Legislature(2017 - 2018)BUTROVICH 205
03/12/2018 03:30 PM Senate RESOURCES
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| Audio | Topic |
|---|---|
| Start | |
| SB211 | |
| SJR13 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 211 | TELECONFERENCED | |
| *+ | SJR 13 | TELECONFERENCED | |
| + | TELECONFERENCED |
SSSB 211-TEMP. TRANSFER OF COMM. FISHING PERMITS
3:30:56 PM
CHAIR GIESSEL announced consideration of SB 211 [SSSB 211 was
before the committee]. This is the first hearing.
TIM LAMKIN, staff to Senator Stevens, Alaska State Legislature,
Juneau, Alaska, said SSSB 211 attempts to address the graying of
Alaska's fishing fleet. It establishes a temporary permit
transfer process to connect the more experienced master
fishermen with younger journeymen to train them over a period of
time to take over the reins. The intent is to help younger
fishermen with some upward mobility into the industry and
provide them with some advanced training. The stakeholders,
fishermen, and Commercial Fisheries Entry Commission (CFEC), all
support this idea. The bill uses terms that convey the purpose
of allowing the means for a master fisherman to phase himself
out as younger fishermen are trained to phase themselves in.
3:33:07 PM
MR. LAMKIN said that Section 25 is the substantive component of
this bill and he would start with that in his sectional
analysis. Every other section is conforming amendments to
existing statute.
Section 25 adds a new subsection establishing the Alaska Master
Fisher Retirement Transfer Program (AMFRT). In trying to be
gender neutral he realizes "fisher" needs to be changed back to
"fisherman" with the intent of still being gender neutral. The
following is the sectional analysis of the rest of SSSB 211,
version 30-LS1369\D:
(a) Would require that the transfer not be initiated
during an open fishing season, so it's not an
impromptu decision.
(b) The transfer process is limited to a period of no
more than three consecutive years, so it can't be in
perpetuity. This bill was carefully crafted to honor
the Limited Entry Program and avoids looking like a
leasing program.
(c) The transfer process must include written binding
contract between both parties filed with CFEC.
(d) Provides that the primary permit holder be present
during 50 percent of the fishing season.
(e) The journeyman must use the master's vessel for
the fishing season.
(f) Provides that both names of master and journeyman
are on the permit.
(g) The journeyman qualifies to participate in the
AMFRT program if the journeyman:
1. applies to the CFEC on a form approved by the
ADF&G.
2. Demonstrates having been employed by and be a
crewmember for the master for a minimum of one year
prior to initiating the transfer process.
3. Meets marine and navigational safety standards
appropriate for the fishery and sophistication of the
vessel being operated, including demonstrated
knowledge of the fishery and of protecting the state's
fisheries and marine environment and
4. Paid a required fee.
The CFEC is charged with adopting regulations
specifying the forms, dates of application, and
procedures to be followed in applying for and renewing
a temporary permit transfer under the AMFRT program.
These regulations will also include reporting
requirements for both master and journeyman.
3:38:15 PM
SENATOR MEYER joined the meeting.
3:39:06 PM
MR. LAMKIN provided the rest of the analysis as follows:
Section 1 Conforms with the naming of the program as
"the Alaska Master Fisher Retirement Transfer Program
(AMFRT."
Section 2 Allows the Board of Fisheries to require a
fisherman participating in the AMFRT program to be
physically present at the fishing site.
Section 3 Requires a fisherman participating in the
AMFRT program to hold a commercial fishing license
during their portion of the transfer process when they
are actually fishing under the permit, as well as
requiring a crew member license when an AMFRT
participant is on the vessel, but not directly fishing
under the permit.
Section 4 Exempts resident participants of the AMFRT
program from having to pay a fee for an annual crew
member fishing license.
Section 5 Exempts nonresident participants of the
AMFRT program from having to pay a fee for their
annual crewmember fishing license.
Section 6 Exempts participants of the AMFRT program
from being eligible for a seven-day crewmember fishing
license.
3:41:08 PM
Section 7 Incldues in the definition of "commercial
fishing license" the entry perjimnit being temporarily
transferred through the AMFRT program.
Section 8 Allows participants in the AMFRT to deliver
or land fish provided they meet the permitting
requirements consistent with existing commercial
fishing laws and regulations.
