Legislature(2023 - 2024)GRUENBERG 120
04/02/2024 10:00 AM House FISHERIES
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| Audio | Topic |
|---|---|
| Start | |
| HB297 | |
| HB294 | |
| HB195 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 195 | TELECONFERENCED | |
| *+ | HB 297 | TELECONFERENCED | |
| *+ | HB 294 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 195-COOK INLET: NEW ADMIN AREA;PERMIT BUYBACK
11:24:00 AM
CHAIR VANCE announced that the final order of business would be
HOUSE BILL NO. 195, "An Act relating to the powers of the Alaska
Commercial Fisheries Entry Commission; relating to
administrative areas for regulation of certain commercial set
net entry permits; establishing a buy-back program for certain
set net entry permits; providing for the termination of state
set net tract leases under the buy-back program; closing certain
water to commercial fishing; and providing for an effective
date." [Amendments 1, 2, and 3 were adopted to HB 195 during
the meeting on 3/26/24.]
11:24:32 AM
REPRESENTATIVE MCCABE moved to adopt Amendment 4 to HB 195, as
amended, labeled 33-LS0807\A.1, Bullard, 3/4/24, which read as
follows:
Page 6, line 24:
Delete "200"
Insert "300"
REPRESENTATIVE CARPENTER objected for the purpose of discussion.
CHAIR VANCE explained that Amendment 4 would change the number
of permits in the current buyback program to 300. She stated
that this puts the number of permits closer to the Commercial
Fisheries Entry Commission (CFEC) number.
REPRESENTATIVE STUTES clarified that this would make the maximum
number of permits 300.
11:25:33 AM
REPRESENTATIVE CARPENTER removed his objection. There being no
further objection, Amendment 4 was adopted.
11:25:46 AM
REPRESENTATIVE MCCABE moved to adopt Amendment 5 to HB 195, as
amended, labeled 33-LS0807\A.7, Bullard, 3/29/24, which read as
follows:
Page 5, line 3, following "and":
Insert "how"
Page 5, lines 3 - 4:
Delete "to be offered"
Insert "will be determined"
Page 6, lines 19 - 30:
Delete all material and insert:
"(b) Participation in the buy-back program
established under this section is voluntary. Subject
to appropriation and to this section, the commission
shall buy back the unencumbered entry permit of an
individual qualified under this section. A qualified
individual may apply electronically on a form provided
by the commission to have the individual's entry
permit purchased under this section. If an applicant
is disqualified from participation in the program
under (c) of this section, elects not to participate
in the buy-back program, fails to sign the contract of
sale within a period specified by the commission, or
fails to provide all of the information required under
(a) of this section, the commission shall disapprove
the individual's application and may not buy back the
individual's entry permit under the program."
Page 6, line 31:
Delete "whose name is selected in the lottery
under this section"
Page 7, lines 12 - 13:
Delete all material and insert:
"(1) determine the amount for which to buy
back an entry permit of an applicant by dividing the
money allotted to the buy-back program established by
this section among the qualified applicants after
(A) all appeals made under sec. 5 of this
Act concerning the assignment of entry permits are
resolved; and
(B) all timely received applications have
been approved or disapproved by the commission under
(b) of this section;
(2) buy back the entry permit of an
applicant for an amount determined under (1) of this
subsection, less administrative costs; and"
Renumber the following paragraph accordingly.
REPRESENTATIVE CARPENTER objected for the purpose of discussion.
11:26:00 AM
ROBERT BALLINGER, Staff, Representative Sarah Vance, Alaska
State Legislature, on behalf of Representative Vance, answered
committee questions on Amendment 5. He said that the primary
purpose of Amendment 5 would be to make a modification to the
dollar amount that was set for the buyback program, as this
would help facilitate the program. He stated that this would
make the buyback amount align with the funding available, and
the funds would be distributed equally among participants.
CHAIR VANCE asked if Amendment 5 would address constitutional
concerns related to HB 195.
MR BALLINGER explained that the issue with the buyback program
dollar amount is that the value in the proposed bill is much
higher than the appraised value of the permits, as the bill
value includes the cost of the ability to fish. He suggested
that Amendment 5 would change the amount to what could be paid.
