Legislature(1995 - 1996)
02/22/1995 03:50 PM RES
* first hearing in first committee of referral
= bill was previously heard/scheduled
= 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.