Section 9 Provides for participants in the AMFRT
program to be able to employ crew for purposes of
commercial fishing activities, and to transport and
sell fish caught commercially.
Section 10 Includes criminal penalties for
participants of the AMFRT program if they are
convicted for failure to be present, on board during
commercial fishing activity under their permit.
Section 11 Includes the provision that a fish
processor or commercial buyer may only purchase fish
from permit holders, including participants of the
AMFRT program.
Section 12 Provides that participants of the AMFRT
program must possess and present their permit
identification when selling commercial fish caught
under their permit.
Section 13 Includes AMFRT program participants n
common property fisheries and terminal harvest area
takings.
Section 14 Includes in the duties of the Alaska
Commercial Fisheries entry Commission (CFEC) the
authority to approve temporary permit transfers for
qualifying participants of the AMFRT program, and to
adopt regulations to manage the program.
Section 15 Specifies that a person may not operate
gear in the commercial taking of fishery resources
unless that person is an AMFRT program participant.
Section 16 Specifies that a crewmember may assist with
operation of gear for the commercial taking of fishery
resources, provided an AMFRT program participant is
physically present and also engaged in the operation
of that gear.
3:43:08 PM
Section 17 Provides for AMFRT program participants to
operate gear within a specified fishery.
Section 18 Requires AMFRT program participants to be
in possession of their permit at all times when
operating the gear for which the permit was issued.
Section 19 Prevents the permit activated under the
AMRFT program from being used as an instrument of
equity or financially encumbered in any way, or to be
transferred to repossessed in any way beyond what is
allowed within the program, as set forth by the
program and related regulations.
Section 20 Adds a new subsection establishing that a
temporary permit holder under the AMRFT program has
the same use privilege and rights in a fishery as is
available to an individual holding a regular entry
permit.
Section 21 Provides CFEC authority to establish annual
fees for the issuance and renewal of entry permits,
including temporary permits issued under the AMFRT
program.
Section 22 Establishes that temporary permits issued
under the AMFRT program may only be transferred
through the CFEC as provided by law and by regulations
established by the CFEC.
Section 23 Disallows the transfer of temporary permits
issued under the AMFRT program except as specifically
provided by law or regulation.
Section 24 Provides exceptions, established by
regulation, for the transfer of temporary permits
issued under the AMFRT program, to include emergency
transfer of the permit in the event of such things as
medical illness, death, military or governmental
duties, or other extenuating circumstances resulting
in an unavoidable hardship and preclusion from being
able to participate in the fishery.
Section 25 (Covered at the beginning of the analysis)
Section 26 As regards the existing point system for
frequent violators of the Entry Permit salmon fishery
laws, this section includes the AMFRT program permitee
in that point system of respective violations.
Section 27 Extends the requirement of the CFEC to
provide notice of violations and point-docking for
AMFRT permit holders committing violations to salmon
fisheries laws, consistent with existing notice
requirements for standard permit holder making same
violations.
Section 28 Extends the assessment of points against a
standard permit holder to also include a permit holder
under the AMFRT program that such assessment shall be
in addition to and not a substitution for other
penalties that may be imposed by a court.
3:46:03 PM
Section 29 Adds a new subsection to clarify the master
shall be given notice of any points assessed against a
journeyman participating under an AMFRT transfer
agreement.
Section 30 Specifies that if a master's or
journeyman's salmon fishery permit is suspended for
any reason, the CFEC shall not issue another permit
for either of them in that fishery during the
suspension period, nor may they engage in any manner
of commercial salmon fishing activity during that
suspension time period.
Section 31 Extends CFEC authority to revoke the AMFRT
permit in the event that false or misleading
information was used to obtain it.
Section 32 Establishes an effective date of January 1,
2019.
SENATOR VON IMHOF asked what happens now when a retiring
fisherman wants to leave his permit to a younger fisherman, in
the absence of this program.
MR. LAMKIN said first that this bill is missing an owner
financing mechanism for these permits, and that is currently
being worked on with the Department of Commerce, Community and
Economic Development (DCCED). Currently, when a retiring
fisherman wants out, he sells his permit out-right to an
interested buyer. There isn't a shortage of sellers or buyers
right now, but permits can cost over several hundreds of
thousands of dollars and that may keep a younger fisherman from
entering the industry. Rather than them being left out, this
provides an opportunity for them to participate.
