Legislature(2021 - 2022)SENATE FINANCE 532

04/06/2021 09:00 AM Senate FINANCE

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+ Bills Previously Heard/Scheduled TELECONFERENCED
                 SENATE FINANCE COMMITTEE                                                                                       
                       April 6, 2021                                                                                            
                         9:09 a.m.                                                                                              
9:09:16 AM                                                                                                                    
CALL TO ORDER                                                                                                                 
Co-Chair Bishop called the  Senate Finance Committee meeting                                                                    
to order at 9:09 a.m.                                                                                                           
MEMBERS PRESENT                                                                                                               
Senator Click Bishop, Co-Chair                                                                                                  
Senator Bert Stedman, Co-Chair                                                                                                  
Senator Donny Olson (via teleconference)                                                                                        
Senator Natasha von Imhof                                                                                                       
Senator Bill Wielechowski                                                                                                       
Senator David Wilson                                                                                                            
MEMBERS ABSENT                                                                                                                
Senator Lyman Hoffman                                                                                                           
ALSO PRESENT                                                                                                                  
Tim Lamkin, Staff, Senator Gary Stevens.                                                                                        
PRESENT VIA TELECONFERENCE                                                                                                    
Senator Gary  Stevens, Sponsor; Ben Brown,  Chairman, Alaska                                                                    
State Council on the Arts;  Sam Rabung, Director, Commercial                                                                    
Fisheries,  Department  of  Fish  and  Game;  Ginny  Eckert,                                                                    
Professor  of   Fisheries  Ecology,  University   of  Alaska                                                                    
Fairbanks; Heather  McCarty, Chair, Alaska  Mariculture Task                                                                    
Force,  Juneau;  Julie  Decker, Executive  Director,  Alaska                                                                    
Fisheries Development Foundation;  Jeremy Woodrow, Executive                                                                    
Director, Alaska Seafood  Marketing Institute, Juneau; Nancy                                                                    
Hillstrand, Owner, Pioneer Alaska Fisheries, Kachemak Bay.                                                                      
SB 20     OUT OF STATE TEACHER RECIPROCITY                                                                                      
          SB 20 was SCHEDULED but not HEARD.                                                                                    
SB 64     SHELLFISH PROJECTS; HATCHERIES; FEES                                                                                  
          SB 64 was HEARD and HELD in committee for further                                                                     
SB 71     COUNCIL ON ARTS: PLATES & MANAGE ART                                                                                  
          SB 71 was HEARD and HELD in committee for further                                                                     
Co-Chair  Bishop  relayed that  committee  would  set SB  20                                                                    
aside until the sponsor could attend the bill hearing.                                                                          
SENATE BILL NO. 71                                                                                                            
     "An  Act  relating   to  special  request  registration                                                                    
     plates  celebrating the  arts; relating  to artwork  in                                                                    
     public  buildings  and   facilities;  relating  to  the                                                                    
     management of  artwork under the  art in  public places                                                                    
     fund; relating to  the powers and duties  of the Alaska                                                                    
     State  Council  on  the  Arts;  and  providing  for  an                                                                    
     effective date."                                                                                                           
9:10:27 AM                                                                                                                    
Co-Chair Bishop relayed that it  was the first hearing of SB
71, and  the intent of  the committee  was to hear  the bill                                                                    
and set it  aside. After hearing from  invited testimony, he                                                                    
would open public testimony on the bill.                                                                                        
9:11:32 AM                                                                                                                    
SENATOR GARY STEVENS,  SPONSOR (via teleconference), thanked                                                                    
the committee  for hearing the  bill. He relayed that  SB 71                                                                    
was drafted  at the request  of the Alaska State  Council on                                                                    
the Arts (ASCA).  It was a bill that allowed  the council to                                                                    
raise funds from  the sale of arts license  plates, and held                                                                    
the council harmless by disallowing  a veto hold for funding                                                                    
the council raised private funds.                                                                                               
9:12:32 AM                                                                                                                    
TIM  LAMKIN,  STAFF,  SENATOR   GARY  STEVENS,  addressed  a                                                                    
Sectional  Analysis  for Version  I  of  the bill  (copy  on                                                                    
     Sec. 1: AS  28.10.421(a), relating to fees  paid to the                                                                    
     Division of  Motor Vehicles  (DMV) for  vehicle license                                                                    
     plates,  allows for  an additional  fee, set  by Alaska                                                                    
     State Council  on the Arts  (ASCA) regulation,  and not                                                                    
     to  exceed  $50,  when  a   person  chooses  a  new  or                                                                    
     replacement ASCA artistic plate.                                                                                           
     The  subsection  also  provides that  these  additional                                                                    
     fees will be accounted for separately and that                                                                             
     the  total  amount  that  exceeds   the  costs  of  the                                                                    
    Artistic License Plate Program may be appropriated                                                                          
     to fund the ASCA.                                                                                                          
Mr. Lamkin noted that in Section 1, the fee was intended                                                                        
not to exceed  $50, but clarified that the fee  would not be                                                                    
set at $50. He continued to address the Sectional Analysis:                                                                     
     Sec. 2: AS  35.27.020(h), relating to the  Art Works in                                                                    
     Public  Buildings and  Facilities program,  adds a  new                                                                    
     subsection to specify  ASCA's management responsibility                                                                    
     for  public  artwork  created  under  the  program,  to                                                                    
     include the management  of the relocation, disposition,                                                                    
     or exchange of such artwork.                                                                                               
     Sec. 3: AS 44.27.050(7), relating  to the duties of the                                                                    
     ASCA,  is  a  cross  reference to  the  prior  section,                                                                    
     specifying ASCA's management  responsibility for public                                                                    
     artwork created  through its  programs, to  include the                                                                    
     management of the  relocation, disposition, or exchange                                                                    
     of such artwork.                                                                                                           
     Sec.  4:  AS  44.27.053(a),  establishes  the  Attorney                                                                    
     General being legal counsel for  ASCA, similar to other                                                                    
     state  agencies,   and  allows   the  ASCA   to  retain                                                                    
     additional  legal counsel  as  needed,  subject to  the                                                                    
     approval of the Attorney General.                                                                                          
     Sec. 5: AS 44.27.055(d),  relating to the ASCA managing                                                                    
     its affairs, exempts from the purview of the Executive                                                                     
     Budget Act  those funds received  by ASCA  from private                                                                    
     non-profit foundation partners.                                                                                            
     Sec. 6: AS 44.27.080(a),  relating to an ASCA-sponsored                                                                    
     competition  for  artistic  plates design,  from  being                                                                    
     mandatory to  being optional, every four  years, at the                                                                    
     discretion of ASCA.                                                                                                        
     Sec.  7:  AS  44.27.080(c), relating  to  the  artistic                                                                    
     plate  design competition,  restores authority  for the                                                                    
     ASCA  to  award the  artist  of  the winning  design  a                                                                    
     monetary  amount  set  in regulation,  from  the  funds                                                                    
     generated by  the artistic  plates. This  provision was                                                                    
     repealed in 2018.                                                                                                          
     Sec. 8: Provides an effective date of July 1, 2021.                                                                        
9:15:59 AM                                                                                                                    
BEN BROWN, CHAIRMAN,  ALASKA STATE COUNCIL ON  THE ARTS (via                                                                    
teleconference), thanked  the sponsor and his  staff for the                                                                    
