Legislature(1997 - 1998)
10/24/1997 01:35 PM Senate STA
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
JOINT MEETING
HOUSE STATE AFFAIRS STANDING COMMITTEE
SENATE STATE AFFAIRS STANDING COMMITTEE
October 24, 1997
1:35 p.m.
Fairbanks, Alaska
HOUSE MEMBERS PRESENT
Representative Jeannette James, Chair
Representative Ethan Berkowitz (via teleconference)
Representative Kim Elton (via teleconference)
Representative Ivan Ivan (via teleconference)
HOUSE MEMBERS ABSENT
Representative Fred Dyson
Representative Mark Hodgins
Representative Al Vezey
SENATE MEMBERS PRESENT
Senator Jerry Ward, Vice Chairman
SENATE MEMBERS ABSENT
Senator Lyda Green, Chair
Senator Jerry Mackie
Senator Mike Miller
Senator Jim Duncan
COMMITTEE CALENDAR
HOUSE BILL NO. 228
"An Act relating to the Board of Agriculture, to the Agriculture
Development Corporation, to the Agricultural Revolving Loan Fund
Board, and to the disposal of state agricultural land; and
providing for an effective date."
- HEARD AND HELD
(* First public hearing)
PREVIOUS ACTION
BILL: HB 228
SHORT TITLE: BD OF AGRIC./AGRICL.DEVELOP. CORP
SPONSOR(S): REPRESENTATIVES(S) JAMES
Jrn-Date Jrn-Page Action
04/03/97 923 (H) READ THE FIRST TIME - REFERRAL(S)
04/03/97 923 (H) STATE AFFAIRS, RESOURCES
04/12/97 (H) STA AT 10:00 AM CAPITOL 102
04/12/97 (H) MINUTE(STA)
10/24/97 (H) STA AT 1:30 PM FAIRBANKS LIO
WITNESS REGISTER
BARBARA COTTING, Legislative Assistant
to Representative Jeannette James
Alaska State Legislature
Capitol Building, Room 102
Juneau, Alaska 99701
Telephone: (907) 465-6822
POSITION STATEMENT: Presented sponsor statement for HB 228.
ROBERT WELLS, Director
Division of Agriculture
Department of Natural Resources
1800 Glenn Highway, Suite 12
Palmer, Alaska 99645-0949
Telephone: (907) 745-7200
POSITION STATEMENT: Introduced himself to the committee members.
LEW REECE
Reece Homesteading
3074 Riverview Drive
Fairbanks, Alaska 99709
Telephone: (907) 474-0936
POSITION STATEMENT: Testified on HB 228.
LARRY PETTY
Salcha
P.O. Box 56114
North Pole, Alaska 99705
Telephone: (907) 488-2770
POSITION STATEMENT: Testified on HB 228.
BOB FRANKLIN, President
Alaska Farm Bureau
P.O. Box 75184
Fairbanks, Alaska 99707
Telephone: (907) 488-7738
POSITION STATEMENT: Testified on HB 228.
KELLY LADERE
Susitna Ranch
P.O. Box 13304
Trapper Creek, Alaska 99683
Telephone: (907) 733-1450
POSITION STATEMENT: Testified on HB 228.
CRAIG TRYTTEN
Trytten Farms
P.O. Box 871628
Wasilla, Alaska 99687
Telephone: (907) 373-0340
POSITION STATEMENT: Testified on HB 228.
BILL WARD
Ward Farms
P.O. Box 350
Soldotna, Alaska 99669
Telephone: (907) 262-5135
POSITION STATEMENT: Testified on HB 228.
JIM ELLISON
Farm Alaska
P.O. Box 55590
North Pole, Alaska 99705
Telephone: (907) 488-1970
POSITION STATEMENT: Testified on HB 228.
HOLLIS HALL, Director
Alaska Cooperative Extension
University of Alaska Fairbanks
P.O. Box 756180
Fairbanks, Alaska 99775
Telephone: (907) 474-7246
POSITION STATEMENT: Testified on HB 228.
WENDY REDMAN, Vice President of University Relations
University of Alaska Statewide System
910 Yukon Drive
Fairbanks, Alaska 99779
Telephone: (907) 474-7582
POSITION STATEMENT: Testified on HB 228.
ED AROBIO, Acting Director
Division of Agriculture
Department of Natural Resources
P.O. Box 949
Palmer, Alaska 99645-0949
Telephone: (907) 745-7200
POSITION STATEMENT: Testified on HB 228.
ALLEN MITCHELL, Acting Director and Associate Dean
Palmer Research Center
University of Alaska Fairbanks
533 East Fireweed Avenue
Palmer, Alaska 99645
Telephone: (907) 746-9450
POSITION STATEMENT: Testified on HB 228.
HERB SIMON
HC1 Box 2292
Glennallen, Alaska 99688
Telephone: (907) 822-3059
POSITION STATEMENT: Testified on HB 228.
FRED HUSBY, Acting Dean
College of Natural Resource Development and Management
University of Alaska Fairbanks
P.O. Box 757140
Fairbanks, Alaska 99775
Telephone: (907) 474-7083
POSITION STATEMENT: Testified on HB 228.
