Legislature(2017 - 2018)SENATE FINANCE 532

04/25/2018 09:00 AM FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ HB 306 PERS/TERS DISTRIBUTIONS TELECONFERENCED
Heard & Held
+ HB 47 MUNICIPAL PERS CONTRIBUTIONS/INTEREST TELECONFERENCED
Heard & Held
+ HB 217 LOCAL FOOD GOV PROCUREMENT; FARM TOURS TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
CS FOR HOUSE BILL NO. 217(FIN)                                                                                                
                                                                                                                                
     "An Act relating to civil  liability for risks inherent                                                                    
     in farm  touring; relating to  the state  and municipal                                                                    
     procurement   preferences  for   agricultural  products                                                                    
     harvested   in  the   state   and  fisheries   products                                                                    
     harvested  or  processed  in  the  state;  relating  to                                                                    
     merchandise sold and certain  fees charged or collected                                                                    
     by the  Department of Natural Resources;  and providing                                                                    
     for an effective date."                                                                                                    
                                                                                                                                
10:34:29 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE  GERAN TARR,  SPONSOR,  believed that  issues                                                                    
related to  agriculture were important in  discussions about                                                                    
diversifying  the state's  economy.  She offered  background                                                                    
information from the Sponsor Statement:                                                                                         
                                                                                                                                
     More  than  95%  of  Alaska's  food  is  imported,  yet                                                                    
     farmers in  Alaska are ready and  motivated to increase                                                                    
     production. From  2007 to 2012, direct  sales in Alaska                                                                    
     grew by 32% - 13 times the national average.                                                                               
                                                                                                                                
     In 2017,  the Farm  Bureau and Division  of Agriculture                                                                    
     launched  a  statewide   campaign  to  encourage  every                                                                    
     Alaskan  to   spend  just   $5/week  on   Alaska  Grown                                                                    
     products,  year-round,  to  generate $188  million  for                                                                    
     Alaska's economy.                                                                                                          
                                                                                                                                
     Retailers include  Carrs-Safeway, Walmart,  Fred Meyer,                                                                    
     and  Save-U-More. With  expectations of  further market                                                                    
     growth  in  2018,  Bell's  Nursery  plans  to  increase                                                                    
     production of tomatoes and cucumbers  by 20 percent and                                                                    
     the  Alaska   Flour  Company   added  products   to  23                                                                    
     additional retailers throughout the state.                                                                                 
                                                                                                                                
     Alaska's farmers markets are  also growing. In 2005 the                                                                    
     Division of  Agriculture listed  13 markets  in Alaska.                                                                    
     In  2014 that  number grew  to 37,  and in  2017, there                                                                    
     were  41, with  more in  planning stages.  Market sales                                                                    
     include:                                                                                                                   
                                                                                                                                
          ? Tanana Valley Farmers Market (Fairbanks) -                                                                          
          $1.25 million                                                                                                         
         ? Homer Farmers Market (Homer)- $500,000                                                                               
          ? Kodiak Farmers Market (Kodiak) - $100,000                                                                           
          ? Mountain View Farmers Market (neighborhood                                                                          
          market in Anchorage) - $19,000                                                                                        
Representative Tarr  discussed the genesis of  the bill. She                                                                    
said  that the  effort was  to increase  direct producer  to                                                                    
consumer sales, eliminating  the need for a  middle man. She                                                                    
shared  that the  Department  of Environmental  Conservation                                                                    
was working  with farmers  on a  pilot program  for expanded                                                                    
sales of cottage food products online.                                                                                          
                                                                                                                                
Representative Tarr  stated that  as the  bill transitioned,                                                                    
short term  policy changes that  would benefit  farmers came                                                                    
to  light.  She  discussed  the receipt  authority  for  the                                                                    
Department of Natural  Resources to collect the  fee for the                                                                    
promotional use  of the "Alaska  Grown" logo.  She explained                                                                    
that the department would buy  more promotional Alaska Grown                                                                    
materials  wholesale and  then distribute  them to  farmers.                                                                    
She added  that the department would  reinvest proceeds from                                                                    
the materials into the Alaska Grown program.                                                                                    
                                                                                                                                
Representative  Tarr discussed  procurement,  which she  had                                                                    
worked on  for four years.  She spoke of the  Alaska Product                                                                    
Procurement  Preference  statue,  which said  that  a  state                                                                    
procurement officer  buying food  product would  be directed                                                                    
to buy  the lowest priced  product but  could spend up  to 7                                                                    
percent  more on  Alaskan products.  She said  that she  had                                                                    
requested  an  audit  of  the  statute  in  order  to  fully                                                                    
evaluate the effectiveness of the  statute. She relayed that                                                                    
the audit  revealed several  challenges: the  price problem,                                                                    
getting  farmers  on the  preferred  vendors  list, and  not                                                                    
having  enough seasonal  availability. She  shared that  the                                                                    
bill added "may  spend" up to 15 percent.  She stressed that                                                                    
the bill did not require  additional spending but would make                                                                    
purchasing Alaskan grown products easier.                                                                                       
                                                                                                                                
