Legislature(1993 - 1994)

03/03/1993 08:30 AM FSH

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                                                                               
              HOUSE SPECIAL COMMITTEE ON FISHERIES                             
                          March 3, 1993                                        
                            8:30 a.m.                                          
                                                                               
                                                                               
  MEMBERS PRESENT                                                              
                                                                               
  Representative Carl E. Moses, Chairman                                       
  Representative Harley Olberg, Vice Chairman                                  
  Representative Irene Nicholia                                                
  Representative Cliff Davidson                                                
                                                                               
  MEMBERS ABSENT                                                               
                                                                               
  Representative Gail Phillips                                                 
                                                                               
  OTHER MEMBERS PRESENT                                                        
                                                                               
  Representative Fran Ulmer                                                    
                                                                               
                                                                               
  COMMITTEE CALENDAR                                                           
                                                                               
  HB 140    "An Act relating to the king salmon tag fee."                      
                                                                               
            HELD IN COMMITTEE FOR FURTHER CONSIDERATION                        
                                                                               
  HB 123    "An Act relating to loans for the purchase of                      
            individual fishery quota shares."                                  
                                                                               
            MOVED OUT OF COMMITTEE AS A CS, WITH FISCAL NOTE                   
                                                                               
  WITNESS REGISTER                                                             
                                                                               
  Royce Weller, Legislative Aide                                               
    to Representative Bill Hudson                                              
  State Capitol, Room 108                                                      
  Juneau, Alaska  99811-1182                                                   
  Phone:  465-3744                                                             
  Position Statement: Gave an overview of amendments to HB 140                 
                                                                               
  Mike Millar                                                                  
  Charter Boat Operator                                                        
  4510 Prospect Way                                                            
  Juneau, Alaska  99801                                                        
  Phone:  789-9345                                                             
  Position Statement: Opposed $20 king salmon stamp                            
                                                                               
  Mike Dobson                                                                  
  Charter Boat Operator                                                        
  P.O. Box 32563                                                               
  Juneau, Alaska  99803                                                        
  Phone:  780-4468                                                             
  Position Statement: Commented on restrictive fishing                         
                      regulations                                              
                                                                               
  William Foster, President                                                    
  Sitka Charter Boat Operators Association                                     
  2810 Sawmill Creek Rd                                                        
  Sitka, Alaska  99835                                                         
  Phone:  747-6711                                                             
  Position Statement: Concerned with the non-                                  
                      resident king salmon fees                                
                                                                               
  Ann Chadwick, Executive Director                                             
  Sitka Convention & Visitors Bureau                                           
  Box 6112                                                                     
  Sitka, Alaska  99835                                                         
  Phone:  747-5940                                                             
  Position Statement: Proposed $20 tag fee too high for non-                   
                      residents                                                
                                                                               
  Merle Wolford, Representative                                                
  Homer Charter Association                                                    
  South Peninsula Sportman's Association                                       
  P.O. Box 813                                                                 
  Homer, Alaska  99603                                                         
  Phone:  235-7427                                                             
  Position Statement: Favored a king salmon stamp but not for                  
                      anglers under 16                                         
                                                                               
  Tom Ramiskey, President                                                      
  Ketchikan Marine Charters Association                                        
  No address available                                                         
  Ketchikan, Alaska                                                            
  Position Statement: Supported the concept of a graduated fee                 
                      schedule                                                 
                                                                               
  Dan McQueen                                                                  
  Ketchikan Charter Boat Operator                                              
  3222 Tide Ave.                                                               
  Ketchikan, Alaska  99901                                                     
  Phone:  225-2731                                                             
  Position Statement: Supported HB 140, if amended                             
                                                                               
  William Pattison                                                             
  Charter Boat Operator                                                        
  Rt. 1, Box 878                                                               
  Ward Cove, Alaska  99928                                                     
  Phone:  247-8489                                                             
  Position Statement: Supported HB 140                                         
                                                                               
  Donald Westlund                                                              
  Charter Boat Operator                                                        
  P.O. Box 7883                                                                
  Ketchikan, Alaska  99901                                                     
  Phone:  225-9319                                                             
  Position Statement: Favored salmon stamp concept                             
                                                                               
  Dennis Ketchum                                                               
  Ketchikan Resident                                                           
  2343 2nd Avenue                                                              
  Ketchikan, Alaska  99901                                                     
  Phone:  225-7774                                                             
  Position Statement: Supported HB 130                                         
                                                                               
