Legislature(1995 - 1996)

02/22/1995 03:50 PM RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
 SRES 2/22/95                                                                  
        SB  63 SPORT FISHING MARKETING COUNCIL/SURCHARGE                      
  SENATOR LEMAN announced SB 63 to be up for consideration.                   
 ERIC STIRRUP, Kodiak resident, opposed SB 63, because sport fishing           
 is better served by private industry, an industry which stands                
 quite well on its own feet.  He didn't understand the rationale               
 behind this bill, other than it creates another council, another              
 State funded organization, more government, with the cost put on              
 the backs of non-resident recreational anglers.                               
 JOSH FINK, Legislative Aide to Senator Kelly, said SB 63 has two              
 goals, first to increase revenues going into the ADF&G fund for               
 sport fish research and management which includes habitat and                 
 species restoration; and second, to create a new self-funded                  
 council to both promote Alaska as a sport fishing destination and             
 to inform anglers of the diversity of fishing experiences available           
 lessening the crowding on current high impact areas.  SB 63 would             
 establish a $5 fee on non-resident fishing licenses which would be            
 deposited directly into the constitutionally established Fish and             
 Game fund.  This fund can only be utilized for fish and game                  
 research and management which includes species and habitat                    
 restoration.  More than $1.1 million of new revenue would go into             
 the fish and game fund.                                                       
 The Council would implement a sport fishing marketing program.  He            
 admitted there was a problem with the funding mechanism.  They may            
 receive industry contributions as well as some general fund                   
 contributions, but the money will be going into a dedicated fund,             
 so that could be a problem.                                                   
 MR. FINK said that the prime sponsor would probably support                   
 reducing the size of the council and adding the Director of Tourism           
 and Director of Sport Fish as permanent members.  He concluded by             
 saying that sport fishing is a major industry worth hundreds of               
 millions of dollars, yet there is no statewide organization that              
 focuses on the marketing of this industry.  This council would                
 organize the industry and allow it to help itself.  It would help             
 alleviate the problem of over-crowding on popular rivers by helping           
 inform the public of less crowded streams and rivers.                         
 SENATOR LEMAN asked how they would keep from creating more                    
 conflicts on the already crowded rivers.  MR. FINK responded that             
 there are a lot of areas that don't see sport fishermen which would           
 be highlighted by the council.                                                
 SENATOR HOFFMAN said the Legislature had raised the license fees a            
 few years ago and asked what they are currently.  MR. FINK answered           
 that a non-resident license for the whole season is $50, the 14-day           
 non-resident license is $30, the three-day is $15, and the one-day            
 is $10.  SENATOR HOFFMAN said he thought they pushed the limits on            
 the disparity test between resident and non-resident last time and            
 they would probably have to increase the fee for residents as well.           
 SENATOR LEMAN remarked that the disparity is supposed to be no more           
 than 3 to 1.                                                                  
 TAPE 95-11, SIDE B                                                            
 Number 568                                                                    
 SENATOR LINCOLN said she didn't know why this bill was introduced,            
 because we already have the Alaska Tourism Marketing Council which            
 promotes Alaska.  Part of that is the fisheries.  She noted that              
 license fees had already been increased recently and it looks like            
 a $5 surcharge was going to be imposed only if the Commissioner               
 goes into some kind of contract.  She said 19 people on a                     
 Commission were too many.  MR. FINK said it was modeled after the             
 ATMC.  She thought the council would just duplicate exactly what we           
 have now.                                                                     
 MR. FINK said it's the difference between a shot gun approach and             
 rifle approach.  The ATMC does a fine job, but their efforts are              
 largely concentrated on cruise ships.  He said they are amenable to           
 dropping the size of the council to 11.                                       
 SENATOR FRANK asked if he proposed a match by the industry and if             
 so, what mechanism would they use.  MR. FINK said he did want a               
 match from the industry.  This is a part of the bill that needs               
 work.  They are considering some type of sliding scale registration           
 fee to be part of this non-profit industry association, based on              
 gross revenues.                                                               
 SENATOR FRANK asked if that would be a voluntary mechanism. MR.               
 FINK said they were working on that issue now.                                
 SENATOR LEMAN held up a copy of a sport fishing brochure from ADF&G           
 and asked Mr. Fink if he was aware that this was being done and was           
 it what they were thinking about doing.  Mr. Fink indicated he                
 hadn't seen it.                                                               
 Number 521                                                                    
 JEFF BUSH, Deputy Commissioner, Department of Commerce and Economic           
 Development, said his department supports all marketing efforts for           
 the State and encourages efforts to add funds to the State's                  
 marketing efforts.  It is because of that the Department opposes              
 this legislation.  The State has a generic approach to its                    
 marketing at present.  That's the way ATMC and the Division of                
 Tourism operate.  Their concern is that this is an effort to                  
 fragmentize what is a finite amount of marketing dollars.                     
