02/11/2022 01:00 PM House RESOURCES
| Audio | Topic |
|---|---|
| Start | |
| HB287 | |
| HB52 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 287 | TELECONFERENCED | |
| += | HB 52 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
HOUSE RESOURCES STANDING COMMITTEE
February 11, 2022
1:06 p.m.
MEMBERS PRESENT
Representative Josiah Patkotak, Chair
Representative Grier Hopkins, Vice Chair
Representative Zack Fields
Representative Calvin Schrage
Representative Sara Hannan
Representative George Rauscher
Representative Mike Cronk
Representative Ronald Gillham
Representative Tom McKay (via Microsoft Teams)
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE BILL NO. 287
"An Act making an appropriation for oil and gas tax credits; and
providing for an effective date."
- HEARD & HELD
HOUSE BILL NO. 52
"An Act providing that operation of the Tutka Bay Lagoon
Hatchery in Kachemak Bay is compatible with the functions of
Kachemak Bay State Park; and providing for an effective date."
- HEARD & HELD
PREVIOUS COMMITTEE ACTION
BILL: HB 287
SHORT TITLE: A: OIL & GAS TAX CREDIT FUND APPROP.
SPONSOR(s): REPRESENTATIVE(s) RAUSCHER
01/21/22 (H) READ THE FIRST TIME - REFERRALS
01/21/22 (H) RES, FIN
02/09/22 (H) RES AT 1:00 PM BARNES 124
02/09/22 (H) Heard & Held
02/09/22 (H) MINUTE(RES)
02/11/22 (H) RES AT 1:00 PM BARNES 124
BILL: HB 52
SHORT TITLE: TUTKA BAY HATCHERY
SPONSOR(s): REPRESENTATIVE(s) VANCE
02/18/21 (H) PREFILE RELEASED 1/8/21
02/18/21 (H) READ THE FIRST TIME - REFERRALS
02/18/21 (H) FSH, RES
04/29/21 (H) FSH AT 10:00 AM GRUENBERG 120
04/29/21 (H) Heard & Held
04/29/21 (H) MINUTE(FSH)
05/06/21 (H) FSH AT 10:00 AM GRUENBERG 120
05/06/21 (H) Heard & Held
05/06/21 (H) MINUTE(FSH)
05/18/21 (H) FSH AT 10:00 AM GRUENBERG 120
05/18/21 (H) Moved CSHB 52(FSH) Out of Committee
05/18/21 (H) MINUTE(FSH)
05/19/21 (H) FSH RPT CS(FSH) NEW TITLE 4DP 1NR
05/19/21 (H) DP: VANCE, STUTES, ORTIZ, TARR
05/19/21 (H) NR: STORY
02/07/22 (H) RES AT 1:00 PM BARNES 124
02/07/22 (H) Heard & Held
02/07/22 (H) MINUTE(RES)
02/11/22 (H) RES AT 1:00 PM BARNES 124
WITNESS REGISTER
CONOR BELL, Fiscal Analyst
Legislative Finance Division
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: During the hearing on HB 287, answered
questions.
COLLEEN GLOVER, Director
Tax Division
Department of Revenue (DOR)
Anchorage, Alaska
POSITION STATEMENT: During the hearing on HB 287, answered
questions.
MONICA ALVAREZ, Section Chief
Resource Assessment and Development Section
Division of Mining, Land and Water (DMLW)
Department of Natural Resources (DNR)
Anchorage, Alaska
POSITION STATEMENT: During the hearing on HB 52, answered
questions.
SAMUEL RABUNG, Director
Division of Commercial Fisheries
Alaska Department of Fish and Game (ADF&G)
Juneau, Alaska
POSITION STATEMENT: During the hearing on HB 52, answered
questions.
WES HUMBYRD
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
JESSIE NELSON
Homer, Alaska
POSITION STATEMENT: Testified in support of HB 52.
BEAVER NELSON
Homer, Alaska
POSITION STATEMENT: Testified in support of HB 52.
CRISTEN SAN ROMAN
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
LEN FABICH
Homer, Alaska
POSITION STATEMENT: Testified in support of HB 52.
PENELOPE HAAS
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
ROBERT VERNON
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
BRUCE FRIEND
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
ROBERT ARCHIBALD, Chair
Kachemak Bay State Park, Citizen Advisory Board
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52?
ROBERTA HIGHLAND
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
STEVE VANEK
Ninilchik, Alaska
POSITION STATEMENT: Testified in support of HB 52.
ROD VAN SAUN
Ninilchik, Alaska
POSITION STATEMENT: Testified in support of HB 52.
DAVID MARTIN
Clam Gulch, Alaska
POSITION STATEMENT: Testified in support of HB 52.
LIZ NERING
Cook Inlet Keeper
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
MALCOLM MILNE
North Pacific Fisheries Association
Homer, Alaska
POSITION STATEMENT: Testified in support of HB 52.
KEVIN WALKER
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
ALAN PARKS
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
BRENT JOHNSON
Clam Gulch, Alaska
POSITION STATEMENT: Testified in support of HB 52.
NANCY HILLSTRAND
Pioneer Alaskan Fisheries
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
JEFFREY LEE
Seldovia, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
EARL HOPPER
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
ALLEN DAVIS
Anchor Point, Alaska
POSITION STATEMENT: Testified in support of HB 52.
CHRIS BARROWS, President
Pacific Seafood Processors Association
Seattle, Washington
POSITION STATEMENT: Testified in support of HB 52.
CHRIS PERRY
Homer, Alaska
POSITION STATEMENT: Testified in support of HB 52.
HOLLY NORWOOD
Nikiski, Alaska
POSITION STATEMENT: Testified in support of HB 52.
SUE CHRISTIANSEN
Homer, Alaska
POSITION STATEMENT: Testified regarding HB 52.
DEAN DAY, Executive Director
Cook Inlet Aquaculture Association (CIAA)
Kenai, Alaska
POSITION STATEMENT: Testified in support of HB 52.
PAUL A. SHADURA II
Kalifornsky, Alaska
POSITION STATEMENT: Testified regarding HB 52.
MAKO HAGGERTY
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
KASEY ADERHOLD
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
ARON PETERSON
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
MARK THOMAS
Anchor Point, Alaska
POSITION STATEMENT: Testified in support of HB 52.
DAVID SEAMAN
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 52.
REPRESENTATIVE SARAH VANCE
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: During the hearing on HB 52, answered
questions as the prime sponsor.
CHRISTOPHER ORMAN, Assistant Attorney General
Natural Resources Section
Department of Law (DOL)
Juneau, Alaska
POSITION STATEMENT: During the hearing on HB 52, answered
questions.
ACTION NARRATIVE
1:06:06 PM
CHAIR JOSIAH PATKOTAK called the House Resources Standing
Committee meeting to order at 1:06 p.m. Representatives
Schrage, Gillham, Hannan, Rauscher, Cronk, McKay (via Microsoft
Teams), and Patkotak were present at the call to order.
Representatives Hopkins and Fields arrived as the meeting was in
progress.
HB 287-A: OIL & GAS TAX CREDIT FUND APPROP.
1:06:50 PM
CHAIR PATKOTAK announced that the first order of business would
be HOUSE BILL NO. 287, "An Act making an appropriation for oil
and gas tax credits; and providing for an effective date."
CHAIR PATKOTAK noted that committee members should have received
the follow-up to their questions from the bill's [2/9/22]
hearing. He invited members to ask any further questions.