ACTION NARRATIVE
TAPE 98-60, SIDE A
Number 0001
CHAIR JEANNETTE JAMES called the joint meeting between the House
State Affairs Standing Committee and Senate State Affairs Standing
Committee to order at 1:35 p.m.
HB 228 - BD OF AGRIC./AGRICL.DEVELOP. CORP
CHAIR JAMES indicated the committee would address HB 228, "An Act
relating to the Board of Agriculture, to the Agriculture
Development Corporation, to the Agricultural Revolving Loan Fund
Board, and to the disposal of state agricultural land; and
providing for an effective date."
CHAIR JAMES said she believes HB 228 needs to be worked on. She
said the committee would take testimony. Chair James informed the
committee members that the University Cooperative Extension Service
is hosting the teleconference in Delta Junction.
CHAIR JAMES explained the purpose of the meeting is to discuss
agriculture and what can be done to help that industry grow,
prosper and be of help to the state.
Number 0304
BARBARA COTTING, Legislative Assistant to Representative Jeannette
James, Alaska State Legislature, came before the committee and read
the following sponsor statement into the record:
"Please be aware this bill is just a starting point submitted in
response to numerous requests from members of the agricultural
industry in Alaska. It restructures the way state agricultural
services will function in our state making them more responsive to
the industries needs and more in touch with the grassroots
operations of our producing farmers. Alaska needs to encourage
agricultural development. We need to remove roadblocks and allow
the industry to grow and prosper for the benefit of our state and
all its citizens.
"Again, this is just a starting point. We plan to expand the
duties and authorities of the Agriculture Development Corporation
once we agree upon its formation. We welcome all input and
suggestions."
Number 0633
ROBERT WELLS, Director, Division of Agriculture, Department of
Natural Resources, came before the committee members and introduced
himself. He stated he doesn't intend to take a position on HB 228.
Mr. Wells said he was glad to hear the word "grassroots" mentioned
in the sponsor statement. He said he intends to acquaint himself
with the Alaskan producers and will listen very carefully to what
they perceive the needs are of the agricultural community. He
thanked Chair James for having the hearings as they will help him
understand the needs and desires of the agricultural community.
Mr. Wells stated, "We're all aware that the agricultural industry
is growing and I think we are on a nice steady course and I think
we want to continue that. We need to examine the assistance and
programs we have in place and always see where we can do the job
better." Mr. Wells thanked Chair James for holding the hearings.
Number 0754
SENATOR JERRY WARD wished Mr. Wells luck with his new job. He said
it has to be one of the most challenging positions in the state.
He said, "As long as you listen to the people that are producing
the product maybe instead of the ones that are producing
regulations, I think it'll work out great."
Number 0828
CHAIR JAMES noted Representatives Elton and Ivan are listening via
teleconference in Anchorage and asked if they had any comments.
Number 0844
REPRESENTATIVE KIM ELTON said, "I don't know if you could hear me,
but just add my good wishes to Senator Ward."
Number 0858
REPRESENTATIVE IVAN IVAN congratulated Mr. Wells on his new
position and wished him well. He noted he is from the village of
Akiak.
Number 0953
LEW REECE, Reece Homesteading, came before the committee to
testify. He said over the past 13 or 14 years, his family
developed an agricultural homestead in Delta Junction. He said,
"We first obtained the property under the Richardson Homestead
Development State Act in 19 - I believe in 1983 - 1984. We've gone
through the entire process as far as staking the land, developing
the land, clearing it, and have reached the place now where we're
producing on 11 acres. So we have a total of 240 acres, but on 11
acres we're producing commercial cared crop and we sell to the
paramedics market and then through the military sales we've
expanded into Emendorf, Fort Richardson and to Kodiak this last
year. We processed approximately 130,000 pounds of carrots. We
own and operate, in addition to the farm, a packing facility with
about a 14,000 cubic foot cold storage to maintain the quality of
the crop."
MR. REECE said he appreciates the opportunity to discuss the future
of agriculture in this state with the committee. He complimented
the legislators who were involved in drafting HB 228. In reference
to his own farm, he said HB 228 made them look at agriculture from
a different perspective in the sense that they were more narrowly
focused on their own activities and they weren't looking at what
was happening within state government and in other communities. He
said the introduction of HB 228 has made them examine exactly what
they think the role of agriculture and the Division of Agriculture
should be in the state, what marketing opportunities exist and
where the state can assist and where the state has no function in
the private sector. Mr. Reece referred to his agricultural history
and said it goes back at least 14 years in Alaska. He stated there
were some difficulties with the Delta project two decades ago, and
because of that he has a great deal of concern with HB 228. It
establishes an agricultural farming board. Mr. Reece said he
thinks the Division of Agriculture has made significant gains in
the last decade and believes there is momentum within agriculture
that can be built upon existing framework modification changes. He
stated they are extremely concerned that the momentum may be lost
with the development of another new bureaucracy from (indisc.). He
said they would rather see a cooperative effort between the
legislature, the agriculture community and other aspects of the
system in developing and making a stronger contribution. He
pointed out there are some specific areas that need to be worked on
such as crop inspection and verification. Without inspection and
certification of the crops, they can't be sold. It is a service;
it is protection for the general public and it protects the grower.
MR. REECE informed the committee members that another positive
aspect he has experienced with the Division of Agriculture was the
Alaskan grown sales and promotion. He said he found it to be
extremely beneficial for new growers coming into the market. Mr.