work on the bill. He  affirmed that Mr. Lamkin had addressed                                                                    
the provisions accurately and  succinctly. He commented that                                                                    
the  bill  was somewhat  time  sensitive.  He discussed  the                                                                    
current  Alaska  Artistic  License Program,  which  involved                                                                    
artist-designed  license  plates.   He  explained  that  the                                                                    
plates were not like other  special plates. There was a dual                                                                    
purpose to the  plates: to celebrate an  Alaskan artist, and                                                                    
to provide a small piece  of visual artistic beauty on cars.                                                                    
The  program was  originally structured  with no  additional                                                                    
fee  to Alaskans.  The public  response  had been  amazingly                                                                    
Mr. Brown  mentioned the National  Arts and  Humanities Act,                                                                    
which  dictated  the  calculation  for  state  funding,  and                                                                    
explained  that there  was a  minimum state  contribution in                                                                    
every  state to  trigger the  federal match,  which for  the                                                                    
arts council  equated approximately $600,000. He  noted that                                                                    
much of  the ASCA budget was  from non-governmental sources.                                                                    
Without the  state contribution, the council  would not have                                                                    
access   to  funding   partners   such   as  the   Rasmussen                                                                    
Foundation. He relayed that the  council wanted to earn some                                                                    
income  to help  with  the state  match.  He continued  that                                                                    
foundation funds could  not be used to fund  the state much,                                                                    
however  designated  general  funds  (DGF) in  the  form  of                                                                    
revenues from the Artistic License  Program, could do so. He                                                                    
asserted that  every dollar from  an artistic  license plate                                                                    
signified  an undesignated  general fund  (UGF) dollar  that                                                                    
did not  need to be  requested from state general  funds. He                                                                    
noted  that  other  provisions of  the  bill  were  targeted                                                                    
changes  identified when  the  topic of  the  bill had  been                                                                    
9:20:47 AM                                                                                                                    
Senator Wilson asked  about the total of  state funds needed                                                                    
for matching funds.                                                                                                             
Mr.  Brown specified  that the  council  needed $686,000  to                                                                    
trigger federal matching funds.                                                                                                 
Senator  Wielechowski asked  for the  approximate amount  of                                                                    
private funding  or funds  from nonprofit  organizations the                                                                    
council received.                                                                                                               
Mr. Brown  relayed that for  FY 22, the  governor's proposed                                                                    
budget for the council included  $685,100 in UGF, $10,900 in                                                                    
DGF,   $806,000  in   federal  funds,   and  $2,359,700   in                                                                    
statutorily  designated  program receipts.  He  approximated                                                                    
that about  54 percent of  the council's overall  budget was                                                                    
coming from non-governmental foundation partner sources.                                                                        
Senator  Wielechowski  referenced  Section 5  of  the  bill,                                                                    
which exempted  the council from  the Executive  Budget Act.                                                                    
He asked for the rationale behind the provision.                                                                                
Mr. Brown explained  that the provision was  a direct result                                                                    
of the  council's experience from  a few years ago  when all                                                                    
of the council's funding had  been vetoed. He explained that                                                                    
at the time, if  the statutorily designated program receipts                                                                    
had not  been vetoed,  the council would  have been  able to                                                                    
stay in operation  longer and not have had  to abruptly shut                                                                    
down  and lay  off all  its  staff, close  its offices,  and                                                                    
erase its website. After the  funds had been restored by the                                                                    
legislature, he had  met with the governor and  his chief of                                                                    
staff  to discuss  putting  a provision  in  the statute  to                                                                    
exempt  the  component  of the  budget  from  the  Executive                                                                    
Branch Budget Act. He noted  that the bill section was there                                                                    
with the concurrence of the  Dunleavy Administration. He did                                                                    
not  see the  provision  as problematic.  The rationale  was                                                                    
that the funds were not governmental  and did not need to be                                                                    
subject to  the act in the  same way that state  and federal                                                                    
dollars were.                                                                                                                   
9:24:04 AM                                                                                                                    
Co-Chair Bishop  asked if Mr.  Brown could  discuss auditing                                                                    
protocol for  the council if Section  5 of the bill  were to                                                                    
go into effect.                                                                                                                 
Mr.  Brown did  not  believe that  being  exempted from  the                                                                    
Executive Branch  Budget Act  would prevent  the Legislative                                                                    
Audit  Department from  looking  at all  funds received  and                                                                    
spent  by  the  council.  He  noted  that  the  council  was                                                                    
administratively housed  in the Department of  Education and                                                                    
Early  Development (DEED).  He elaborated  that the  council                                                                    
could  come  up  with  any  new  procedures  that  might  be                                                                    
necessary if  Section 5  became law along  with the  rest of                                                                    
the  provisions  of  the  bill. He  noted  that  there  were                                                                    
specific  provisions  that  detailed   how  funds  from  the                                                                    
National Endowment for  the Arts could be  spent. He thought                                                                    
there might  be additional steps to  ensure transparency for                                                                    
Legislative  Audit or  other entities  but assured  that the                                                                    
provision was not  to escape tracking but  rather to prevent                                                                    
private  foundation  funds from  being  vetoed  by a  future                                                                    
Co-Chair   Bishop  stated   he  would   reach  out   to  the                                                                    
legislative  auditor  for  clarification   on  some  of  the                                                                    
questions that had been raised.                                                                                                 
Senator Wielechowski  was curious  how procurement  would be                                                                    
done with  funds from  private or  non-profit organizations.                                                                    
He asked  if there were  any related procedures in  place at                                                                    
the council.                                                                                                                    
Mr. Brown explained that ASCA  had undergone a transition to                                                                    
become  a  quasi-public  corporation  and  ceased  to  be  a                                                                    
regular-line agency,  it was already somewhat  exempted from                                                                    
the strictures  of state procurement.  He relayed  that ASCA                                                                    
had since endeavored to come  up with a standalone code, but                                                                    
at  the current  time, the  council followed  all of  DEED's                                                                    
current  requirements. He  continued that  ASCA was  farther                                                                    
along with  its personnel  policy that  the conversion  to a                                                                    
public corporation  status allowed  for. He noted  that ASCA                                                                    
only had  three staff that were  juggling the administrative                                                                    
and finance tasks  to run the agency,  and unfortunately did                                                                    
not have a dedicated finance person.                                                                                            
Mr.  Brown  continued   to  address  Senator  Wielechowski's                                                                    
question.  He  qualified  that  ASCA was  not  in  the  same                                                                    
position of a regular agency  but continued to behave as one                                                                    
with regard  to procurement until  such time that  there was                                                                    
sufficient staff  to set  up a  separate set  of procedures.                                                                    
The change  in procedure  would be  done in  concurrence and                                                                    
with the  approval of  DEED, and he  was confident  that the                                                                    
change would satisfy the public's  interest in ensuring that                                                                    
procurement activities were legitimate and documented.                                                                          