10:40:49 AM                                                                                                                   
                                                                                                                                
Representative  Tarr used  the example  of an  anchor tenant                                                                    
and smaller  shops in a  mall environment. She said  that if                                                                    
farmers  had a  solid wholesale  opportunity, they  would be                                                                    
more likely to  sell at a less than retail  price because of                                                                    
the size  of the contract.  She asserted that  farmers would                                                                    
grow  more if  they  had assurance  that  their goods  would                                                                    
sell.  She  believed  that  the   bill  would  open  greater                                                                    
opportunities  for  Alaskan  farmers and  would  keep  state                                                                    
dollars in-state. She relayed that  there was a new trend in                                                                    
farm touring and believed that  Alaskan could cash in on the                                                                    
activity. She stated that farm  tour language had been added                                                                    
to statute, with protections form civil liability.                                                                              
                                                                                                                                
10:44:19 AM                                                                                                                   
                                                                                                                                
Representative Tarr thought that the activities listed in                                                                       
the bill were low risk for farmers.                                                                                             
                                                                                                                                
10:45:05 AM                                                                                                                   
                                                                                                                                
DIANA RHODES, STAFF, REPRESENTATIVE GERAN TARR, addressed                                                                       
the Sectional Analysis (copy on file):                                                                                          
                                                                                                                                
     Section 1 Amends powers of Commissioner of Department                                                                    
     of Natural Resources to sell promotional merchandise                                                                     
     related to the Alaska Grown logo                                                                                         
                                                                                                                                
          Allows  the  Division  of Agriculture  within  the                                                                    
          Department  of   Natural  Resources  to   issue  a                                                                    
          license and charge  a license fee for  the sale of                                                                    
          promotional merchandise related to the                                                                                
          Alaska  Grown logo.  The commissioner  shall price                                                                    
          the  merchandise  in  a   manner  that  ensures  a                                                                    
          reasonable  monetary return  to the  state. It  is                                                                    
          encouraged  that the  merchandise be  manufactured                                                                    
          in the  US and is  procured from either  an Alaska                                                                    
          bidder  or a  person  that  employs Alaska  prison                                                                    
          inmates.                                                                                                              
                                                                                                                                
     Section 2  Amends Alaska Code of Civic Procedures,                                                                       
     under the section of civil liability for sports and                                                                      
     recreation activities                                                                                                    
                                                                                                                                
          Provides  more  freedom  from civil  liability  to                                                                    
          farmers who operate "farm tours"                                                                                      
                                                                                                                                
     Section 3  Defines farm touring                                                                                          
                                                                                                                                
          Farm  touring means  briefly  visiting  a farm  to                                                                    
          observe   or   experience  aspects   of   raising,                                                                    
          growing,  producing,  cultivating, harvesting,  or                                                                    
          processing an  agricultural product as  a tourist,                                                                    
          without receiving pay.                                                                                                
                                                                                                                                
     Sections 4 to 7  Amends multiple sections of existing                                                                    
     statutes providing for the solicitation and purchasing                                                                   
     of Alaska Grown agricultural and seafood products                                                                        
                                                                                                                                
          There currently  exists a seven percent  state and                                                                    
          municipal  preference  procurement preference  for                                                                    
          Alaska  Grown agricultural  products harvested  in                                                                    
          the state and Alaska                                                                                                  
          Grown  fisheries products  harvested or  processed                                                                    
          in  the  state;  this would  give  flexibility  to                                                                    
          purchase  fisheries  and agriculture  products  if                                                                    
          priced not  more than 15  percent above  a similar                                                                    
          product   harvested   outside  the   state   (This                                                                    
          includes  entities   that  receive   state  money,                                                                    
          including school districts and the university).                                                                       
                                                                                                                                
     Section 8  Amends Public Finance Fiscal Procedures                                                                       
     Act to collect fees                                                                                                      
                                                                                                                                
          Allows  the  Commissioner  of  the  Department  of                                                                    
          Natural Resources to collect fees for                                                                                 
          Alaska Grown promotional merchandise.                                                                                 
                                                                                                                                
     Section 9  Effective date for the "farm touring" is                                                                      
     after January 1, 2019.                                                                                                   
                                                                                                                              
     Section 10  Effective date of the bill is July 1,                                                                        
     2019.                                                                                                                    
                                                                                                                                
