Legislature(1993 - 1994)

04/08/1993 02:00 PM L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
  SENATOR KELLY called  the Senate Labor and  Commerce meeting                 
  to  order  at  2:00  p.m.   and  announced  SB  177  (SALMON                 
  MARKETING,  TAX;ASMI   BOARD  &   DUTIES)  to   be  up   for                 
  SENATOR  PEARCE   explained  that  the   proposed  committee                 
  substitute was in response to a number of concerns expressed                 
  in the previous meeting.                                                     
  KIM  ELTON, Director of ASMI,  said he anticipated a revenue                 
  stream of between $3 - $5 million with this legislation.  It                 
  supplements revenues received from the processing segment of                 
  the industry.  The harvester tax dollars envisioned in  this                 
  bill would be used  exclusively for salmon marketing in  the                 
  domestic market place.  The processing revenues are now used                 
  for all species.                                                             
  MR.  ELTON  noted  that  the  data  and  market  information                 
  provision of  Section 5  should be  available to the  public                 
  rather than to just one portion of ADF&G.                                    
  Number 171                                                                   
  SENATOR LINCOLN asked about the expansion of the Board.  MR.                 
  ELTON explained that  the Board now  consists of 18  members                 
  and  would expand  to  24 members  comprised of  eight large                 
  processors, 4 small  processors, and 12 fishermen.   SENATOR                 
  LINCOLN  asked who wanted the  expansion.  MR. ELTON replied                 
  that   expansion   was   designed   to   accommodate   50/50                 
  representation among the processors and  fishermen.  He said                 
  under  the  voluntary  processor  assessment the  processing                 
  segment is  contributing hundreds of  thousands of  dollars.                 
  If any of them were removed  from the Board, it would create                 
  a significant amount  of turmoil  in the industry.   So  for                 
  equal representation of fishermen, they  had to add members.                 
  The public  member was  dropped which  he was  uncomfortable                 
  SENATOR SHARP said  he was  uncomfortable taking the  public                 
  member off  the Board since a considerable  amount of public                 
  treasury money was going into ASMI.                                          
  MR.  ELTON  explained that  the  Board is  appointed  by the                 
  Governor and then the Board elects  a chairman annually.  It                 
  is very  important to  maintain the 50  percent balance,  he                 
  Number 303                                                                   
  SENATOR LINCOLN thought the appointing process left too much                 
  discretion to the Governor.                                                  
  There was some discussion about the  makeup of the Board and                 
  Senator  Rieger  thought  a  smaller  Board  might  be  more                 
  workable.    MR.  ELTON  said  a  smaller  number  would  be                 
  difficult, because there would be a lot of bruised feelings.                 
  Also with a larger number of fishermen, many gear groups, as                 
  well  as   different  regions   of  the   state,  could   be                 
  SENTOR KELLY said they would add the public member back into                 
  the bill.                                                                    
  Number 413                                                                   
  CHERYL  SUTTON,  United  Fisherman  of  Alaska, said  as  an                 
  industry they have more than paid their way.   She said they                 
  like the bill except for Section  5.  She said it was  their                 
  intent that  beneath the  ASMI Board  there would  be a  new                 
  salmon committee that would essentially oversee the domestic                 
  marketing  program  which  would be  largely  funded  by the                 
  assessment of  fishermen/harvesters.  They  want a committee                 
  of seven, comprised of four  fishermen and three processors.                 
  SENATOR KELLY  read the proposed language and  asked if they                 
  should require  the members  to be  Alaska  residents.   MS.                 
  SUTTON said that would not  be good, because their processor                 
  members may or  may not be residents of  the state, but have                 
  tremendous cash flow within the state.                                       
  SENATOR KELLY asked if there would  be a problem with having                 
  the fishermen  being residents of  Alaska.  MS.  SUTTON said                 
  that would  be no  problem  for them,  but it  might not  be                 
  Number 526                                                                   
  SENATOR  LINCOLN   said   the   language   regarding   which                 
  Commissioner  does  the appointing  was  unclear.   She also                 
  wondered  if  the Board  could  select the  salmon marketing                 
  committee without prejudice.  MS. SUTTON said she didn't see                 
  prejudice as a problem based on her previous experience.                     
  SENATOR  RIEGER   suggested   that   there   needs   to   be                 
  clarification on which commissioner does the appointing.                     
  SENATOR  LINCOLN  said  she  really  wanted  to  see  Alaska                 
  residents on the  Board.   SENATOR KELLY suggested  language                 
  saying "the other three should  be Alaska residents selected                 
  from other fishery  regions within the state  and shall hold                 
  permits under AS 16.43."                                                     
  Number 557                                                                   
  Referring to page  3, line 4,  MS. SUTTON said there  was no                 
  reason to create  an Executive Board.   MR. ELTON said  that                 
  language  applied to the  committee system and  there was no                 
  problem with keeping that.                                                   
  TAPE 93-27, SIDE B                                                           
  Number 580                                                                   
  SENATOR LINCOLN thought there should be language stating the                 
  duties of the new salmon marketing board.                                    
  Number 573                                                                   
  KATE TROLL,  Southeast Alaska Seiners  Association, said the                 
  ability of the fishermen to afford the one percent tax was a                 
  problem.   Southeast Alaska is the only  region that already                 
  pays a three percent enhancement tax.  All the other regions                 
  pay  two percent  or less.   Bristol Bay doesn't  have a tax                 
  since they  have plenty  of fish  with the  wild runs.   MS.                 
  TROLL said they would like the  option of taking one percent                 
  of their enhancement tax and spending it on marketing.                       
  MS. TROLL said she  had asked Commissioner Fuhs if  he could                 
  allow  the  aquaculture  associations to  restructure  their                 
  loans  until  marketing  kicks in,  if  this  amendment goes                 
  through.  He said there was no problem with that.                            
  She  said they would  support the bill  if they got  the one                 
  percent credit.                                                              
  Number 463                                                                   
  DEAN   PADDOCK,   Bristol   Bay  Driftnetters   Association,                 
  supported a one percent assessment for salmon marketing.  He                 
  also supported changing Section 9 as Ms. Sutton suggested.                   
  Number 425                                                                   
  ROBIN  SAMUELSON, Bristol  Bay fisherman,  opposed  the tax,                 
  because he thought Western  Alaska would be left out  of the                 
  picture   and   it   would  amount   to   taxation   without                 
  representation.  He  said they pay  city taxes in excess  of                 
  five percent.  He said the  domestic processors have to show                 
  a willingness to bring fish into  the United States and then                 
  they  would follow  with marketing.   This  bill would  also                 
  benefit the hatchery produced fisheries over natural stocks,                 
  he said.                                                                     
  Number 406                                                                   
  SENATOR KELLY closed the  public hearing on SB 177  and said                 
  he would have staff work on a new committee substitute.                      

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