Legislature(2023 - 2024)SENATE FINANCE 532
02/19/2024 01:30 PM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB34 | |
| SB82 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 34 | TELECONFERENCED | |
| + | SB 82 | TELECONFERENCED | |
| + | TELECONFERENCED |
SENATE BILL NO. 82
"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."
1:45:24 PM
SENATOR JESSE BJORKMAN, SPONSOR, introduced the
legislation.
1:52:19 PM
KONRAD JACKSON, STAFF, SENATOR BJORKMAN, discussed the
Sectional Analysis (copy on file):
Section 1: Amends the uncodified law of the State of
Alaska by adding a new section which establishes that
this legislation may be known as the East Side of Cook
Inlet Set Net Fleet Reduction Act.
Section 2: Amends the uncodified law of the State of
Alaska by adding new Legislative findings and intent
relating to the bill.
Section 3: Amends AS 16.43.200 by adding 2 new
subsections:
(c) Establishes an area of the Upper Subdistrict
of the Cook Inlet Central District as a distinct
administrative area separate from the Cook Inlet
Central District on December 31, 2023. This area
is made up of the statistical areas identified on
January 1, 2023 as 244-21, 244-22, 244-31, 244-
32, 244-41 and 244-42.
(d) Provides that an individual who has a set net
permit for the Cook Inlet Central District on
December 31, 2023 is not entitled to set net in
the administrative area created under this
section as of January 1, 2023 unless the permit
has been reassigned to that new administrative
area.
Section 4: Amends the uncodified law of the State of
Alaska by adding a new section which provides how the
commission will determine whether an individual who
holds a set net entry permit in the Cook Inlet Central
District on January 1, 2024 is reassigned an entry
permit for the administrative area established under
AS 16.43.200(c) (added by sec. 3 of the bill) or the
portion of the Cook Inlet Central District that was
not assigned into the administrative area established
under AS 16.43.200(c).
Section 5: Amends the uncodified law of the State of
Alaska by adding a new section which defines the
appeals process in the new administrative area. This
section provides that a provisional license will be
issued pending resolution of an appeal and the
provisional permit holder may cast a provisional
ballot in the election established under section 6.
Section 6: Amends the uncodified law of the State of
Alaska by adding a new section which requires on April
1, 2024 an election be conducted by the commission
among persons holding permits in the new
administrative area, to affirm support or opposition
to a buy-back program. Requires the commission provide
public notice of the election, hold public meetings
concerning the election, and clarify the details of
the buy-back program to those participating in the
election.
Section 7: Amends the uncodified law of the State of
Alaska by adding a new section which establishes the
set net entry permit buy-back program for certain
permits fished in the administrative area established
under AS 16.43.200(c) (added by sec. 3 of the bill).
This section will only take effect if approved in an
election by the set net entry permit holders in the
administrative area established under AS 16.43.200(c).
If it is approved, the buy-back program will become
law 30 days following notification of the Lt. Governor
(see secs. 9 and 11). Sets qualifications for
participation in the program, provides the buy-back
price for permits, requires that the purchased permits
be cancelled and not re-issued, provides that certain
waters that were fished with permits purchased under
the program will be closed to future commercial salmon
fishing, and specifies other details of the buy-back
program.
Section 8: Amends the uncodified law of the State of
Alaska by adding a new section which requires the
commission to provide a written report to the
Legislature on the status of the program not later
than January 15, 2030.
Section 9: Amends the uncodified law of the State of
Alaska by adding a new section which requires the
chair of the commission to notify the Lieutenant
Governor and the Revisor of Statutes of the outcome of
the election held under section 6.
Section 10: Repeals sections 1, 2, 7 and 8 on June 30,
2030.
Section 11: Amends the uncodified law of the State of
Alaska by adding a new section which provides that
secs. 1, 2, 7, and 8 take effect only if notice is
provided under section 9 that the buy-back program
established under section 7 was approved.
Section 12: Effective Date Clause. Section 4 of the
bill takes effect January 1, 2024.
Section 13: Effective Date Clause. Provides if
sections 1, 2, 7 and, 8, take effect under section 11,
they take effect 30 days following the date of the
notice provided in section 9 that the buy-back program
was approved.