3:48:54 PM
SENATOR VON IMHOF asked if this measure is being designed for
buying the limited entry permit but not the boat and gear.
MR. LAMKIN replied yes, and testimony will indicate that once
you get the permit, the rest tends to fall in place much easier,
although that may be arguable.
SENATOR VON IMHOF asked how having the journeyman on the
master's vessel interplays with the permit and is three years
enough time for pay back. How does a bank loan play into that?
MR. LAMKIN replied that those great questions would be ironed
out eventually. They want to associate the permit and this
training transfer process with not just the master fisherman and
the name on the permit, but also the vessel and the gear and the
equipment associated with that permit and fishery. Whether three
years is realistic is a good question and more time may be
needed.
SENATOR MEYER, referring to sections 4 and 5, asked what the
ratio is between residents and nonresidents having these
permits. He wanted to incentivize Alaskans and not nonresidents.
MR. LAMKIN replied that he didn't know but could look it up.
MR. LAMKIN said section 4 has to do with being a crewmember not
being the permit holder, adding that the whole point of Limited
Entry is to keep our fleets and the holders of those permits at
least substantially in the hands of Alaskans.
3:52:35 PM
CHAIR GIESSEL opened invited testimony.
BRUCE SCHACTLER, commercial fisherman/representing himself,
Kodiak, Alaska, supported SB 211. He commented that resident
participation depends on the area and the fishery. Kodiak
fisheries are more than 75 percent residents.
He explained that SB 211 is designed to be a training program.
Although he has been fortunate to have the same crew for many
years, many crewmen don't know if they want to be a captain or
have what it takes to be one. Are they fish killers? Do they
have what it takes to find fish and catch them? Do they know how
to handle grumpy crewmembers? Can they deal with the
responsibility of running a boat? He said this program was put
together by captains with their crewmen. It's not intended for a
crewman to amortize the cost of the permit over three years. The
idea of three years was after doing this for three years the
journeyman will have it figured out. Either he wants to buy a
permit and a boat and get into it as a Limited Entry permit
holder, or not.
3:57:26 PM
Another possible way to transfer a permit is through the central
lien registry that CFEC and the Division of Investments is
working on. This concept would enable someone to do an owner
transfer and if it didn't work out, be able to get the permit
back.
MR. SCHACTLER said SB 211 doesn't require a complicated rewrite
of Limited Entry; it just amends one section that adds the
program. The other amendments are conforming language. It will
add no more gear to the fishery and it adds safety training for
everyone. In all his conversations he hadn't found anyone not in
favor of this.
He added that another variable is on the table now: the fishing
resource itself is "iffy," the loss of codfish in the Gulf of
Alaska, for example.
4:00:17 PM
FATE PUTMAN, Commissioner, Commercial Fisheries Entry Commission
(CFEC), Alaska Department of Fish and Game (ADF&G), Juneau,
Alaska, supported SB 211. It heads in the right direction in
establishing a new temporary transfer for this type of permit.
He had some concerns about language on page 11, lines 5-7,
saying the commission is responsible for certifying that the
journeyman has the safety training. That and the protection of
property along with the state's fisheries and marine
conservation are jobs better suited to other agencies like the
Department of Environmental Conservation (DEC), and the Alaska
Department of Fish and Game (ADF&G), or the Coast Guard for
training. He hoped that could be changed.
Secondly, this measure would require the CFEC to find a stopping
point in order to effectuate the transfer, and some fisheries go
throughout the year with no stopping point.
SENATOR VON IMHOF said she understood the motivation behind the
transfer process but she is not clear if money will change hands
for a lease towards ownership for three years. She asked Mr.
Putman if he cares if money is transferred prior to that.
MR. PUTMAN replied the commission is concerned about leasing,
but at the same time, catch profits are normally exchanged
between the master and journeyman and that should continue. A
provision requires CFEC to maintain and review the contracts
between the master and journeyman.
4:03:45 PM
CHAIR GIESSEL thanked him and opened public testimony on SB 211.
4:03:49 PM
DAVID HASHAGEN, commercial fisherman/representing himself,
Ketchikan, Alaska, supported SB 211. It is a step in the right
direction in addressing "the graying of the fleet." However, he
said a provision is needed allowing a person with a temporary
permit to obtain his own vessel. He wants to keep his boat if he
were to lease out his permit, because after 54 years, he has a
boat that he can put his pickup on and travel up and down the
coast from Patagonia to the Bering Sea. And if a person has two
sons and turns the boat over to one and the permit over to the
other, they would both have to come up with another permit or
boat to make the business work.