CHAIR VANCE explained that Amendment 5 addresses the dollar
amount, as at this point it is unknown how much funding would be
allocated. She expressed the understanding that this is not
meant to impact the state treasury, and she expressed the desire
to not give "false promises" to fishermen, as the program should
be equally available to those who choose to participate. She
further explained that the amendment would remove the lottery so
each participant would receive an equal amount based on the
allocation. She acknowledged that the sponsor of the proposed
legislation does not support the amendment, as he prefers the
lottery option.
11:29:26 AM
REPRESENTATIVE MCCORMICK asked to hear from the sponsor of HB
195.
REPRESENTATIVE JUSTIN RUFFRIDGE, Alaska State Legislature, as
prime sponsor, answered committee questions on Amendment 5 to HB
195. He explained that the intention of HB 195 is to establish
an election and a lottery to enter the buyback program. He said
HB 195 would create a framework for people who engage in the
setnet fishery on the east side of Cook Inlet to enter
voluntarily a buyback program. The fishermen would elect for
themselves whether their permit would be put into the lottery to
be selected. He stated that the amount of federal funding
allocated for this has not been established. He added that HB
195, as is, would set a cap at $60,000 per permit, but this is
contingent on whether these funds are available. Per Amendment
5, he expressed concern on how permits would then qualify for
the program. He stated that the purpose of the buyback program
would be to establish a fishery that would sustain itself, but
the amendment would remove the lottery and the price cap. He
advised that this would create "nebulous components to a bill
that is already setting a framework with some question marks:
what is the dollar amount going to be and who is going to fund
that." He expressed understanding of the impetus behind
Amendment 5 but stated that the individual fishermen are not
taking this stance. He expressed the understanding that the
fishermen want to have a framework for a buyback program, so
they can decide whether to have their permits in a lottery,
leaving the remaining permits to participate in a sustainable
fishery. He argued that the amendment would not help HB 195
accomplish the primary goals it aims to achieve.
11:33:43 AM
REPRESENTATIVE HIMSCHOOT asked if Amendment 5 would satisfy the
constitutional concerns posed by HB 195.
11:34:00 AM
ALPHEUS BULLARD, Legislative Counsel, Legislative Legal
Services, Alaska State Legislature, answered committee questions
on Amendment 5 to HB 195. He expressed the understanding that
the constitutional concern is whether paying $260,000 for the
permit would serve the public purpose. He recommended that
Amendment 5 would provide a different process and alleviate any
concerns raised by this. In response to a follow-up question,
he stated that for the concern that a permit would be bought
back for a higher price than the market value, the proposed
amendment would make each permit worth the same percentage value
from the appropriated funds.
11:36:14 AM
GLEN HAIGHT, Commissioner, Commercial Fisheries Entry
Commission, in response to a question from Representative Stutes
on who would be affected by the proposed legislation, stated
that there are around 340 current permit holders who hold from
405 to 450 permits registered to fish in the area in the last 10
years. He responded that multiple permit holders own more than
one permit.
REPRESENTATIVE STUTES questioned whether the amendment should
include a limit of the number of permits one individual can
sell.
COMMISSIONER HAIGHT clarified that one individual can only hold
two permits. He added that these fishermen will fish together
in one operation, and in these operations multiple individuals
hold either one or two permits. He explained that this could be
misleading on how many permits one person can hold, as many
permits can fish in one operation.
COMMISSIONER HAIGHT, in response to a question from
Representative McCabe, he pointed out that per the CFEC's
economic report from 2021, there were 453 permits registered to
fish in 2016, with 407 permits registered to fish in 2020. For
the eligibility years for the buyback, he said there were 428
permits registered to fish.
REPRESENTATIVE MCCABE clarified that based on these years there
was around 430 permits, with around 300 permit holders.
11:40:40 AM
REPRESENTATIVE STUTES questioned the number of total permits,
registered, or not registered to fish. If a permit was not
registered to fish in the qualifying years, she questioned
whether the permit would qualify for the buyback.
COMMISSIONER HAIGHT responded that in the Cook Inlet setnet
fishery, these permits can fish in any subdistrict, but the
permit holder must register for one district and stay in the
district for the year. He expressed the understanding that
these fishermen are stable, returning to the same subdistrict
every year; however, the ability to move districts would create
a range of participants in the east side. He continued that it
is difficult to show whether an individual actually participated
in the fishery because when many fishermen fish in one
operation, the fish may all be landed under just one of the
permits in the operation. He suggested that if the permit were
registered in a district, the individual is most likely fishing.