1:07:34 PM
REPRESENTATIVE HANNAN said she did not see an answer from the
Department of Law (DOL) or the Department of Revenue (DOR) to
her question about the lapsing fund structure and the choice of
language included in HB 287.
REPRESENTATIVE PATKOTAK said DOL is not online but that a memo
should have been posted to BASIS regarding the "sweepability."
REPRESENTATIVE RAUSCHER, prime sponsor, noted that DOL's busy
schedule did not allow for the department to be online today.
1:08:49 PM
CONOR BELL, Fiscal Analyst, Legislative Finance Division, Alaska
State Legislature, responded to Representative Hannan's inquiry.
The oil and gas tax credit fund is not subjected to the sweep,
he explained, because the sweep provision applies to money in
the general fund available for appropriation. The amount in the
oil and gas tax credit fund has already been appropriated, so
when that money goes from the fund to producers or companies, it
is paying for those tax credits and the legislature doesn't have
to approve an appropriation for those payments that go out, and
since it doesn't require further appropriation it's not subject
to the sweep.
1:09:48 PM
COLLEEN GLOVER, Director, Tax Division, Department of Revenue
(DOR), added that the oil and gas tax credit fund is not subject
to lapse, and Mr. Bell's response answers the question about
whether it is sweepable.
1:10:31 PM
REPRESENTATIVE HANNAN drew attention to Mr. Bell's memorandum of
2/10/22 answering Representative Schrage's question about there
being two bills [HB 250 and HB 287]. She pointed out that both
bills include $60 million for oil tax credit, which would be a
total appropriation of $120 million into the oil and gas tax
credit fund should both bills be enacted. Given that amount
would exceed the minimum tax due this year, she asked whether
$60 million would remain in the fund to start out fiscal year
2023 (FY 23) or whether the minimum tax owed for FY 22 would be
exceeded.
REPRESENTATIVE RAUSCHER replied that the two bills would be
sorted out upon reaching the House Finance Committee, and that
that committee would not let the appropriations from each bill
be added together.
REPRESENTATIVE PATKOTAK added that HB 250 hasn't yet left the
House Finance Committee, which is the next assigned committee
for HB 287.
1:12:50 PM
REPRESENTATIVE SCHRAGE asked why the undesignated general fund
(UGF) was used in HB 287 as opposed to the constitutional budget
reserve (CBR) as previously proposed.
REPRESENTATIVE RAUSCHER answered that last year's appropriation
from the CBR was tripped up because of the way the different
caucuses within the House view the usage of the CBR. A [3/4
vote of each body] is needed to use the CBR, which is one of the
reasons it failed. [Using the UGF] ensures that the legislature
doesn't have to go through that again.
REPRESENTATIVE SCHRAGE said there seems to be broad support for
paying off the state's debts. He asked whether it would show a
stronger statement of support if CBR funds were used given the
higher vote threshold to fund these oil and gas tax credits. He
further asked whether there is enough money in the CBR from
which to pull these funds.
REPRESENTATIVE RAUSCHER responded that he already gave his
opinion on why he chose this route, and he still believes it is
the best route. He offered his opinion that passing it in both
bodies is the important thing and would say more to the oil
companies than not getting the appropriation at all.
1:15:37 PM
REPRESENTATIVE PATKOTAK announced that HB 287 was held over.
HB 52-TUTKA BAY HATCHERY
1:16:16 PM
REPRESENTATIVE PATKOTAK announced that the final order of
business would be HOUSE BILL NO. 52, "An Act providing that
operation of the Tutka Bay Lagoon Hatchery in Kachemak Bay is
compatible with the functions of Kachemak Bay State Park; and
providing for an effective date." [Before the committee was the
proposed committee substitute (CS) for HB 52, Version 32-
LS0327\D, Bullard, 2/4/22, adopted as the working draft on
2/7/22.]
1:17:07 PM
REPRESENTATIVE HANNAN inquired whether legislatively designated
lands have ever before been removed from an existing state park.
She further inquired whether there has ever been a conflict with
any of the management plans that have existed since Kachemak Bay
State Park was created in 1970 and the hatchery built in 1976.
1:18:19 PM
MONICA ALVAREZ, Section Chief, Resource Assessment and
Development Section, Division of Mining, Land and Water (DMLW),
Department of Natural Resources (DNR), confirmed that there has
been a previous instance where lands were excepted from a
legislatively designated area to address a disposal issue. That
instance was the legislation that excepted land out of Denali
State Park in anticipation of the gas line easement.
REPRESENTATIVE HANNAN asked whether that gas line easement is
still pending. She further asked whether language was included
that the easement land would revert to Denali State Park if the
gas line was never built or whether the easement land would
remain as DNR general use land.
MS. ALVAREZ offered her understanding that a "reverter" clause
was not included in that particular legislation, and it excepted
the lands from the park for the pipeline easement.
1:19:44 PM
REPRESENTATIVE HANNAN asked whether any of the management plans
for Kachemak Bay State Park ever articulated a conflict or
objection to the hatchery.
MS. ALVAREZ responded that the draft plans DNR has been working
on over the last nine years have listed the hatchery as
incompatible. Most recently, in the intent-to-adopt version of
that plan, the incompatibility is mainly because DNR recognizes
that there is an issue related to a disposal of interest, as
well as because the enabling legislation requires that these
lands be managed according to the definition of a scenic park.
1:20:41 PM
REPRESENTATIVE HANNAN noted that Kachemak Bay State Park was
created in 1970. She offered her assumption that there have
been several management plans prior to the last nine years that
didn't indicate a conflict even though the park was designated
as a scenic park.
MS. ALVAREZ answered that the previous plan of 1995 was not as
specific as the plan that [DNR] currently has before it and was
intending to adopt. In 1995 the current case law was not then
in [DNR's] mind. The case most relevant here was in 2013, so
the most recent plan was developed with that in mind.
1:21:55 PM
REPRESENTATIVE FIELDS inquired about the number of driftnet and
seine fishermen who pay into the Tutka Bay Lagoon Hatchery and
other hatcheries, and the number of fishermen who catch the
pinks produced by the hatchery.
1:22:37 PM
SAMUEL RABUNG, Director, Division of Commercial Fisheries,
Alaska Department of Fish and Game (ADF&G), replied that the
limited entry permit for the Cook Inlet area is limited in
regulation to 545 commercial drift gillnet salmon permits, 686
set gillnet permits, and 68 purse seine permits. There are no
purse seine fisheries in Upper Cook Inlet and there are no drift
gillnet fisheries in Lower Cook Inlet or Resurrection Bay, but
there are set gillnet fisheries in both Upper Cook Inlet and
Lower Cook Inlet. Most of the pink salmon are harvested in the
purse seine fisheries in Lower Cook Inlet, but in many years the
setnet fishery harvests more pink salmon than does the seine
fishery. All the permit holders who make commercial salmon
landings in Area H pay a 2 percent salmon enhancement tax, which
was established in 1988 through a vote by Area H fishermen. The
sockeye salmon produced and released from the Tutka Bay Lagoon
Hatchery also contribute to the Lower Cook Inlet set and seine
fisheries.
1:24:32 PM
REPRESENTATIVE FIELDS offered his understanding that the Tutka
Bay Lagoon Hatchery is primarily a pink salmon hatchery. He
sought clarification on how many sockeye salmon come out of the
hatchery. He further inquired about the value of red and silver
salmon versus pink salmon in Cook Inlet and Kachemak Bay.