Reece said they have incorporated the state logo "Alaskan Grown
Local" on all of their packaging. They found it as a means to
ensure that it is an Alaskan product on the market, it's good
quality control as well as a very positive and helpful thing that
the division can do.
MR. REECE said he looks forward to further dialogue regarding HB
228. He also noted he has reviewed the Department of Natural
Resources' budget for the previous year. He said he thinks the
three special assistants in the Office of the Commissioner had
little or no budget. He suggested that within the Department of
Natural Resources there should be a review of the allocation of
resources and the development of renewable resources. Mr. Reece
noted agriculture is certainly a renewable resource.
Number 1528
CHAIR JAMES informed Mr. Reece that she has spent five legislative
sessions in Juneau and has fought for agriculture money every year.
And every year she was less successful than the previous one. She
noted she has seen the farming community come to Juneau en masse
and go from office to office and fight for enough funds to keep
things going. She said she has fought the issue over inspection
for not only the crops, but for inspection of crops and plants that
are coming into the state to see whether they are bringing any
diseases into Alaska's pristine growing conditions. Chair James
said, "We are seeing the university's budget being slashed
constantly and the School of Agricultural Forestry, which is now
put into a resource management school, we have seen the Cooperative
Extension Service being reduced in funds and like, they don't care
if it goes away. We've also, in the soils conservation area, we've
found absolutely no real support in Juneau amongst the legislators
around the state for these issues. And by putting all of this
emphasis together - having these hearings and so forth, maybe we
can figure out that we have strength enough amongst ourselves to be
absolutely sure that we have a program that continues. Those
things that you mentioned are extremely important and we need to do
more research and more planning to get more crops that we can do
better than anyone else. And so I appreciate your testimony very
much and I just wanted to let you know, since we haven't had the
chance to talk, where I'm coming from on this issue. It has
nothing to do with discrediting the Division of Agriculture."
Number 1734
MR. REECE said, "Madam Chair, if I came across that way, it
certainly was not my intent. Originally, when I began my statement
I indicated that I appreciated the fact that the legislation was
introduced because it made me and I think a lot of other people do
some serious thinking over the past six or eight months. And I
think that bill, whatever may happen to it, I think that's most
significant right now at this particular time." Mr. Reece said he
recognized revenues are shrinking and he realizes the difficulty
Representative James has had in securing funding for the division.
He said his own belief is, based on his experiences, that sometimes
within a department that has a division that may or may not have
quite as high of a profile as other divisions or activities in that
division, sometimes that division is not always appropriately taken
care of. He said he didn't have the figures for the Division of
Agriculture's budget for last year, but it was significantly lower
than the $11 million budget he saw identified in the commissioner's
office.
Number 1836
CHAIR JAMES said she thinks there is an analogy to agriculture and
the subsistence issue. She referred to the subsistence issue and
said she personally has been trying really hard to negotiate a
settlement between the interested parties on both sides so Alaskans
can have continuing subsistence without fighting. She said she
wants to have continuing agriculture without fighting.
Number 1928
MR. REECE referred to Chair James' comment regarding products
brought into the state, and stated whether it's chemicals used in
the fields or whether it's the products that are in the stores or
market, it is extremely important. He referred to his property and
said he knows every mineral that has been put in the soil and the
water quality. He has a history of the soil and wants to maintain
its pristine condition which would be an appropriate role for the
Division of Agriculture.
Number 2033
LARRY PETTY, Salcha, was next to come before the committee. Mr.
Petty stated he disagrees with the previous speaker. He said he
has been in the agriculture business in Alaska for quite awhile.
He stated, "I first tried to get in the first time they put Point
MacKenzie up in Anchorage. But the Division of Ag. [Agriculture]
started going downhill, I think, when Sheffield was in there and we
had -- the problems with the mental health came up and so over
night, he was for agriculture and then he was against it. They
closed the mill, the storage and everything - shipping stuff at
Seward. And I don't know whatever happened to that, but from then
it went downhill until you got Mr. Kerttula in there and he thought
there couldn't be anything raised in the Mat valley. And so it
continued to slide and it has slid and I hope the new director can
turn that around that we do have agriculture in Fairbanks and the
Delta area. They've tried to run people off of the land is what
they've tried to do so they wouldn't have to transfer some from
other lands that they wanted to keep to give to mental health for
the lands that we were trying to farm. And I know that for a fact
because of the people that's been run off out in the Eielson and
ag. area. And the Division of Agriculture were state employees
that had no interest in agriculture - I mean the lower people, not
the director, but the lower people and they should have been trying
to build agriculture to make their self a better job. But they
didn't, they run it down all the time and any kind of a stumbling
block they put in your way -- anything that -- they wouldn't work
with you on anything. And it was just a tremendous fight, I've
made several trips down and talked to the director and the
revolving loan fund board at that time and it was just a mess ever
since I started with the state. I don't think that they've done
agriculture any good from the time they got into it. Determining
where the barns was going to be, what they were going to raise - if
it's dairy or if it's going to be barley and that's all. And you
know they kept changing the rules from day to day and when I was
finally able to borrow some money from the revolving loan fund,
they told me my loan was approved as read. Well, I went in and
first off they said, 'Well it's not exactly approved as you read
because you have to put up 25 percent of the money.' So I had to
put up 25 percent. Well, they -- the rest of the loan -- I had a
dozier leased for $3,500 a month and it's just on and on and on.
