REPRESENTATIVE JOHNSON opined that "the federal wildlife" makes
more by selling duck stamps as posters and where the actual
stamp is below the poster itself. "They make more money off of
that," he said, "than they do off the actual people hunting."
MR. POUND agreed that that potential is there and people who
will never come to Alaska will actually purchase the posters in
an online scenario.
REPRESENTATIVE JOHNSON expressed his concern for the two year
limit because if the department does not own the art work it
will miss out because down the road the artwork will become more
valuable and can be reprinted in the form of a poster. In the
event the department buys the artwork it should own the rights
to it, although, the artist can retain certain rights but he
would hate to see the department pay for it and have someone go
out and create these posters, buy the stamps, and the big money
is on the backend. He said he would like the department to own
the artwork, have a contest like with the duck stamp, the winner
receives $3,000, and the department owns it in perpetuity.
MR. POUND said he has no objection to that amendment coming
forth.
2:21:41 PM
REPRESENTATIVE TARR referred to HB 177, page 1, lines 6-8, which
read: "The department shall make stamps available for the
creation of king salmon limited edition prints and provide for
the sale of stamps and prints to the public." She suggested
that the language limits the opportunity to only a print and
inquired as to whether it might be appropriate to read "or other
products" or something similar that would provide flexibility.
For example, she pointed out that Director Ben Ellis, Division
of Parks and Outdoor Recreation, advised there is a strong
interest in T-shirts, hats, and sweatshirts with the state park
emblem, which is a popular design.
MR. POUND replied that his goal on this legislation is to come
up with funds for fish enhancement and he appreciates that this
is a commercial type enterprise making money.
2:23:12 PM
REPRESENTATIVE SEATON referred to HB 177, page 1, lines 14-15,
"A contract under this subsection is governed by AS 36.30 (State
Procurement Code)," and asked whether there is anything in the
State Procurement Code on art that will make it a difficult
process.
MR. POUND replied he doesn't believe there is, but that he
hadn't considered that aspect of the State Procurement Code.
2:24:18 PM
KEVIN BROOKS, Deputy Commissioner, Office of the Commissioner,
Alaska Department of Fish & Game (ADF&G), referred to the fiscal
note and clarified that the number for a contract is $2,500-
$5,000, a range that would encompass $3,000.
REPRESENTATIVE CHENAULT responded that if he said a larger
amount, he certainly didn't mean it.
2:25:02 PM
MR. BROOKS advised that the department based the fiscal note on
the assumption of selling 500 prints and 1,000 posters. The
department expects there would be some standup costs given it
employs biologists and does not have a marketing department.
The fiscal note reflects it would be a general fund cost with
the program subsequently generating revenue that would pay for
itself. He noted that the department ran a duck stamp program
from the mid-1980s to 2009, when it was discontinued for lack of
a market. This program used to be a real big deal, but over
time that market dried up and there are only a handful of
printing firms that will take on this type of thing. The
expectation would be that a new program would probably see a
surge of sales in the event it could be marketed. He recalled
for the duck stamp program in 1985 there was a big build up with
a lot of advertising. All 50 states were doing it, with a lot
of sales early on, but in the last years of it there was $5,000-
$10,000 in sales on the various items. The department
appreciates the intent and effort because it has been cutting
its budget with programs going away, and anything that could
generate revenue the department is certainly open to. However,
he said, the department is not as optimistic about the level of
revenue that might be generated from the program on a sustained
basis going into the future.
2:27:08 PM
REPRESENTATIVE SEATON reminded the committee that he had asked
about the State Procurement Code. He referred to page 2, lines
1-2, "All costs incurred under this section may be paid from the
fish and game fund." He said he wants to be sure that is an
allowable use of the fund.
MR. BROOKS responded that the state procurement is typically
when the department is buying something and it provides for
competition wherein the department would put a bid out and
accept those bids. He said he doesn't see anything that would
restrict the department's ability to do that by reference of the
State Procurement Code in Title 36.30.
REPRESENTATIVE SEATON noted his understanding of the bidding
procedure wherein people bid for the amount of money they want
to sell something to the state. In this case, essentially, the
department will say the winner would receive $3,000 or $5,000,
and then the department would choose from among the applicants
based on an artist's selection or the commissioner's selection.
He asked whether that is the way it would work.
MR. BROOKS answered he envisions it to be something along those
lines.
REPRESENTATIVE SEATON, regarding that the costs incurred under
this section may be paid from the fish and game fund, asked
whether that is an allowable use of the fund.
MR. BROOKS replied that typically the department uses the fish
and game fund to benefit sport anglers. The department matches
Dingell-Johnson Sport Fish Restoration funding, which has its
own requirements and has to benefit the resources and provide
opportunity. There is a relationship there, but if the
legislature appropriated it for that purpose he thinks it could
legally be done. But, he continued, the department does not
currently have an art program using fish and game funds.
