Legislature(2011 - 2012)BARNES 124
01/27/2011 10:15 AM House ECON. DEV., TRADE & TOURISM
| Audio | Topic |
|---|---|
| Start | |
| Overview(s): Agriculture in Alaska | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
HOUSE SPECIAL COMMITTEE ON ECONOMIC DEVELOPMENT, INTERNATIONAL
TRADE AND TOURISM
January 27, 2011
10:18 a.m.
MEMBERS PRESENT
Representative Bob Herron, Chair
Representative Neal Foster
Representative Wes Keller
Representative Cathy Engstrom Munoz
Representative Steve Thompson
Representative Peggy Wilson
Representative Berta Gardner
Representative Chris Tuck
MEMBERS ABSENT
Representative Kurt Olson, Vice Chair
COMMITTEE CALENDAR
OVERVIEW(S): AGRICULTURE IN ALASKA
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
REPRESENTATIVE ALAN AUSTERMAN
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Spoke to the committee on the subject of a
missed opportunity for economic development in the state.
TIM MEYERS, Owner
Meyers Farm
Bethel, Alaska
POSITION STATEMENT: Described farming techniques on his organic
farm during the overview on agriculture in Alaska.
SIOUX-Z HUMPHREY MARSHALL, Chief Executive Officer
NorthernLatitude Controlled Environment Agriculture
Anchorage, Alaska
POSITION STATEMENT: Provided a PowerPoint presentation on
NorthernLatitude Controlled Environment Agriculture during the
overview on agriculture in Alaska.
PETE FELLMAN
Delta Junction, Alaska
POSITION STATEMENT: Introduced Dr. Jenifer Huang McBeath.
JENIFER HUANG McBEATH PhD, Professor
Plant Pathology and Biotechnology Laboratory
Agricultural and Forestry Experiment Station
University of Alaska Fairbanks (UAF)
Fairbanks, Alaska
POSITION STATEMENT: Presented the report titled, "Prospects and
Challenges of Alaska Seed Potatoes Export to Asia."
FRANCI HAVEMEISTER, Director
Central Office
Division of Agriculture
Department of Natural Resources (DNR)
Palmer, Alaska
POSITION STATEMENT: Testified during the overview on
agriculture in Alaska.
BRYCE WRIGLEY, President
Alaska Farm Bureau
Delta Junction, Alaska
POSITION STATEMENT: Provided a PowerPoint presentation titled,
"Alaskans Feeding Alaska."
ACTION NARRATIVE
10:18:49 AM
CHAIR BOB HERRON called the House Special Committee on Economic
Development, International Trade and Tourism meeting to order at
10:18 a.m. Representatives Herron, Peggy Wilson, Foster,
Thompson, Tuck, and Gardner were present at the call to order.
Representatives Munoz and Keller arrived as the meeting was in
progress. Representative Alan Austerman was also in attendance.
^OVERVIEW(S): AGRICULTURE IN ALASKA
OVERVIEW(S): AGRICULTURE IN ALASKA
10:19:19 AM
CHAIR HERRON announced that the only order of business would be
presentations on agriculture in Alaska. He then introduced a
surprise special guest who would share a missed opportunity for
economic development in the state.
10:19:59 AM
REPRESENTATIVE ALAN AUSTERMAN, Alaska State Legislature,
representing Kodiak and the Lake and Peninsula areas, recalled
during his term as chair of the Subcommittee for Commerce,
Community, and Economic Development, House Finance Committee,
the economic development function of the Department of Commerce,
Community & Economic Development (DCCED) was dominated by the
functions of community and regional affairs. Since then there
has been a change of administration and personnel, and the
department is "turning around." But prior to that change, The
Boeing Company announced plans to build a plant outside of its
home state of Washington, and sent letters of interest to Alaska
and other locations. The letter was received by DCCED and
"floated around inside the department for two weeks, going from
desk to desk looking for somebody that could respond to them ...