MR. RABUNG responded that he does not have that figure before
him, but sockeye salmon are more valuable per pound. Pink
salmon typically make up in volume and are the second highest
value salmon statewide. Sockeye are the highest when Bristol
Bay is taken into account. While he doesn't know what the
contribution breakdown is in the salmon enhancement tax, he said
that since about 2003 the salmon enhancement tax revenue has
only been between $100,000 and $200,000 a year. It is not
insignificant, but it is not the largest contributor to paying
for the operations.
1:26:37 PM
REPRESENTATIVE PATKOTAK opened public testimony on HB 52.
1:27:36 PM
WES HUMBYRD testified in opposition to HB 52. He said he has
fished 60 years for crab, salmon, and shrimp. He argued that
the bill continues the Tutka Bay Lagoon Hatchery burden on 1,109
active Area H permit holders in Upper Cook Inlet, and illegally
authorizes exclusive privilege for the Tutka Bay pink hatchery
to exploit Kachemak Bay State Park. He further argued that the
Cook Inlet Aquaculture Association's (CIAA) annual hatchery
expense of $4.5 million allows access to only 17 of the 1,109
Area H fishermen. He maintained that HB 52 obscures CIAA's
insolvency and that the Tutka Bay Lagoon Hatchery is illegal and
needs to go away.
1:30:36 PM
JESSIE NELSON testified in support of HB 52. She stated she is
a 56-year resident of Homer and a sport and commercial fisher.
She said passing HB 52 is in the best interest of the state to
clear the land disposal issue at Tutka Lagoon and to add acreage
to the Cottonwood-Eastland parking area to ease the burden on
residents from park users. If the bill is not passed and the
hatchery is forced to close, she continued, there will be a cost
to the state as the law says the state, not the hatchery
contractor, must demolish this state asset and return the site
to its normal condition. Further, if the hatchery is collateral
for loans, that would have to be paid for by the state. While
there may not be many seiners participating, each seiner is a
small business that employs three to four people, all of whom
buy fuel, groceries, and supplies.
1:32:16 PM
BEAVER NELSON testified in support of HB 52. He said he is a
former Alaska Department of Fish and Game (ADF&G) research
biologist and now a commercial fisher. He noted he is a member
of the Kachemak Bay State Park Citizen Advisory Board but is
speaking only for himself. The bill mainly addresses the land
disposal issue, he stated, which must be addressed somehow.
Qualified people within ADF&G, the Division of State Parks and
Outdoor Recreation, and the Department of Law worked together on
this bill. Failure to pass HB 52 will likely cause the shutdown
of the Tutka Bay Lagoon Hatchery, which would mean no cost
recovery revenue to CIAA on the pink salmon from there. This
would mean saying goodbye to the China Poot dipnet fishery and
the Tutka Lagoon sockeye sport fishery, each of which attracts
many people. The Resurrection Bay sockeye sport fishery, which
attracts hundreds of people, could also possibly be lost because
without the cost recovery revenue stream the Trial Lakes
Hatchery may have to be closed.
1:34:54 PM
CRISTEN SAN ROMAN testified in opposition to HB 52. She said
she has followed HB 52 since last spring, and each user group
opposing the bill has its own reasons for its opposition. For
example, the setnet and driftnet fleet do not like being used
for collateral in funding a business that they are not allowed
to benefit from. Conservationists are concerned about the land
losing its highest threshold of protection. Landowners in the
park are upset over CIAA being poor neighbors and bad stewards.
Park users are unhappy about the park's draft management plan
being overturned after the public process that went into
creating it. Liberals and conservatives alike are upset over
the Alaska government's valuable money being wasted on this
operation. The average citizen does not care to see millions of
low-quality pink salmon crowding the bay. She said she is not
anti-hatchery, but she is pro-state parks, pro-conservation, and
pro-community, and the community wants the hatchery to move out
of the park. After 30 years of being unable to run the Tutka
Bay Lagoon Hatchery efficiently, it is time for CIAA to move on.
The state park can achieve the highest and best use of that land
for the benefit of all Alaskans and that is what should be
promoted. Without HB 52, the hatchery operations will cease by
2031, and per the park's draft management plan the area can be
converted into a group camp facility or utilized for educational
purposes, which would be a huge plus for the park and for Homer.
1:36:53 PM
LEN FABICH testified in support of HB 52. As written, he
stated, the bill would cure the legal land disposal issue that
state agencies have supported. He has sport and commercially
fished Kachemak Bay for over 30 years and is currently one of
the commercial seiners participating in the fish provided by
Tutka Bay. He supports the land trade because Tutka Bay Lagoon
is difficult to navigate and is rarely a destination point for
anyone other than those involved in the hatchery or sport
fishing for red salmon. The land that the lagoon area is being
traded for will have significantly more use on the road system.
As a Lower Cook Inlet seiner, he can say that during July nearly
the entire fleet fishes for the red salmon produced by this
hatchery. In 2019 his entire season was spent fishing red and
pink salmon from this hatchery. Commercial fishermen do
benefit. The China Poot red salmon dipnet fishery is produced
in an effort utilizing two hatcheries, with the collection and
egg taking being done at the Tutka Bay Lagoon Hatchery, and puts
fish in the freezer for a huge number of people. These are
excess fish not caught by the commercial fleet. The pink salmon
produced and sold at a cost recovery in Tutka Bay help in a very
large way to fund the red salmon production and are critical to
the financing of this operation.
1:39:20 PM
PENELOPE HAAS testified in opposition to HB 52. She noted she
is on the board of the Kachemak Bay Conservation Society but is
speaking for herself. She has worked in Alaska commercial
salmon fisheries for the past 13 years in Bristol Bay, Prince
William Sound, and the Alaska Peninsula. She recreates, hunts,
and fishes in Kachemak Bay State Park. She said the public
record represents what the people want - only a few people have
voiced support of HB 52 while over 250 people do not and want
the bill to go away. She maintained that the reason the
commissioners of DNR and ADF&G support HB 52 is to stop DNR from
having to manage a hatchery, which will happen if the bill does
not pass. She urged members to look at all the public testimony
that shows why the sockeye fishery is not tied to the pink
salmon fishery. This hatchery is not supporting commercial
fishermen in any meaningful way, she argued, as Lower Cook Inlet
setnetters and seiners are catching 97.5 percent of their fish
through other fisheries, and the Cook Inlet Conservation Society
has provided charts outlining this. These public lands should
be managed in the most beneficial way to the public interest,
which is closing the Tutka Bay Lagoon Hatchery.
1:41:42 PM
ROBERT VERNON testified in opposition to HB 52. He argued that
extracting 123 acres of land from the middle of a state park to
give to private seiners for a "financially failing humpy farm"
is like putting a locust farm in the middle of wheat fields. He
urged committee members to talk with various other people
familiar with different aspects of this issue. He said [the
hatchery] pollutes the park and that the park is supposed to
guard the pristine nature of this piece of Cook Inlet from
pollution.
1:44:37 PM
BRUCE FRIEND testified in opposition to HB 52. He said he has
been a property owner in Big Tutka Bay since 1983 and has
watched Tutka Bay Lagoon go from having many species of crab,
shrimp, and clams, to now being completely desolate. Much of
the lagoon's underwater environment is anaerobic where no
species can survive, and this extends into Big Tutka Bay.