And they lost the warrant. They brought it -- the loan - they
brought it to Delta and they were supposed to have dropped it back
by Fairbanks, but they didn't. They were running late so they, the
director, flew back to Juneau and carried the warrant with him and
it was about six months before I ever got the loan. Well, at
$3,500 a month, you can imagine what kind of a bill I owed for the
rent of a dozier that I wasn't able to hardly use."
MR. PETTY continued, "But I'm saying this is that we do need to
make a change. We do need to get somebody that is interested in
agriculture and expanding it because I'm growing warm weather
vegetables up here and I know it can be done. I've done it for
about three years now and I think the technology is here now that
we could raise vegetables that can feed some of the people in
Alaska and save fuel and everything else, but we are going to have
to have some freedom. We've been tied down and regulated and lied
to and changed until nobody has the...."
MR. PETTY said, "I would like to see a change in this bill here
which I would like to see somebody from the university if they were
into raising vegetables so that we could -- like the plants and
material center or somebody could grow vegetables only they need to
be grown up here on the north end. If we could raise them up here,
we know we can raise them in Wasilla or somewhere so -- and I know
we can up here, but we just need to get the type of vegetable that
does the best, you know, the brand name of whatever type of
vegetables it is. But I -- last year, I grew cucumbers outside -
a little over a ton of them and I know it can be done. And I sold
them to the stores, locally. I plan on expanding the operation
next year. And all I would like to do is see us have somebody
that's fair and not change the rules. Have it down, one rule is
the same for other like I borrowed $30,000 to clear some land. I
spent another $30,000 on it. The legislators gave us a moratorium.
Well, I was two days late so they said the fourth year get my
moratorium papers in there. I had to spend that much money on the
land and I did every year. Well, they said 'you're two days late,
we've cancelled your moratorium - everything - all your penalties,
interest, payments are due now or get off the property.' Well,
needless to say I didn't pay them and I did get off the property.
It took them seven or eight years, but they finally took it. But
the loan that I had, which was supposed to have been for $40,000,
I got $30,000, cleared that land and they took the debt -- they
took the land back, but took the debt and put it on my other
property. So I still had to pay it. They sold that land for $600
or $700 an acre - a portion of it, but my clearing didn't help any
of it. I paid $160 an acre for it."
MR. PETTY stated he realized he was talking in the past, but it has
been a sore spot with him because he knew the state of Alaska was
trying to get him off of his property.
Number 2919
CHAIR JAMES acknowledged that mistakes have been made and said,
"We're having to live with them even though we didn't make them."
She said when she first became a part of the legislature, there
might have been five voices that she was able to get to support
agriculture. It is about four times that many now. She said there
needs to be 40 out of 60 voices to have real support. Chair James
said, "Of course, everyone holds the Delta barley project against
us because of all the money that was spent and nothing grown." She
said no matter whether it's farming or anything else, it has to be
market driven and they didn't allow an opportunity to grow
naturally. Chair James said she doesn't believe it was a farming
failure, it was a legislative failure.
Number 3110
BOB FRANKLIN, President, Alaska Farm Bureau, was next to come
before the committee to testify. He informed the committee members
he lives about half way between Fairbanks and North Pole and he
runs a meat processing operation of Alaskan grown products. Mr.
Franklin said he believes HB 228 has a lot of merit and it is a
very good discussion point to start from. He said presently, the
director of the Division of Agriculture is appointed by the
Governor. He stated, "Every time the Governor changes, we lose the
continuity from one director to another where if the board was
designated and appointed by the Governor of who or what type of
lifestyle that person had to have to be qualified to be on the
board, then we would have more representation from our industry
rather than just someone put there which could be put there for a
favor or payback or however a person gets that position." Mr.
Franklin said it is important that we investigate having a true
board of agriculture to bring in all the entities to the director.
He said farmers need to continue to tell the legislature and the
public their story regarding agriculture and impress the importance
of an agricultural industry. Alaska is capable of raising its own
food, but there isn't enough interest or availability of people to
get to Alaska to do the job. This is where the board of
agriculture could help the director of the Division of Agriculture
to put some things into place. He said the committee will hear
about a lot of things that has happened in the past, but the past
can't be changed.
MR. FRANKLIN explained he believes the biggest thing is that
farmers have to get involved and go to Juneau to let the
legislature know what they are doing. Mr. Franklin noted his
organization will be doing some strategy planning at their general
membership annual meeting on November 14 and 15 in Anchorage to
determine the type of action to take to Juneau in regards to HB
228.
Number 3648
KELLY LADERE, Susitna Ranch, testified via teleconference from the
Mat-Su Legislative Information Office. She informed the committee
members she was raised on a homestead in the Susitna Valley during
the 1950s and early 1960s. She said she earned most of her college
money raising hay in that area and noted she has had eight years of
college. Over the last 18 years she earned her living as a farmer
and has about 1,100 acres. She noted she has farmed as much as
1,100 acres of crop land on other people's land, including her own.
On the average, she usually crops between 3 and 500 acres. She
informed the committee she sells meat from her farm in the legal
fashion.