[and] it ended up on somebody's desk and just stayed there." He
opined this was a big missed opportunity, and Virginia got the
new plant. Alaska needs to make an effort on an ongoing basis
to reach out to industry and stabilize its economic base which
is now 90 percent dependent on oil. Representative Austerman
expressed his hope that an opportunity that the state does not
miss is to market Alaska, not only for tourism and fishing, but
as a business destination. He pointed out that the legislature
invested $17 million in marketing tourism last year and urged
that a fund of $30 million be directed to additional new
markets, such as agriculture and business. He emphasized that
major manufacturers are located in places where they were
invited to come.
10:24:53 AM
CHAIR HERRON restated his plan for a surprise special speaker at
each meeting.
10:27:50 AM
TIM MEYERS, owner, Meyers Farm, informed the committee he and
his wife began farming a three and one-half acre farm in 2003
and have expanded to ten acres. They farm on land they own and
land leased from the state. Mr. Meyers said they have success
planting crops outside in early May and begin to harvest
cabbages and Napa cabbages earlier than most farmers. He said
people are amazed at the crop yields, as the farm is strictly
organic and no commercial fertilizers are used. Mr. Meyers
opened one acre of leased land that had never been farmed, added
1,500 pounds of ground fish bones and harvested 8,000 pounds of
potatoes. From the middle of June to the end of September the
Meyers box a variety of produce for local sale.
10:30:38 AM
MR. MEYERS described their experiences with a "high tunnel" -
supplied by the U.S. Department of Agriculture (USDA) - designed
to extend the growing season. Last year they built a root
cellar that has the potential of storing 200,000 pounds of
crops. Harvest from the farm last year included 8,000 pounds of
potatoes, 7,000 pounds of cabbage, 800 pounds of rutabagas, 800
pounds of turnips, 400 pounds of beets and 400 pounds of onions,
the remainder of which is still being sold from the root cellar.
Mr. Meyers related a publication from 2008 indicated that the
soil in the Kuskokwim valley and around Bristol Bay is highly
fertile and is capable of supporting sustainable agriculture.
In fact, he opined their farm is located in the most pristine
organic region left on the planet that has not been developed
for agriculture. The future expansion of agriculture in Western
Alaska is further encouraged by the readily available air
transportation to markets. He then described his system of
fertilizing by adding ground fish to water, aerating the water
for two weeks, and applying it to the soil. The farm also had
great success raising turkeys last fall.
10:36:50 AM
REPRESENTATIVE GARDNER recalled her visit to Meyers Farm and
said she was very impressed with the farm and its activities.
10:37:26 AM
CHAIR HERRON asked for Mr. Meyers' opinion on seed potatoes
grown in the Kuskokwim area.
10:37:41 AM
MR. MEYERS observed that growing certified seed potatoes
requires three inspections per season by the Plant Materials
Center, Division of Agriculture, Department of Natural Resources
(DNR). This region is right for growing organic seed potatoes
because of the isolation, but there is a need for infrastructure
and more cultivated land.
10:38:15 AM
REPRESENTATIVE P. WILSON expressed her surprise at the shortage
of land available to grow organic food.
10:39:11 AM
MR. MEYERS agreed the shortage of fertile land for organic
farming is a concern. He acknowledged the difficulty of farming
in this region as there is no infrastructure or history of
agriculture. He has been invited to the Resource Conservation
and Development, Natural Resources Conservation Service, USDA,
national conference in Washington, D.C., to speak about the
farm. In response to Representative Peggy Wilson, he observed
that the ground is so cold produce should not grow, but it is
delicious and very high in quality. With sufficient production,
he opined he "could be shipping it all over the world."
REPRESENTATIVE KELLER offered that the flavor is from all of the
sunshine.
10:42:28 AM
REPRESENTATIVE GARDNER asked whether Mr. Meyers has knowledge of
fungus or pest problems.
10:42:57 AM
MR. MEYERS indicated no, in fact, the big problem for most
places in Alaska is with moose, but Meyers Farm is pest free
except for root maggots and aphids that are on purchased starts.