  Lee Putman, Representative                                                   
  Ketchikan Sports and Wildlife Club                                           
  6005 Roosevelt Drive                                                         
  Ketchikan, Alaska  99901                                                     
  Phone:  225-7694                                                             
  Position Statement: Commented that no increased fees were                    
                      needed on King Salmon tags                               
                                                                               
  Drew Scalzi, Representative                                                  
  North Pacific Fisheries Association                                          
  P.O. Box 1115                                                                
  Homer, AK  99603-1115                                                        
  Phone:  235-6359                                                             
  Position Statement: Supported HB 123                                         
                                                                               
  Paul Seaton                                                                  
  Palmer Fisherman                                                             
  58360 Bruce Drive                                                            
  Homer, Alaska  99603                                                         
  Phone:  235-6342                                                             
  Position Statement: Opposed HB 123                                           
                                                                               
  Mako Haggerty                                                                
  Homer Fisherman                                                              
  P.O. Box 737                                                                 
  Homer, Alaska  99603                                                         
  Phone:  235-6410                                                             
  Position Statement: Opposed HB 123                                           
                                                                               
  Chris Moss, Representative                                                   
  North Pacific Fisheries Association                                          
  P.O. Box 1115                                                                
  Homer, AK  99603-1115                                                        
  Phone:  235-8053                                                             
  Position Statement: Supported HB 123                                         
                                                                               
  Anna Borland Ivy, Deckhand                                                   
  Homer Charter Boats                                                          
  P.O. Box 2219                                                                
  Homer, Alaska  99603                                                         
  Phone:  235-5955                                                             
  Position Statement: Opposed HB 123                                           
                                                                               
  Bill Sullivan, Crewman                                                       
  Homer Fishing Boats                                                          
  No address available                                                         
  Homer, Alaska                                                                
  Position Statement: Opposed HB 123                                           
                                                                               
  Dan Falvey, Member                                                           
  Alaska Longline Fishermen's Association                                      
  P.O. Box 8083                                                                
  Sitka, Alaska  99835                                                         
  Phone:  747-3400                                                             
  Position Statement: Supported HB 123                                         
                                                                               
  Eric Jordan                                                                  
  Commercial Salmon Troller                                                    
  103 Gibson Plaza                                                             
  Sitka, Alaska  99835                                                         
  Phone:  747-6743                                                             
  Position Statement: Found problems with HB 123                               
                                                                               
  Matt Donohoe                                                                 
  P.O. Box 2993                                                                
  Sitka, Alaska  99835                                                         
  Phone:  747-6467                                                             
  Position Statement: Stated there was not enough money                        
                      allotted in HB 123 for the IFQ program                   
                                                                               
  Linda Kozak, Member                                                          
  Kodiak Longliners Association                                                
  P.O. Box 135                                                                 
  Kodiak, Alaska  99615                                                        
  Phone:  486-3781                                                             
  Position Statement: Supported HB 123                                         
                                                                               
  Kris Norose, Director                                                        
  Petersburg Vessel Owners Association                                         
  P.O. Box 232                                                                 
  Petersburg, Alaska  99833                                                    
  Phone:  772-9323                                                             
  Position Statement: Supported HB 123                                         
                                                                               
  Bill Hall                                                                    
  Commercial Fishing and Agriculture Bank                                      
  P.O. Box 92070                                                               
  Anchorage, Alaska 99509                                                      
  Phone:  276-2007                                                             
  Position Statement: Suggested IFQ financing be more                          
                      thoroughly looked into                                   
                                                                               
  Chris Berns                                                                  
  P.O. Box 26                                                                  
  Kodiak, Alaska  99615                                                        
  Phone:  486-5091                                                             
  Position Statement: Opposed the IFQ loan program                             
                                                                               
  Eric Forrer                                                                  
  Retired Setnetter                                                            
  P.O. Box 32563                                                               
  Juneau, Alaska  99803                                                        
  Phone:  789-2024                                                             
  Position Statement: Supported the IFQ program                                
                                                                               
  Mary McBurney, Executive Director                                            
  Cordova District Fishermen's United                                          
  P.O. Box 939                                                                 
  Cordova, Alaska 99574-0939                                                   
  Phone:  424-3447                                                             
  Position Statement: Supported HB 123                                         
                                                                               