9:28:53 AM                                                                                                                    
Co-Chair Bishop OPENED public testimony.                                                                                        
9:29:10 AM                                                                                                                    
Co-Chair Bishop CLOSED public testimony.                                                                                        
Co-Chair Bishop set the bill aside.                                                                                             
SB  71  was   HEARD  and  HELD  in   committee  for  further                                                                    
SENATE BILL NO. 64                                                                                                            
     "An Act  relating to management  of enhanced  stocks of                                                                    
     shellfish; authorizing  certain nonprofit organizations                                                                    
     to engage  in shellfish enhancement  projects; relating                                                                    
     to  application fees  for salmon  hatchery permits  and                                                                    
     shellfish  enhancement  project permits;  allowing  the                                                                    
     Alaska  Seafood Marketing  Institute to  market aquatic                                                                    
     farm products; and providing for an effective date."                                                                       
9:29:28 AM                                                                                                                    
Co-Chair Bishop noted  that the committee was  hearing SB 64                                                                    
for the first time. He intended to hear and hold the bill.                                                                      
Senator Stevens,  Sponsor, discussed  the bill.  He reminded                                                                    
that fisheries  around the state  had been up and  down, and                                                                    
the bill was an attempt to  rebuild the crab and clam stocks                                                                    
the state  had in the past.  He thought there had  been some                                                                    
overfishing. He cited that the  practice of planting crab as                                                                    
proposed in the  bill had been done  successfully in Norway.                                                                    
He noted  that Norway had  not previously had king  crab and                                                                    
the practice  had been successful, while  Alaska already had                                                                    
the species  naturally occurring. He  though the bill  was a                                                                    
step forward for industry and would provide jobs.                                                                               
9:31:43 AM                                                                                                                    
Tim Lamkin, Staff, Senator Gary  Stevens, commented that the                                                                    
bill was identical  to a bill seen in the  past. He reminded                                                                    
that the purpose the bill  was to strengthen and broaden the                                                                    
fisheries portfolio  in Alaska.  The statutes  were modelled                                                                    
after existing programs for salmon hatcheries. There was                                                                        
also conforming language.                                                                                                       
Mr. Lamkin addressed a Sectional Analysis (copy on file):                                                                       
     Sec. 1:  AS 16.05.730(c)  Provides the Alaska  Board of                                                                    
     Fisheries authority to direct  the department to manage                                                                    
     production of  enhanced shellfish stocks,  beyond brood                                                                    
     stock needs, for cost recovery harvest.                                                                                    
     Sec.  2: AS  16.10.400(b)  Removes a  flat $100  permit                                                                    
     application  fee  for   new  private  nonprofit  salmon                                                                    
     hatcheries, to instead be  determined by the department                                                                    
     by regulation, as  described in Section 3  of the bill,                                                                    
     Sec.  3: AS  16.10.400  Conforming language  consistent                                                                    
     with  other   fee  structures   set  and   adjusted  by                                                                    
     regulation,  requiring  fees to  approximately  reflect                                                                    
     the cost of administering  the application process, and                                                                    
     to be reviewed and adjusted periodically.                                                                                  
     Sec. 4: Adds  a new Chapter 12 to  Title 16, "Shellfish                                                                    
     Stock Enhancement Projects"                                                                                                
     AS 16.12.010 Provides direction  to the commissioner of                                                                    
     the  Department of  Fish and  Game on  the issuance  of                                                                    
     permits   for  private   nonprofit  shellfish   fishery                                                                    
     enhancement  projects intended  to  improve the  yield,                                                                    
     rehabilitate   stocks,   or    increase   habitat   for                                                                    
     shellfish.   This    subsection   also    directs   the                                                                    
     commissioner to  set an application fee  and to consult                                                                    
     with  technical experts  in the  relevant areas  before                                                                    
     permit issuance;                                                                                                           
     AS  16.12.020   Provides  for  a  hearing   and  public                                                                    
     notification and  input process prior to  issuance of a                                                                    
     AS 16.12.030 Describes terms  and conditions for permit                                                                    
     holders to conduct their  work, including cost recovery                                                                    
     fisheries,  harvest, sale,  and release  of enhancement                                                                    
     project  produced  shellfish,  and selection  of  brood                                                                    
     stock sources;                                                                                                             
     AS 16.12.040 Describes the  revocation process should a                                                                    
     permit  holder  fail  to  comply  with  the  terms  and                                                                    
     conditions of the permit;                                                                                                  
     AS  16.12.050 Specifies  that shellfish  produced under                                                                    
     an approved  enhancement project are a  common property                                                                    
     resource, with  provision for special harvest  areas by                                                                    
     permit holders.  This section also specifies  the Board                                                                    
     of Fisheries to establish  regulations relating to this                                                                    
     AS  16.12.060  Directs  the department  to  advise  and                                                                    
     assist  permit holders  in their  planning, operations,                                                                    
     and  construction of  facilities  to  a reasonable  and                                                                    
     appropriate extent;                                                                                                        
     AS 16.12.070  provides department authority  to approve                                                                    
     source  and  number  of  shellfish  taken  for  use  as                                                                    
     AS   16.12.080  places   restrictions  on   how  monies                                                                    
     receives from  sale of shellfish  may be used  only for                                                                    
     operating  costs associated  with their  facilities; AS                                                                    
     16.12.090  Relates  to  Cost  Recovery  Fisheries,  and                                                                    
     provides  a means  by which  a  shellfish hatchery  may                                                                    
     contract to  either harvest and  sell shellfish,  or to                                                                    
     implement   a   self-assessment    from   amongst   its                                                                    
     membership,  for  purposes  of  recovering  operational                                                                    
     costs associated with the  hatchery. AS 16.12.100 Gives                                                                    
     the department  authority to inspect facilities  at any                                                                    
     time while  the facility is in  operation; AS 16.12.110                                                                    
     Requires a permit holder to  submit an annual report to                                                                    
     the department;  AS 16.12.199 provides  definitions for                                                                    
     "enhancement    project,"   "facility,"    "genetically                                                                    
     modified shellfish," "hatchery," and "shellfish."                                                                          
     Sec.  5:   AS  16.43.400(a)  Provides   the  Commercial                                                                    
     Fisheries Entry  Commission authority to  issue special                                                                    
     harvest  area  entry  permits  to  holders  of  private                                                                    
     nonprofit  shellfish   rehabilitation,  or  enhancement                                                                    
     project permits.                                                                                                           
     Sec.  6: AS  16.43.430 Defines  legal fishing  gear for                                                                    
     special harvest area entry permit holders.                                                                                 
     Sec. 7:  AS 16.51.090  adds marketing and  promotion of                                                                    
     aquatic farm products  to the powers and  duties of the                                                                    
     Alaska Seafood Marketing Institute (ASMI).                                                                                 
9:36:06 AM                                                                                                                    
Mr. Lamkin continued to address the Sectional Analysis:                                                                         
     Sec. 8: AS  16.51.110 conforming amendment, prohibiting                                                                    
     ASMI  from promoting  aquatic  farm  products not  from                                                                    