2:29:23 PM
REPRESENTATIVE TARR referred to page 1, lines 11-12, which read:
"The department may only consider designs submitted by state
residents," and asked whether there are issues with limiting who
the department accepts designs from.
MR. BROOKS answered that the department can set its requirements
in a bid document to limit it to Alaska residents.
REPRESENTATIVE TARR referred to page 1, lines 6-8, [text
provided previously] and reiterated that adding the language,
"or other products" might be important given the demise of the
duck stamp program. The state wouldn't have to become a retail
distributor, but, in a more real time analysis, it could
determine whether money is being recouped and coffee mugs could
be easily made. She asked whether the department would be
interested in that type of flexibility or whether it is beyond
the scope of what it wants to take on.
MR. BROOKS pointed out that the department's personnel are not
marketers, they are biologists by trade and the department
manages fisheries and game populations, although, currently many
of those programs are being cut through different efforts in
trying to live within its means. The department would assign
marketing duties to staff, and not add staff, but it could add
months to a seasonal employee. In the event the sum total of
mugs, cards, stamps, and prints could generate money to help the
resources of the state and help the department manage the
fisheries it would be open to doing it, not wanting to limit
itself.
CO-CHAIR TALERICO opened public testimony, but closed it after
ascertaining no one wished to testify.
2:32:10 PM
CO-CHAIR TALERICO stated he would hold the bill given there was
a question about the terms and the two year wording.
2:32:29 PM
REPRESENTATIVE JOHNSON related that prior to being a legislator
he was a marketing person and advised that the opportunity here
is not with creating the state's own division to do this
marketing, but creating an ability to generate the artwork and
license it to someone and generate the money off the license as
opposed to actually doing the products. He suggested that
several places come to mind such as the people that make the
gold coins; there could be a salmon coin and the state would
receive a certain percentage off of everything sold. He said he
does not want ADF&G getting into the marketing business and
agreed ADF&G doesn't have the people. The licensing aspect
could be done through the Department of Commerce, Community &
Economic Development, he suggested. He added that he is unsure
about the way it is currently outlined and offered to work with
the sponsor's office.
2:34:08 PM
REPRESENTATIVE TARR reiterated Mr. Ellis's comments regarding
requests for Alaska State Park designs in different formats, and
noted her support for opportunities to raise money in addition
to this bill.
[HB 177 was held over.]
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB254 Sponsor Statement.pdf |
HRES 3/23/2016 1:00:00 PM |
HB 254 |
| HB254 Supporting Documents-Email AK Trophy Adventures 2-11-2016.pdf |
HRES 3/23/2016 1:00:00 PM |
HB 254 |
| HB254 Supporting Documents-Email APHA 2-12-2016.pdf |
HRES 3/23/2016 1:00:00 PM |
HB 254 |
| HB254 Supporting Documents-Email James P Jacobson 2-15-2016.pdf |
HRES 3/23/2016 1:00:00 PM |
HB 254 |
| HB254 Supporting Documents-Email Sam Rohrer 1-21-2016.pdf |
HRES 3/23/2016 1:00:00 PM |
HB 254 |
| HB254 Supporting Documents-Email Steve H Perrins II 1-26-2016.pdf |
HRES 3/23/2016 1:00:00 PM |
HB 254 |
| HB254 Supporting Documents-Letter Joe Klutsch 2-22-2016.PDF |
HRES 3/23/2016 1:00:00 PM |
HB 254 |
| BGCS LBA Audit.pdf |
HRES 3/23/2016 1:00:00 PM |
HB 254 |
| HB254 ver A.PDF |
HRES 3/23/2016 1:00:00 PM |
HB 254 |
| HB0177A.PDF |
HRES 3/23/2016 1:00:00 PM |
HB 177 |
| HB 177 Sponsor.pdf |
HRES 3/23/2016 1:00:00 PM |
HB 177 |
| HB 177 Salmon stamps.pdf |
HRES 3/23/2016 1:00:00 PM |
HB 177 |
| HB 177 FiscalNote.pdf |
HRES 3/23/2016 1:00:00 PM |
HB 177 |
| HB 177 ARRC Annual Art Program Costs (2015).pdf |
HRES 3/23/2016 1:00:00 PM |
HB 177 |
| HB 177 alaska duck stamps ebay.pdf |
HRES 3/23/2016 1:00:00 PM |
HB 177 |
| HB177 RR costs.pdf |
HRES 3/23/2016 1:00:00 PM |
HB 177 |
| HB 254 SCI Alaska.pdf |
HRES 3/23/2016 1:00:00 PM |
HB 254 |
| HB 254 FiscalNote.php.pdf |
HRES 3/23/2016 1:00:00 PM |
HB 254 |