  Representative Fran Ulmer                                                    
  State Capitol                                                                
  Court Building, Room 601                                                     
  Juneau, Alaska  99811-1182                                                   
  Phone:  465-4947                                                             
  Position Statement: Prime Sponsor, HB 123                                    
                                                                               
  Greg Winegar, Manager                                                        
  Juneau Lending Branch                                                        
  Division of Investments                                                      
  Alaska Department of Commerce and Economic Development                       
  P.O. Box 34159                                                               
  Juneau, AK  99803-4159                                                       
  Phone:  465-2510                                                             
  Position Statement: Supported HB 123                                         
                                                                               
  Richard B. Lauber, Lobbyist                                                  
  Pacific Seafood Processors Association                                       
  321 Highland                                                                 
  Juneau, AK  99801                                                            
  Phone:  586-6366                                                             
  Position Statement: Supported HB 123                                         
                                                                               
  PREVIOUS ACTION                                                              
                                                                               
  BILL:  HB 140                                                                
  SHORT TITLE:  FEES FOR NONRESIDENT KING SALMON TAG                           
  BILL VERSION:                                                                
  SPONSOR(S):  REPRESENTATIVE(S) HUDSON,Phillips                               
  TITLE:  "An Act relating to the king salmon tag fee."                        
                                                                               
  JRN-DATE     JRN-PG               ACTION                                     
  02/08/93       254    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  02/08/93       254    (H)   FISHERIES, RESOURCES, FINANCE                    
  02/22/93              (H)   FSH AT 08:30 AM CAPITOL 17                       
  02/22/93              (H)   MINUTE(FSH)                                      
  03/03/93              (H)   FSH AT 08:30 AM CAPITOL 17                       
                                                                               
                                                                               
  BILL:  HB 123                                                                
  SHORT TITLE:  LOANS FOR IFQ'S                                                
  BILL VERSION:                                                                
  SPONSOR(S):  REPRESENTATIVE(S) ULMER,Grussendorf,Navarre,                    
  Sitton,Mackie,Davies,Davidson,Brown                                          
  TITLE:  "An Act relating to loans for the purchase of                        
  individual fishery quota shares."                                            
                                                                               
  JRN-DATE     JRN-PG               ACTION                                     
  02/03/93       215    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  02/03/93       215    (H)   FISHERIES, RESOURCES, L&C,                       
                              FINANCE                                          
  02/05/93       241    (H)   COSPONSOR(S): BROWN                              
  02/19/93              (H)   FSH AT 08:00 AM CAPITOL 17                       
  02/19/93              (H)   MINUTE(FSH)                                      
  03/03/93              (H)   FSH AT 08:30 AM CAPITOL 17                       
                                                                               
                                                                               
  ACTION NARRATIVE                                                             
                                                                               
  TAPE 93-9, SIDE A                                                            
  Number 000                                                                   
                                                                               
  HB 140:  FEES FOR NONRESIDENT KING SALMON TAG                                
                                                                               
  CHAIRMAN CARL MOSES called the meeting to order at 8:40 a.m.                 
  He noted members in attendance, advised them that HB 140 and                 
  HB 123 were on the agenda and noted the meeting was being                    
  teleconferenced.  He asked Royce Weller of Representative                    
  Bill Hudson's office to give an overview of HB 140, related                  
  to the king salmon tag fee.                                                  
                                                                               
  Number 037                                                                   
                                                                               
  ROYCE WELLER, LEGISLATIVE AIDE TO REPRESENTATIVE BILL                        
  HUDSON, PRIME SPONSOR of HB 140, noted four amendments                       
  proposed by the Alaska Department of Fish & Game (ADF&G) had                 
  been inserted into members' packets.  He claimed the                         
  sponsor, Representative Hudson, had no objections to the                     
  amendments, the first of which changed the effective date to                 
  January 1, 1994.  The second and third amendments                            
  distinguished between river and land-locked king salmon.                     
  The fourth amendment clarified the non-resident military                     
  king salmon tag would remain at $20.                                         
                                                                               
  MR. WELLER stated the committee had discussed adopting a $5                  
  or $10 fee for a one day tag, and the fiscal notes detailed                  
  the impact of those fees.  The sponsor, Representative                       
  Hudson, had no objection to those fees, he added.                            
                                                                               