10:44:03 AM
SIOUX-Z HUMPHREY MARSHALL, Chief Executive Officer,
NorthernLatitude Controlled Environment Agriculture, informed
the committee her company is an indoor farm located in Anchorage
that grows produce year around. The mission of the farm is to
be commercial indoor agriculture production leaders in the
northern latitudes; to help northern communities gain food
security and independence; to grow local, clean, and nutritious
food. She explained that the controlled environment agriculture
(CEA) technique used by her company is a hydroponic nutrient
film technique (NFT), and is not a greenhouse, but uses
fluorescent grow lights, a temperature controlled environment,
and an air circulation system housed in an enclosed warehouse.
At the beginning of her venture, she evaluated growing the
product in a commercial greenhouse using waste heat from the new
Anchorage Regional Landfill Gas-to-Energy power plant. However,
it is necessary to be adjacent to the power plant to collect
waste heat at an economic cost. Next, a pilot program growing
lettuce and basil indoors was attempted, but because of the cost
of the electricity to power the large lights needed to grow
full-sized vegetables, a head of lettuce cost $20. Ms. Humphrey
Marshall then tried growing micro greens. She explained that
micro greens can be grown in a rack system to save space and
they have a short growth cycle, amazing flavors, and are a
viable product to market economically. In addition, the rack
system is adaptable to a home or school setting and uses a low
amount of electricity. Since September, NorthernLatitude has
been growing pesticide-free products and selling weekly harvests
to local restaurants, Food Services of America - actually
displacing its California supplier - , and Glacier Valley CSA.
Future growth for the company will include franchises, the
marketing of growing kits, custom racks, technical support, and
expansion into rural communities.
10:51:16 AM
REPRESENTATIVE GARDNER asked whether NorthernLatitude has any
customers in Juneau and if the company is part of Robin
Richardson's Global Foods Cooperative, LLC.
10:51:45 AM
MS. HUMPHREY MARSHALL responded that she is not marketing in
Juneau yet, and that she is interested in joining the food
cooperative.
10:52:08 AM
CHAIR HERRON asked for the cost per serving of NorthernLatitude
products.
10:52:23 AM
MS. HUMPHREY MARSHALL said a container packed for sale to a
restaurant sells for $18. In further response to Chair Herron,
she said the warehouse is located at 5801 Arctic Blvd.,
Anchorage, and she her legislative representatives are
Representative Doogan and Senator French.
10:53:21 AM
REPRESENTATIVE TUCK reported that the Arctic Blvd. area of
Anchorage has agricultural, manufacturing, residential,
warehousing, and retail interests. He expressed his personal
interest in hydroponic systems of food production.
10:56:01 AM
MS. HUMPHREY MARSHALL invited members to visit her business.
10:56:42 AM
PETE FELLMAN, Dairy Farmer, recalled during the 80's residents
questioned whether farming could be successful in Alaska. Today
farmers have proven that farming can be abundantly productive,
and can help broaden the security and the economic base of the
state. Alaska has invested a total of $190 million in
agriculture, much of which has provided roads, a power
infrastructure, and land, and he urged the legislature to do
everything possible to enhance the success of agriculture. He
then reminded the committee of the past Taiwanese seed potato
project and how much was learned about how to export seed
potatoes from Alaska. Now, Alaska has a great opportunity to
export seed potatoes to China, generating an "unbelievable"
amount to its economy. Mr. Fellman introduced Dr. McBeath.
