Legislature(2019 - 2020)BUTROVICH 205
02/28/2020 03:30 PM Senate RESOURCES
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| Audio | Topic |
|---|---|
| Start | |
| SB159 | |
| SB189 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 159 | TELECONFERENCED | |
| *+ | SB 189 | TELECONFERENCED | |
| + | TELECONFERENCED |
SB 189-SPORT FISHING ENHANCEMENT SURCHARGE
3:55:00 PM
CHAIR MICCICHE announced that the final order of business would
be Senate Bill 189 (SB 189), "An Act relating to the fish and
game fund; establishing the sport fishing enhancement surcharge;
relating to the repeal of the sport fishing facility surcharge;
providing for an effective date by amending the effective date
of sec. 21, ch. 18, SLA 2016; and providing for an effective
date."
3:55:13 PM
DAVE RUTZ, Director, Division of Sport Fisheries, Alaska
Department of Fish and Game (ADF&G), Palmer, Alaska, explained
that the legislature approved a bond measure in 2005 to
construct two sport fish hatcheries: the William Jack Hernandez
Sport Fish Hatchery in Anchorage and the Ruth Burnett Sport Fish
Hatchery in Fairbanks.
He detailed that ADF&G crafted a bond repayment plan that added
a $9 sportfish license surcharge for residents and a bit higher
surcharge for nonresidents. The surcharge goes directly to bond
repayment, except for an annual $500,000 payment for hatchery
production in Southeast Alaska. The surcharge plan has been so
successful, ADF&G will be able to pay off the bond five years
early. The final payment is scheduled for December 2020.
He noted that the legislature made a promise initially that the
surcharge would be eliminated after the final bond payment. The
scheduled repeal of the surcharge and associated statutes is the
end of 2020.
3:57:06 PM
MR. RUTZ said the department remembers the promised repeal but
also recognizes the benefit of the surcharge to sport fish
enhancement operations. With that in mind, they propose a
compromise to reduce the surcharge 34 percent so Alaska
residents would pay $4 and nonresidents would contribute a
little more. The department would collect the surcharge funds in
a separate ADF&G account that would only be used for sport fish
enhancement programs and sport fish hatchery facilities.
He noted that upon repayment of the current bond, there is an
immediate $500,000 funding loss to Southeast Alaska. Targeted
sites in Southeast use the surcharge funds to raise and release
1.4 million chinook salmon smolt that mainly benefit Alaskan
sport fish anglers.
3:58:34 PM
MR. RUTZ detailed that the sport fishing enhancement program
annually releases 7.2 million fish into 270 locations, most of
which are lakes, and 1.4 million chinook salmon in Southeast
Alaska. The enhancement efforts generate hundreds of thousands
of sport fish angler days which in turn contributes
significantly to local economies. The fishing efforts focused on
enhanced chinook salmon in Southeast and Southcentral Alaska
reduces the harvest of wild chinook salmon stocks that are
currently in a state of recovery.
MR. RUTZ noted that the department redirected nearly $5 million
of Dingell-Johnson Act funds to pay for operations and
maintenance after the Ruth Burnett and William Jack Hernandez
hatcheries came on line. Any needed repairs and maintenance to
date have come from existing operating budget funds at the
expense of other division needs. Several larger and more
expensive needs were deferred. Maintenance needs will grow and
place undue burden on existing programs as facilities age.
Having the ability to tap into a funding source will allow the
department to cover sport fish enhancement without impacting
other needs.
4:00:17 PM
MR. RUTZ detailed that the surcharge generates an average of
$6.4 million in revenue. The division allocates approximately $7
million to enhancement related programs and projects with most
tied to the Anchorage and Fairbanks hatchery operations and
maintenance.
He summarized that establishing the new reduced enhancement
surcharge would cover existing enhancement program costs,
address deferred maintenance and maintenance needs, and ensure
funds are available for unforeseen facility events to avoid
supplemental budget requests or facility shutdown.
4:01:50 PM
RACHEL HANKE, Legislative Liaison, Alaska Department of Fish and
Game, Juneau, Alaska, provided the following sectional analysis
for SB 189:
Section 1
Amends AS 16.05.130(e) to name the newly created sub-
account of the fish and fund the sport fishing
enhancement account. This section also restricts the
use of the sub-account to maintenance of sport fishing
facilities as well as sport fish enhancement programs.