     Alaska, a specific  region of Alaska, or  by a specific                                                                    
     brand name.                                                                                                                
     Sec. 9: AS  16.51.180(7) conforming amendment regarding                                                                    
     the definition of "seafood."                                                                                               
     Sec.  10:  AS  16.51.180   (8)  is  a  new  referential                                                                    
     subsection  pointing  to  the  existing  definition  of                                                                    
     "aquatic farm  product" as  described in  AS 16.40.199,                                                                    
     which states "an aquatic plant  or shellfish,.. that is                                                                    
     propagated, farmed,  or cultivated  in an  aquatic farm                                                                    
     and sold or offered for sale."                                                                                             
     Sec. 11: AS 17.20.049(b)  Exempts shellfish raised in a                                                                    
     private   nonprofit   shellfish    project   from   the                                                                    
     definition of "farmed fish."                                                                                               
     Sec.   12:  AS   37.05.146(c)  Makes   application  fee                                                                    
     revenues received  by the Dept.  of Fish and  Game from                                                                    
     the salmon hatchery and  shellfish hatchery programs be                                                                    
     accounted  for  separately. Appropriations  from  those                                                                    
     program  receipts are  not made  from the  unrestricted                                                                    
     general revenue fund.                                                                                                      
     Sec.   13:   AS   43.20.012(a)  Exempts   a   nonprofit                                                                    
     corporation  holding  a shellfish  fishery  enhancement                                                                    
     permit  from state  corporate  income  tax when  making                                                                    
     shellfish   sales  and   engaging  in   shellfish  cost                                                                    
     recovery activity.                                                                                                         
     Sec.  14: AS  43.20.012(a)  Is  a technical  conforming                                                                    
     amendment  required by  prior  session law  and has  no                                                                    
     impact on the policies being set in this bill.                                                                             
     Sec.  15:  AS  43.76.390  Exempts  shellfish  harvested                                                                    
     under a special harvest  area entry permit from seafood                                                                    
     development taxes.                                                                                                         
     Sec. 16:  Establishes an effective date  for the salmon                                                                    
     hatchery  permit application  fee change,  as described                                                                    
     in Section 2 above.                                                                                                        
     Sec. 17: Authorizes the Department  of Fish and Game to                                                                    
     adopt implementing regulations.                                                                                            
     Sec. 18:  Establishes an  immediate effective  date for                                                                    
     Section 17 pursuant to AS 01.10.070(c).                                                                                    
     Sec. 19: Is a technical, conforming effective date for                                                                     
     Section 14 concomitant with 2 CH 55, SLA 2013 and has                                                                      
     no effect on the policy set forth in this bill.                                                                            
Senator  Wilson  asked  how soon  the  industry  would  have                                                                    
information about the fees.                                                                                                     
Mr.  Lamkin  explained  that  stakeholders  were  all  well-                                                                    
informed  about the  proposed changes.  He noted  that there                                                                    
was  invited testimony  that could  further address  Senator                                                                    
Wilson's question.                                                                                                              
Co-Chair Bishop read the list of invited testifiers.                                                                            
Senator  Wilson noted  that sometimes  it took  a couple  of                                                                    
years for  regulations to be  developed. He wondered  if the                                                                    
fees would  be similar  to those already  in statute  and at                                                                    
what point the industry would have the fee information.                                                                         
9:39:58 AM                                                                                                                    
SAM  RABUNG, DIRECTOR,  COMMERCIAL FISHERIES,  DEPARTMENT OF                                                                    
FISH AND GAME (via  teleconference), explained that the fees                                                                    
were  one-time fees  for a  permit  application. The  salmon                                                                    
hatchery  program  had  only   had  50  permit  applications                                                                    
processed since its  inception in the 1970s.  He thought the                                                                    
one-time fee  would have a  small impact. He  estimated that                                                                    
considering inflation,  the one-time permit  application fee                                                                    
would be  in the range  of $1,000,  and the amount  would be                                                                    
determined through a public process.                                                                                            
Senator Wilson  asked if the  permits would be  new permits,                                                                    
limited  entry, or  if  the  permits would  be  open to  all                                                                    
Mr. Rabung  stated that  the fee would  be for  new permits.                                                                    
The  permits  did  not  expire but  could  be  revoked.  Any                                                                    
qualified non-profit could apply for a permit.                                                                                  
Senator  Wilson  asked if  there  was  a limitation  on  the                                                                    
number of permits  that could be issued. He  wondered if the                                                                    
department expected there to be a limit on the permits.                                                                         
Mr. Rabung stated  there was no limit on  the permits, which                                                                    
were  somewhat  unique.  The permit  applications  would  go                                                                    
through a significant review process.  He explained that the                                                                    
permits  would be  somewhat self-limiting  due  to the  fact                                                                    
that  there would  not be  practicality in  issuing multiple                                                                    
permits for the same location.                                                                                                  
9:42:42 AM                                                                                                                    
Senator Wielechowski asked  if any of the  scientists at the                                                                    
department had expressed any concerns about the bill.                                                                           
Mr. Rabung  relayed that the  areas of concern for  the bill                                                                    
would be  the same as  those for existing projects,  such as                                                                    
genetics,  pathology,  interactions,   and  management.  The                                                                    
department would  ensure that  there was  sufficient comfort                                                                    
to issue  permits on a  case-by-case basis. He  thought many                                                                    
people  did not  know that  there  were many  ideas for  the                                                                    
existing salmon  fishery enhancement  program that  were not                                                                    
approved nor initiated.  He expected the same  would be true                                                                    
for the proposed program.                                                                                                       
Senator   Wielechowski   understood  that   scientists   had                                                                    
expressed concern about the program  but the department felt                                                                    
it  had the  necessary tools  to  ensure the  safety of  the                                                                    
Mr. Rabung answered in the  affirmative and assured that the                                                                    
department  would  be  conservative  and  precautionary.  He                                                                    
reminded  that   the  department   was  still   tasked  with                                                                    
maintaining for sustained  yield, which entailed maintaining                                                                    
natural productivity, which was the primary charge.                                                                             
Senator   Wielechowski   asked   about   specific   concerns                                                                    
expressed by scientists  at the Department of  Fish and Game                                                                    
Mr. Rabung  relayed that specific concerns  had been related                                                                    
to  practices.  He  explained   that  the  department  would                                                                    
prescribe the minimum number of  brood stock to use in order                                                                    
to   not   create   genetic  bottlenecks.   The   department                                                                    
prohibited breeding  for traits  or doing anything  to alter                                                                    
the organism, which would be  placed in the wild for harvest                                                                    
by common property. He noted  there were safeguards in place                                                                    
including   pathology   requirements  to   prevent   disease                                                                    
transmission from  the projects to  the wild. He  cited that                                                                    
there was  not a  documented case  of transmission  from the                                                                    
salmon  hatchery program  to the  wild,  and the  department                                                                    
intended  to continue  its positive  track  record with  any                                                                    
future projects.                                                                                                                