11:00:30 AM
JENIFER HUANG McBEATH PhD, Professor, Plant Pathology and
Biotechnology Laboratory, Agricultural and Forestry Experiment
Station, University of Alaska Fairbanks (UAF), expressed her
excitement about presenting a project "which is 20 years in the
making." She assured the committee that her project addresses
the question of "how to market Alaska" that was raised by
Representative Austerman earlier in the hearing. In fact, when
she is in contact with officials from the Taiwanese and Chinese
governments, she presents only the potential and quality of
Alaska's agriculture. Today, Alaska is the only exported source
of seed potatoes for the largest seed potato market in the
world: Taiwan and China. Dr. McBeath provided background
information on the project and noted that the project is complex
because it involves the international trade of agricultural
products. It is known that Alaska has 12 million acres of land
suitable for agriculture, but a limited portion is farmed due to
its small local market and long distances to consumers. She
pointed out the challenges to agricultural development:
isolation; harsh climatic conditions; conversion of farmland
from wilderness; small domestic market. Further challenges from
the political climate are: inconsistent agricultural policies
that lead to the failure of projects; dependency on multi-
national oil and mining corporations that leads to the
colonization of Alaska by corporations; reluctance in the long-
term investment of state funds in agricultural development and
research; lack of infrastructure, such as storage or roads to
the Yukon-Kuskokwim Delta; ignorance of diseases and pests.
These challenges have resulted in small professional farms - 400
acres is considered a big farm in Alaska - and the inability to
"dream big."
11:08:20 AM
DR. McBEATH stated that opening the export market to China
changed this situation. In 1989, after the problems to Alaska
farming caused by bacterial ring rot (BRR), she developed a new
concept of a lab test that resulted in disease-free seed
potatoes. The concept was based on scientific lab testing, and
produced the very best seed potatoes in the world. However, the
relationships among Alaska seed potato production, U.S.
interests and the interests of China and Taiwan are complicated,
and must be mutually beneficial, thus the exportation of seed
potatoes must satisfy the needs of all of the parties. Dr.
McBeath provided a history of the activities from 1988-2003 that
allowed Alaska to gain access to Chinese and Taiwanese markets,
beginning with the BRR epidemic, and noted "how complicated the
issue is and how time-consuming" the process was. She advised
the committee that a 20-year process is not a long time in the
international agricultural trade; in fact, The Netherlands,
which is the largest exporter of seed potatoes in the world, had
already spent 20 years negotiating for the Chinese market.
Between 1988-1989 BRR, which is a quarantined, zero-tolerance
disease devastating to a far, became epidemic in Alaska with an
incidence rate of 15 percent, and the Alaska Farmers and
Stockgrowers Association asked Dr. McBeath to solve the BRR
problem and develop a market for Alaska seed potatoes. By 1990,
Dr. McBeath had developed a lab-test system for disease-free
seed potatoes. Due to high production and transportation costs,
the most appropriate market for Alaska seed potatoes was the
international market and in 1994, she was successful in
establishing export protocols to Taiwan for Alaska seed
potatoes. Taiwan and China are worthy markets because at that
time both countries refused any imports of seed potatoes. The
"greatest prize in agriculture in the world of seed potatoes"
was achieved in 2003 when China signed export protocols for
Alaska seed potatoes.
11:15:48 AM
DR. McBEATH observed very few people realize the value of the
lab-test disease-free testing program that allows Alaska to be
the only state in the U.S., as well as the world, to export seed
potatoes to Taiwan and China. Other accomplishments are that
Alaska is one of five U.S. states permitted to export table
stock potatoes to Taiwan; one of two U.S. states permitted to
export asparagus; the only state in the U.S. permitted to export
carrots to Taiwan. She stressed that the international
requirements that are needed for these accomplishments are based
on the lab-test disease-free certification for: potato viruses;
bacterial ring rot; late blight; phytoplasmas; nematodes.
Addressing those who question the need to fund the testing
program, she emphasized that testing results in the world's best
seed potatoes. The procedure for testing begins with samples
taken in the field, which are then returned to the lab and
tested. Dr. McBeath continued to explain that all of the
activities from 2003 to today, have cost the state very little
money because her travel to Taiwan and China also includes talks
paid by the federal government and other organizations. For
example, as a result of her trip to Kunming, Yunnan, as an U.S.
Embassy Science Fellow to the World Potato Congress, exportation
of 20 tons of Alaska seed potatoes became the first shipment of
seed potatoes of foreign origin entering China through
commercial channels since 1949. She indicated she has provided
a written report titled, "Prospects and Challenges of Alaska
Seed Potatoes Export to Asia," in the committee packet for
members to review. She concluded her presentation after noting
that through her research she developed a plant growth
microorganism that will enhance growth during Alaska's short
growing season.