MS. LADERE spoke of her research of other states and how they
governed their agricultural industry. She said it was her
conclusion after conducting the study that the most successful
states were those in which a board of agriculture served as the
governing body for the particular state. The majority of the board
members were farmers and the remaining members were people in
related businesses.
MS. LADERE said she is very interested in HB 228. She will be very
interested in watching it develop. She stated she would like to
make specific comments to Section 03.10.015, "Agricultural
Development Corporation." She said this is the section in which an
agricultural development corporation is established for the purpose
of financial business with the farmers. Ms. Ladere stated the
section says that the Board of agriculture will serve as the board
of directors of the corporation. She said if she is reading the
bill correctly, then the only addition that would be needed is to
name the change. Ms. Ladere said, "What I mean by that statement
is that you would be setting up an administrative board that would
also mean the financial board for this industry. And that being
the case, what we're talking about is not these form of government
with which we are functioning in the state of Alaska or any other
state in the union, and it's not a form of government in which our
United States of America functions. For a board to have the direct
financial responsibilities as well as the direct administrative
responsibilities I think is extremely inappropriate."
Number 4125
CHAIR JAMES said Ms. Ladere brought up a good point and stated she
tends to agree with her. She asked Ms. Ladere if she has ever
received any loans from the agriculture revolving loan fund.
Number 4136
MS. LADERE replied, "Yes." And, she is currently in good standing
in paying one off.
CHAIR JAMES said one of the things that she has been fighting over
the last five years is a legislature that wants to decimate it.
She said, "In the discussion with this, we also toyed with the idea
there is some distress with the agricultural revolving loan fund
and its behavior over the years. And then this legislative mandate
that we have to meet that says that these people are doing a good
job of managing and dissipating funds and collecting them and that
sort of thing -- and one of the thoughts that we wanted to do, it's
really not a problem of we don't have any money and soon we won't
have any if we don't do something. Anyway, one of the other
thoughts was to give that pot money - put it out for bid to some
other bank or lending institution to manage under the same or
similar guidelines that we have and that would be then not having
it under the same other group of people. But that's how it got
there - is trying to protect that fund and from either stealing by
the legislature or what is may be determined by some to be not
managed the way they thought it should." Chair James thanked Ms.
Ladere for her thoughts.
Number 4401
CRAIG TRYTTEN, Trytten Farms, testified via teleconference from
Mat-Su. He referred to the personal conflict category and said he
had concerns about being on the board and being able to get a loan.
He also noted concern with the amount of per diem. Mr. Trytten
indicated that he believes the bill needs more work.
CHAIR JAMES asked Mr. Trytten to put his concerns in writing and
send them to her.
MR. TRYTTEN noted another concern with HB 228 is there is no
mention of actually financing land. He said it talks about the
agriculture clearing process, development processing, purchasing of
livestock, machinery, storage, but it doesn't talk about the
purchase of farm land.
Number 4453
CHAIR JAMES asked Mr. Trytten if he is talking about the purchase
of land from the state or a farmer.
MR. TRYTTEN responded, "Well, whatever."
CHAIR JAMES said that maybe it isn't in the bill, but she was of
the opinion that one of the things that would be capitalized with
the corporation was the agricultural lands in the state. The lands
would continue to be sold the way they have been sold, which is
under the state's financing. Chair James referred to the
university and the roll it plays, the Soils Conservation Service,
the Cooperative Extension Service, and any other places where any
agricultural efforts could be orchestrated together to make better
use of the funds that are available.
Number 4630
MR. TRYTTEN said he is on the Wasilla Soil and Water Board and he
thinks it is very important that when lands are dispersed, there
should be a farm and conservation plan. He said he would also like
to see seven members on the board and four should be farmers.
Number 4657
CHAIR JAMES referred to a conservation plan and a farm plan and
said one of the problems she has with a farm plan is you can make
a farm plan today and the market is not there ....
TAPE 97-60, SIDE B
Number 001
CHAIR JAMES continued, "...having a problem under the mandates of
their purchase of state land that they have a period of time when
they had to have a certain amount of land cleared. And the crop
that they're working on doesn't - didn't allow them to do that when
there was other priorities that they had to do first." Chair James
said a conservation plan, which is how you manage to use the land
and protect the soil and water, certainly is a very important
issue. She said she understands that very clearly. Over the last
30, 40 or 50 years, she has been concerned with keeping the soil on
the ground and not going down the streams. A farming plan which
specifically says which crops you are going to grow and when you
are going to grow them, et cetera, is a good framework. Every year
you have to make a decision on how the market affects everything,
what the weather does, et cetera. Chair James described a loan
situation her brother participated in the Yakamah Valley. She
noted she supports the soil and water conservation efforts.
Number 0201
BILL WARD, Ward Farms, testified via teleconference from the Kenai
Legislative Information Office. He informed the committee members
he has a farm on the Kenai Peninsula and a farm in the Delta
Junction area. He read the following testimony into the record:
"This legislation is comprised of two main components, the
formation of a Board of agriculture and the creation of an
independent agriculture development corporation. Each element of
this legislation on a sound basis should be reviewed on single
merits.
"A board of agriculture, made up of newly appointed Alaskan
residents, has the ability to bring forth experience and expertise
from within the agriculture industry and help guide and manage the
administration and development of agriculture policy in Alaska.
