04/09/2010 09:00 AM Senate FINANCE

SENATE BILL NO. 225                                                                                                           
                                                                                                                                
     "An Act relating to the  grant of certain state land to                                                                    
     the  University of  Alaska; relating  to the  duties of                                                                    
     the Board of Regents; relating  to deposits made to the                                                                    
     Alaska  permanent  fund  received  from  certain  lands                                                                    
     conveyed  to the  University of  Alaska; ratifying  and                                                                    
     reauthorizing certain prior conveyances  of land to the                                                                    
     University  of  Alaska; making  conforming  amendments;                                                                    
     and providing for an effective date."                                                                                      
                                                                                                                                
10:11:46 AM                                                                                                                   
                                                                                                                                
TIM  BENINTENDI,  STAFF,  SENATOR OLSON,  commented  on  the                                                                    
legislation.  He introduced  a  program  implemented by  the                                                                    
National Marine Fisheries Service  providing loans to groups                                                                    
with the purpose  of reducing fleet capacity  by engaging in                                                                    
permit buy  backs as authorized by  AS1640250. The Southeast                                                                    
Revitalization   Association   is   engaged   in   such   an                                                                    
arrangement  accommodating  those   in  the  Southeast  sane                                                                    
fishery and operating with a  self imposed three percent fee                                                                    
on fish  sales. This fee  is the basis for  repaying federal                                                                    
loans.  The  objective  is  to  drop  from  380  permits  to                                                                    
approximately 260  permits. He noted that  SB 255 authorizes                                                                    
the  Department   of  Fish  and  Game   and  the  Commercial                                                                    
Fisheries  Entry  Commission  to  release  to  the  National                                                                    
Marine Fisheries  Service individual  fish ticket  data held                                                                    
by  the  state supporting  monitoring  the  loan program  by                                                                    
allowing confirmation  of correct assessments  and payments.                                                                    
He added that an issue  emerged between permit holders and a                                                                    
processors association  regarding the eventual  final number                                                                    
of permits  to remain active  in the fishery. He  noted that                                                                    
SB  255 does  not address  a target  number of  permits upon                                                                    
completion  of  the "buy  back"  program.  While the  permit                                                                    
holders have  expressed an interest  in reducing  the number                                                                    
to approximately  260, the  processors express  concern that                                                                    
too  few   permits  remaining  might  impact   the  economic                                                                    
viability  of the  fishery and  investments made  in Alaskan                                                                    
facilities.  A memorandum  of agreement  was struck  whereby                                                                    
the  Southeast  Revitalization  Association agreed  that  no                                                                    
fewer  than   260  permits  would  remain   in  the  fishery                                                                    
following  a successful  "buy back"  program. A  legislative                                                                    
letter of intent was produced to solidify the agreement.                                                                        
                                                                                                                                
Co-Chair Stedman  noted the two  zero fiscal notes  from the                                                                    
Department of Fish and Game and the Department of Revenue.                                                                      
                                                                                                                                
10:15:40 AM                                                                                                                   
                                                                                                                                
FRANK  HOMAN,   COMMISSIONER,  COMMERCIAL   FISHERIES  ENTRY                                                                    
COMMISSION, commented  on the legislation as  the completion                                                                    
of a series of attempts  to incorporate a program authorized                                                                    
by  the  Alaska Legislature  in  2002.  The association  was                                                                    
created with the  goal of limiting the number  of permits in                                                                    
the fishery. State  statutes in 2002 and 2006  show that the                                                                    
program was  facilitated by the  Alaska Legislature  and the                                                                    
fishermen have  convened with the National  Marine Fisheries                                                                    
Service  to utilize  a federal  loan  program to  repurchase                                                                    
permits.  The   loan  program   from  the   National  Marine                                                                    
Fisheries Service  requested a  process to confirm  that the                                                                    
three  percent assessment  to be  paid by  the fisherman  is                                                                    
monitored. He  mentioned that fifty  percent of  the permits                                                                    
are not fished meaning that  the removal of the permits will                                                                    
not  have  a  significant  impact, but  the  future  of  the                                                                    
fishery  will be  enhanced by  the  remaining fishermen.  He                                                                    
pointed out that the state  retains all authority for future                                                                    
management of the fishery.                                                                                                      
                                                                                                                                
10:19:03 AM                                                                                                                   
                                                                                                                                
Senator  Olson asked  if the  permits given  by the  limited                                                                    
entry  commission could  be transferred  from generation  to                                                                    
generation.  Commissioner  Homan  responded that  a  limited                                                                    
entry permit  does not come  back to  the state except  in a                                                                    
buyback by the  state. Mr. Homan responded  that a provision                                                                    
was  incorporated  at  the  beginning   of  the  program  to                                                                    
incorporate the suggestion made  by Senator Olson. A limited                                                                    
entry  permit   can  be   transferred  from   generation  to                                                                    
generation by the permit holder.                                                                                                
                                                                                                                                
10:20:21 AM                                                                                                                   
                                                                                                                                
ROB ZUANICH,  MANAGER, SOUTHEAST  REVITALIZATION ASSOCIATION                                                                    
(via teleconference) testified in  favor of the legislation.                                                                    
He noted  that the association  exists for the  sole purpose                                                                    
of implementing a  program to reduce or buy  back the number                                                                    
of permits in the fishery.  The bill before the committee is                                                                    
essential  to  the implementation  of  the  program and  the                                                                    
background  can   be  summarized.  He  echoed   comments  of                                                                    
Commissioner  Homan. He  stressed  that the  bill has  great                                                                    
support   from  Southeast   Alaskan  salmon   fishermen  and                                                                    
processors.                                                                                                                     
                                                                                                                                
10:22:27 AM                                                                                                                   
                                                                                                                                
BOB  THORETENSON, EXECUTIVE  DIRECTOR, SEAS,  added that  he                                                                    
moved  to Alaska  six  years  ago for  the  sole purpose  of                                                                    
achieving  the fleet  consolidation. He  anticipated funding                                                                    
initially  to be  grant  related, but  $3  million in  grant                                                                    
funding was the  limit. He pointed out  that the legislature                                                                    
financed over  20 percent of  the program and  the remaining                                                                    
80 percent belongs  to the loan. He spoke  to the importance                                                                    
of the  legislation as  it links  the National  Fisheries in                                                                    
the  federal loan  program to  ensure  utilization by  State                                                                    
Waters Fisheries.                                                                                                               
                                                                                                                                
10:24:58 AM                                                                                                                   
                                                                                                                                
MICH EIDE, BOARD  MEMBER, SEAS, testified in  support of the                                                                    
legislation. He urged the committee's support.                                                                                  
                                                                                                                                
Senator  Olson  asked  for  an   idea  about  the  potential                                                                    
negative  impact  of  the  bill.  Mr.  Eide  responded  that                                                                    
additional boats do not mean additional fish.                                                                                   
                                                                                                                                
10:26:50 AM                                                                                                                   
                                                                                                                                
SB  225  was  HEARD  and   HELD  in  Committee  for  further                                                                    
consideration.