11:24:57 AM
REPRESENTATIVE GARDNER asked about the incident in 2008-2009
when 40 tons of seed potatoes were ordered by Chinese interests
but none were available.
DR. McBEATH explained that in 2008, 40 metric tons of seed
potatoes were ordered through former Senator Therriault by a Mr.
Shen, but the state did not appropriate money in 2007 for
testing, thus the seed potatoes could not be exported.
REPRESENTATIVE GARDNER asked how appropriations are made to the
program.
DR. McBEATH indicated appropriations are made directly to her
program; in fact, UAF does not want her program included in its
budget request because of the funding ceiling. Therefore,
appropriations sometimes come through DNR, or through the Alaska
Manufacturing Extension Partnership, Inc. (AMEP) which partners
with DCCED.
11:27:53 AM
CHAIR HERRON asked for the net harvest from 40 tons of seed
potatoes.
11:29:06 AM
DR. McBEATH estimated a harvest of "10 times."
11:29:12 AM
FRANCI HAVEMEISTER, Director, Central Office, Division of
Agriculture, Department of Natural Resources (DNR), informed the
committee the Division of Agriculture has cooperated with and
supported the abovementioned program for many years. She
recalled two weeks ago she was in Delta and witnessed the
packing of trucks ready for shipment. The division conducted a
satisfactory quality inspection at that time. She expressed the
division's optimism about the program, and affirmed farmers are
interested in participating. Ms. Havemeister reiterated the
success of Alaska's farm production and acknowledged that
"marketing continues to be an issue for us."
11:31:03 AM
CHAIR HERRON referred to Dr. McBeath's comments on the state's
agricultural policy and said the committee would want to work
with the division to examine her concerns.
11:31:34 AM
DR. McBEATH said, "As a person in science, many times I might
not be diplomatic enough to state my point of view."
11:32:01 AM
CHAIR HERRON said Dr. McBeath's testimony and presentation was
appreciated, and pointed out the importance of establishing a
dialog between the committee and the director.
11:32:29 AM
BRYCE WRIGLEY, President, Alaska Farm Bureau, expressed his
intent to share information that reflects the attitude of most
of the farmers and ranchers in Alaska regarding their future
opportunities. Various land surveys conducted in Alaska have
identified 8.9 million-18.4 million acres of land that are
suitable for some form of agriculture. In 1976, Governor
Hammond approved a plan to invest a portion of oil revenue to
develop renewable resources, including agriculture. During the
following years, 84,000 acres in Delta were sold by the state,
and the land was cleared and planted raising primarily barley.
The governor's 10-year plan for agriculture called for 500,000
acres to be in production by 1992, a substantial portion
intended for growing barley to fuel meat production and for
export to Pacific Rim countries; however, in 1982 the plan was
abandoned and there was no further development for about 30
years. Also during those years, markets did not keep pace with
production, and grain surpluses prompted farmers to scale back
acreage under cultivation. Additionally, the Alaska
Agricultural Action Council was disbanded. Even under these
circumstances, he assured the committee that Alaska farmers and
ranchers continue to work in all facets of agriculture
production and to search for new markets for grain, vegetables,
meat, and milk products in order to create diversified markets
and stabilize the industry. One possibility for a new
agricultural product to market is biomass for fuel; in fact,
barley, hay, straw, and canola oil are already available for
biomass to generate heat and electricity. Mr. Wrigley advised
that as a result of the federal mandate requiring federal
facilities to use renewable energy, the U.S. Army post Fort
Greeley is looking at converting to biomass fuel and using up to
15,000 acres of barley to generate 275 billion British thermal
units (Btus) of heat. He provided a comparison of barley as a
home heating fuel source, and stated that it costs 50 percent
more to heat a home in the Interior with fuel oil than with
barley. Substantial savings for the state would be seen if
barley were included in AEA's Power Cost Equalization program
that is used to supplement heating fuel in the villages. Barley
fuel has a one-year harvest cycle, which is much less than wood