  MIKE MILLAR, CHARTER BOAT OPERATOR IN JUNEAU, testified in                   
  opposition to the $20 king salmon stamp.  He exclaimed that                  
  he must have nine different licenses on board to operate his                 
  boat, including a radio station license, charter boat                        
  license, business license, life-skills license, transporter                  
  license and a Coast Guard license.  He said there were one                   
  and three day licenses to attract tourists to go fishing                     
  which cost $10 and $15, respectively.  He believed to                        
  increase these fees decreased the opportunity for non-                       
  residents to fish, and drove more and more people into                       
  British Columbia where the bag limit was four king salmon,                   
  whereas the limit in Alaska has been one, and might be two                   
  this year (1993).                                                            
                                                                               
  MR. MILLAR claimed 80% of his license sales were the one and                 
  three day licenses.  Further, he claimed the state was                       
  planning to place $700,000 projected revenue into hiring                     
  more creel census-takers.  He claimed there were enough                      
  creel census-takers in past years to count the 41,000 fish                   
  that got sport fishermen and commercial fishermen into                       
  disputes years ago.  He did not have a problem with the                      
  enhancement of hatchery stocks because fishermen got more                    
  fish through the quota from the hatchery stocks; on the                      
  other hand, enhancement of wild stocks did no good, he                       
  believed.                                                                    
                                                                               
  REPRESENTATIVE CLIFF DAVIDSON asked if more people were                      
  vying for more fish or if there was a market situation                       
  forcing Alaskan fishermen to become more competitive because                 
  there were fewer fish.  He also asked if the lower prices of                 
  fish in Canada was an advantage to people who fished there.                  
  Further, he asked how many king salmon Mr. Millar's                          
  operation took and what amount of money was paid to the                      
  state for the privilege of getting those salmon for his                      
  customers.                                                                   
                                                                               
  MR. MILLAR advised that fishermen were going to British                      
  Columbia (BC) because the limit there was four sport king                    
  salmon.  Through the International Treaty, Alaska got                        
  260,000 king salmon while BC got 880,000 king salmon.  In                    
  parts of BC, like the west side of Vancouver Island, sport-                  
  caught king salmon were not charged against their quota.                     
  The ADF&G has calculated that a sport-caught king salmon is                  
  worth well over $900.                                                        
                                                                               
  MR. MILLAR said he paid nothing to the state except for the                  
  licenses; the revenue he generated helped hotels, gift                       
  shops, bed & breakfasts and other tourist attractions, he                    
  added.                                                                       
                                                                               
  Number 240                                                                   
                                                                               
  MIKE DOBSON, CHARTER BOAT OPERATOR IN JUNEAU, stated that                    
  78% of his clientele were nonresidents and the price was                     
  really becoming prohibitive.  A maximum catch of one to two                  
  king salmon per day was not as attractive as the limit in                    
  BC.  The $20 fee was also to count the king salmon, of which                 
  one million to 1.2 million were projected per year.  One-                    
  half million of that was to hire 14 census takers.  The                      
  state boasted the ADF&G had an extremely accurate count of                   
  how many king salmon were caught.  When the Board of                         
  Fisheries mandated 17%, or 41,000 kings had been caught, the                 
  ADF&G then admitted they did not know how to count the fish.                 
                                                                               
                                                                               
  MR. DOBSON alleged the ADF&G then claimed 14 additional                      
  census takers; the other half million was to go into salmon                  
  enhancement.  If the money went into a hatchery, fishermen                   
  could not catch the salmon because it was not counted                        
  against the treaty.  If the money went into re-stocking                      
  streams, then it went against the International Treaty,                      
  which does fishermen no good.  The other argument was that                   
  re-stocking gave fishermen another issue to negotiate with                   
  the Canadians to increase the treaty.                                        
                                                                               
  MR. DOBSON continued by commenting that the Canadians were                   
  not going to let Alaskans catch more fish.  In his view, the                 
  money going into hatcheries was doing Alaskan fishermen no                   
  good anymore.  Therefore, to help the Alaskan fishermen, the                 
  tag price for the one and three day fishermen should be                      
  reduced, he concluded.                                                       
                                                                               
  Number 296                                                                   
                                                                               
  REPRESENTATIVE DAVIDSON claimed the committee should come up                 
  with some ideas and more information that would be fair to                   
  all user groups.                                                             
                                                                               