9:45:48 AM                                                                                                                    
Mr.  Rabung  noted  he  was   a  member  of  the  Governor's                                                                    
Mariculture  Task Force,  which  was  established by  former                                                                    
Governor  Bill  Walker  in  2016   and  was  reinstated  and                                                                    
extended  by  Governor  Dunleavy.  He referred  to  the  DFG                                                                    
mission statement  that charged  the department  to protect,                                                                    
maintain,  and improve  the fish,  game,  and aquatic  plant                                                                    
resources of the state and  manage their use and development                                                                    
in the  best interest  of the economy  and the  wellbeing of                                                                    
the people of the state  consistent with the sustained yield                                                                    
principle.  He  cited  AS   116.05.092,  which  charged  the                                                                    
department   to   encourage   the  investment   by   private                                                                    
enterprise  in the  technological  development and  economic                                                                    
utilization   of  the   fisheries  resources,   and  through                                                                    
rehabilitation, enhancement and  development programs do all                                                                    
things   necessary  to   ensure  perpetual   and  increasing                                                                    
production and  use of  the food  resources of  state waters                                                                    
and continental shelf areas.                                                                                                    
Mr. Rabung  continued explained that  the work  described in                                                                    
the statute  had begun  under the  Fisheries Rehabilitation,                                                                    
Enhancement, and  Development Division  (FRED) of  DFG until                                                                    
1994  when  FRED division  was  merged  with the  Commercial                                                                    
Fisheries  Division. He  explained that  with FRED  division                                                                    
gone,   the   department   no   longer   conducted   fishery                                                                    
restoration, rehabilitation, or  enhancement projects; other                                                                    
than the  Division of Sport  Fish's hatcheries  and stocking                                                                    
program.  He  explained  that  the  Division  of  Commercial                                                                    
Fisheries still  operated the pathology,  gene conservation,                                                                    
and mark tag and age  labs, and had contracted out operation                                                                    
of   FRED's   salmon   hatcheries  to   private   non-profit                                                                    
aquaculture associations that operated  at their own expense                                                                    
as a service to common property users.                                                                                          
Mr.  Rabung continued  his remarks.  He  explained that  DFG                                                                    
provided    permitting   and    oversight   for    statewide                                                                    
aquaculture.  The section  was  responsible  for the  salmon                                                                    
hatchery   program,  the   aquatic   farming  program,   and                                                                    
permitting research  and educational projects  statewide. He                                                                    
explained that currently Alaskan  mariculture was limited to                                                                    
aquatic  farming. He  noted that  aquatic  farm product  was                                                                    
considered   private  property   just   as  livestock,   and                                                                    
primarily  benefitted   private  owners  and   business.  In                                                                    
contrast,   fishery    enhancement   entailed   restoration,                                                                    
rehabilitation  of natural  production, which  benefited the                                                                    
common property fisheries rather  than private ownership and                                                                    
was what would be allowed if SB 64 became law.                                                                                  
9:49:01 AM                                                                                                                    
Mr.  Rabung explained  that  restoration  meant restoring  a                                                                    
stock  in a  location where  it had  been extirpated  and no                                                                    
longer existed, and  bringing it back to a  level that could                                                                    
be naturally  produced and  sustained. Once  restoration was                                                                    
achieved,  the  project  would   cease.  He  explained  that                                                                    
enhancement  signified   producing  additional   numbers  of                                                                    
natural  producing stock  above  what could  be produced  in                                                                    
nature in  order to provide additional  harvestable surplus.                                                                    
If  the project  ceased,  the  supplemental production  went                                                                    
away and  the production of  the stock would revert  to what                                                                    
could  be  naturally produced  and  sustained.  He used  the                                                                    
example  of the  Alaska King  Crab Research,  Rehabilitation                                                                    
and Biology  Program (AKCRRAB), which planted  juvenile king                                                                    
crab from nearby stocks into  locations which once supported                                                                    
the stocks,  until they were  overfished. He  recounted that                                                                    
the  only  recovery  tool DFG  could  employ  was  fisheries                                                                    
closure,  and with  the  passage  of SB  64  there would  be                                                                    
another tool to try.                                                                                                            
Mr. Rabung described collecting  adult razor clams, inducing                                                                    
them to  spawn, and planting  the juveniles on  the parents'                                                                    
beach  as   an  example  of  a   mariculture  rehabilitation                                                                    
project.  He  used  the  example   of  hard-shell  clams  in                                                                    
Kachemack  Bay and  collecting  and  aggregating abalone  in                                                                    
Southeast  to enhance  spawning success.  The technique  had                                                                    
been  used   in  other  parts   of  the  world   to  improve                                                                    
reproductive  success  but  was  not  yet  legal  in  Alaska                                                                    
outside  the  department.  He  mentioned  back-stocking  sea                                                                    
cucumber juveniles after  a dive fishery as an  example of a                                                                    
mariculture  enhancement project.  The department  typically                                                                    
operated dive  fisheries on a  three-year rotation  to allow                                                                    
for the stock to  recover and produce additional harvestable                                                                    
surplus.  He  thought the  process  could  be used  for  any                                                                    
number of shellfish including geoduck and crab.                                                                                 
Mr. Rabung  noted that targeting enhanced  stocks could give                                                                    
the opportunity  for other stocks to  replenish and recover.                                                                    
He summarized  passage of  a law  to allow  for restoration,                                                                    
rehabilitation and  enhancement of shellfish stocks  was one                                                                    
of the priorities identified by  the mariculture task force.                                                                    
If SB  64 passed,  the work would  be subject  to pathology,                                                                    
genetic,  and management  oversight  by  the department.  He                                                                    
asserted  that Alaska  had  the  most stringent  aquaculture                                                                    
guidance in  the world and  was used  as an example  of best                                                                    
practices  while  it  minimized   the  negative  effects  on                                                                    
natural production and maintained sustainability.                                                                               
9:53:08 AM                                                                                                                    
Senator  Wielechowski  asked about  the  scope  of a  permit                                                                    
granted  to  a non-profit.  He  asked  the permit  could  be                                                                    
limited to the placement of  shellfish stock, not to include                                                                    
the removal of another species such as sea otters.                                                                              
Mr. Rabung stated that a  permit would only be for placement                                                                    
of juvenile  stocks and  could not be  used to  mitigate sea                                                                    
Senator Wielechowski  asked if  the areas where  stocking or                                                                    
rehabilitation  occurred would  be closed  to the  public or                                                                    
limited in access.                                                                                                              
Mr.  Rabung  stated  that  the  organisms  produced  by  the                                                                    
projects  would  be available  to  the  common property  for                                                                    
harvest.  There were  provisions in  the bill  to allow  for                                                                    
cost-recovery  harvests  in a  special  harvest  area to  be                                                                    
established.  He thought  the  bill had  an  awkward way  to                                                                    
model after a  salmon problem, since salmon  returned to the                                                                    
same place. A special harvest  area signified a special area                                                                    
that  a project  operator  could harvest  organisms to  help                                                                    
with cost recovery and would not exclude others.                                                                                