This board, with its defined qualifications and service, merge,
compliment and replace the efforts currently undertaken by the
Agriculture Revolving Loan Fund Board and the Natural Resource
Conservation Board.
"It is imperative for government and the private sector to work
together in the formulation and administration of public policy and
the board of agriculture to ensure that the policies administered
by our state government coincide with efforts of the private sector
industry. Even if the Division of Agriculture is retained, the
board of agriculture is a positive addition to the DNR [Department
of Natural Resources] structure.
"Agriculture must be represented by an advocacy agency to stimulate
the development of the industry, to facilitate market growth for
agriculture products, to interact with other agencies on matters of
public policy and to protect the health and overall interest of the
Alaskan public.
"In the past, the DNR, Division of Agriculture, has served in this
capacity and under the right circumstances, it should continue to
do so in the future. Unfortunately, the Division of Agriculture
has fallen victim to budget cuts, severe criticism from all fronts,
lack of administrative support and poor staff attitudes. In truth,
the division has no state budget because both the legislature and
the Administration has chosen to steal dedicated funds from the
ARLF (Agriculture Revolving Loan Fund) for operations rather than
provide legitimate general fund monies. Bureaucracy downsizing may
be warranted, but without the necessary internal reorganization the
result is an agency unable to provide service to anyone.
"The Division of Agriculture has no clear mission or long-term
objectives. It has had no leadership for the past several
Administrations and is left with a staff that is understandably
either unable or unwilling to serve the agriculture industry. When
you call the division and find that they have no market development
program, no land disposal program other than piecemeal
repossessions, a reduced inspection program, a loan program
burdened with unwieldy regulations and mountains of paperwork, no
relationship with their sister divisions or other government
agencies and a staff looking to retirement as the way to restore
their outlook on life. To correct this, the Administration will
have to dedicate the time and resources to rebuild the agency from
the ground up focusing on service to an industry and responsible
public policy administration. In addition, the Administration and
legislature will have to address long-term stable funding by
establishing a balanced and reasonable general fund appropriations,
federal allocations, land sale contracts, asset management,
interagency agreements and industry fees. That will require a
commitment by both parties to work together in a non-partisan way
to provide long-term solutions to preserve the division as an
agency of state government. I'm not optimistic that we'll see that
level of commitment or effort from this Administration or
legislature, and without it the Division of Agriculture is destined
to disappear and its regulatory duties dispersed amongst other
agencies. The agriculture industry will be left to fend for itself
without government support or leadership.
"House Bill 228 will give us the tools, as an industry, to manage
our own growth and development. It will create a public/private
partnership whereby the state provides agriculture classified lands
and ARLF assets for the Agriculture Development Corporation to
manage. Agriculture not only generates dollars which remain in the
state, it also provides high quality fresh food for our citizens
and stabilizes rural economies, provides aesthetic diversity,
conservation enhancement and improved wildlife habitat. The
implementation of House Bill 228 will create a board of agriculture
made up of dedicated and qualified industry representatives who
will manage the Agriculture Development Corporation to facilitate
agriculture's growth, develop its markets and stabilize farm-based
incomes, all of which will result in a significant contribution of
the economy of Alaska.
"I want to thank Representative Jeannette James for her dedication
to agriculture and sponsorship of this legislation and I would like
to encourage the passage of House Bill 228."
MR. WARD requested from Chair James that she put the
representatives from the university and extension service in the
hot seat and ask them how their mission statements and budgets
would affect agriculture. He understood that their budgets could
not provide adequate service to the agricultural industry, and in
some cases their directions were going more urban, away from the
rural economy.
Number 0832
CHAIR JAMES referred to her appointment on the deferred maintenance
task force and the problems it has encountered because of the
limited amount of funds. The reality, she stated, is that the
budget can not grow unless something else shrinks. Until the
people tell us they are willing to pay for services then the
deferred maintenance plan will not change. As a matter of reality,
it is important to look at what can and can not be changed.
Therefore, you can count on the budget being smaller next year and
agriculture is not considered important to the members in charge of
the budget. But we need to be prepared when it is time for a
change. In addition, there is a growth factor in the state which
we have not been meeting for a number of years. The population is
growing and as a result increasing infrastructure that needs to be
maintained. We are at the point of needing to take programs away.
The staff has already been cut to the point that they can not
operate. This is serious business. She cited the road commission
meeting of the Eilson Farm Road as an example of getting to a point
where the road can not be maintained anymore.
Number 1518
JIM ELLISON, Farm Alaska, stated the President of the United States
is about to instigate a clean air act that could add another 50
cents to the gas dollar. "We're gonna get to a point where the
working guy can't drive down the road. He doesn't have the money
to buy the gasoline."
Number 1547
CHAIR JAMES stated we have set our levels of acceptance way too
low, according to the environmental movement. A realistic level is
needed. She doesn't know how to change it because once government
tightens up on something it never loosens up again. But we can
keep it from going deeper.
Number 1651
MR. FRANKLIN stated the biggest thing that we have to realize is
that all of the standards were set on unscientific basis. The air
quality in Fairbanks is based on a different standard than Los
Angeles.
