05/16/2003 02:37 PM Senate FIN

                                                                                                                                
     HOUSE BILL NO. 226                                                                                                         
     "An Act relating  to the sale, offer for sale,  representation,                                                            
     and  labeling  of  food  or  other  agricultural   products  as                                                            
     organic,  and to the state organic  certification program;  and                                                            
     providing for an effective date."                                                                                          
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
BARBARA  BITNEY, Staff to  Representative  Bill Stoltze, the  bill's                                                            
sponsor, informed  the Committee that this legislation  is presented                                                            
to "simply  adopt the  federal standard  of organic"  and allow  the                                                            
State to  implement a certification  program  to enable the  State's                                                            
agricultural  districts  to certify  Alaskan produce.  She  informed                                                            
that, absent  an Alaska certified  organic program, Alaskan  growers                                                            
must pay  to have their  crops certified  as organic, at  tremendous                                                            
expense,  by the  states of  Oregon or  Washington.  She noted  that                                                            
program receipts would support the $37,000 fiscal note.                                                                         
                                                                                                                                
Senator Taylor voiced "strong support" for the legislation.                                                                     
                                                                                                                                
RIVER  BEAN testified  via teleconference  from an  offnet site  and                                                            
urged the Committee  to support this legislation,  as it would allow                                                            
his company's produce to  be labeled and certified within the State.                                                            
                                                                                                                                
LARRY BEVILBISS testified  via teleconference from an offnet site in                                                            
support  of  the  bill. He  commented  that  the  industry  and  the                                                            
Department  have  worked  diligently  to  keep the  expense  of  the                                                            
organic certification  program to  a minimum, and he apologized  for                                                            
there being a fiscal note.                                                                                                      
                                                                                                                                
MARK REMPEL,  Organic Farmer, testified  via teleconference  from an                                                            
offnet site,  in support of the bill  as it encourages the  "organic                                                            
niche market" to continue to expand.                                                                                            
                                                                                                                                
Senator  Taylor  moved  to  report  the  bill  from  Committee  with                                                            
individual recommendations and accompanying fiscal note.                                                                        
                                                                                                                                
Senator  Bunde asked  whether avenues,  such as  a corporate  income                                                            
tax, might allow  the State to recoup the cost of  implementing this                                                            
program.                                                                                                                        
                                                                                                                                
Mr. Bevilbiss  responded that while  agricultural businesses  do not                                                            
pay a  corporate business  tax to  the State,  they are required  to                                                            
have an Alaska business  license and must purchase the Alaskan Grown                                                            
organic certification label.                                                                                                    
                                                                                                                                
Ms.   Bitney  affirmed   that   businesses   would   be  charged   a                                                            
certification  fee as well  as a fee  for use  of the Alaskan  Grown                                                            
certification label.                                                                                                            
                                                                                                                                
Senator Taylor voiced that  these fees and the growth of the organic                                                            
agriculture industry would benefit the State.                                                                                   
                                                                                                                                
There being  no objection, HB 226  was REPORTED from Committee  with                                                            
previous fiscal  note #2 from the  Department of Natural  Resources.