Current CIAA operations contribute to the disintegration outside
of the bay through the illegal dumping of carcasses in front of
his cabin and placing unpermitted net pens at the head of the
bay. He disagreed that people are unable to navigate into the
lagoon as he finds himself in the lagoon numerous times a year.
Thought should be given to the future of the bay and its users,
he urged, and a look should be taken at financial and fiscal
responsibilities by referring the bill to the House Finance
Committee. Thirty years of failed operations and failure to
take care of Kachemak Bay State Park is a bridge too far.
1:47:16 PM
ROBERT ARCHIBALD, Chair, Kachemak Bay State Park Citizen
Advisory Board, testified in opposition to HB 52. He related
that on 2/9/22 the board met with Representative Vance and state
agency representatives about the proposed CS for HB 52.
Following the discussion, the board voted 11-2 to submit
[Resolution 2022 1], which opposes HB-52. Regarding the three
parcels in the Cottonwood-Eastland area, he noted that parcel B
has a deed restriction that limits its use to Kachemak Bay State
Park, parcel C has a conservation easement on it, and parcel A
has an Interagency Land Management Assignment (ILMA) that was
paid for by Friends of Kachemak Bay State Park. The state park
system currently manages parcels B and C. [Developing] the
Kachemak Bay State Park management plan has been a long process,
and the [Kachemak Bay State Park Citizen Advisory Board] is in
favor of how the management plan is currently written, which
phases out Tutka Bay Lagoon Hatchery.
1:49:38 PM
ROBERTA HIGHLAND testified in opposition to HB 52. She said she
admires fishers and responsible fisheries and hatcheries but
that not all hatcheries are equal. The Tutka Bay Lagoon
Hatchery (TBLH) has had years of problems, she continued, and
this has never been the right spot for this hatchery. This bill
deserves scrutiny because the TBLH, operated by CIAA, has been
working under an illegal agreement between parties since the
1970s. This bill attempts to fix the problem from long ago by
now asking Alaskans to pay dearly for this mistake through the
unjust loss of a spectacular part of their park. The CIAA has a
bad financial track record with not just the TBLH losses but an
outstanding debt to the state of $16 million. Closure of the
TBLH will help CIAA cut its losses of $600,000-$1,000,000 per
year from TBLH alone. This hatchery has caused environmental
damage to a once rich nursery for crab, shrimp, and clam, and
historically there has been large-scale illegal dumping of fish
carcasses in Tutka Bay. Removal of the 123 acres from Kachemak
Bay State Park sets a dangerous precedent of allowing industrial
or commercial operations to supersede state park protection, not
to mention that the original ILMA is for 6.84 acres. She said
she supports a separate bill to add the Eastland property. She
further said that there are enough legal questions about HB 52
and past agreements that she is seeking her own legal opinion.
1:51:56 PM
STEVE VANEK testified in support of HB 52. He stated he has
been commercial fishing in Cook Inlet since 1966, owns an
original limited entry drift permit, and is the longest serving
board member of the Cook Inlet Aquaculture Association. As a
board member of CIAA, he voted to mothball Tutka Bay Lagoon
Hatchery when pinks were at three cents a pound and the
processors didn't even want them from commercial fishermen. The
CIAA continued to maintain Tutka Bay Lagoon Hatchery so it could
be reopened when the price increased. Many of the objections to
TBLH are from people who are anti-hatchery, he argued, and that
has nothing to do with the location of TBLH. He pointed out the
private inholdings in the park, the sawmill currently going in
opposite the hatchery, and a lodge, and asked whether those
things are alright in a state park. He noted that Tutka Bay
Lagoon Hatchery is a business that depends on many support
industries and asked whether [the state] is going to get rid of
another fishing business at a time when oil is no longer king.
In answer to Representative Rauscher, Mr. Vanek stated he
supports HB 52 and added that the sponsor has done a remarkable
job in all the negotiations that have gone into the bill.
1:55:26 PM
ROD VAN SAUN testified in support of HB 52. He said he has
fished Ninilchik, Kachemak Bay, and Cook Inlet for over 30 years
as both a commercial and charter fisherman. As a guide, pink
salmon were a vital part of his operation and clients from all
over the state and country loved it. As a commercial fisherman,
there were years he would not have been in existence if not for
Tutka, which continues to be true. He disagreed with the
statements that dipnetters will not lose their sockeye, and said
the sockeye in Resurrection Bay, China Poot, and Tutka will all
go away. Tutka is important for funding those programs that
benefit Alaskans from all over the state. People being able to
snag and dipnet those sockeye takes pressure off the Kenai and
Kasilof, he asserted, and gives the people of Homer and Seward
fisheries that they would not otherwise have. He said the
importance of passing HB 52 cannot be overstated.
1:57:54 PM
DAVID MARTIN testified in support of HB 52. He noted he is
active in several commercial fishing organizations and has been
a board member of CIAA since the 1980s but specified that he is
speaking on behalf of himself. He said he has commercial drift
fished in Cook Inlet for 50 years, including seining in Tutka,
China Poot, and Lower Cook Inlet. He has been directly involved
in all aquaculture activities plus the regional planning team
that scrutinizes aquaculture and state hatchery programs for
compliance with state policy and law using the best science and
genetic information available. This bill will resolve the legal
matter of fixing a constitutional land disposal issue, which
will benefit thousands of people. The small group that opposes
hatcheries is using this forum to try to close the Tutka
hatchery, which they have tried for years. The Tutka hatchery
is one spoke in the wheel of aquaculture's multiple hatcheries
and projects, all resources are used to fund all projects. For
example, funds from the hatchery have supported decades of
invasive pike suppression in the Susitna drainage, which has
resulted in 1.7 million adult sockeye returning for harvest by
the common property fisheries that otherwise would have been
eaten by the invasive pike. Another example is the beaver dam
removal that aquaculture has done for decades. He is proud of
having paid his 2 percent aquaculture tax. Regarding the view-
scape, he added, he enjoys seeing the net pens and the fish and
tourists enjoy watching the fishermen fish.
2:00:54 PM
LIZ NERING, Cook Inlet Keeper, testified in opposition to HB 52.
She noted that Cook Inlet Keeper is a community-based
organization of 8,500 members dedicated to protection of the
Cook Inlet watershed. She pointed out that the public has only
had four days' notice to respond to this [proposed] CS, which is
inadequate given the bill would override the extensive public
process to come up with the Kachemak Bay State Park management
plan. To date, both ADF&G and the sponsor have not answered why
the increase in acreage from the original ILMA of 6.84 acres to
the bill's proposed removal of 123.45 acres [from the park].
Cook Inlet Keeper has repeatedly asked for original maps and the
answers have varied on why this increase in acreage is
necessary. Regarding statements about the guarantees that
[Version D of HB 52] would provide to the public, there is no
such text in the bill that provides those guarantees. For
example, it is not written in the bill that the public will
continue to have access and no guarantee that DNR couldn't sell
the land under its management operations. There is no guarantee
about what the status of the land would be if it was returned to
state park land in the future. Further, the fiscal note
attached to the bill is inadequate.