Section 14: Effective Date Clause. Except as provided
in sections 12 and 13, the bill takes effect July 1,
2023.
1:59:23 PM
KEN COLEMAN, EASTSIDE CONSOLIDATION ASSOCIATION, JUNEAU,
discussed, "Eastside Consolidation Association,
Presentation to the Alaska State Legislature" (copy on
file). He pointed to slide 2, "Goals":
Reduce the number of setnet permits and nets on the
Eastside of Cook Inlet
An economically viable and sustainable setnet fishery
Sustainable escapements into our rivers
Reasonable harvest opportunity for ALL user groups
Work Collaboratively in Upper Cook Inlet for the FISH
Passage of SB 82: Cook Inlet: New Admin Area: Permit
Buyback and Gear Reduction Act
Mr. Coleman pointed to slide 3, "Eastside Consolidation
Association":
The Eastside Consolidation Association. Who are we?
The Eastside Consolidation Association (ECA) is a
Qualified Salmon Fishery Association as identified in
AS 16.40.250.
The ECA was formed as a non-profit and is licensed by
the State of Alaska as required by AS 10.20, in
addition is registered with the federal and the
Internal Revenue Code as a Section 501(c)(5) non-
profit.
ECA was formed to promote the consolidation of the
Cook Inlet setnet fishery, primarily by fleet
reduction through buyback of permits and locations.
Further, our position is that such reduction occurs in
the Upper Subdistrict of the Central District,
commonly known as the "Eastside Setnet Fishery".
Our Board of Directors is comprised of limited entry
permit holders as required.
Mr. Coleman addressed slide 4, "We are Eastside
Setnetters":
We are fathers and mothers, we are grandparents, we
are children, sons and daughters, we are families. We
are a community filled with generations of setnetting
families. We are an important part of our local
history. Setnetting is not just a job to us.
Setnetting defines us, it is who we are.
Mr. Coleman highlighted slide 5, "Eastside Setnet History":
For over 150 years these salmon have been feeding
people both locally and all over the world. This rich,
renewable resource was first exported in the 1840's
when ships from America and other nations began
fishing in Alaskan waters and delivering salted salmon
to ports around the world.
The first cannery in Cook Inlet was built at the mouth
of the Kasilof River in 1882. Six years later the
first salmon cannery was constructed on Kenai River.
By 1892, thirty-seven canneries had been built in
Alaska.
Gillnets had been used to some degree in the silty
waters of Cook Inlet from the beginning. Setnetters
fished between traps in the early days. After fish
traps were outlawed, independent fishermen continued
to catch salmon with gillnets to be sold at the
canneries.
Mr. Coleman discussed slide 6, "Upper Cook Inlet Setnet
Area":
736 Set net permits in Upper Cook Inlet
5 districts:
? Northern District
? Kalgin Island District
? Western District
? Southern District
? Central District Upper (Eastside)
The Eastside spans approximately 60 miles and is home
to the two most popular rivers in the State of Alaska:
The Kenai and Kasilof Rivers.
The Cook Inlet fleet reduction opportunity will only
be available to the Eastside setnet fishery.
2:02:45 PM
Mr. Coleman highlighted slide 7, "1973 Limited Entry":
In 1972, Alaskan's voted to amend the constitution to
create a fisheries limitation system (Article VIII,
Sec. 15). The Alaska Legislature approved the Limited
Entry Act in 1973 and created CFEC as an exempt and
independent agency to carry out the mandate of the
people and the legislature.
The mission of the Commercial Fisheries Entry
Commission (CFEC) is to limit the number of
participants in a particular fishery, to allow for
sustainable and economic viability, and as a further
product, conservation of the resource for the common
property into the future.
As a result of Limited entry the number of Cook Inlet
setnet permits has never grown from the original
number of 746. In 2022 there were 736 Cook Inlet
Setnet permits registered.
One Cook Inlet setnet permit allows you to fish three
nets, when regulations provide.