He noted the other qualifications in the proposed legislation,
such as having buoy tags and shore leases.
REPRESENTATIVE STUTES questioned whether a Cook Inlet setnet
permit holder from another district could move to the east side
in a following year.
COMMISSIONER HAIGHT responded that the permit holder could
feasibly move; however, there is not much migration in this
fishery. From a survey taken, it was understood that around
four fishermen moved operations in around ten years. He
described the equipment and land usage in this fishery, which
tends to be difficult to move.
REPRESENTATIVE STUTES expressed the understanding that fishermen
must be registered in certain years to qualify for buyback.
CHAIR VANCE concurred.
11:45:36 AM
REPRESENTATIVE HIMSCHOOT sought to clarify that the amendment
would remove the lottery system and allow the available sum to
be equally distributed to those who qualify and choose to
participate.
CHAIR VANCE reiterated that under the amendment it would still
be a voluntary program.
REPRESENTATIVE HIMSCHOOT questioned whether there would still be
an election.
CHAIR VANCE requested an explanation of the effects of Amendment
5 versus the current language in the proposed legislation.
MR. BULLARD stated that the amendment would replace the lottery
process and the amount each would receive. He stated that under
the amendment there would still be an election where people
would choose to participate; however, the participants would be
signing up to receive a percentage of the funds made available
for the buyback.
11:47:34 AM
REPRESENTATIVE CARPENTER expressed concern that without the
amendment, the bill would not meet the provision in Article VIII
of the [Constitution of the State of Alaska], which provides
just compensation for any individual who gives up his/her right
to fish.
MR. BULLARD stated that because it is a voluntary process, no
one would be divested of his/her right to fish. He stated that
each permit holder would make the decision for himself or
herself.
REPRESENTATIVE CARPENTER pointed out that commercial fishermen
have not been able to fish the east side of Cook Inlet for a
number of years, and they have not been compensated by the state
for the inability to use the waters. He questioned whether the
state policy is following the state's constitution.
MR. BULLARD expressed uncertainty whether HB 195 relates to the
violation of this constitutional provision, as this would be a
voluntary process.
REPRESENTATIVE CARPENTER pointed out that if the amendment is
passed, 300 permits would be taken away. If the state still
does not allow the remaining permit holders to fish, he
questioned whether these permit holders would be losing any
cause of action against the state.
MR. BULLARD stated that holding a CFEC permit does not provide a
right to catch a certain percentage of fish or make a profit
from doing so. He expressed the opinion that HB 195 would not
relate to the provision referred to in the constitution.
REPRESENTATIVE CARPENTER expressed the understanding that
fishermen in Cook Inlet feel that they have been divested of
their right to fish, as they have not been allowed to fish and
have not been compensated, yet the proposed legislation would
compensate some permit holders. He expressed the opinion that
this is "straying into some constitutionally murky water."
11:54:05 AM
CHAIR VANCE clarified that if Amendment 5 were adopted, there
would be no cap on the number of permits.
MR. BULLARD concurred with this statement.
REPRESENTATIVE CARPENTER pointed out that Amendment 4 was just
passed, and this would change the 200 permits to 300 permits.
He suggested that passing Amendment 5 would override Amendment
4.
CHAIR VANCE explained that if Amendment 5 is adopted, anyone who
has a permit can choose to participate, and the money would be
distributed equally; otherwise, the current version of the bill
has a lottery program with a cap on the permit participation of
300 permits.
11:55:52 AM
REPRESENTATIVE RUFFRIDGE, in response to a request from
Representative Himschoot, explained that he opposes Amendment 5
because it would remove the lottery system and the cap that was
passed in Amendment 4. He pointed out that the goal of the
buyback is to have the number of participants be at a
sustainable fishery level, which would be around 200 permits.