  WILLIAM FOSTER, PRESIDENT OF A 40 MEMBER GROUP OF SITKA                      
  CHARTER BOAT OPERATORS, testified via teleconference.  He                    
  expressed his concern with the non-resident salmon tag fee                   
  since last fall.  The $20 non-resident fee was excessive for                 
  a short-term angler and he felt there was no public input to                 
  the legislature prior to passage of the bill that set the                    
  fees.                                                                        
                                                                               
  MR. FOSTER preferred the fee structure in HB 140, and felt                   
  the committee should address non-resident anglers, under 16                  
  years of age, who currently required no license, but needed                  
  a tag at the cost of $20.  He noted over 50% of the clients                  
  were not rich and were charged by the cruise ships for                       
  fishing trips.  These fees charged by the cruise ships were                  
  out of the control of fishermen, he added.                                   
                                                                               
  ANN CHADWICK, EXECUTIVE DIRECTOR OF THE SITKA CONVENTION &                   
  VISITORS BUREAU, testified via teleconference that the                       
  originally proposed $20 tag fee was too high for short-term,                 
  nonresident anglers.  A study by the McDowell Group showed a                 
  southeast Alaska visitor profile which documented that one                   
  in five visitors fished while in Alaska.  These visitors                     
  have moderate household incomes and cannot afford higher                     
  fees, she declared, and added that the Sitka Visitors Bureau                 
  supported HB 130, with the $5, $10, and $20 graduated fee                    
  schedule.                                                                    
                                                                               
  MERLE WOLFORD, REPRESENTATIVE OF HOMER CHARTER ASSOCIATION                   
  AND THE SOUTH PENINSULA SPORTSMAN'S ASSOCIATION, testified                   
  from  Homer that his groups favored a king salmon stamp, but                 
  not for anglers under 16 years old.  Further, he said the                    
  state should not try to gouge those visitors who come to                     
  Alaska and spend their money here.                                           
                                                                               
  TOM RAMISKEY, PRESIDENT, KETCHIKAN MARINE CHARTERS                           
  ASSOCIATION, testified via teleconference from Ketchikan, in                 
  support of the concept of a graduated fee schedule for a                     
  nonresident king salmon tag, and in opposition to specific                   
  fees as provided for in HB 140.  He recommended a 14 day tag                 
  at a cost of no more than $20 and a $50 annual tag.                          
                                                                               
  DAN MCQUEEN a KETCHIKAN CHARTER BOAT OPERATOR, speaking from                 
  Ketchikan, stated he would support HB 140, if amended to                     
  make the 14 day tag $20 and the one year tag $50.                            
  Nonresident children, 16 years and under should not be                       
  included, he believed, and added that these amendments                       
  should be adopted immediately rather than in 1994.                           
                                                                               
  WILLIAM PATTISON, a KETCHIKAN RESIDENT AND CHARTER BOAT                      
  OPERATOR, testified via teleconference.  He supported HB 140                 
  but suggested the three day, $15 dollar tag be increased to                  
  four days.  Additionally, the 14 day, $30 fee should only                    
  cost $20 and an annual fee should be $50, he said.                           
                                                                               
  DONALD WESTLUND, a KETCHIKAN RESIDENT AND CHARTER BOAT                       
  OPERATOR testified from Ketchikan.  He favored the salmon                    
  stamp concept, but liked HB 130 better than HB 140.  The                     
  nonresident child should not have to buy a stamp, he                         
  believed.                                                                    
                                                                               
  DENNIS KETCHUM, a KETCHIKAN RESIDENT speaking from                           
  Ketchikan, advised of his support for HB 130 and the                         
  graduated fee schedule.                                                      
                                                                               
  LEE PUTMAN, REPRESENTATIVE OF THE KETCHIKAN SPORTS &                         
  WILDLIFE CLUB spoke to the committee from Ketchikan.  He                     
  felt any salmon stamp was unnecessary, however if a fee was                  
  passed, they should be lower.                                                
                                                                               
  CHAIRMAN MOSES asked if anyone else wanted to testify, in                    
  person or via teleconference on HB 140.  He then clarified                   
  resident anglers under age 16 were exempt.                                   
                                                                               
  HB 140 WAS HELD IN COMMITTEE AWAITING FURTHER AMENDMENTS                     
  FROM REPRESENTATIVE HUDSON.                                                  
                                                                               
