04/20/2004 02:04 PM Senate L&C

        SB 387-COMMERCIAL FISHING LOANS FOR QUOTA SHARES                                                                    
                                                                                                                                
CHAIR CON BUNDE announced SB 387 to be up for consideration.                                                                    
                                                                                                                                
MR. GREG  WINEGAR, Director, Division of  Investments, Department                                                               
of Community  & Economic Development (DCED),  said he appreciated                                                               
the committee hearing  this bill. It is straightforward  and is a                                                               
very small change to the Commercial Fishing Revolving Loan Fund.                                                                
                                                                                                                                
     It allows  a new  type of  quota shareowner  to qualify                                                                    
     for loans,  which are called community  quota entities.                                                                    
     These  entities  are  being  created  as  a  result  of                                                                    
     changes  the National  Marine Fisheries  Service (NMFS)                                                                    
     is making  in the quota share  program. Essentially, 42                                                                    
     smaller  Gulf communities  will  be able  to form  non-                                                                    
     profit  corporations, go  out  in  the marketplace  and                                                                    
     purchase quota  shares and lease them  back to citizens                                                                    
     within  those particular  communities. The  goal is  to                                                                    
     try  to   improve  the  economic  viability   of  these                                                                    
     communities   through   local  ownership   of   fishing                                                                    
     privileges. The  new federal rule  is expected  to take                                                                    
     place sometime in May. It's not in effect yet.                                                                             
                                                                                                                                
MR. WINEGAR  said this would be  a very small change  to the loan                                                               
program  and that  he can  already do  this for  individuals. The                                                               
loan criteria,  such as interest  rates and down  payments, would                                                               
be the same.                                                                                                                    
                                                                                                                                
     There  is  plenty  of  funding.   This  fund  is  self-                                                                    
     sufficient and  hasn't had any  general funds  for many                                                                    
     years....It will  bring the loan  program in  line with                                                                    
     what NMFS is doing with  the quota share program. It is                                                                    
     consistent   with  the   mission   of  the   Commercial                                                                    
     Revolving Loan Fund and, most  importantly, it is going                                                                    
     to provide these loans to  communities with a tool they                                                                    
     can  use to  try and  generate some  economic activity.                                                                    
     Many  of them  have lost  a  lot of  quota share  since                                                                    
     inception of the program in 1995.                                                                                          
                                                                                                                                
SENATOR GARY STEVENS said he  heard about this program in another                                                               
committee  and  thinks  it's  an excellent  idea.  It  makes  the                                                               
smaller communities  more economically  viable and  doesn't force                                                               
anyone to sell permits.                                                                                                         
                                                                                                                                
MR. WINEGAR acknowledged that those are two good points.                                                                        
                                                                                                                                
CHAIR BUNDE said  he was distributing testimony in  support of SB
 to the committee from Don Beamer and Gordon Jackson.                                                                        
                                                                                                                                
SENATOR GARY  STEVENS moved  to pass SB  392 from  committee with                                                               
attached  fiscal note  and  individual recommendations.  Senators                                                               
Ralph Seekins,  Gary Stevens and  Chair Con Bunde voted  yea; and                                                               
SB 392 moved from committee.