or oil; is safer to ship and store than fuel oil; agricultural
sales "turn over" in a community more often than receipts from
oil. Mr. Wrigley then turned to the subject of the export of
seed potatoes and reiterated that seed potato farming has a 25-
year history in Alaska. Private investors plan to eventually
raise 50,000 acres of seed potatoes for export to China. If
this program grows as planned, direct sales of seed potatoes
would exceed $300 million. Crops planted for rotation and
livestock could add an additional $75,000 million, and grow to
over $3 billion of economic activity to Alaska when the
multiplier of direct sales in agriculture is calculated. As a
matter of fact, last week 100 tons of seed potatoes were shipped
to China, and next year's sales are anticipated to be about
2,000 tons. Mr. Wrigley furnished a chart that showed the
current value of agricultural products raised in Delta alone is
about $9.5 million per year. Since March 2010, seed potato
exports to China may add $30 million with an additional $3
million in increased barley production and rotation crops by
2015. The export program's long-term goal is to grow 25,000
tons of potatoes in the Tanana Valley resulting in $108 million
in direct exports, and $24.7 million in other crops, for a total
in excess of $132 million. He explained that an economic
multiplier captures the economic activity generated by money
that circulates in a community after the original point of sale.
For agriculture, the multiplier commonly used is eight or nine,
meaning that the total economic activity to the Delta community
from farm sales could be $1 billion per year. Mr. Wrigley
observed that Alaska has become lax in its production of food,
thereby putting its food supply at risk. Disruption of
transportation is not uncommon and could cause food shortages in
Alaska villages and cities. In-state production of food
provides security from shortages due to natural disasters, such
as Hurricane Katrina. He warned that there is less capacity for
Alaskans to feed themselves now then there was at the time of
the 1964 Good Friday Earthquake. Furthermore, there is no
emergency storage of food set aside for Alaska in Portland or
Seattle, and if there were, it would be 2,000 miles away and
would serve no purpose during a transportation emergency. He
stressed that Alaska's emergency storehouse should be the
fields, field lots, bins, and cellars of Alaskan farmers and
urged a return to the 1980s' agricultural plan to identify goals
and actions, bring industry leaders into planning, and create a
synergistic effort. Fortunately, foods from every food group
can be grown in Alaska to provide enough to sustain life in an
emergency. Although these foods are not grown in quantity at
this time, the production of meat, milk, and cheese, and the
processing of vegetables to store for the winter, can be
reintroduced. Although grain production is prolific, milling is
needed to supply residents with locally grown flour.
Greenhouses located in rural Alaska could improve the quality of
nutrition in remote areas. Mr. Wrigley pointed out that the
state spends millions of dollars to address social illnesses in
rural areas, and suggested that the reintroduction of
agriculture, with traditional values and self-reliance, may cure
the underlying problems. Because Alaska agriculture is a small
industry facing competition from outside suppliers and
government policies and regulations that prevent "start-up
operations", it is critical that there be a healthy business
climate. The long process of building an agriculture
infrastructure in Alaska must begin now, before a food shortage
emergency arises. Mr. Wrigley concluded that Alaska lacks an
agriculture culture that understands how food is raised, with
good and bad years, but that farmers will continue to plant and
be successful.
11:45:55 AM
REPRESENTATIVE P. WILSON expressed her support for agriculture
in Alaska.
11:46:35 AM
ADJOURNMENT
There being no further business before the committee, the House
Special Committee on Economic Development, International Trade
and Tourism meeting was adjourned at ll:46 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| EDT 1.27.11 MicroGreens - NLC Powerpoint.pdf |
HEDT 1/27/2011 10:15:00 AM |
|
| EDT 1.27.11 Bios and Summaries.docx |
HEDT 1/27/2011 10:15:00 AM |
|
| EDT 1.27.11 Alaska Seed Potatoes Export to Asia, Prospects and Chanllenges 2010b.ppt |
HEDT 1/27/2011 10:15:00 AM |