Mr. Coleman addressed slide 8, "1984 Permit Migration to
the Eastside":
In the mid to late 1980's, after record breaking
sockeye runs to the Kenai and Kasilof Rivers, there
was a mass movement of Cook Inlet setnet permits to
the Eastside from other Cook Inlet districts.
Setnetters at that time were looking for more
lucrative fishing and processing capability. A Cook
Inlet permit allows a permittee to move anywhere in
Cook Inlet making the migration legal. However, in the
upper sub district known as the Eastside Setnet site,
the permittee is required to register their intent to
fish a specific statistical area.
Although the total number of permits in Cook Inlet
have not changed, the migration to the Eastside
doubled the number of nets fishing around the
Kenai and Kasilof Rivers.
Mr. Coleman highlighted slide 9, "Cook Inlet: New Admin
Area: Permit Buyback and Gear Reduction Act":
"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."
Mr. Coleman pointed to slide 10, "Reducing Permits":
736 Cook Inlet Permits
440 permits registered to the Eastside (2022 Season)
Senate Bill 82 currently proposes to remove 200 or
more Eastside permits
440 permits = 1,320 nets on the Eastside today
200 permits = 600 nets on the Eastside removed
After fleet reduction: some 240 permits or less = 720
Eastside nets or less could remain
Mr. Coleman discussed slide 11, "Closing Waters - Removing
Nets":
• Roughly 44 percent of fishing permits in Cook Inlet
have leases assigned to them
• A lease is not mandatory to setnet in Cook Inlet
• The most crucial element of SB 82 is closing vacated
tideland waters on the Eastside
If a set netter voluntarily decides to participate in
the gear reduction program that SB 82 creates, the
immediate tideland area associated with their permit
will be retired. It is important to note that without
the closure of the associated immediate tideland area,
the result could be a re-migration into vacated net
locations. It is important that there be no re-
migration or backfill of permits and nets into the
retired net locations. Without the "closed water"
feature of SB82, it would result in a repeat of
the1980's migration and the diluting of the financial
prospects and stability for setnetters who remain.
Mr. Coleman looked at slide 12, "Voluntary Reduction
Approved by Fleet":
In 2021, former Senator Micciche conducted a survey of
the registered permit holders in the Eastside Setnet
fleet. 56 percent (229) responded to the following
question:
1. Do you support the concept of voluntary fleet
reduction program for the Cook Inlet set net fishery
that would cost nothing to those who do not
participate and remain fishing?
An astounding 92.4 percent responded that they were in
support!
Mr. Coleman pointed to slide 13, "Estimated Value":
When a setnet permit and the accompanying tidal areas
are retired, the result is a small business that will
be retired forever.
The estimated value of $260,000 was determined by
taking the average earnings of a setnet permit each
year over the prior ten years. Equivalent to an
average of $20,000 per year, per permit. Adding a
number for tax implications, if volunteer
participating fishermen are included in a buyback
program, they would exit the fishery with a $200,000
sale for a small business that in many cases has been
in existence for generations.
The remaining permits will gain value and will have a
higher price point in their gross earnings per year.
Co-Chair Stedman assumed the average earnings was the net
after operations.
Mr. Coleman agreed.
Mr. Coleman addressed slide 14, "Reduction in Setnet
Permits":
For 46 years Upper Cook Inlet Setnet permits have seen
a decrease from 746 to 736 permits today. 84 percent
of those permits are owned by Alaska residents.
As a set net permit is retired, three nets will be
permanently removed from the waters on the Eastside of
Cook Inlet.
As a result, a higher percentage of the available fish
on a certain day may be harvested by the remaining
sites, yet will provide a higher percentage of fish
moving to the rivers overall.
Reducing the nets by 600 will result in a Chinook and
Sockeye harvest savings.
SB 82 is the mechanism moving forward to provide the
Eastside set net fleet the opportunity and the
capability of harvesting sockeye while reducing the
harvest of non-targeted Chinook salmon in accordance
with current regulations.
Mr. Coleman addressed slide 15, "Fighting to remain viable
- ESSN Sockeye Harvest."
Mr. Coleman looked at slide 16, "Future Generations":
The Cook Inlet Eastside Setnet fleet reduction will
work to ensure a sustainable and financially stable
setnet fishery that will be around for future
generations.