Senator  Wilson   followed  up  on   Senator  Wielechowski's                                                                    
comment and asked if the  department had looked at funding a                                                                    
group   that  could   legally  help   eradicate  the   otter                                                                    
Mr. Rabung did not know of  a project such as Senator Wilson                                                                    
described and thought the inquiry  would be best directed to                                                                    
the  wildlife conservation  division.  He  thought the  only                                                                    
people  that could  legally harvest  sea  otter were  Alaska                                                                    
Senator Wilson  asked if the  department had looked  at ways                                                                    
to incentivize tribal entities or  other groups to help have                                                                    
a better outcome for shellfish populations.                                                                                     
Mr. Rabung stated, "not to my knowledge."                                                                                       
Senator  Wielechowski referenced  Section 19,  which allowed                                                                    
for Section  14 to take  effect in 2013, and  explained that                                                                    
Section   14  dealt   with  income   taxes.  He   asked  for                                                                    
explanation  and rationale  for  the section  and asked  who                                                                    
would be affected.                                                                                                              
Mr.  Rabung  believed the  section  was  modelled after  the                                                                    
existing  salmon fishery  enhancement program,  whereby non-                                                                    
profits were  not subject to  state corporate income  tax on                                                                    
revenues generated through cost recovery.                                                                                       
Senator Wielechowski understood that  the effective date was                                                                    
2013 in Section 19.                                                                                                             
Mr. Rabung suggested  that if 2013 was shown  in Section 19,                                                                    
the  date  was most  likely  a  holdover from  the  original                                                                    
introduction of the bill.                                                                                                       
Mr.   Lamkin  recalled   that  the   date  was   a  drafting                                                                    
requirement that  was technical and conforming  in nature as                                                                    
proposed  by the  Legislative Legal  Division. He  agreed to                                                                    
research the  matter further and  get back to  the committee                                                                    
with the information.                                                                                                           
9:58:07 AM                                                                                                                    
GINNY ECKERT, PROFESSOR OF  FISHERIES ECOLOGY, UNIVERSITY OF                                                                    
ALASKA FAIRBANKS (via teleconference),  relayed that she was                                                                    
a director  at Alaska Sea  Grant, and  was also a  member of                                                                    
the  Governor's Mariculture  Task Force.  She discussed  her                                                                    
background. She had  been a shellfish expert  working in the                                                                    
state since  2000. Since 2007,  she had worked on  king crab                                                                    
rehabilitation, including with the  AKCRRAB program. She had                                                                    
testified in support  of the bill several  times. She wanted                                                                    
to speak  to the  need for  rehabilitation of  shellfish and                                                                    
related that many of the  native species (such as king crab)                                                                    
had  declined due  to fishery  overharvest.  Many king  crab                                                                    
stocks had crashed in the  1980s and had not recovered since                                                                    
even though  the fishery had  been closed approaching  40 or                                                                    
more years. She thought overfishing  was likely the cause of                                                                    
the decline , and noted  that there was a significant amount                                                                    
of  trawl bi-catch,  including by  foreign fleets  that were                                                                    
allowed prior to the 1970s.                                                                                                     
Dr. Eckert  continued her remarks.  She discussed  open king                                                                    
crab fisheries that  were declining such as  in Bristol Bay,                                                                    
with concern it  could close as early as this  year. She and                                                                    
her colleagues  had published over  30 publications  on king                                                                    
crab  and  had  studied   many  factors  to  understand  the                                                                    
bottleneck  for  recovery. Much  of  the  work had  informed                                                                    
fisheries  management and  helped to  understand if  placing                                                                    
juveniles in  the field would be  successful. She considered                                                                    
that the early life stage  was a bottleneck to recovery that                                                                    
could  be  addressed  by  hatchery  rearing.  She  discussed                                                                    
genetics  and  relayed that  king  crab  and shellfish  were                                                                    
genetically   very   different   than  salmon.   King   crab                                                                    
reproduced  in the  wild, and  it was  possible to  maintain                                                                    
genetic  diversity. She  discussed research  that showed  it                                                                    
was possible  to raise juvenile  crab and place them  in the                                                                    
10:02:47 AM                                                                                                                   
Dr. Eckert continued  her remarks. She used an  example of a                                                                    
successful  program  in  Washington  that  involved  raising                                                                    
abalone in a hatchery and  out-planting them in Puget Sound.                                                                    
She  thought  the  bill  was needed  to  move  forward  with                                                                    
rehabilitation on a larger scale.                                                                                               
Senator  Wielechowski was  curious about  survival rates  of                                                                    
king crab.                                                                                                                      
Dr. Eckert did not have  the survival numbers available. She                                                                    
noted that a female king  crab could release 100,000 embryos                                                                    
per year,  and for  the population  to be  sustainable, only                                                                    
two would need to survive  and reproduce. She explained that                                                                    
natural survival  in the wild  was very low. She  offered to                                                                    
provide more information at a later time.                                                                                       
Co-Chair Bishop  asked Ms. Eckert to  direct the information                                                                    
to his office for distribution to members.                                                                                      
10:04:51 AM                                                                                                                   
HEATHER  MCCARTY,  CHAIR,  ALASKA  MARICULTURE  TASK  FORCE,                                                                    
JUNEAU  (via teleconference),  spoke in  favor of  the bill.                                                                    
She  discussed her  qualifications, and  relayed she  worked                                                                    
with Central  Bering Sea Fisherman's Association  (CBSFA) in                                                                    
St. Paul Island  and was a co-chair of  AKCRRAB. She thanked                                                                    
the sponsor for the work on  the bill. She recalled that the                                                                    
mariculture task force was formed  in 2016, and she had been                                                                    
on the  task force since  its inception. She noted  that the                                                                    
task  force had  a  goal of  development  of mariculture  in                                                                    
Alaska.  The task  force had  focused on  regulatory issues,                                                                    
statutory  issues, science  and  research issues,  marketing                                                                    
issues, and passage of the bill had been a priority.                                                                            
Ms.  McCarty  continued  her   remarks.  She  mentioned  the                                                                    
importance  of  the  marketing   aspect  of  the  bill.  She                                                                    
affirmed that CBSFA  had long been a  supporter of shellfish                                                                    
mariculture.  She discussed  the  Pribilof  Blue King  Crab,                                                                    
which had  been a tremendous  resource that had been  a part                                                                    
of  the economic  base of  St. Paul  until the  early 1980s.                                                                    
There was  a huge  crab processing plant  on St.  Paul which                                                                    
was a  tax basis for  the community. She mentioned  the loss                                                                    
of  the red  king crab  in  Kodiak. She  hoped that  through                                                                    
AKCRRAB  efforts,  the  crabs would  be  rehabilitated.  She                                                                    
thought the bill would put  employ another tool to bring the                                                                    
crabs back from near extinction.                                                                                                
Co-Chair Bishop thanked Ms. McCarty for her testimony.                                                                          
10:09:57 AM                                                                                                                   
JULIE   DECKER,   EXECUTIVE   DIRECTOR,   ALASKA   FISHERIES                                                                    
DEVELOPMENT   FOUNDATION  (via   teleconference),  expressed                                                                    
strong  support for  the bill.  She asserted  that the  bill                                                                    