 Another problem is with how the program is going to be                        
 administered, because a new bureaucracy is being created that then            
 has to contract out efforts to market Alaska.  He said an                     
 alternative to creating a council would be to just give this group            
 a grant.  A council allows decisions to be made on how monies are             
 to be spent.  The problem is that you need some staff to do that,             
 because there will be multiple contracts that have to go under the            
 procurement code and that have to be managed as State contracts.              
 MR. BUSH said the sponsor of SB 63 stated he did not want to have             
 a negative impact on any of the existing marketing the state does,            
 but as a practical matter, this particular council will take money            
 away from the ATMC.  He explained that the Vacation Planner,                  
 published by the ATMC, is funded through advertising from private             
 businesses -many of which are sport fishing related.  Those people            
 would take their money from the Vacation Planner and put it in an             
 organization that promotes sport fishing exclusively.                         
 MR. BUSH said he supported the idea of sport fishermen getting an             
 association together, but he questioned the council approach within           
 the Department of Commerce and Economic Development.                          
 Number 458                                                                    
 SENATOR FRANK asked about the notion of increasing non-resident               
 fees and putting that money into a generic marketing program that             
 would include sports fishing.  MR. BUSH said there may be a legal             
 problem with the surcharge.  Assuming you can overcome this hurdle,           
 that seems a very reasonable way to fund tourism marketing efforts.           
 SENATOR FRANK said some people were concerned that all we do is               
 generic advertising.  He thought that there are some niches that              
 need some focus.                                                              
 MR. BUSH said he appreciates his comments very much and that the              
 Governor and the Commissioner have placed a priority on looking at            
 the way that all Alaska marketing is done.  They feel they want to            
 market areas and interests that have not been properly covered in             
 the past.  Rural tourism is one of the priorities on their agenda             
 right now.                                                                    
 Number 401                                                                    
 BUD HODSON, Alaska Sportfishing Industry, said he supports this               
 bill.  His original concept was to create a marketing council that            
 could look at the sport fishing industry and plan for the future.             
 He said they first thought the $5 surcharge was a good mechanism              
 for self funding; they did not want to come to the Legislature and            
 ask for general funds.  He said they are working on resolving the             
 surcharge issue.  He explained that with the bag limits and                   
 closures in the sport fisheries, some businesses lose a component             
 of their summer.  He thought effort could be spent marketing August           
 and September and alternate, under-utilized fisheries, noting that            
 mostly king salmon are targeted by sport fishermen.  The sockeye              
 allocation is a problem in Cook Inlet, but not the rest of the                
 state.  He said they needed to educate people about what they have            
 to offer.                                                                     
 GERON BRUCE, Alaska Department of Fish and Game, addressed the                
 funding source problems of this bill.  He said the Division of                
 Sport Fisheries has two major funding sources, neither of which are           
 general fund.  It receives funds from the Federal Aid and                     
 Restoration (FAR) Program and a federal Fish and Game Fund.  The              
 FAR Program requires that the Fish and Game fund be used only for             
 certain purposes and not diverted to other uses.  This bill, he               
 thought, would be classified as a divergence of funds.  Mr. Bill              
 Martin, Administrator for the Federal Aid Program in the State of             
 Alaska, has supported this view and said it would jeopardize and              
 result in the loss of about $10 million in federal funds.                     
 Number 303                                                                    
 MAX LOWE, Regal Alaskan Hotel, said he has watched over the past              
 nine years the continued positive impact of Alaska's sports fishing           
 industry on individual tourism related businesses.  He has also               
 experienced the immediate dramatic declines in revenue during                 
 closures and limitations on the fishing resources.  It is                     
 imperative that the tourism, sportfishing, and small businesses               
 have a voice in their own future.  This is a marketing effort that            
 will create more jobs and more revenue for everyone.                          
 SENATOR LEMAN asked him what percentage and what amount of his                
 income was related to sport fishing customers.  MR. LOWE answered             
 that it's been between 17% - 23% of his annual business.                      
 FARLEY DEAN, owner of a resort and Vice President of the Mat-Su               
 Valley Professional Guides Association, said sport fishing in                 
 Alaska has to be better represented.  He said sport fishermen are             
 going to many other places than to Alaska, because they are no                
 longer "getting their bang for their buck in Alaska."                         
 Number 187                                                                    
 ED SHARP, sport fishing lodge owner, supported SB 63.  He said the            
 sport fishing is growing very fast in this state.  It needs more              
 promotion for "off the beaten track" destinations.  SB 63 does have           
 some problems with the funding mechanism and the 19 member Board is           
 too many.                                                                     
 BILL FOSTER, President, Sitka Charter Boat Owners Association,                
 opposed SB 63.  It is not needed in Sitka where allocation is an              
 already tense situation.  In Southeast Alaska king salmon are                 
 allocated between commercial and sport anglers.  There are not                
 enough fish for each Southeast resident to have just one fish.                