  HB 123:  LOANS FOR IFQ'S                                                     
                                                                               
  Number 450                                                                   
                                                                               
  REPRESENTATIVE FRAN ULMER, PRIME SPONSOR of HB 123,                          
  requested teleconference witnesses be allowed to testify                     
  first.                                                                       
                                                                               
  DREW SCALZI, REPRESENTATIVE OF THE NORTH PACIFIC FISHERIES                   
  ASSOCIATION testified from Palmer that his group endorsed HB
  123 and was very encouraged by the bill.  He admitted the                    
  IFQ (individual fishing quota) plan had been very                            
  controversial and felt it would behoove the state to                         
  research the issue before making the loan applications                       
  available when the IFQ's came up for sale.                                   
                                                                               
  PAUL SEATON, a PALMER FISHERMAN, stated HB 123 was premature                 
  as the IFQ plan was not finalized.  Additionally, the loan                   
  program might have problems because it might be                              
  unconstitutional to harvest any of the IFQ fish within                       
  natural waters of the state.  He exclaimed that the program                  
  was creating a situation where salmon harvesting would be                    
  unconstitutional within Alaskan waters.  The 1972 amendment,                 
  known as the limited entry amendment allowed for a permit                    
  restriction, limiting access to a public resource, not                       
  privatization of a public resource.  The amount of                           
  capitalization required should also be addressed, he                         
  believed.                                                                    
                                                                               
  MAKO HAGGERTY, A HOMER FISHERMAN, testified from Homer in                    
  opposition to HB 123 for several reasons.  He felt the bill                  
  was poorly researched as he had been a crewman and a                         
  skipper, and under the IFQ program, he stood to get no quota                 
  shares.  He stated that if he wanted to start a business                     
  with no quota shares and go to the state to borrow money to                  
  buy quota shares, paying $10 per share, he would never be                    
  able to pay it off.  It would take at least 20 years to pay                  
  off a $100,000 loan on 10,000 shares with interest.                          
  Although the intentions were good, he believed HB 123 made                   
  little practical sense and the numbers did not add up.  The                  
  people who will benefit are those large operations that                      
  already have initial IFQs, and those who were economically                   
  dependent on commercial fishing for their livelihood would                   
  not benefit, he added.                                                       
  CHAIRMAN MOSES assured Mr. Haggerty there were proposed                      
  amendments which would perhaps address some of his concerns.                 
                                                                               
  Number 541                                                                   
                                                                               
  CHRIS MOSS, REPRESENTATIVE OF THE NORTH PACIFIC FISHERIES                    
  ASSOCIATION, testified from Homer.  He supported HB 123 and                  
  its companion bill, SB 96 as those bills gave assets and                     
  loans to those in the industry who were least able to afford                 
  them.  He believed this would allow people with residency                    
  and experience, but with few assets, to acquire an initial                   
  allocation.                                                                  
                                                                               
  Number 550                                                                   
                                                                               
  ANNA BORLAND-IVY, A DECKHAND ON A HOMER CHARTER BOAT,                        
  testified from Homer.  She opposed HB 123 as initial IFQ                     
  owners would benefit and the smaller operations who needed                   
  the loans would not.                                                         
                                                                               
  Number 550                                                                   
                                                                               
  BILL SULLIVAN, A CREWMAN ON A HOMER FISHING BOAT, testified                  
  from Homer in opposition to HB 123.  As a crewman, he would                  
  receive no initial allocation to a quota share, and he felt                  
  Alaskans should not have to take out loans to capture fish                   
  that already belonged to Alaskans.                                           
                                                                               
  DAN FALVEY, A MEMBER OF THE ALASKA LONGLINE FISHERMEN'S                      
  ASSOCIATION, testified from Sitka.  He expressed his support                 
  for HB 123 as state involvement might help keep prices under                 
  control.  He felt the start-up limit of $5 million was not                   
  enough money.  With a new program like IfQs, he thought the                  
  turnover rate would be sufficiently high at first.                           
  Additionally, he hoped to see the IFQ program funded as well                 
  as the state's salmon limited entry permit program.  He also                 
  would like to see a second parallel loan program to provide                  
  Native groups, municipalities and the like with low interest                 
  loans.                                                                       
                                                                               
  ERIC JORDAN, A SITKA FISHERMAN, speaking from Sitka, thanked                 
  Representative Ulmer for her work on HB 123, but noted a few                 
  problems.  He said the $5 million total was not enough to                    
  start the program - perhaps $100 million would suffice.  He                  
  then said there might be problems with constitutionality and                 
  the state might need new laws to complement the federal IFQ                  
  regulations.   He also felt the state needed to invest in an                 
  Alaska IFQ acquisition program.                                              
                                                                               