would  create  a  framework for  shellfish  enhancement  and                                                                    
would  allow  for  the Alaska  Seafood  Marketing  Institute                                                                    
(ASMI)  to  market  aquatic farm  products  to  further  the                                                                    
state's  new  mariculture  industry. She  thought  the  bill                                                                    
accomplished   two    priority   recommendations    of   the                                                                    
mariculture  task force.  She discussed  the mission  of the                                                                    
Alaska Fisheries  Development Foundation (AFDF)  and relayed                                                                    
that   the   foundation   had   looked   toward   developing                                                                    
mariculture  in   an  expedited  way.  She   served  on  the                                                                    
mariculture task force.                                                                                                         
Ms.   Decker   continued   her  testimony.   She   discussed                                                                    
sustainability, and AFDF's role  in certifications of Alaska                                                                    
salmon  as  sustainable   fisheries,  including  the  salmon                                                                    
enhancement program.  She noted  that the management  of DFG                                                                    
incorporated a precautionary  approach that prioritized wild                                                                    
fish  and  minimized  adverse impacts  to  wild  stock.  She                                                                    
contended that  DFG had extensive enhancement  policies that                                                                    
protected  wild  stock   and  fulfilled  its  constitutional                                                                    
mandate  to   manage  the  state's  fishery   resources  for                                                                    
sustainability.   She  asserted   that   DFG  would   manage                                                                    
shellfish enhancement with  the same constitutional mandates                                                                    
to  protect wild  stock, and  AFDF supported  the bill  as a                                                                    
part of DFG's sustainable management program.                                                                                   
Ms.  Decker   asserted  that  shellfish   enhancement  could                                                                    
diversify  and  expand  economic opportunity  by  increasing                                                                    
harvests  for sport,  subsistence, and  commercial use.  She                                                                    
cited  the  value that  salmon  enhancement  brought to  the                                                                    
state's economy between 2012 and  2017 and thought shellfish                                                                    
enhancement would similarly add  to the state's economy. She                                                                    
concluded that ADFD believed that  growth of the mariculture                                                                    
industry could  play an important  role in the  economies of                                                                    
coastal  Alaska, and  passage  of the  bill  was central  in                                                                    
enabling the economic potential.                                                                                                
10:14:27 AM                                                                                                                   
Co-Chair Bishop OPENED public testimony.                                                                                        
10:14:36 AM                                                                                                                   
JEREMY   WOODROW,   EXECUTIVE   DIRECTOR,   ALASKA   SEAFOOD                                                                    
MARKETING INSTITUTE, JUNEAU  (via teleconference), testified                                                                    
in support of the bill. He read from a prepared statement:                                                                      
     The  Alaska  Seafood  Marketing Institute  fosters  the                                                                    
     economic development of  Alaska's seafood resources. It                                                                    
     plays  a  key  role  in  positioning  Alaska's  seafood                                                                    
     industry   as   a    competitive   market-driven   food                                                                    
     production industry  and functions  as a  brand manager                                                                    
     of  the Alaska  family of  seafood brands.  Recognizing                                                                    
     mariculture  as  an  emerging maritime  industry,  with                                                                    
     tremendous opportunity for  Alaska's coastal economies,                                                                    
     ASMI supports SB 64.                                                                                                       
     Mariculture  involves cultivating  marine organisms  in                                                                    
     the ocean for food and  other products such as oysters,                                                                    
     mussels, abalone  or geoduck  or seaweed such  as kelp.                                                                    
     the  practice   does  not  require   feed,  fertilizer,                                                                    
     insecticides,  herbicides,  or antibiotics,  making  it                                                                    
     sustainable  and inexpensive.  Because of  its economic                                                                    
     and environmental promise,  the Alaska Mariculture Task                                                                    
     Force  had  identified the  goal  to  build the  Alaska                                                                    
     mariculture  production into  a $100  million per  year                                                                    
     industry over the  next 20 years. In  order to increase                                                                    
     jobs and economic opportunity  for fishermen and Alaska                                                                    
     businesses,  the ASMI  Board  of Directors  unanimously                                                                    
     supports SB 64 and legislative  action to allow for the                                                                    
     marketing  of  mariculture  products  or  aquatic  farm                                                                    
     products  as  defined  in  AS   16.40.199  as  ASMI  is                                                                    
     currently prohibited  from doing  so. It was  joined in                                                                    
     support  of the  bill by  the Alaska  seafood industry,                                                                    
     the  Mariculture  Task   Force,  the  Alaska  Shellfish                                                                    
     Growers Association, as well  as many new Alaskan-owned                                                                    
     and operated businesses.                                                                                                   
     Not  only  does  mariculture  represent  a  significant                                                                    
     economic opportunity for Alaska,  it offers the ability                                                                    
     for  seafood  companies  to  diversify  their  existing                                                                    
     portfolios.  With  the  support   and  efforts  of  the                                                                    
     mariculture  task force,  small  family businesses  had                                                                    
     already  proven products  could be  commercially viable                                                                    
     by selling  boutique products while  offering fishermen                                                                    
     opportunities  to  utilize   their  vessels  and  their                                                                    
     skills in  shoulder seasons. If  passed, ASMI  plans to                                                                    
     include  mariculture  products  in  its  effective  and                                                                    
     lucrative consumer  retail, food service, and  food aid                                                                    
     outreach in  domestic and targeted foreign  markets. In                                                                    
     efforts to ramp up  this burgeoning industry, ASMI will                                                                    
     lend the  same expertise and outreach  to this industry                                                                    
     as it has to Alaska's  seafood industry for the last 40                                                                    
     years. Thank you for recognizing  the value of Alaska's                                                                    
     maritime   economy  and   for  consideration   of  this                                                                    
     meaningful  legislation  to  aid  economic  development                                                                    
     across Alaska's coastal communities.                                                                                       
Senator Wilson  referenced a prior conversation  relating to                                                                    
the  shellfish   industry  not  paying  an   assessment  and                                                                    
mentioned equitability. He asked  if Mr. Woodrow anticipated                                                                    
that  the   shellfish  industry  would  contribute   to  the                                                                    
marketing of its product.                                                                                                       
Mr. Woodrow  explained that the  ASMI board  recognized that                                                                    
the shellfish was  presently a very small  but promising and                                                                    
growing  industry. He  qualified that  at its  present size,                                                                    
any  assessment would  be miniscule  and would  not make  an                                                                    
impact to  ASMI's overall operation. He  continued that ASMI                                                                    
anticipated  that as  the industry  grew as  anticipated, at                                                                    
some  point an  assessment  would be  created  and then  the                                                                    
industry  could  be equal  partners  like  the rest  of  the                                                                    
seafood industry. He  explained that the ASMI  board as well                                                                    
as  the mariculture  industry really  saw the  value of  the                                                                    
statute  change.  He  emphasized that  there  were  numerous                                                                    
grant opportunities  that ASMI could  apply for if  the bill                                                                    
were  to pass.  He considered  that the  ASMI board  thought                                                                    
adding shellfish to its portfolio  would be good for finding                                                                    
new investors and buyers.                                                                                                       
10:19:11 AM                                                                                                                   
NANCY HILLSTRAND, OWNER,  PIONEER ALASKA FISHERIES, KACHEMAK                                                                    
BAY (via  teleconference), spoke in opposition  to the bill.                                                                    