We will continue to work with In-River user groups to
ensure that the fish entering the rivers are harvested
responsibly and sustainably.
Healthy limits on every user group will ensure there
will be healthy sustainable fisheries for generations
to come. By forming partnerships between user groups
through open dialog and collaboration, we can protect
our resource while enjoying its many benefits well
into the future.
2:10:30 PM
Mr. Coleman pointed to slide 17, "Collaboration by Users":
Cook Inlet setnet permits have decreased in the past
46 years. An Eastside setnet fleet reduction will be a
start to the solution.
The Kenai River is home to the largest dipnet fishery
in the State of Alaska. This fishery has increased in
participation in the last 20 years. Eastside
setnetters will continue to work with the Board of
Fisheries to ensure healthy returns are achieved to
maximize harvestable surplus.
The Kenai River In-river Sport fishery has increased
in the last 20 years. Eastside setnetters look forward
to working with In-River user groups to ensure
healthy, strong and sustainable runs.
Eastside setnetters will step forward to work
collaboratively to repair the contentious environment
that surrounds Upper Cook Inlet Fisheries. We look
forward to other users joining the conversation. The
next generation and our State of Alaska deserve
respectful dialog in the search for collaborative
solutions.
Mr. Coleman pointed to slide 18, "Letter to Erin":
I have fished every Upper Cook Inlet salmon season of
my life. Forty-five years, minus however long I was in
diapers. I have never lived without fishing. I have
never lived without fish.
Seasons have been bountiful. Nets sunk. Fighting
against wind and tide and regulations to get our gear
in on time. Long hours spent bent over picking sockeye
after sockeye until my hands were sore, my back was
sore, my being was sore and I smiled. It was the
best kind of sore. Seasons have been bleak. Waterhauls
and a narrative running from, "it's still early," to
"everything is running late this year," to "well,
there's always next year."
Good years or bad, it has all been satisfying. Fishing
is not just something I do, it is who I am. It is my
passion. And my identity. Political pressures grew
along with the population. Our voice doesn't carry.
What does this one little fishery matter? But to those
of us who grew up in it, those whose families have
fished these beaches since the Territorial days of
Alaska, it seems like everything.
Most of us work other jobs in the off-season. I strove
to become a veterinarian, and it is a profession I am
extremely proud of. I love my work, yet here is the
difference. I became a veterinarian. I was born a
fisherman. People ask what it is like, being a woman
commercial fisherman. I tell them I don't know. I am
not trying to be cryptic; the truth is, I knew I was a
fisherman before I knew I was a woman.
I am not naive. I see the handwriting on the wall. One
of these days, my fishery will merely be a small
anecdote in Alaskan history.
My most terrifying day of fishing hasn't happened yet.
But I fear it is close. The day they close our
fishery, the day I have to figure out who I am when I
am not a fisherman? That will be my most terrifying
day.
2:12:53 PM
GLENN HAIGHT, COMMISSIONER, ALASKA COMMERCIAL FISHERIES
ENTRY COMMISSION, discussed the straightforward
implementation of the bill.
2:17:29 PM
Co-Chair Stedman queried the required amount.
Mr. Haight responded that it was $15,000 after taxes and
expenses.
Co-Chair Stedman queried the current net income.
Mr. Haight agreed to provide that information.
Co-Chair Stedman wondered whether other fisheries had
problems.
Mr. Haight replied that there were a number of other
fisheries that the permits did not get fished, but stressed
that the others did not have as many issues as the proposed
segment.
Co-Chair Stedman queried the provisions to ensure that
there were not frontrunning and other issues with the
Southeast buyback.
Senator Bjorkman replied in the affirmative.
2:21:44 PM
Co-Chair Stedman surmised that there were some set netters
that had zero income, and requested a calculation of the
gross and expected net income.
Senator Bjorkman replied that studies could be very
invasive on the set netters. He stated that the latest
analysis was less invasive.
Mr. Jackson furthered that the $20,000 value was the result
of examining a normal fishing year.
2:26:11 PM
Co-Chair Stedman wondered whether it would be a model for
buybacks and other precents for other fisheries.