  MATT DONOHOE, A SITKA RESIDENT, testified from Sitka.  He                    
  said the IFQ program was a major economic disaster for                       
  coastal communities in Alaska, and agreed the $5 million was                 
  not sufficient funding for the program.                                      
                                                                               
  TAPE 93-9, SIDE B                                                            
  Number 000                                                                   
                                                                               
  MR. DONOHOE added that before such a loan program could                      
  begin, goals for the program should be organized.  He also                   
  said there must be some way to protect the small fishermen                   
  within the program.                                                          
                                                                               
  Number 040                                                                   
                                                                               
  LINDA KOZAK, A MEMBER OF THE KODIAK LONGLINERS ASSOCIATION                   
  spoke to the committee from Kodiak.  She endorsed HB 123 as                  
  IFQs were good for the future of Alaskan fishermen, if the                   
  program was designed to benefit Alaskans, specifically.  She                 
  felt vessel owners should be able to go to a lending                         
  institution and acquire quota shares to develop markets for                  
  their product.  She opposed the section of HB 123 which                      
  provided that individuals would not be eligible for                          
  alternative sources of financing to purchase quota shares.                   
  Lastly, she noted her concern for the low amount of initial                  
  financing of the program.                                                    
                                                                               
  Number 090                                                                   
                                                                               
  KRIS NOROSE, DIRECTOR OF THE PETERSBURG VESSEL OWNERS                        
  ASSOCIATION testified from Petersburg and said she endorsed                  
  HB 123.  Now that the IFQ program has been adopted, the                      
  state should allow for the public purchase of these quotas.                  
  The current limited entry permit loan program has been a                     
  great success in allowing Alaskans to participate in the                     
  fisheries along the coast.  This was also an opportunity for                 
  non-initial IFQ receivers to enter into the program, she                     
  believed.                                                                    
                                                                               
  BILL HALL, representing the COMMERCIAL FISHING AND                           
  AGRICULTURE BANK, spoke to the committee from Anchorage.  He                 
  had been asked by Representative Ulmer to comment on a                       
  proposed letter of intent regarding SeaFad's letter of                       
  intent regarding its role in financing IFQs.  He suggested                   
  the committee look into IFQs more thoroughly, but advised                    
  that he had no objection to the letter of intent.                            
                                                                               
  CHRIS BERNS, A KODIAK RESIDENT, testified from Kodiak in                     
  opposition to the loan program because of the lack of                        
  research in the price per quota share.                                       
                                                                               
  Number 209                                                                   
                                                                               
  ERIC FORRER, A RETIRED SETNETTER FROM THE YUKON RIVER,                       
  commented on the difficulty for young fishermen to get into                  
  the business in Alaska based on hard work.  The IFQ program                  
  was important and must be put in place and supported, and                    
  halibut quotas must stay in the state, he stressed.                          
                                                                               
  Number 265                                                                   
                                                                               
  MARY MCBURNEY, EXECUTIVE DIRECTOR, CORDOVA DISTRICT                          
  FISHERMEN UNITED, testified from Cordova.  She endorsed HB
  123 and felt the IFQ was a logical program to allow people                   
  to buy into IFQ fisheries and promote local ownership.                       
                                                                               
  REPRESENTATIVE ULMER responded to some of the points raised                  
  from the testimonials.  She said the timing of the                           
  applicability of the federal regulations and the allocations                 
  were rather unclear.  If the legislature waited to see when                  
  the regulations would be in place, then Alaskan fishermen                    
  would be out of luck, she believed.                                          
                                                                               
  REPRESENTATIVE ULMER commented on the community allocations                  
  and that a program to mirror the Commercial Development                      
  Quota (CDQ) program was a good idea.  She noted some new                     
  language for CSHB 123, on page 2, line 29, that would read                   
  "are not eligible for financing to purchase quota shares                     
  from other recognized, commercial lending institutions."                     
  She believed this change should address the concerns about                   
  loan sharks from the folks in Sitka.  She also noted                         
  additional language in the proposed CSHB 123 that clarified                  
  the program was aimed at helping small fishermen the most.                   
  Lastly, she asked that the committee adopt the CS with the                   
  proposed changes on page 2, as well as the proposed letter                   
  of intent.                                                                   
                                                                               
