Legislature(1993 - 1994)
02/19/1993 08:00 AM FSH
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HB 123: LOANS FOR IFQ'S Number 163 REPRESENTATIVE ULMER spoke briefly about HB 123, which related to loans for individual fishing quotas (IFQs). She advised that it allowed Alaskan fishermen to have the financial backing to purchase quota shares by extending the existing limited entry permit loan program to quota shares. Currently, there was money in the revolving loan fund which allowed capitalization of this program without having to find new money, she said, and added the federal government had advised that it would be late this year before the regulations were in place and they did the adjudications necessary to determine who got the quota shares and how much they would be. "If we put HB 123 in place this session, it will be ready when the federal government finishes the regulations," she said. GREG WINEGAR, LOAN MANAGER, DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT (DCED), advised that HB 123 amended the loan program and made it more available to more people. Currently the interest rate was eight percent he said, and finished by saying that the department supported HB 123. RICK LAUBER, LOBBYIST, PACIFIC SEAFOOD PROCESSORS ASSOCIATION, testified in support of HB 123. He said the worth of the quota share was unknown, but he thought borrowers should be able to pay it off in about five years. Number 420 JAY GINTER, BIOLOGIST, NATIONAL MARINE FISHERIES SERVICE, defined IFQs and advised that the concept would be expensive to implement. He thought the cost versus benefit ratio was about ten to one. REPRESENTATIVE ULMER asked if the federal government was planning to implement a loan program similar to the program in HB 123. MR. GINTER was not aware of such a program on the federal level. REPRESENTATIVE DAVIDSON asked if the federal government was more concerned with preserving businesses of the small fishermen or just with the efficiency of harvests. MR. GINTER advised that the federal government looked to support smaller fishermen by providing a one percent cap on the harvests and a .5% cap on crab harvests. MR. THOMSON interjected that the UFA had not been involved in developing the IFQ program, yet they liked the concept of HB 123. He further said that HB 123 needed restraint language to not make loans to people who already had loans. Loans should be made to really small fishermen and crew members who wished to be self-supporting, he believed. MR. SCHACTLER suggested the loan program was a great idea, but needed refinancing options consistent with programs in other states. Number 576 GERON BRUCE, SPECIAL ASSISTANT, ADF&G, advised that the ADF&G supported HB 123. Number 590 REPRESENTATIVE ULMER asked whether or not loans could be linked to landing the product in Alaska and if that was feasible. She also asked about changing the loan rates. MARTIN RICHARD, DIRECTOR, DIVISION OF INVESTMENTS, DCED, had no comment on the first question and asked how, from a lending standpoint would he enforce how or where fishermen landed their fish. In response to the second question, he said that fishing loans were currently refinanced at 10.5%, as required by statute. He then stated the DCED had always charged the maximum rate which was a fixed, floating rate based on the Wall Street prime. He noted one problem with refinancing many loans at a time was that it was labor- intensive to modify each loan. LINDA BEHNKEN, EXECUTIVE DIRECTOR, ALASKA LONGLINE FISHERMEN'S ASSOCIATION, said British Columbia went to a quota share program. She added that Alaska needed to develop and market more value-added products. Further, she would like to see more consistent fishing throughout the year instead of the one-day, 30K pound catches. TAPE 93-7, SIDE A Number 000 MS. BEHNKEN said longline fishermen supported HB 123. ADJOURNMENT VICE CHAIRMAN OLBERG asked members and the public if there were further comments. Hearing none, he adjourned the meeting at 9:55 a.m.