Her  organization  had  been incorporated  in  Alaska  since                                                                    
1964,  had  fished  since  1959,  and  fished  most  of  the                                                                    
different  species in  the state.  She shared  that she  had                                                                    
testified on the  bill in a previous committee  and had been                                                                    
degraded by DFG  for trying to share her  concerns about the                                                                    
bill. She thought that people  in opposition to the bill did                                                                    
not want to testify. She  thought SB 64 diverted significant                                                                    
DFG  budget away  from wild  fisheries, and  reduced general                                                                    
funds away from  the state's mandate of  wild fish priority.                                                                    
She thought  there were major  problems with  sockeye salmon                                                                    
in the  Gulf of Alaska.  She emphasized that  wild fisheries                                                                    
needed protection. She mentioned  "major hatchery strain" in                                                                    
Prince  William Sound  and Cook  Inlet. She  mentioned major                                                                    
strain  in  Southeast  Alaska. She  cited  that  the  Alaska                                                                    
Hatchery Research Program was  showing productivity was less                                                                    
than  half  of  hatchery  fish   than  wild  fish.  She  was                                                                    
concerned  about  the  legislature getting  the  appropriate                                                                    
Ms.  Hillstrand continued  her remarks.  She cited  that the                                                                    
chief scientist at the recent  March meeting of the Board of                                                                    
Fisheries had stated that "we  don't want to be caught flat-                                                                    
footed," and  that the state  needed an academy  of sciences                                                                    
to assist in  sorting through the problems.  She thought the                                                                    
legislature  was only  hearing one  side of  the story.  She                                                                    
referenced the  1991 legislative research  request regarding                                                                    
the effects of  hatchery salmon on wild  salmon. She thought                                                                    
it was important to get  more information about fisheries in                                                                    
the  state.  She  mentioned overharvest  of  crab.  She  had                                                                    
concerns  about  AS  16.12.050  and  thought  the  Board  of                                                                    
Fisheries was not being consulted  when there was alteration                                                                    
of hatcheries permits.  She thought there needed  to be more                                                                    
public process  and alterations  of regulations  with regard                                                                    
to hatcheries alterations.                                                                                                      
Ms.  Hillstrand continued  her  remarks.  She referenced  AS                                                                    
16.12.080. She  reiterated that  more information  needed to                                                                    
be  in the  enhancement  report and  wanted the  legislature                                                                    
having a balanced  report. She mentioned a  lawsuit with the                                                                    
Department  of Natural  Resources. She  worried about  small                                                                    
shellfish farmers  and thought  ASMI had a  burgeoning focus                                                                    
on corporate  farms. She thought there  were many unanswered                                                                    
questions and more work needed to be done on the bill.                                                                          
10:23:57 AM                                                                                                                   
Co-Chair  Bishop   asked  if  Mr.   Rabung  had   heard  Ms.                                                                    
Hillstrand's public testimony and if he had any comments.                                                                       
Mr.  Rabung  thought  Ms. Hillstrand  made  some  very  good                                                                    
points,  but   thought  she   misunderstood  the   Board  of                                                                    
Fisheries' regulation  she had referenced. He  asserted that                                                                    
there was  no obligation for  the department to  run permits                                                                    
by the board. He thought  there was a mischaracterization of                                                                    
the  statute. he  addressed  the  hatchery research  program                                                                    
that  the  department had  been  conducting  since 2012  and                                                                    
explained that  the program  was not  complete, and  all the                                                                    
publications would not be out  until 2024. He mentioned pink                                                                    
salmon strays in Prince William  Sound, and the finding that                                                                    
there were  fewer offspring returns if  salmon stray-spawned                                                                    
in natural  streams. There were  no results from  the second                                                                    
generation  from  the  pedigree  study. He  thought  it  was                                                                    
intuitive  that  a  stray   would  have  lower  reproductive                                                                    
success due to  selective pressures. He noted  that three of                                                                    
the  four  highest wild  stock  returns  of pink  salmon  in                                                                    
Prince  William Sound  had been  in the  last ten  years. He                                                                    
noted that  the department was  doing a "deep dive"  to look                                                                    
for  mechanisms, and  to investigate  whether the  situation                                                                    
was ephemeral.  He noted that  hatchery stocks  were derived                                                                    
from local stocks, which was unique to Alaska.                                                                                  
Mr.  Rabung   continued  his  comments.  He   mentioned  the                                                                    
Hatchery  Scientific Reform  Group had  summarized work  and                                                                    
itemized improvements,  which Alaska  was already  doing. He                                                                    
discussed the  success of salmon  hatcheries in  Alaska, and                                                                    
thought it was hard to see the problem.                                                                                         
10:28:08 AM                                                                                                                   
Mr. Rabung  addressed Ms.  Hillstrand's comment  about ASMI.                                                                    
He  thought  it was  important  to  protect small  shellfish                                                                    
farmers  as referenced  by Ms.  Hillstrand. He  thought ASMI                                                                    
fees  had  a minimum  income  threshold.  He referenced  Ms.                                                                    
Hillstrand's  comment about  budget and  explained that  the                                                                    
department did not  expect any cost from  the proposed bill,                                                                    
as the work  would be absorbed by existing  programs. He did                                                                    
not anticipate a rush of  projects, as projects needed to be                                                                    
self-funded.  He noted  that the  department also  routinely                                                                    
required new  projects to start  small in order  to identify                                                                    
unintended consequences  and to  allow projects to  adapt or                                                                    
be stopped.                                                                                                                     
Senator Wielechowski referenced  page 5, lines 30  and 31 of                                                                    
the bill,  which iterated  that the  Board of  Fisheries may                                                                    
not  adopt a  regulation  or take  an  action regarding  the                                                                    
issuance or denial  of a permit. He asked  for the rationale                                                                    
behind the language.                                                                                                            
Mr.  Rabung  that the  same  language  was in  the  existing                                                                    
salmon fishery  enhancement statutes.  He relayed  that when                                                                    
the  statutes  were written,  it  had  been clear  that  the                                                                    
permitting  authority was  given  to  the commissioner,  and                                                                    
allocation of  the harvest was  the authority of  the board.                                                                    
The separation  was intentionally done to  prevent mixing of                                                                    
10:31:04 AM                                                                                                                   
Co-Chair Bishop CLOSED public testimony.                                                                                        
SB  64  was   HEARD  and  HELD  in   committee  for  further                                                                    
Co-Chair  Bishop  discussed  the  agenda  for  the  upcoming                                                                    
10:31:38 AM                                                                                                                   
The meeting was adjourned at 10:31 a.m.                                                                                         

Document Name Date/Time Subjects
SB 71 Arts Council Sponsor Statement.pdf SFIN 4/6/2021 9:00:00 AM
SSTA 3/9/2021 3:30:00 PM
SB 71
SB 71 DMV License Plate Options.pdf SFIN 4/6/2021 9:00:00 AM
SSTA 3/9/2021 3:30:00 PM
SB 71
SB 71 Sample Plates Plate Demand.pdf SFIN 4/6/2021 9:00:00 AM
SSTA 3/9/2021 3:30:00 PM
SB 71
SB 71 Sectional Analysis.pdf SFIN 4/6/2021 9:00:00 AM
SSTA 3/9/2021 3:30:00 PM
SB 71
SB 71 ArtsCouncil_Support-Letter_KodiakArts_08March2021.pdf SFIN 4/6/2021 9:00:00 AM
SB 71
SB064_ShellfishEnhancement_Sponsor-Statement.pdf SFIN 4/6/2021 9:00:00 AM
SRES 2/22/2021 3:30:00 PM
SB 64
SB064_ShellfishEnhancement_Sectional_VersionA.pdf SFIN 4/6/2021 9:00:00 AM
SRES 2/22/2021 3:30:00 PM
SB 64
SB064_Shellfish-Enhancement_Research Backup_PSPA-UFA Flyer_Pays-Its-Way.pdf SFIN 4/6/2021 9:00:00 AM
SRES 2/22/2021 3:30:00 PM
SB 64
SB064 AFDF Letter of Support 2- Alaska Mariculture Development Plan.pdf SFIN 4/6/2021 9:00:00 AM
SRES 2/22/2021 3:30:00 PM
SB 64
SB 64 ShellfishEnhancement_SupportLetter_JEDC_09March2021.pdf SFIN 4/6/2021 9:00:00 AM
SB 64
SB 64 ShellfishEnhancement_SupportLetter_UFA_23Feb2021.pdf SFIN 4/6/2021 9:00:00 AM
SB 64
SB 64 - ASMI Support.pdf SFIN 4/6/2021 9:00:00 AM
SB 64
SB 71 Public Testimony Rogers.pdf SFIN 4/6/2021 9:00:00 AM
SB 71