Legislature(2005 - 2006)
04/22/2005 02:33 PM House RES
| Audio | Topic |
|---|---|
| Start | |
| Confirmation Hearing(s) || Alaska Oil and Gas Conservation Commission | |
| HB37 | |
| HB218 | |
| HB251 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 218-PRIVATE HATCHERY COST RECOVERY FISHERIES CO-CHAIR SAMUELS announced that the next order of business would be HOUSE BILL NO. 218 "An Act relating to cost recovery fisheries for private nonprofit hatchery facilities." REPRESENTATIVE ELKINS moved to adopt HB 218, labeled 24LS054\L, Utermohle, 4/20/05, as a work draft. IAN FISK, Staff to Representative Bill Thomas, Alaska State Legislature, said the hatchery program in Alaska has been very successful. It makes up about 30 percent of the volume of salmon caught. He said HB 218 will provide a new way for hatcheries to recover costs, but it is completely optional. Currently processors bid on the fish that the hatcheries will catch using only a couple of vessels from the commercial fishing fleet, he stated. This bill gives hatcheries the option to recovery their costs through the common property fishery, since the intent of the hatchery program is to provide fish to fishermen. The language in HB 218 is permissive, he restated. 2:43:53 PM MR. FISK said the committee substitute (CS) changes "special harvest areas" to "terminal harvest areas". Both areas relate to specific hatcheries, and a terminal harvest area is slightly larger and can be set by the commissioner of the Alaska Department of Fish & Game (ADF&G) or the Board of Fisheries. The special harvest area can be set only by the board. This change maintains allocation plans, he explained. Hatchery fish are subject to allocation plans between gear groups, and the bill is not intended to change those plans. 2:45:21 PM MR. FISK said the ADF&G commissioner designee has concerns that the bill may affect allocations, but Mr. Fisk said he believes it won't. "We are both committed to resolving that issue in a way that will be amenable to the department before the bill passes through the rest of the process." 2:46:52 PM MR. FISK said there is a change on line 16 to clarify that no allocative changes should be made, and subsection (d) on page 3 was rewritten based on Department of Law advice. Line 23 is relevant to the Department of Revenue. He said that the basic intent of the bill is to put an assessment on the fleet, which will be collected by the state. It will need to pass through the legislative appropriation process, "just like any other revenue of the state, and what we want to do is make this a user pay system." He added that this is experimental and it is hard to anticipate what the costs to the state will be. 2:49:01 PM MR. FISK said a new section was added on page 4 at the request of one of the hatchery associations. It would make the salmon harvested under this law subject to the three percent salmon enhancement tax. Previously, fish harvested for cost recovery weren't taxed, he said. 2:50:08 PM JIM BACON, Commercial Fisherman, Ketchikan, said he supports HB 218 because it provides an excellent tool for the hatcheries to use if they choose to. He said he served on the board of the Southern Southeast Aquaculture Association, and he is glad the bill leaves the final decision to its board of directors. 2:51:10 PM MITCH EIDE, Commercial Seiner, Petersburg, said he supports HB 218. It may give seiners more fishing time and gives ADF&G more flexibility. He said most of the seiners in the fleet would like to see a change in the cost recovery structure. CRAIG EVENS, Commercial Seiner, Petersburg, said there are more fish of less value, and cost recovery takes more effort now. It takes more fishermen, tenders, and processing capacity, which poses a time crunch and lost opportunities to catch wild fish. He said HB 218 will give ADF&G more flexibility. 2:53:46 PM JASON WELLS, Executive Director, Valdez Fishery Development, said HB 218 has improved from its initial drafting. He finds fault on page 1, lines 7 and 8, where the bill references direct sales by hatcheries. "We have saved the commercial fishermen 86 million pounds and $10 million in the past ten years by being able to go out and do direct sales and have the processors compete against each other for our fish," he said. It is a negative bent to talk about doing away with direct sales. "They are the strongest tool that we have in the salmon industry right now to push prices up," he declared. He said the bill should remain voluntary. 2:55:55 PM BOB THORSTENSON, Executive Director, Southeast Alaska Seiners, Ketchikan, said he supports HB 218. He said it will improve harvest quality and market timing, it will allow seiners to have a direct user fee, and it will instill more sense of fairness between the fishermen and the hatcheries. He stated that the permissive language is good because he doesn't want hatcheries to do something they don't want to do. He said United Fishermen of Alaska, Kake Vessel Owners Association, and Petersburg Vessel Owners Association also support HB 218. 2:57:25 PM PETER ESQUIRO, General Manager, Northern Southeast Alaska Regional Aquaculture Association (NSRAA), Sitka, said HB 218 has evolved over the last few weeks, but it still needs changing. He is concerned whom the interested and knowledgeable parties are that are referenced on page 2, lines 4-6. He said the language requiring a commercial fishing representative is redundant because his board already has that. He suggested that "of the corporation" should be added to the end of line 11 on page 3. MR. ESQUIRO said NSRAA has a cost recovery program with many different facets. He further suggested that "the amount of the existing reserve" be deleted from subsection (d) on page 3, because the existing reserve is unrelated to setting the rate of the assessment. "That is very much a part of the fiduciary responsibility in determining those levels of the NSRAA board of directors," he added. He said the legislation needs to consider the costs to the Alaska Department of Fish & Game because more enforcement will be required. He added that there are other related issues to be discussed before moving to this type of system. Moving from the present cost recovery system to an assessment system may have impacts on the seine boat operators. He said this has happened fairly rapidly, and he doesn't understand the rush. 3:03:07 PM MR. FISK said the other interested parties could be any number of people who could provide helpful input. He said NSRAA has a majority of commercial fishermen on its board, but there are other aquaculture organizations that don't. 3:04:57 PM MR. FISK referred to the addition of "corporations" on line 11; "we've been working with them through this process and we would be willing to discuss adding that in before the next committee of referral." CO-CHAIR SAMUELS said that looks like just a technical change. Regarding the last comment of Mr. Esquiro, the legislature can appropriate anything it wants, he said. MR. FISK said it is just a reminder, and the bill could list any number of departments. Mr. Fisk discussed enforcement. It is a terminal harvest area, he said, and the Department of Public Safety is not at every opening, but fishermen don't know where they will be, and the penalties are severe. "Just the knowledge that they are lurking ... is enough to keep people honest." 