2:03:22 PM
MALCOLM MILNE testified in support of HB 52. He noted he is a
Lower Cook Inlet seine permit holder, current first vice
president of CIAA, president of the local Homer organization
called North Pacific Fisheries Association, a member of the Cook
Inlet Seiners Association, and a member of the Homer Fish and
Game Advisory Committee. He said he supports HB 52 as a cure to
the land disposal issue between the Department of Natural
Resources and the Alaska Department of Fish and Game. The land
disposal issue needs a solution, he continued, and he
appreciates the sponsor bringing the bill forward. Because a
majority of the CIAA board of directors must be Area H permit
holders, and the gear groups include drifters, seiners, and
setnetters, the decisions are made by fishermen for fishermen.
This bill is not a venue or a trial for the hatchery, and as a
CIAA board member he is aware there is room for improvement,
which CIAA works towards every day. A past management plan for
Kachemak Bay State Park that continued the compatible use
determination for Tutka Bay Lagoon Hatchery was rescinded upon
the recent development of the land disposal issue. He urged
that there be collaborative work towards building community.
2:06:50 PM
KEVIN WALKER testified in opposition to HB 52. He stated he
worked for CIAA for several seasons at the Trail Lakes Hatchery
and is [currently] on the Kachemak Bay State Park Citizen
Advisory Committee but is speaking on his own behalf. He
maintained that the China Poot dipnet fishery does not depend on
the Tutka Bay Lagoon Hatchery. He said the hatchery was totally
closed for seven years between 2003 and 2011, with no expenses
shown. From 2005-2010, with the Tutka Bay Lagoon Hatchery
closed, between 100,000 and 500,000 sockeye were released into
the China Poot system according to the 2021 annual management
plan from ADF&G. Trail Lakes Hatchery is responsible for
incubating these fish, no sockeye salmon have been in Tutka Bay
Lagoon Hatchery for many years. Sockeye cannot survive in the
Tutka Bay Lagoon Hatchery. He argued that HB 52 would benefit a
tiny fraction of the fishermen who must pay into CIAA to support
this hatchery; 97 percent of fishermen pay this fee at
absolutely no benefit from the hatchery. Most of the fish go to
cost recovery. The land to be traded in this bill is already
owned by DNR. The Friends of Kachemak Bay State Park has paid
the $2,400 fee to initiate a land transfer to include this land
into the Kachemak Bay State Park. No trading is needed, the
process began several years ago. The Tutka Bay Lagoon Hatchery
should be re-purposed into an education and youth camp, rental
cabins, and other park facilities compatible with outdoor
recreation. He urged that HB 52 be rejected and the original
intent to adopt a park management plan be continued.
2:09:20 PM
ALAN PARKS testified in opposition to HB 52. He said he is
retired from 40 years of commercial fishing in Alaska. As a boy
he had a permit and fished Lower Cook Inlet and went in and out
of the lagoon all the time when it first started operating under
the Division of Fisheries Rehabilitation, Enhancement and
development (FRED). He said his opposition to the bill stems
from the poor stewardship and degradation by CIAA, which has
destroyed the lagoon. Further, he is concerned about CIAA's
loans with the Department of Commerce, Community and Economic
Development (DCCED) and the State of Alaska allowing state
property to be used as collateral for one of CIAA's loans, which
he thinks inappropriate. There are a few violations where CIAA
has infringed on a half-acre of state park lands outside of the
ILMA with ADF&G and DNR, which CIAA operates under. He urged
that a thorough look be taken at the many details associated
with this project.
2:12:09 PM
BRENT JOHNSON testified in support of HB 52. He said he has
been a setnetter since 1962, is a CIAA member, and was president
of the CIAA board for 15 years. He stated that the fish he
catches don't have anything to do directly with Tutka Bay Lagoon
Hatchery, so he doesn't have a direct financial link. However,
he continued, the work done by CIAA directly supports what he
does. Also, the Tutka Bay Lagoon Hatchery directly supports
what he does in a way because the processors depend on having
fish so they can stay in business and this hatchery produces
fish that have helped the processors stay in business. Due to
some disaster years in the Upper Cook Inlet, there are now fewer
processors in Kenai than there ever have been since the
beginning of the fishery. He needs the processors to stay in
business so that when he does catch fish, he has someone to sell
his fish to. His neighbor sport fishes for sockeye in Tutka
Bay. If CIAA loses the Tutka Bay Lagoon Hatchery there will be
no more sockeye in either China Poot or Tutka Bay. He concluded
by stating that the pink salmon are high quality.
2:14:25 PM
NANCY HILLSTRAND testified in opposition to HB 52. She stated
she has been in fisheries for 45 years, including working at the
Tutka Bay Lagoon Hatchery for 11 years, and she is the
owner/operator of Coal Point Seafoods and Pioneer Alaskan
Fisheries. She said the disposal and compatibility issues have
already been cured with the solution found after eight years of
revising the Kachemak Bay [State Park] management plan, under
which it was determined that the best thing to do is phase out
the inefficient hatchery. Phasing out the hatchery would cure
all the incompatible issues, she continued, including the
chronic strife. When thinking about HB 52, a question is
whether the bill serves the highest and best use to assure the
greatest utilization and development of a state-owned facility.
A second question is whether the bill authorizes exclusive use
of fisheries just allowing 17 people to have access to these
fish compared to the 1,100 other fishermen in the Area H Cook
Inlet fisheries. A third question is whether HB 52 promotes
inefficient aquaculture. Looking at the $17 million of debt
that all the fishermen are being put through attests to
something that needs to be investigated as far as upholding the
state constitution. All these issues have to do with the
constitution, she argued, and HB 52 is not constitutional.
2:17:05 PM
JEFFREY LEE testified in opposition to HB 52. He noted he is a
member of the Kachemak Bay State Park Citizen Advisory Board,
which has put him on the forefront of this battle that has been
raging since 2011. It has been nothing but conflict and strife
with Cook Inlet Aquaculture Association for years, he said. One
chronic thing through these past 12 years has been the
misleading information or half information on this. Some of the
land disposal issues are already being solved or have been
solved by this management plan, and the disposal would be solved
by doing nothing if HB 52 does not pass. The Cottonwood-
Eastland land as a land swap is simply a grab because one must
be swapped for the other, and that [was already] moving along
just fine. The red salmon program is separate and can be
eliminated because there are lots of ways in the future that the
state park can work to continue that program. Seventeen
seiners, 1 percent of the fishermen, will benefit from this.
The management plan, if followed, would open a huge area for
future growth for everyone, not a select few.
2:19:26 PM
EARL HOPPER testified in support of HB 52. He said the bill
would cure the legal state land disposal issue that the state
agencies support. He and his family dipnet and fill their
freezer every year. It would be a shame to see it go away as
those fish are a big part of his family's diet and provide much
benefit.
2:20:31 PM
ALLEN DAVIS testified in support of HB 52. He stated that this
fishery provides a local economic opportunity and is an
important local fishery that many people take advantage of. In
addition, it takes pressure off the Kenai and Kasilof dipnet
fisheries.
2:21:15 PM
CHRIS BARROWS, President, Pacific Seafood Processors
Association, testified in support of HB 52. He said the bill is
a solution to the land issues associated with the Kachemak Bay
State Park plan and the need to continue operation of the Tutka
Bay Lagoon Hatchery. He stated that the 1995 management plan
identifies fisheries enhancement as a goal for Kachemak Bay
State Park and as compatible under permit focused on fishing as
a critical recreational and commercial activity in the park and
in Tutka Bay specifically. Any changes to the park plan that
would end operations at the Tutka Bay Lagoon Hatchery would
impact communities and permit holders who have already faced
years of economic hardship. Commercial fishers and processors
in Southcentral Alaska make up a vital backbone of local
communities, employing 11,500 workers and contracting with local
vendors and service providers. The breadth of fisheries users
recreational, personal use, commercial, and sport is
significant in its reliance on this hatchery and has been for
decades. Removing recreational and employment opportunities
will unnecessarily remove some of the base of local economies.