This section also removes all language which
references the enterprise account and the revenue
bond. These amendments will go into effect January 1
the year following the bond being paid and closure of
the enterprise account.
Section 2
Amends AS 16.05.340(j) to reference the new
enhancement surcharge and new funding purpose, it
removes all language referencing the revenue bond, it
also reduces all existing license surcharge amounts by
$5. These amendments will go into effect January 1 the
year following the bond being paid and closure of the
enterprise account.
Section 3
Repeals Section 21, ch. 18, SLA 2016. This section
made a conforming amendment which removed reference to
16.05.340(j) because the section would have been
repealed once the revenue bond is satisfied.
Section 4
Removes AS 16.05.130(e) and AS 16.05.340(j) from
Section 34, ch. 18, SLA 2016, which is the repealing
section. This will retain the sections after the
revenue bond has been satisfied and allow the
amendments from sections 1 and 2 of this legislation
to go into effect.
Section 5
Amends uncodified law in Section 35, ch. 18, SLA 2016
to remove reference to Section 21, ch. 18, SLA 2016.
This section effectively removed reference to AS
16.05.340(j) upon repayment of the revenue bond. This
section will now be retained therefore, the repeal is
removed.
Section 6
Adds transition language to uncodified law which
transfers the balance of the enterprise account to the
new sport fishing enhancement account January 1
following the calendar year that the revenue bond
obligation is satisfied.
Section 7
Adds new conditional effect to uncodified law which
states that sections 1 and 2 of this legislation will
only go into effect once the commissioner of fish and
game notifies the revisor of statutes that the
principal amount of the bond and any other obligations
of the bond have been paid.
Section 8
Amends Section 36, ch. 18, SLA 2016 to remove
reference to AS 16.05.340(j).
Section 9
Effective date section which states that January 1 of
the calendar year following the commissioner notifying
the revisor of statutes as required in section 7,
sections 1 and 2 of this legislation go into effect.
Section 10
Establishes an immediate effective date for sections
3-10.
CHAIR MICCICHE asked if the bill was clean enough to not
compromise the dedicated fund issues.
4:04:16 PM
CHERYL BROOKING, Assistant Attorney General, Civil Division,
Natural Resources Section, Alaska Department of Law, Anchorage,
Alaska, answered yes. She said the surcharge program currently
has an established account for the bonds and the bill would
continue the practice to some extent.
CHAIR MICCICHE asked if she would do additional research and
provide the committee with a more thorough answer.
MS. BROOKING answered yes.
SENATOR KIEHL asked for assurance that the proposal does not
raise any legal concerns for the Department of Law.
MS. BROOKING replied the bill does not trigger the Privileges
and Immunities Clause that the Carlson v. State case impacted.
The Privileges and Immunities Clause only applies to commercial
operations and not sport fishing. The clause protects the
ability of people to work and make a living in different states.
Sport fishing fees for residents and nonresidents can be
different.
CHAIR MICCICHE asked what the definitions of enhancement and
maintenance to make it clear what the expected activities from
funding bill be.
4:06:23 PM
TOM TAUBE, Deputy Director, Division of Sport Fisheries, Alaska
Department of Fish and Game, Juneau, Alaska, specified that
surcharge funding for enhancement and maintenance means
supporting sport fish production at the Anchorage and Fairbanks
hatcheries. Maintenance would include adding a backup well at
the Fairbanks hatchery in addition to addressing corroded pipes,
upgrading effluent system, and improving public access at the
Anchorage hatchery. Maintenance would also encompass general
wear and tear on hatchery equipment.
CHAIR MICCICHE asked if there is a reason the bill does not
specify maintenance funding associated to sport fishing
facilities.
MR. TAUBE answered that including enhancement would allow for
fund dispersement to Southeast Alaska that currently occurs with
the bond package. The intent is to maintain the $500,000 going
to Southeast Alaska for king salmon production.
4:08:46 PM
SENATOR COGHILL said Interior Alaska is grateful that the
Fairbanks hatchery provides local king salmon. However, the
legislature promised constituents that the surcharge would go
away. He conceded that the operational and maintenance
expectations for the hatcheries via the bond did not come in the
way that people expected.
SENATOR GIESSEL recalled that the Fairbanks hatchery struggled
with finding a suitable water source. She imagined that a second
backup well in Fairbanks is going to be an expensive endeavor.