Number 1757
HOLLIS HALL, Director, Alaska Cooperative Extension, University of
Alaska Fairbanks, stated any action that articulates the needs of
agriculture and creates a positive image would be good. In Alaska,
a new philosophy of creating rather than buying is needed. The one
area that this new philosophy can be achieved in is agriculture.
The attitude and lack of support for a basic industry such as
agriculture is foreign to him because he grew up in a state where
agriculture was prioritized. There has been a deliberate procedure
to destroy the support of agriculture by making the extension
service weak. The research and experiment station has undergone a
27 percent reduction in the last seven years. The Alaska
Cooperative Extension has undergone a 26 percent reduction.
MR. HALL stated, nevertheless, the extension is trying to keep the
services to agriculture and farmers in place in Delta Junction,
Fairbanks, Kenai and Palmer. In an effort to continue to make a
commitment to agriculture the district office in McGrath was
closed. The community development program was also closed. The
extension program also went from four to two administrators.
Number 2300
MR. WARD asked Mr. Hall whether the agents in Delta Junction and
Palmer would be filled on a full-time basis or were they temporary
positions.
Number 2314
MR. HALL replied they will be a one year appointment, temporary
positions. More than likely they will not be filled by individuals
with an advanced degree in agriculture. They will not be permanent
positions until there is more information on funding for the
future.
Number 2403
MR. WARD asked Mr. Hall what would be needed to convert the
positions from temporary to permanent.
Number 2420
MR. HALL replied funding at about $3.1 million would be needed to
offer services as the extension did seven years ago.
Number 2507
MR. WARD asked Mr. Hall if the urban coverage has been hit as hard
as the rural farm-based coverage.
Number 2521
MR. HALL replied probably not because 10 percent of the district
agents are located in the town that has 50 percent of the
population.
Number 2617
CHAIR JAMES noted for the record that Representative Ethan
Berkowitz has been in Anchorage listening via teleconference for a
while.
Number 2636
MR. TRYTTEN stated that he knows about the downsizing of
agriculture in the state and federal budget. He suggested selling
some of the land in the state, only 1 percent of it is owned by the
public. He pays property taxes and has the worst roads, no mail,
no fire or police services. Something is wrong.
Number 2723
CHAIR JAMES announced that the legislators in Anchorage had to
leave for other meetings. She noted that James Hayes from U.S.
Senator Ted Stevens office was also in attendance in Fairbanks.
Number 2751
WENDY REDMAN, Vice President of University Relations, University of
Alaska Statewide System, said the impact on rural Alaska is
disproportionate because the money being spent is so little in
comparison to the needs. She suggested relaying some of the
comments made today to the meeting of the Board of Regents in
November.
Number 3001
SENATOR WARD suggested in regards to the 50 cent increase on gas to
send a letter to Newt Gingrich and ask him to follow the proper
course for treaty ratification. It is on a fast track now and has
already cost almost 7,000 jobs.
SENATOR WARD further stated in regards to land ownership that there
are four separate bills to transfer land from public to private
ownership for large projects.
Number 3206
MR. FRANKLIN asked Chair James where we go from here.
Number 3218
CHAIR JAMES stated next week there will be a meeting in Mat-Su.
The bill will be taken up again in Juneau in the House State
Affairs Standing Committee. We will see if there is a way to
refine the bill so that it is acceptable.
MR. FRANKLIN asked Chair James if the bill has gone through the
Legislative Legal Department.
CHAIR JAMES replied the bill was drafted by the Legislative Legal
Department.
Number 3336
MS. REDMAN asked Chair James if the Administration has a position
on the bill that she knew of.
Number 3353
CHAIR JAMES replied that she has worked with Commissioner Shively.
He will not oppose the bill. He also helped some with drafting the
bill.
Number 3431
MR. WELLS stated that the Commissioner wants to hear from the farm
community before any additional work is done on the bill.
Number 3535
CHAIR JAMES stated a plan is needed; the bill is only an idea. She
is not going to write a simple bill so that the Administration has
to write regulations to implement the chapter. Parameters are
needed in the beginning.
Number 3553
MR. WELLS stated he will work with all parties to develop a plan.
Number 3631
MR. FRANKLIN explained one of the reasons he set up a meeting with
the Commissioner was because he wanted to get general funding for
the inspectors. The inspectors help the industry as a consumer
protection program so the positions should be paid for out of the
general fund.
Number 3717
CHAIR JAMES wondered if there are fees collected.
Number 3721
MR. FRANKLIN replied there were $91,000 in a federal grant for
military inspection purposes. If the money goes into the general
fund then it should be compensated back to the program as a
receipt. He warned the Representatives and Senators that he will
be beating on their doors in Juneau for those general funds monies.
Number 3821
SENATOR WARD said the state institutions do not buy Alaskan grown
products. He asked if it is because we do not have inspectors, and
if anybody has tallied how much institutions buy in a year from
outside farmers.
Number 3913
MR. FRANKLIN replied that 99 percent of the institutions buy from
outside products even though they have to consider local products
according to law. The wholesalers and suppliers need to buy
Alaskan products because they bid low enough to exclude the Alaskan
farmer.
Number 3958
ED AROBIO, Acting Director, Division of Agriculture, Department of
Natural Resources, explained selling to the military has been a
very good market for Alaskan farmers. The military has been very
receptive. The difficulty is with the state institutions because
of the state procurement procedure. The state tends to buy on a
multi-item situation.