Mr. Haight replied what was seen in Cook Inlet could be
seen in most fisheries. He felt that it would inform what
was done within ten years. He stressed that there could be
other solutions in other areas.
Senator Bjorkman stated that the process would provide a
way for the commercial setnet industry in Cook Inlet to
survive.
Co-Chair Stedman wondered whether there was no economic
base, would there be a stop to fishing.
Senator Bjorkman replied that reducing the amount of gear,
the ability to fish increases so less salmon would be taken
in the industry.
2:31:11 PM
Co-Chair Stedman requested the market value of the permit.
Mr. Haight replied that the permit was fairly volatile, so
there were swings in the permit values from $225,000 to
$40,000.
Mr. Jackson stated that there was not a great possibility
for purchasing of others' permits.
Co-Chair Stedman surmised that the opportunity for profit
on permits was closed.
Senator Bjorkman agreed.
2:34:43 PM
LOREN LEMAN, SELF, ANCHORAGE (via teleconference), spoke in
support of the bill.
Co-Chair Stedman stressed that Alaska became a state to be
rid of fish traps.
Mr. Leman agreed.
2:39:24 PM
TIM KEENER, SELF, KENAI (via teleconference), spoke in
support of the bill.
2:44:40 PM
SARAH FROSTAD-HUDKINS, SELF, KENAI (via teleconference),
spoke in support of the bill.
2:46:18 PM
LISA GABRIEL, SELF, KENAI (via teleconference), spoke in
support of the legislation.
Co-Chair Olson OPENED public testimony.
2:48:59 PM
GARY HOLLIER, SELF, KENAI (via teleconference), spoke in
support of the gear reduction.
2:51:18 PM
GARY DEIMAN, SELF, NINILCHIK (via teleconference), spoke in
support of the bill.
2:52:12 PM
ALLAN CROOKSTON, SELF, KENAI (via teleconference),
testified in support of the bill.
2:55:33 PM
DOUGLAS M. BLOSSOM, SELF, NINILCHIK (via teleconference),
spoke in support of the legislation.
2:57:36 PM
RUSSEL CLARK, SELF, KENAI (via teleconference), spoke in
support of the legislation.
3:00:14 PM
GREG JOHNSON, SELF, VANCOUVER (via teleconference),
testified in support of the bill.
3:02:44 PM
TEAGUE VANEK, SELF, NINILCHIK (via teleconference),
testified in opposition of the bill.
3:05:08 PM
TED CROOKSTON, SELF, KENAI (via teleconference), spoke in
support of the bill.
3:06:58 PM
STEVE VANEK, SELF, NINILCHIK (via teleconference), spoke in
opposition to the bill.
3:09:36 PM
JOANN WICHERS, SELF, KENAI (via teleconference), testified
in support of the bill.
3:10:47 PM
DAVID WICHERS, SELF, KENAI (via teleconference), spoke in
support of the legislation.
3:11:36 PM
JOHN MANLEY, SELF, KENAI (via teleconference), testified in
support of the bill.
3:12:29 PM
BRUCE MANLEY, SELF, KASILOF (via teleconference), spoke in
support of the legislation.
3:13:55 PM
CODY BLOSSOM, SELF, CLAM GULCH (via teleconference),
testified in support of the bill.
3:14:37 PM
ROBERT WILLIAMS, SELF, KASILOF (via teleconference), spoke
in support to the legislation.
3:16:12 PM
RUDY WILSON, COOK INLET FISHERIES, KENAI (via
teleconference), spoke in support of the bill.
3:17:00 PM
JOSEPH LEMAN, SELF, ANCHORAGE (via teleconference), spoke
in support of the bill.
3:19:11 PM
DAVID MARTIN, SELF, CLAM GULCH (via teleconference),
testified in opposition to the bill.
3:22:12 PM
HARRY LEMAN, SELF, NINILCHIK (via teleconference),
testified in support of the legislation.
Co-Chair Olson CLOSED public testimony.
3:23:47 PM
Senator Bjorkman thanked the committee.
SB 82 was HEARD and HELD in committee for further
consideration.