3:08:13 PM STEVE REIFENSTUHL, Staff, Northern Southeast Alaska Aquaculture Association (NSRAA), Sitka, said he is opposed to HB 218. He said he is the messenger for seiners, trollers, and gillnetters because NSRAA represents the interests of the fishermen through its 25-member board elected through a certified ballot. Any permit holders can vote for their gear representative, he said. There are 3,200 permits for all the gear groups in Southeast, and the NSRAA board members look out for all. When board members were introduced to the concepts of HB 218, they were told to trust that the details would be taken care of later. They voted unanimously to oppose it, he said. The majority of fishermen don't want the bill. He said he doesn't see what the rush is, especially considering the opposition. "If the bill truly has merit, the proponents should work with the majority of fishermen ... to iron out the wrinkles rather than cram it down their throat." He said NSRAA is one of the most successful organizations of its kind. On average, 80 percent of the fish that NSRAA produces goes to fishermen. The board wants to maintain that track record, and the bill is not the path. 3:11:47 PM MR. REIFENSTUHL said he has spoken to some supporters of the bill, and they agree that the bill should be withdrawn for the year. "We have always been willing to work closely with fishermen because we really represent them." He said he is at the Hidden Falls opening every year, "and protection was out there one time last year, and I had to work for two days prior to them arriving to make sure they would be there for an opening." They are spread thin, he added. 3:13:13 PM REPRESENTATIVE LEDOUX said the bill is permissive; NSRAA will simply have a new option. MR. REIFENSTUHL said the board of directors heard the same thing, but there is a lack of trust and it's worried the system may become required. He said he has spoken to the other organizations across the state, and "they mostly want to keep their head down on this, and I understand that. Just because you are not hearing from them today doesn't mean that they don't have some of the same concerns." 3:14:35 PM REPRESENTATIVE ELKINS said he finds that hard to swallow. If they have the same concerns, where are they? We need to hear from them, he said. MR. REIFENSTUHL said you have to go with what you hear, but he said he represents the 3,200 permit holders who elect his board, and they are in opposition to HB 218. MR. FISK postulated that if an informal poll of fishermen were taken, they would generally be supportive of hatcheries but not of the cost recovery programs. This is not a new subject, he said, it has been discussed for a long time, including through the Salmon Task Force. "It did not just come out of the blue," he stated. It is a stretch to say NSRAA represents 3,200 commercial permit holders, he said. REPRESENTATIVE LEDOUX asked if the concern is that the boards will make the hatcheries use the new cost recovery system. 3:17:39 PM MR. FISK said that may be the case. He noted that NSRAA's Hidden Falls hatchery will "likely be the first place we try to do this." People have talked about doing it in Cook Inlet. He noted that NSRAA does a great job. 3:18:46 PM STEVEN DOUGHERTY, Attorney General, Department of Law (DOL), Anchorage, referred to subsection (d) on page 3 where Mr. Esquiro wanted to remove the words, "the amount of the existing reserve". He said, "One of the standards that has been imposed in this new version of the bill ... for the development of the assessment, is consideration of the maintenance or development of reserve fund of up to 100 percent of annual operating costs of the corporation. In order to determine what the assessment should be, it would be necessary for the department to look at the amount of existing reserves." He said it should stay in the bill, and the language needs to be consistent for the hatchery permit holder and the corporation. He noted that the changes in the CS are to reduce the discretion of the Department of Revenue in setting the assessment. The legislature sets it, and the Department of Revenue is merely implementing it based on criteria that will vary year to year. It is not practicable for the legislature to set the value for every facility each year. 3:21:20 PM REPRESENTATIVE ELKINS asked about the Southern Southeast Alaska Aquaculture Association (SSRAA) cost recovery program. MR. FISK said the method by which each hatchery deals with cost recovery differs. SSRAA has a different program, and "they have indicated that they won't need to do this anytime soon." If an attempt was made to make this system a requirement instead of an option, the sponsor would no longer support the bill, he added. REPRESENTATIVE ELKINS said the SSRAA board listened to the managers when he was a board member. CO-CHAIR SAMUELS asked if any other bill has language saying the legislature may appropriate funds. 3:23:40 PM CHUCK HARLAMERT, Juneau Section Chief, Tax Division, Department of Revenue, said yes, and it is an indication of intent that doesn't broach the dedicated fund problem. CO-CHAIR SAMUELS offered Amendment 1 as follows: Page 3, line 11, after "annual operating costs" Insert "of the corporation" There being no objection, Amendment 1 carried. 3:24:43 PM REPRESENTATIVE ELKINS moved to report HB 218, labeled 24LS054\L, Utermohle, 4/20/05, as amended, out of committee with individual recommendations and the accompanying fiscal notes. There being no objection CSHB 218(RES) passed out of committee. The committee took an at-ease from 3:25 PM to 3:30 PM.
| Document Name | Date/Time | Subjects |
|---|