This bill resolves an issue that results in support of these
jobs, the revenue created by the hatchery, the infrastructure
that supports entities, and the volume necessary for processors.
2:23:36 PM
CHRIS PERRY testified in support of HB 52. He specified he has
commercially fished Upper and Lower Cook Inlet for 39 years.
The bill would protect the Tutka Bay Lagoon Hatchery in the
state park. This small hatchery benefits all Alaskans and
visitors by its substantial contribution to personal use, sport,
and commercial fisheries. China Poot fishery residents are
allowed to take 12 fish a day with no annual limit. Closure of
the hatchery would close these fisheries. The CIAA pays for the
entire cost of these stocking projects. Closure of the hatchery
would also close all seining in Kachemak Bay as there are
limited pink salmon returns and no other sockeye in the area.
Many of the negative biological impacts being quoted are not
scientifically proven and are still under research. There are
very productive finfish and shellfish fisheries near large
hatcheries in Prince William Sound and Southeast Alaska. There
have been as many as 84 salmon seine permits in Lower Cook
Inlet. Throughout the 1980s there were between 52 and 83 seine
permits fished; in the 2000s between 15 and 36 permits were
fished which was mainly due to the Tutka Bay Lagoon Hatchery's
temporary closure. The bill does not allow increased hatchery
production or expansion into other parts of the park and does
not change existing public use.
2:26:21 PM
HOLLY NORWOOD, on behalf of herself and her husband, testified
in support of HB 52. She said she and her husband are "generic"
Kenai Peninsula residents who do not commercial fish or have
much involvement with the environmental community. She and her
husband support keeping the Tutka Bay Lagoon Hatchery open,
which means they support the bill. What catches their attention
if the hatchery was to close is the inability to get sockeye at
China Poot and Tutka Bay because she and her husband depend on
those fish for food security. She disagreed that all of Homer
supports closing the Tutka hatchery as there are people on both
sides whom she and her husband respect. Those who want the
hatchery closed have hunches that the pink fry are competing
with [other] salmon, the [hatchery] pinks are hurting the wild
pinks, and the herring and crab are gone because of this
hatchery. But, she added, the science does not support that.
2:29:13 PM
SUE CHRISTIANSEN testified regarding HB 52. She noted she owns a
cabin adjacent to the state park, has been a commercial fisher,
is a cofounder of the Kachemak Heritage Land Trust, and is a
board member of the Kachemak Bay State Park Citizen Advisory
Council. However, she qualified, she is speaking on her own
behalf. One of her favorite places on earth is Tutka Bay Lagoon
because it meets every unique scenic criterion that the state
park was designated for. An application is currently ongoing to
designate the lagoon as a [Biosphere] Reserve under the United
Nations Educational, Scientific and Cultural Organization
(UNESCO). If HB 52 does not pass, the hatchery will remain open
and there will be 10 years to come up with a better solution. A
[biosphere] reserve is about fostering ecologically sustainable
development, which is the best use for Tutka Bay Lagoon.
2:31:42 PM
DEAN DAY, Executive Director, Cook Inlet Aquaculture Association
(CIAA), testified in support of HB 52. He said the bill
resolves the land disposal [and incompatibility] issue that is
highlighted in the new proposed park management plan. For
decades the Tutka Bay Lagoon Hatchery has operated under
multiple park plans with the designation of being compatible.
If this hatchery is no longer operational, the China Poot dipnet
fishery goes away, along with all sockeye enhancement in the
Lower Cook Inlet, which includes Hazel Lake, Kirschner Lake, and
Tutka Bay Lagoon fishery. The complexity of the China Poot
project is described in his written testimony. The Trail Lakes
Hatchery is an integral part of the project but cannot do the
project itself. It is true that the program took place during
the closure, but it still required the facility to be
operational and staffed seasonally, which means that during the
closure CIAA had to continue paying the electric bills,
insurance, maintenance, and upkeep for the project to continue.
It never was designated to be a stand-alone project. The
sockeye program is costly and comes with a risk, and thus
requires pink salmon returns for funding for the project to be
sustainable. Funding for projects is determined by CIAA's 26-
member, all volunteer, board of directors made up of multiple
stakeholders.
2:34:12 PM
PAUL A. SHADURA II testified regarding HB 52. He related that
he has been commercial fishing for 55 years, and that since the
late 1970s he has been a board member of CIAA, a nonprofit
regional association. He qualified, however, that he is not
representing CIAA in this discussion. He thanked Representative
Vance for addressing the possible inconsistencies in the
proposed park management plan. He said provisions in Appendix C
of the completed 5/20/14 Standard Agreement [for Professional
Services] [between CIAA and ADF&G], establish a contract period
of 20 years, expiring 6/30/2033, and allow for contract renewal
upon request. Cook Inlet Aquaculture Association is contracted
to operate the Tutka Bay facilities under ADF&G's strict permit
guidelines and the comprehensive Regional Cook Inlet Management
Plan. As a CIAA board director, he is aware of CIAA's fiduciary
responsibilities and had assumed that to enter the revolving
loan fund to further improve CIAA facilities and operations,
that CIAA had a long-term commitment from the state to be able
to pay these loans through the cost recovery process. He noted
that CIAA is not a single operation, but rather a comprehensive
one that affects all areas of Cook Inlet and Resurrection Bay,
with multiple facilities in various legislative districts. The
operation of CIAA through Tutka Bay is just one of many parts,
but a very important part, to maintain the operation and
continue with solvency.
2:37:40 PM
MAKO HAGGERTY testified in opposition to HB 52. He said he owns
Mako's water taxi, has spent much time on the bay, and is aware
of how much use the area gets from all sorts of user groups.
Kachemak Bay State Park is Alaska's first state park and a jewel
in the state park system, he continued, and Tutka Bay Lagoon is
a jewel within the park. Carving it up for special interests is
a dangerous precedent for this and all state parks. The park is
a growing economic engine. As other resources diminish, the
continuing growth of Kachemak Bay State Park contributes more
and more to the local economy. He said he supports this
critical visitor industry, whereas HB 52 benefits so few and is
a social program for special interests. The zero fiscal note is
false, he maintained, because the bill will cost the state money
and therefore should not be passed without knowing what those
costs will be.
2:40:33 PM
KASEY ADERHOLD testified in opposition to HB 52. She urged that
since this is a park issue, it be settled as such. She argued
that it doesn't make sense to cut out an over-sized chunk of the
park, either temporarily or permanently, just because the
hatchery isn't in compliance with the [proposed] new management
plan. Kachemak Bay State Park is a unique and important
environment, so it is worth taking the time to explore the
options that do not resort to removal of this land from park
management. The bill is too rash and sets a bad precedent for
all of Alaska's parks. Park management plans must be able to be
developed without fear that conflicts with narrow interests may
end up in a loss of park land that is meant for the good of the
public. The hatchery has been given 10 years of continued
operation during which a solution can be sought. It is worth
taking the time to get it right while keeping the park intact
for the highest use of the land.