He suggested inserting "or by discretion of the commissioner"
into section 25, lines 16-17, after "three consecutive years",
as was done for Limited Entry. That language would allow the
CFEC to make adjustments for the differences in each fishery. He
said he has had the same crew for many years and if a temporary
permit holder was added, he wouldn't have a place to sleep. He
is in the gillnet fishery and there isn't a whole lot to learn;
it's just a lot of hard work, and that's what the guys find out
right away. In addition, a journeyman might want to gillnet in a
different area than where he fishes his boat.
The owner financing concept is an excellent idea. He would
probably be the first one to participate in that if something
was set up, because now when you turn your permit over to
someone and if you haven't got your money, he can look you
square in the eye and say: "good luck," and doesn't have to give
the permit back.
MR. HASHAGEN noted that the Limited Entry Program has been
upheld by the Supreme Court three times: you can't discriminate
against non-residents. However, he thought the owner financing
provision would encourage a master to make a deal with someone
he knows who lives in the state. And the three-year timeframe
would provide the state with a financial track record for the
fishery a person wants the state to finance the permit in.
THERESA PETERSON, commercial fisherman/representing himself,
Kodiak, Alaska, supported the intent of SB 211. However, the
language needs to be tightened to make sure it meets the stated
intent, because it changes significantly the integrity of the
owner/operator limited entry system, which she thinks, works
"really well."
4:13:12 PM
Language in section 25, line 16, saying that the transfer cannot
be initiated during an open fishing season needs more work. It
would be important to determine that this agreement needs to be
reached prior to when a fishery opens on a certain date but then
it closes and opens throughout the course of the summer, at mid-
season, or goes year-round.
The "period of not more than three consecutive years on line 17
is not an adequate timeframe for someone to really understand if
they want to pursue funding to purchase a permit, and this
arrangement should be limited to one-time. The contract should
include what the payments are while in the transitional phase
(section 25 on page 10, line 20). That would be a good way to
keep track of how much money is being extracted out of the
fisheries.
MAC MEINERS, representing himself/commercial fisherman, Juneau,
Alaska, supported SB 211.
4:17:21 PM
CHRIS BURNS, commercial fisherman/representing himself, Kodiak,
Alaska, supported SB 211. He said the Limited Entry Program has
been very successful. The CFEC has done plenty of studies on
emergency transfer and fraud issues and hasn't found very much
of that going on over the last three to five years. This is just
fixing an oversight in the limited entry system.
MR. BURNS said this is a way to break into management in the
fisheries like the International Brotherhood of Electrical
Workers (IBEW). Fishing is a little more complicated than the
other trades: the owner needs to deal with insurance, crew,
weather, big runs/low runs, and global market fluctuations.
4:21:26 PM
JOHN MOLLER, commercial fisherman/representing himself, Juneau,
Alaska, supported SB 211, agreeing with many testifiers. He owns
three permits and his daughter owns one. They fish in three
different fisheries out of Juneau. He said Alaska has some
outstanding loan programs for financing permits and boats and
this should not turn into a leasing program. The owner operator
is an essential part of the overall CFEC program.
4:23:16 PM
JIM PETERSON, commercial fisherman/representing himself, Kodiak,
Alaska, supported SB 211. He wholeheartedly supports this bill,
because like all the rest of them he isn't getting any younger.
One of the biggest mountains a guy has to climb is getting that
permit and making it easier for that individual is a good thing.
4:24:53 PM
CHAIR GIESSEL said they could submit their specific
recommendations in writing to her office. Finding no further
testimony, she closed public testimony and set SB 211 aside. She
invited the sponsor to comment.
SENATOR STEVENS, sponsor of SB 211, Alaska State Legislature,
Juneau, Alaska, said this issue was brought forward by Mr.
Schactler who like a lot of older fishermen, realize they want
to be able to pass their business on to somebody else. Passing
it on to the son is the traditional way, but some people don't
have a child to pass it on to. Getting young people into the
industry is a big problem; a vessel and gear that used to cost
$15,000 costs $300,000, now is more than most young people can
accumulate. This is not a perfect solution, but he is looking
forward to making it as good as possible.
CHAIR GIESSEL held SB 211 in committee.