  Number 342                                                                   
                                                                               
  GREG WINEGAR, LOAN MANAGER, JUNEAU LENDING BRANCH, ALASKA                    
  DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT (DCED),                      
  noted the DCED's support for HB 123.  The overall purpose of                 
  the bill was consistent with the goals in the commercial                     
  fishing program; that being to promote a resident fishery,                   
  he noted.                                                                    
                                                                               
  REPRESENTATIVE DAVIDSON asked Mr. Winegar if he saw any                      
  problems with HB 123 or if the bill could work against                       
  Alaskan interests.  He also asked about the collection                       
  process for loans if a borrower suffered from deflated                       
  halibut prices years after taking out a loan.                                
                                                                               
  MR. WINEGAR addressed one of the concerns from the                           
  teleconference regarding debt service and if fishermen could                 
  afford to get loans through this program.  He also said the                  
  DCED looked closely at the debt service of the borrower, and                 
  historically there had been a low default rate.  He advised                  
  the committee of a soft collection program and of work with                  
  fishermen through an extension process.                                      
                                                                               
  RICHARD LAUBER, LOBBYIST FOR PACIFIC SEAFOOD PROCESSORS                      
  ASSOCIATION, offered to answer questions as he had spoken at                 
  the last meeting.                                                            
                                                                               
  REPRESENTATIVE DAVIDSON asked Mr. Lauber if he could note                    
  any problems with the program, to be analyzed in the next                    
  committee of referral.                                                       
                                                                               
  MR. LAUBER stated HB 123 was designed to stop the migration                  
  of quota shares to outside interests.  However, non-                         
  residents or residents with these shares might decide to go                  
  south with their product.  The more shares a person had, the                 
  more likely they were to go south with their product, yet                    
  the smaller operations would probably sell locally so the                    
  funds go through the local community, he said.                               
                                                                               
  MR. LAUBER continued by noting that if fish were caught off-                 
  shore and went south, Alaska collected no tax.  If caught                    
  offshore and taken to Petersburg, for example, then the                      
  state received the tax.  The state wished to encourage                       
  participation onshore for tax purposes, but also wanted                      
  participation onshore so local economies and employment did                  
  not suffer.                                                                  
                                                                               
  Number 430                                                                   
                                                                               
  REPRESENTATIVE ULMER noted she had done research about the                   
  landing issue and discovered that enforcement personnel                      
  logged landings at 16 primary ports, while other ports were                  
  spot checked by officers randomly.  Boats were supposed to                   
  radio in after a catch, at least six hours before delivery,                  
  with estimated arrival time and catch weight.  At delivery,                  
  the catch would be logged and recorded against the IFQ.                      
                                                                               
  REPRESENTATIVE ULMER pointed out any product destined for a                  
  non-Alaskan port must be checked through one of the 16                       
  primary ports in Alaska.  Shipments outside Alaska would be                  
  sealed by enforcement officers as Alaskan products and                       
  checked for regulatory compliance.  All shipments of frozen                  
  fish must be through a primary port.  Further, she noted                     
  these proposed regulations solved the problems of outside                    
  shipments.                                                                   
                                                                               
  MR. LAUBER commented that boats might be hesitant to check                   
  into one of the ports as they would be taxed for the                         
  product.  The check-in was merely an in-transit federal rule                 
  for enforcement purposes, to ensure no sale was taking                       
  place.  To tax the product might be a violation of the                       
  interstate commerce clause to pose a tax, if the boats were                  
  selling their product elsewhere.  He further noted the                       
  proposed legislation from years ago, which dealt with a                      
  landing tax for processed products and boats that actually                   
  sold their products in Alaska.  He then differentiated that                  
  the current issue was that the product would not actually be                 
  landed in Alaska, but would merely have to come to port for                  
  enforcement purposes, and then be transported elsewhere.                     
                                                                               
  REPRESENTATIVE HARLEY OLBERG MOVED to ADOPT CSHB 123, as                     
  amended, with the letter of intent and fiscal note, and MOVE                 
  from the committee with individual recommendations.                          
                                                                               
  ADJOURNMENT                                                                  
                                                                               
  CHAIRMAN MOSES asked members and the public if there were                    
  further comments.  Hearing none, he adjourned the meeting at                 
  10:00 a.m.                                                                   

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