2:41:58 PM
ARON PETERSON testified in opposition to HB 52. He stated he is
opposed to the bill mainly because it is a legal issue and sets
a precedent of removing land from a park that could then happen
all over the state. There is no benefit from the Cottonwood-
Eastland land trade, he argued, and it is a bill just for
special interests.
2:42:56 PM
MARK THOMAS testified in support of HB 52. He said his first
experience in Tutka Bay Lagoon was in the late 1980s when he
drifted in a sport fishing boat and caught pink salmon. The
brood stock situation at the hatchery is because brood stock had
to be imported for the Lower Cook Inlet lakes spawning program.
It had to be moved there because there were no other options for
CIAA to do that. He argued that access to Tutka Bay Lagoon
would not be lost with passage of HB 52 because people would
still be able to drift in and catch pinks, the sockeye would
still be there, and the trail system would still be there.
2:45:08 PM
DAVID SEAMAN testified in opposition to HB 52. He said he lives
in Little Tutka Bay about nine or ten miles from the Tutka Bay
Lagoon Hatchery. He related that he has history with the
hatchery through hauling its supplies, personnel, and mail,
especially when the hatchery was owned by ADF&G. He said he
would rank the hatchery on whether it is providing fish for the
common property fishery and not just for itself, which it hasn't
done since CIAA took it over. He wouldn't say that it has been
a success as CIAA has its own fiefdom up there and own private
industry and sells the fish to whoever CIAA wants. He further
related that he ran a tender where he bought fish out of Tutka
and bought fish all over the bay and suddenly they went away
from Tutka and are still away. Much has been said about what
happens with pink salmon that go out and compete with other
species as well as other pinks in the bay. He said he is not
for giving away park lands to a private interest group.
2:47:18 PM
CHAIR PATKOTAK closed public testimony after ascertaining that
no one else wished to testify. He noted that the public can
submit written comments on HB 52 for as long as the bill is in
committee.
2:48:29 PM
REPRESENTATIVE FIELDS asked how the China Poot dipnet fishery
stayed open during the nine-year period when CIAA was not
operating the Tutka Bay Lagoon Hatchery.
MR. RABUNG clarified that the hatchery stopped producing pink
salmon for a period because the price of pinks was so low, but
CIAA continued to use the hatchery for the sockeye program and
stocking of China Poot was continued. He offered his
understanding that CIAA was running out of ways to fund it. The
price of pinks came back up and the demand for pinks is
tremendous. He pointed out that every hatchery program in the
state, regardless of what a hatchery's mix of species is, has
pinks and/or chums as their cost recovery fish.
MR. RABUNG noted that the Lower Cook Inlet lakes sockeye program
includes Hazel, Leisure, and Kirschner lakes. He specified that
the brood stock currently produced for this program are released
at Tutka Bay Lagoon Hatchery, so the eggs are collected at Tutka
Bay Lagoon Hatchery. It is true that Trail Lakes Hatchery is
where the eggs are incubated and reared to fry stage, or smolt
stage in the case of Tutka, and then they are taken offsite and
released at those Lower Cook Inlet lakes projects. But, he
reiterated, the brood stock is at Tutka, and it is complex.
2:50:40 PM
MR. RABUNG explained that, previously, the brood stock for the
Lower Cook Inlet lakes projects came from Tustumena Lake. The
eggs were collected from wild stock that matured in the lake
every year. Upon reaching sexual maturity and the ability to
spawn, the sockeye would swim up into the stream to spawn, which
was when the brood stock was collected and the eggs collected
and which were flown to the Trail Lakes Hatchery for incubation,
rearing, and subsequent out planning at the release sites.
However, another location had to be found after the federal
government determined that commercial activity in Tustumena Lake
was incompatible with the lake being in a [federally designated
Wilderness area]. So, for a short period, eggs were then taken
from Hidden Lake in Kenai, part of the Kenai River system. But
those fish were not well adapted to the life history of the
Lower Cook Inlet lakes project because they swim 100 miles
upstream and go into a lake to rear and spawn. After more
looking around the English Bay Lakes stock were found. The
nearest significant stock of sockeye, it is the appropriate
stock for all the Lower Cook Inlet lakes stocking program, and
it has been identified in the Cook Inlet Comprehensive Salmon
Plan as the appropriate stock. So, with assistance from ADF&G
and Nanwalek, owner of the land, CIAA collected eggs from
English Bay Lakes for three or four years. Those eggs were
incubated at Trail Lakes Hatchery and the fry were released at
the Lower Cook Inlet lakes project and at Tutka Bay Lagoon
Hatchery where they were imprinted so they would return there.
MR. RABUNG continued. He explained that once the fish started
returning to Tutka Bay Lagoon Hatchery there was no longer a
need to go into English Bay Lakes, which was timely because the
Nanwalek community was done with egg collecting being on their
land. So, the cycle now is that all the brood stock returns to
Tutka Bay Lagoon Hatchery where the eggs are collected and then
flown to Trail Lakes Hatchery where they are incubated to the
juvenile stage and then out planted. Trail Lakes doesn't have
any salmon that return to it, it is what is called a central
incubation facility. All eggs must be transported into Trail
Lakes Hatchery and all the juveniles must be transported out for
release somewhere else. Trail Lakes Hatchery is used for
sockeye because it is on well water, which is virus-free water.
Tutka Bay Lagoon Hatchery does not have virus-free water so all
that can be done there is collect the eggs and release the fish.
Eggs cannot be incubated and reared at Tutka Bay Lagoon Hatchery
because that would violate ADF&G's sockeye salmon policy.
2:54:11 PM
REPRESENTATIVE HANNAN drew attention to Representative Vance's
briefing paper on HB 52. She said she is trying to avoid fish
politics and is looking to understand the legal land disposal
issues that have brought forth this situation. She observed
that the briefing paper includes four court precedents, the
first citation being [the 2000 decision for Northern Alaska
Environmental Center v. State of Alaska, Department of Natural
Resources] that establishes the functionally irrevocable test.
She asked whether that case was about state park land.
2:55:26 PM
REPRESENTATIVE SARAH VANCE, Alaska State Legislature, prime
sponsor of HB 52, deferred to Mr. Christopher Orman to answer
the question given he provided the documentation within DNR's
white paper.
2:55:45 PM
CHRISTOPHER ORMAN, Assistant Attorney General, Natural Resources
Section, Department of Law (DOL), offered his recollection that
[the 2013 decision for SOP, Inc. v. State of Alaska, Department
of Natural Resources] is the only case addressing and dealing
with legislatively withdrawn lands, so state park lands. The
other cases deal with public domain lands, so general state
lands.
2:56:35 PM
REPRESENTATIVE HANNAN drew attention to the paragraph on page 2
of the HB 52 briefing paper which states: "The plain language
of ADF&G's 2014 agreement with CIAA suggests a lease and thus
a disposal of these lands. The agreement allows CIAA to
operate the TBLH for twenty years. The agreement states that
the parties would work towards transferring the TBLH facilities
to CIAA." She related that in a meeting yesterday with Mr.
Rabung of ADF&G, it was asserted that this remains ADF&G land,
that the hatchery is ADF&G's and CIAA is simply a contractor
that can be terminated on a 90-day notice, whereas DNR's read is
that the lease leads to a transfer of the facilities to CIAA.
She asked which interpretation is more accurate.
MR. ORMAN first clarified that [the 2020 decision for SEACC v.