He argued that Amendment 5 would create an open-ended system
with a level of uncertainty on how the buyback would be
administered. He suggested that the amendment would allow
fishermen to wait until the amount of appropriated money is
known before they consider the program. Once this happens, the
number opting into the program would divide the amount. He
clarified that the legislature would not be using state funds to
fund the buyback. He stated that the funds would be either
federal or private. He opined that this comes down to what
should be first: the choice to be involved in the buyback or the
determination of how much money is appropriated to the buyback.
11:59:02 AM
A roll call vote was taken. Representatives Stutes, Carpenter,
Himschoot, and Vance voted in favor of adopting Amendment 5 to
HB 195, as amended. Representatives McCormick and McCabe voted
against it. Therefore, Amendment 5 was adopted by a vote of 4-
2.
12:00:11 PM
REPRESENTATIVE STUTES moved to adopt Amendment 6 to HB 195, as
amended, labeled 33-LS0807\A.6, Bullard, 3/26/24, which read as
follows:
Page 7, line 13:
Delete "$260,000"
Insert "$13,500"
REPRESENTATIVE CARPENTER objected for the purpose of discussion.
REPRESENTATIVE STUTES stated that Amendment 6 is based on the
value of the permits as reported by CFEC. This amount was
reported at $13,500 per permit. She argued that the buyback
should be for the value of the permit and nothing else. She
stated that the boats, houses, and equipment should not be
included in the buyback.
CHAIR VANCE noted that the newly adopted Amendment 5 removed the
dollar value of the permit. She questioned whether this would
change the intent of Amendment 6.
REPRESENTATIVE STUTES responded in the negative.
12:01:12 PM
REPRESENTATIVE MCCORMICK requested that the bill sponsor speak
to the amendment.
REPRESENTATIVE RUFFRIDGE stated that after the adoption of
Amendment 5, this bill has become open ended with a vague
framework. He suggested that a legal opinion should be sought
on whether Amendment 6 and Amendment 5 could coexist.
12:02:56 PM
The committee took an at-ease from 12:02 p.m. to 12:03 p.m.
12:03:15 PM
REPRESENTATIVE STUTES withdrew Amendment 6. There being no
objection, Amendment 6 was withdrawn.
12:03:33 PM
CHAIR VANCE requested closing comments.
REPRESENTATIVE MCCABE expressed support for the version of the
proposed legislation before Amendment 5 was adopted, as now the
buyback would be something that it was not designed to be, which
could result in more legal issues.
REPRESENTATIVE CARPENTER expressed the understanding that there
are 340 permit holders, but he expressed uncertainty on the
number of eligible permits. He expressed the opinion that this
would be unfair and unconstitutional if only a small portion
receives compensation for not being able to fish. He argued
that this is the main issue. He further discussed this, opining
that state policy would be left to "chance" on who receives
compensation. He pointed out that Amendment 5 would make this
fair; however, the issue of the funding has not been addressed.
He suggested that if this is state policy, the state should pay;
however, leaving this to a lottery with an unknown funding
source could have a negative effect with the fishermen in the
area. He reiterated the argument on the unfairness of the
lottery system.
12:08:48 PM
The committee took an at-ease from 12:08 p.m. to 12:12 p.m.
12:12:43 PM
REPRESENTATIVE STUTES clarified that the buyback program was not
the state's idea, as it was the user group's idea. She
suggested that Amendment 5 "leveled the playing field" for the
user group.
CHAIR VANCE voiced that her job is to answer to her constituents
and the state's constitution. She stated that the amendments
brought forward addressed constitutional concerns, but still
there is a high probability of litigation. She expressed the
hope that the bill will reflect the constitution and the will of
fishermen. She suggested that the proposed legislation would
provide a tool that allows the fishermen to have their say. She
thanked the committee members for the conversation. She
expressed support for the bill because her constituents are in
support of the bill.
REPRESENTATIVE CARPENTER clarified that by adopting Amendment 5,
the fishermen would still have an election, and the maximum
number can participate, if they so choose. He argued that
otherwise only a certain number of fishermen would be allowed to
participate.
12:16:04 PM
REPRESENTATIVE MCCABE moved to report HB 195, as amended, out of
committee with individual recommendations and the accompanying
fiscal notes. He granted Legislative Legal Services the
authority to make technical and conforming changes as necessary.
There being no objection, CSHB 195(FSH) was reported out of the
House Special Committee on Fisheries.