 Because of the U.S./Canada Salmon Treaty, there may be even less in           
 the future.  He said that presently the people in the private                 
 sector are doing a good job of marketing.                                     
 Number 117                                                                    
 BEN ELLIS, Executive Director, Kenai River Sport Fishing, testified           
 in tentative support of the concept behind SB 63 - providing that             
 the funding mechanism can be addressed successfully.  This state              
 has a big sport fishing potential that needs to be marketed in a              
 clear, concise, and logical manner.  The fisheries have been a                
 critical part of Alaska's past and will be important in its future.           
 Sport fishing, in particular, fuels a growing tourism economy. The            
 need for marketing sport fishing experiences was noted in a report            
 by the Governor's transition team.                                            
 SENATOR LEMAN said the Kenai River fishery is an example of a                 
 fishery that is fully utilized and additional activity should be              
 focused on under-utilized fisheries.  He asked Mr. Ellis if he                
 agreed with this.  MR. ELLIS said it would be hard to market Alaska           
 sport fishing without, at some point, pointing out that the Kenai             
 River is the greatest sport salmon fishing river in the world.  The           
 Kenai, incidentally, holds more world records than any river and he           
 thought it would be unrealistic to not include the Kenai River in             
 a marketing effort.                                                           
 Number 36                                                                     
 DON JOHNSON, Soldotna resident, said he is a sport fishing guide on           
 the Kenai River.  He said SB 63 leaves out the important element of           
 allocation of fisheries to the potential people this bill is                  
 targeted to attract.                                                          
 TAPE 95-12, SIDE A                                                            
 Number 001                                                                    
 MR. JOHNSON had a problem figuring out how the allocation was going           
 to change to accommodate more sport fishermen in Alaska.  He said             
 this bill was attempting to sell a non-existent product, basically.           
 JOSEPH JOLLY, Board member, United Cook Inlet Drift Association,              
 said this bill has a lot of problems.  His biggest concern was with           
 habitat.  This legislation would promote increased pressure to the            
 over worked sport fishing habitat of the Alaskan waters.                      
 DENNIS RANDA, State Council of Trout Unlimited, said, "What we are            
 facing is lack of planning."  He commented that if we don't start             
 planning for the future of sport fishing in Alaska, we will have              
 the same situation as in Oregon and Washington where there is very            
 little sport fishing left.                                                    
 Number 133                                                                    
 DICK HOFFMAN, commercial and sport fisherman, opposed SB 63.  He              
 said the concept of targeting some species that aren't being                  
 utilized has some merit, but allocation would be a conflict in the            
 near future.  At this time, the International Pacific Halibut                 
 Commission and the North Pacific Fisheries Management Counsel are             
 looking at placing restrictions on the harvest of halibut by the              
 guided sport fleet.  In Southeast the U.S./Canada Salmon Treaty has           
 put a restriction on us and there will be further cutbacks on the             
 quota available on king salmon, he said.                                      
 To promote a rapid growth of the guided sport fishery is going to             
 lead invariably to increased conflicts between subsistence, the               
 sport user, the guided sport user, and the commercial fleet that              
 will have to be battled out either in the Board of Fisheries or in            
 the Legislature.                                                              
 MR. HOFFMAN said that a few years ago commercial fishermen were               
 assessed 1% of their gross income every year to help promote their            
 product.  Maybe there should be some sort of marketing tax on the             
 guided charter fleet.                                                         
 In Southeast Alaska the king salmon are split 20% for sport                   
 fishermen and 80% for commercial fishermen.  That is changing, for            
 when the Board of Fisheries meets again it will a 25%/75% split.              
 Number 169                                                                    
 SELIM HASSAN, owner of a sport fishing business, said he deals                
 strictly with fly fishing clients.  His clients are almost 100%               
 from out of state.  He said he lived in Oregon for about 10 years             
 and he saw what happened with habitat which is very important.  If            
 you don't have it, you don't have fish.                                       
 MR. HASSAN said he has a business relationship with Holland America           
 and he is aware of the cruise lines interest in fishing and he goes           
 out of his way, geographically, to take his clients to good spots.            
 He doesn't advertise personally.  Their advertising is done by                
 magazine articles and word of mouth.  When it comes to Alaska,                
 Alaska sells itself.  He has talked to many people from Russia,               
 Europe, Japan, and other places.  Everyone knows where Alaska is              
 and what Alaska has.  He doesn't have to sell Alaska.  He just has            
 to sell his programs.                                                         
 He thought the concept of SB 63 was good, but he thought it would             
 be better for the sport fishermen get together and form a council             
 of their own.  He didn't think the state had the revenues to fund             
 another council.                                                              

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