State of Alaska] was unique because it was talking about general
state lands, public domain lands, and about an issue involving
the [Alaska Mental Health Trust Authority] and trust land. It
is a complicated issue of conveyance and lack of public notice,
but in general that case is probably general state lands
although there are a lot of nuances.
MR. ORMAN then addressed Representative Hannan's question about
the agreement. He said he doesn't necessarily disagree with
ADF&G's point there, but pursuant to the language in the 2014
agreement two things have been stated that are a concern about
that agreement. First, the idea that legislatively withdrawn
lands could ever be at any point potentially conveyed to an
entity like CIAA is a problem. Regarding the agreement being
referred to potentially as a lease or suggests a lease, he said
a lease concept is a problem when talking about legislatively
withdrawn lands. Given the legislature set these lands aside
for the department to manage the lands, and only to be the one
managing these lands, the idea that ADF&G somehow holds a lease
or interest to the lands or holds the land is problematic when
talking about disposal, when talking about the functionally
irrevocable test. In that briefing paper and talking about that
agreement, when the agreement is characterized as a lease, when
the idea is that there is a potential lease of legislatively
withdrawn lands, he said that has been the trigger as far as the
functionally irrevocable test, that's the problem and that's the
disposal.
3:00:47 PM
REPRESENTATIVE HANNAN posed a scenario in which ADF&G is
operating the aquaculture location, the hatchery, as ADF&G did
in its original state. She asked whether that would then not be
irrevocable land because it remains in state hands.
MR. ORMAN responded that if only ADF&G was operating the
hatchery, and it was the state operating the hatchery, there is
still a problem potentially with the ILMA and there is also then
the definition of scenic park. There is a lot of history, a lot
of documents, and a lot of different viewpoints. So, he
continued, the answer to that question becomes complicated and
the best answer would be, "Well, we may not then directly have
the disposal problem we have, which is the investment, the
interest there, the functionally irrevocable problem, I think
then there's still going to be other legal problems that would
have to be addressed and figured out."
3:02:13 PM
CHAIR PATKOTAK invited Mr. Rabung to give further clarification.
MR. RABUNG spoke to the professional services agreement contract
between ADF&G and CIAA. He said the contract states that during
this term the parties agree to explore the possibility of the
transfer of ownership of the hatchery to CIAA. He further said
that members of the public were pushing for ADF&G to transfer
ownership of the 12 state-owned hatcheries with contracted
operators to the contractors. This was investigated by ADF&G,
and it was found not legal.
MR. RABUNG spoke to another part of the contract, [Appendix C,
Article VII. Interagency Land Management Assignment (ILMA)],
which states: "ADF&G holds an ILMA from the Department of
Natural Resources (DNR) (ADL200098), a copy of which is attached
and made part of this contract. There is no expiration date.
The Contractor shall be responsible for complying with the terms
and conditions of the ILMA and any additional amendments. The
ILMA authorizes land use for the Tutka Bay Lagoon Hatchery and
the ILMA is not transferable from the state to CIAA. The State
of Alaska retains primary responsibility for adherence to the
conditions of the ILMA." Mr. Rabung elaborated that this is a
state hatchery on state land; this does not change regardless of
whether the land is general DNR state land or state park land.
The only thing changing since 1976 when the hatchery was
constructed in its location, he said, is the paperwork regarding
the land status. Nothing new is going to be built or developed.
It is just basically being grandfathered and the operation
continued as it has been since the state invested into it and
built it in 1976 using state bond money.
3:04:36 PM
MR. RABUNG addressed several statements made during the earlier
testimony. Regarding constitutionality, he pointed out that
aquaculture is included in the Alaska State Constitution under
Article 8, Section 15. He further pointed out that Alaska
Statute (AS) 16.05.092 directs ADF&G to do these things, so the
department is doing what the state law requires it to do.
Regarding changing the hatchery into some other use, he said his
understanding is that it is not the hatchery that is at issue,
it is the disposal of land that is at issue. So regardless of
what the facility is, whether a hatchery or a wilderness center
or a Girl Scout camp, the land issue is the same. Regarding Mr.
Clem Tillion, founder of the park, he recounted that Mr. Tillion
is the one who got the hatchery built and who spoke in support
of the hatchery continuing prior to his death.
3:06:02 PM
REPRESENTATIVE VANCE noted that the CIAA contract can be viewed
on BASIS [under the documents provided for the bill's hearing
before the House Resources Standing Committee on 2/7/22].
CHAIR PATKOTAK invited the sponsor to make any final comments on
HB 52.
REPRESENTATIVE VANCE thanked the public for testifying and said
she respects the positions of everyone who supported or opposed
the bill through this public process. She further thanked ADF&G
and DNR for working with her on the bill.
3:07:01 PM
CHAIR PATKOTAK [announced that HB 52 was held over].
3:08:13 PM
ADJOURNMENT
There being no further business before the committee, the House
Resources Standing Committee meeting was adjourned at 3:08 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 52 Testimony Provided by KBCS 2.8.2022.pdf |
HRES 2/11/2022 1:00:00 PM |
HB 52 |
| HB 52 Letters of Support 2.1.2022.pdf |
HRES 2/7/2022 1:00:00 PM HRES 2/11/2022 1:00:00 PM |
HB 52 |
| HB 52 DNR and DFG Letter of Support 2.7.2022.pdf |
HRES 2/7/2022 1:00:00 PM HRES 2/11/2022 1:00:00 PM |
HB 52 |
| HB 52 Testimony Received as of 2.7.2022.pdf |
HRES 2/7/2022 1:00:00 PM HRES 2/11/2022 1:00:00 PM |
HB 52 |
| HB 52 Testimony Provided by FKBSP 2.11.2022.pdf |
HRES 2/11/2022 1:00:00 PM |
HB 52 |
| HB 52 Testimony Provided by KBCS 2.9.2022.pdf |
HRES 2/11/2022 1:00:00 PM |
HB 52 |
| HB 287 Sectional Analysis 2.9.2022.pdf |
HRES 2/9/2022 1:00:00 PM HRES 2/11/2022 1:00:00 PM |
HB 287 |
| HB 287 Sponsor Statement 2.9.2022.pdf |
HRES 2/9/2022 1:00:00 PM HRES 2/11/2022 1:00:00 PM |
HB 287 |
| HB 287 Testimony Received as of 2.9.2022.pdf |
HRES 2/9/2022 1:00:00 PM HRES 2/11/2022 1:00:00 PM |
HB 287 |
| HB 287 Testimony Provided by ASRC and PetroStar 2.9.2022.pdf |
HRES 2/9/2022 1:00:00 PM HRES 2/11/2022 1:00:00 PM |
HB 287 |
| HB 52 Testimony Provided by Inletkeeper 2.10.2022.pdf |
HRES 2/11/2022 1:00:00 PM |
HB 52 |
| HB 52 Resolution from KBSP 2.10.2022.pdf |
HRES 2/11/2022 1:00:00 PM |
HB 52 |
| HB 52 Testimony Provided by Nancy Hillstrand 2.10.2022.pdf |
HRES 2/11/2022 1:00:00 PM |
HB 52 |
| HB 52 Testimony Received as of 2.11.2022 .pdf |
HRES 2/11/2022 1:00:00 PM |
HB 52 |
| HB 52 Supporting Document Petition 2.11.2022.pdf |
HRES 2/11/2022 1:00:00 PM |
HB 52 |