Legislature(2001 - 2002)
05/03/2002 01:44 PM Senate JUD
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 286-FISHING PERMITS/ASSOCIATIONS/ASSESSMENTS
REPRESENTATIVE SCALZI, sponsor of HB 286, said the bill would
offer the salmon industry a tool for consolidation. He said it
would allow individuals to hold two salmon permits in any given
area. He said there was often a lot of inactivity of permits and
believed there were more permits issued in some areas than
necessary; more permits were activated when a fishery became
healthy through an increase in prices or salmon runs. HB 286
would offer individuals in the salmon fisheries the opportunity
to buy and hold some of the permits. The permits would carry no
privileges, such as extra fishing gear or time. He said
consolidating the effort would keep fishermen from other areas
from coming in and exacerbating the problem of overcrowding.
He said HB 286 was the highest priority bill supported by the
United Fishermen of Alaska (UFA) because it would offer the most
benefit to the commercial fishing industry.
CHAIRMAN TAYLOR asked Ms. Sue Aspelund to provide testimony.
MS. SUE ASPELUND, Executive Director, Cordova District Fishermen
United (CDFU), said CDFU represents the fishing families of the
Copper River/Prince William Sound area. CDFU believes the
industry needs a variety of tools to pursue structural changes
necessary to compete in the new global marketplace. HB 286 would
provide fishermen with one of the simplest and most immediate
tools to get fishing gear out of the water in distressed
fisheries.
CHAIRMAN TAYLOR asked if there were any questions for Ms.
Aspelund. There were none.
MR. VICTOR SMITH said UFA and processors are saying that HB 286
is part of a plan to revitalize Alaskan salmon fisheries. He
said the main authors of HB 286 were Mr. David Bedford, Executive
Director of the Southeast Alaska Seiners Association (SASA), and
Mr. Bob Thorstenson, president of UFA and stockholder of "Alaska
Seafoods." He said fishermen themselves had very little input on
the bill. The SASA board did not authorize or direct Mr. Bedford
to proceed on its behalf regarding permit stacking. He said the
board authorized a committee to explore options for fleet
reduction but while that committee was exploring options, Mr.
Bedford was also working on a plan of his own. He said Mr.
Bedford denied saying there was a deal that processors would
support permit stacking in exchange for UFA's support to keep
global seafoods out. He said Mr. Bedford now claims he said UFA
wouldn't oppose the processors' new management plan if the
processors would support permit stacking.
MR. VICTOR SMITH said one of the touted features of HB 286 was
that it could be used in different ways in different fisheries.
He wondered why that would be necessary because all Alaska salmon
fisheries were subject to the same laws. He said UFA and SASA
also used the selling point that HB 286 would be in the control
of fishermen. He said they had possibly been guilty of
involvement or trade on their global decision. He said
nonresidents couldn't use their permits and were forced to sell.
He said the salmon industry needs to follow the law. Key people
involved in HB 286 had conflicts of interest and had broken rules
of accountability. He said these same people would probably have
control over permit stacking and how it would work. He believed
HB 286 would be as bad for many Alaskans as it had been for the
first round of nonresidents ousted from Alaska fisheries.
CHAIRMAN TAYLOR asked if there were any questions for Mr. Victor
Smith. There were none. He asked Mr. David Bedford to provide
testimony.
MR. DAVID BEDFORD, Executive Director, SASA, said he sat on the
board of UFA for SASA and was licensed to practice law in Alaska.
He said HB 286 is the highest priority piece of legislation for
UFA and has a strong majority of support within that
organization.
He said UFA brought HB 286 forward because the salmon fisheries
are in dire straits and some things need to be done to address
the economic difficulties the fisheries are experiencing. He
said HB 286 would give them the opportunity to reduce the number
of people competing for a share of a shrinking pie so they could
have a viable fishing business to support the coastal regions
that depend on the salmon fisheries.
MR. BEDFORD maintained that HB 286 was drafted to be as
transparent as possible to make sure that control would be in the
hands of the permit holders. It was drafted that way because
they were concerned somebody might be able to use the bill to
force something on fishermen that they didn't want. He said HB
286 would require a two-thirds vote of all permit holders before
any kind of assessment could be levied. He said anybody wanting
to initiate the program would be required to go to the permit
holders with an outline of the plan so they had a very clear idea
of what would be done and what their money would be paying for.
The program would be regional so nobody from another area would
have anything to say about a distant fishery.
MR. BEDFORD said UFA and SASA are asking the Legislature to give
them the tools to address their problems.
1:55 p.m.
SENATOR THERRIAULT asked who would buy and hold the permits.
MR. BEDFORD said the limited entry law specifies that only
individuals can hold permits. He said the association would
decide it was going to set up a program and figure out how to do
it. They could contract with a permit holder to send their permit
back to the Commercial Fisheries Entry Commission to be
extinguished, or the association could contract with a permit
holder to hold a second permit until sometime in the future when
the fishery was so lucrative that there should be more people
fishing. Individuals would hold the permits at all times.
SENATOR THERRIAULT asked if HB 286 might create a situation where
people would buy low and hope to sell high.
MR. BEDFORD said that is possible with any kind of effort
reduction program. He said the Magnuson-Stevens Act provided
effort reduction programs for federal fisheries. A person could
buy a permit and try to speculate on it but he didn't think that
would be a very good investment. He said people currently in the
fishery would probably buy a second permit to hold because they
would receive an annual payment from the association and they
would have to compete with one less boat. He said the association
should be able to contract for less money with a person who would
be gaining the additional benefits of less competition.
CHAIRMAN TAYLOR asked if there were any further questions for Mr.
Bedford. There were none.
MR. JERRY MCCUNE, UFA, said HB 286 wouldn't work for every
fishery; it would be an option that some fisheries could use. He
said people probably wouldn't buy another permit in a fishery
where permits cost $60,000 to $70,000. However, they would
probably buy another permit if the permit cost $10,000 to
$18,000. He said that might be a good investment for a fisherman
planning to stay in the fishery.
MR. MCCUNE said the associations would be difficult to set up
because the permit holders need to support the idea to start an
association. He said many safeguards are contained in HB 286: a
timeline on assessments is required; a two-thirds vote of all
permit holders would be required to extend an assessment; and 25%
of the permit holders could petition to have a vote to change or
remove an assessment.
CHAIRMAN TAYLOR asked if there were any questions for Mr. McCune.
There were none.
SENATOR COWDERY moved CSHB 286(RES) am out of committee with
attached zero fiscal note and individual recommendations.
There being no objection, CSHB 286(RES) am moved out of committee
with attached zero fiscal note and individual recommendations.
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