MR. TAUBE answered that a second well would cost approximately
$1 million. High iron content in the water would require an
elaborate water filtration system as well as heat exchangers to
better grow fish. Both hatcheries have been functioning well,
but the aging facilities require maintenance.
4:12:00 PM
SENATOR GIESSEL commented that there is quite a backlog of
deferred maintenance on buildings and other facilities. The
State risks losing the hatchery facilities due to deferred
maintenance and keeping the fund going seems prudent.
SENATOR COGHILL explained that legislators always want to keep
their promises. However, hatchery maintenance and enhancement to
meet sport fishing expectations is a place that does not allow
the legislature to keep a promise of not adding the surcharge
into perpetuity.
4:13:13 PM
CHAIR MICCICHE opened public testimony.
He noted his appreciation that the fiscal note provided clarity
for ongoing hatchery maintenance. He said he served on the board
for the Cook Inlet Aquaculture Association and confirmed the
importance of hatcheries and their requirement for maintenance.
The fiscal noted clearly states on page 2 that funding provides
ongoing hatchery maintenance. He admitted that he is more
comfortable with the language in the fiscal note than in the
bill.
MR. TAUBE noted that the bill references the hatcheries as sport
fishing facilities.
CHAIR MICCICHE said he did not see anyone asking to testify.
4:15:23 PM
SENATOR KIEHL referred to an estimated nonresident revenue
report for one-day sport fishing licenses that showed the
revenue going down 65 percent when the surcharge goes down 50
percent. He asked why estimated revenue goes from $1.2 million
to $550,000 when the surcharge is reduced from $10 to $5.
4:17:00 PM
BRIAN FRENETTE, Assistant Director, Division of Sport Fisheries,
Alaska Department of Fish and Game, Juneau, Alaska, explained
that the revenues are a function of license sales volume. He
noted that there is a significant number of one-day nonresident
sales, particularly in Southeast Alaska tied to the cruise ship
industry, and that accounts for the big difference in revenue.
SENATOR KIEHL pointed out that Southeast Alaska is expecting
increased numbers of cruise ship passengers. He restated his
question about the decreased revenue estimate for one-day
nonresident license sales.
CHAIR MICCICHE asked the division get back to the committee with
an answer to Senator Kiehl's question regarding the decreased
revenue estimate.
MR. FRENETTE replied that he would clarify the one-day
nonresident license purchase amount.
4:18:32 PM
CHAIR MICCICHE announced that public testimony would remain open
for SB 189.
He said both SB 189 and SB 159 are simple bills, but the
legislation may require a bit of clarity. He asked the
departments to answer the questions that committee members
posed.
4:19:23 PM
CHAIR MICCICHE held SB 189 in committee.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 159 ver. A.pdf |
SRES 2/28/2020 3:30:00 PM |
SB 159 |
| SB 159 Transmittal Letter 1.28.2020.pdf |
SRES 2/28/2020 3:30:00 PM |
SB 159 |
| SB 159 Sectional Analysis 1.28.2020.pdf |
SRES 2/28/2020 3:30:00 PM |
SB 159 |
| SB 159 Fiscal Note DFG-DSF-01.14.2020.pdf |
SRES 2/28/2020 3:30:00 PM |
SB 159 |
| SB 159 ADFG Letter of Support 1.28.2020.pdf |
SRES 2/28/2020 3:30:00 PM |
SB 159 |
| SB 159 Logbook Use Summary 1.28.2020.pdf |
SRES 2/28/2020 3:30:00 PM |
SB 159 |
| SB 189 v. A.PDF |
SRES 2/28/2020 3:30:00 PM |
SB 189 |
| SB 189 Transmittal Letter ver. A 2.18.2020.pdf |
SRES 2/28/2020 3:30:00 PM |
SB 189 |
| SB 189 Sectional Analysis - ver. A 2.18.2020.pdf |
SRES 2/28/2020 3:30:00 PM |
SB 189 |
| SB 189 Fiscal Note DFG-SF 02.03.2020.pdf |
SRES 2/28/2020 3:30:00 PM |
SB 189 |
| SB 189 Support Doc - DOR Redemption Letter 2.13.2020.PDF |
SRES 2/28/2020 3:30:00 PM |
SB 189 |
| SB 189 Support Doc - Surcharge Revenue Breakdown 2.18.2020.pdf |
SRES 2/28/2020 3:30:00 PM |
SB 189 |