10:46:50 AM                                                                                                                   
                                                                                                                                
Vice-Chair Bishop commented on  the importance of supporting                                                                    
in-state  agriculture. In  1950, Alaska  grew 55  percent of                                                                    
its food. He  discussed food security and  the importance of                                                                    
being  prepared  for  emergencies.  He  noted  that  Alaskan                                                                    
products   had  a   greater  shelf-life   than  out-of-state                                                                    
products.                                                                                                                       
                                                                                                                                
Senator Stevens  commented on  seafood products.  He thought                                                                    
that similar  interest should be  taken in the  marketing of                                                                    
seafood products.                                                                                                               
                                                                                                                                
10:49:09 AM                                                                                                                   
                                                                                                                                
Co-Chair MacKinnon OPENED public testimony.                                                                                     
                                                                                                                                
AMY    SEITZ,   ALASKA    FARM    BUREAU,   SOLDOTNA    (via                                                                    
teleconference),  testified  in  support of  the  bill.  She                                                                    
echoed the  comments of Vice-Chair Bishop  on food security.                                                                    
She believed that the agriculture  industry in the state was                                                                    
young  and needed  to  build  infrastructure and  supporting                                                                    
policy.  She lamented  that 95  percent of  the food  in the                                                                    
state  was  imported form  other  states  and countries  and                                                                    
there was  only a 3  to 5-day supply  of most food  items on                                                                    
grocery  store shelves.  She  remarked  on language  removed                                                                    
from the bill  related to cottage foods  industry. She hoped                                                                    
to  work with  Department of  Environmental Conservation  on                                                                    
the items that had been removed  to the bill. She hoped that                                                                    
the bill would give farmers  more opportunity in the product                                                                    
preference  program. She  discussed  receipt authority.  She                                                                    
thought that the  if fees could be collected  for the Alaska                                                                    
Grown  marketing items  it would  help  farmers to  indicate                                                                    
that  products  were  Alaskan grown,  while  supporting  the                                                                    
Division of  Agriculture. She highlighted the  importance of                                                                    
public  outreach for  Alaskan grown  products. She  hoped to                                                                    
increase the incentives for the  State Procurement Office to                                                                    
buy Alaska grown  and to develop enticement  language to get                                                                    
wholesalers to buy Alaskan grown products.                                                                                      
                                                                                                                                
10:54:36 AM                                                                                                                   
                                                                                                                                
Ms. Seitz concluded that protecting  farmers, who offer farm                                                                    
tours, from liability should be a priority.                                                                                     
                                                                                                                                
10:55:15 AM                                                                                                                   
                                                                                                                                
Co-Chair MacKinnon CLOSED public testimony.                                                                                     
                                                                                                                                
CSHB 217(FIN)  was HEARD and  HELD in committee  for further                                                                    
consideration.                                                                                                                  
                                                                                                                                
Co-Chair MacKinnon  announced that  amendments were  due the                                                                    
following day at noon.                                                                                                          
                                                                                                                                
Co-Chair MacKinnon discussed the agenda for the afternoon.                                                                      
                                                                                                                                

Document Name Date/Time Subjects
CSHB217 Supporting Document - Benefits of Farmers Markets 2017.pdf SFIN 4/25/2018 9:00:00 AM
HB 217
HB 217 CS Ver J Supporting Document Farm Bureau Support 2.8.18.pdf SFIN 4/25/2018 9:00:00 AM
HB 217
HB 217 Alaska Grown Sponsor Statement 4.5.18.pdf SFIN 4/25/2018 9:00:00 AM
HB 217
HB 217 Supporting Document - Oceanside Farms 4-2-18.pdf SFIN 4/25/2018 9:00:00 AM
HB 217
HB 217 Signed waiver from Senate Resources 4.17.18.pdf SFIN 4/25/2018 9:00:00 AM
HB 217
HB 217 Summary of Changes Version O to I 4.13.18.pdf SFIN 4/25/2018 9:00:00 AM
HB 217
HB 217 Version I Sectional Analysis 4.13.18.pdf SFIN 4/25/2018 9:00:00 AM
HB 217
HB217 Supporting Document - Homer Farmers Market.pdf SFIN 4/25/2018 9:00:00 AM
HB 217
HB 217 Supporting letter Farm Bureau 4.14.18.pdf SFIN 4/25/2018 9:00:00 AM
HB 217
HB47 DOA Documents.pdf SFIN 4/25/2018 9:00:00 AM
HB 47
HB47 Letters of Support.pdf SFIN 4/25/2018 9:00:00 AM
HB 47
HB47 Sponsor Statement.pdf SFIN 4/25/2018 9:00:00 AM
HB 47
HB 306 01.23.18 Speaker Edgmon Transmittal Letter PERS & TRS.PDF SFIN 4/25/2018 9:00:00 AM
HB 306
HB 306 Sectional Analysis.pdf SFIN 4/25/2018 9:00:00 AM
HB 306