Number 4055
CHAIR JAMES commented in other states an association is used to
sell the crops. She would like to see that happen under the board
of agriculture eventually, at present the volume is not there yet.
Number 4147
MR. FRANKLIN stated it would be surprising to many people that the
inspector in Palmer has inspected $20 million worth of logs to go
to Italy. A lot of time is also spent inspecting bans for color
and quality. The public and the merchants are the ones demanding
this. It is a necessary evil that does not need to come out of the
ARLF.
Number 4232
ALLEN MITCHELL, Acting Director and Associate Dean, Palmer Research
Center, University of Alaska Fairbanks, stated in the early days
the Division of Agriculture had annual agricultural development
plans. The experiment station responded accordingly. This is not
the situation now. The experiment station still has some resources
and it would like to put them towards the development of
agriculture in conjunction with the Division of Agriculture and the
Cooperative Extension Service.
Number 4353
CHAIR JAMES announced for the record that Sara Fisher from the
office of Representative Gene Therriault is in the audience.
Number 4412
MR. WARD commented one of the problems is the assumption that
agriculture does not pay for anything, it just comes out of the
general fund. Ironically, the fees are not recorded and there is
a misunderstanding that the industry already pays for inspection
services. For example, there is a fee paid to Mt. McKinley Meats
for every animal processed. And the plant keeps the carcass and
makes money off of it. He reiterated the industry is paying its
way, but not all of it is being recorded. He suggested looking
towards expanding the industry by transferring state land sales to
the Division of Agriculture.
TAPE 97-61, SIDE A
Number 0001
MR. WARD continued by suggesting further consolidation within the
Department of Natural Resources such as combining forestry, with
the exception of the fire-fighting bunch, with agriculture.
Number 0108
SENATOR WARD asked Mr. Reece when he was with corrections whether
there was there something formed with the Governor and the Division
of Agriculture in terms of procurement policies for corrections.
He asked, "Did it fall by the wayside?"
Number 0132
MR. REECE replied it did fall by the wayside. There probably was
not enough emphasis placed by the Administration to finalize or
implement the concept.
Number 0143
SENATOR WARD stated maybe we could chat about this further. He
thought that it had at least been attempted.
Number 0204
MR. REECE stated that the Division of Agriculture took a lead role
along with the Palmer office. It was the emphasis of the division,
however, that pushed the concept. The division tried to
consolidate purchasing with state agencies and to obtain market
data for pricing.
Number 0256
MR. AROBIO said the division recently received pricing information
from one of the procurement agencies. The figures made Alaskan
purchasing so far out of line that it would not make sense for
anyone to do it. The division does not believe that is the reality
because it knows that the farmers are selling more and it is really
not that out of line. It could be a lack of understanding by
outside vendors. There is no reason why it can not work, but it
might take a legislative push.
Number 0408
SENATOR WARD stated the institutions are not opposed to it.
Number 0426
MR. AROBIO replied it is not the institutions; it is the people who
buy for the institutions.
Number 0431
SENATOR WARD stated maybe we ought to revisit the issue again.
Number 0502
MR. AROBIO stated the pioneer homes, the university system and the
hospitals did not have a problem with procuring Alaskan products;
in fact, they like them. It is not working above those systems,
however.
Number 0552
HERB SIMON testified next via teleconference from Mat-Su. He
stated he was concerned in legal terms how the board of agriculture
would perform. Under the present Division of Agriculture if
something goes amiss, the producer has an option of redress of a
grievance. He noted, however, that not many in the past have been
too successful. He reiterated he was curious how the board would
be organized to protect the state and the individual producers in
terms of liability and sovereign immunity. In addition, he was
also curious how the board would handle product inspections and
cited the issue of "e-coli."
Number 0839
MS. COTTING replied that regulatory functions would have to be
taken care of with the formation of the board of agriculture. The
bill drafter did not want to tackle the issue just yet. But, the
whole area of regulatory functions would have to be dealt with
later on.
Number 0921
CHAIR JAMES stated that Mr. Simon found the hole.
Number 1028
MR. SIMON replied the state of Alaska has been negligent in funding
product inspections appropriately even though there had been a
greater demand on product inspections. He suggested including
provisions to prioritize the function of product inspection.
Consumer confidence at present is at an all time low. He asserted
that we all have a responsibility to ensure to the public that the
products are fit for human consumption.
Number 1220
CHAIR JAMES stated there are a number of producers in the Fairbanks
area who were selling their products as pesticide free. Alaskan
grown agricultural products have an advantage when selling to
outside markets because we are isolated and have cold weather which
gets rid of a lot of the diseases and insects. Therefore, it is
important to ensure that nothing is brought into the state as well.
Number 1414
MR. WARD asked Mr. Husby to talk about the future for research from
the university in terms of the budget and the consequence of the
budget reduction.
Number 1500
FRED HUSBY, Acting Dean, College of Natural Resource Development
and Management, University of Alaska Fairbanks, replied, right now,
the school of agriculture, experiment station and extension service
are at their critical-mass point. Further reductions will result
in a layoff of one or two researchers, at least, along with the
program. He noted, accreditation of the forestry degree program
would be threatened, if a forestry faculty member was lost. If a
couple of people were lost at the Palmer research center and the
Fairbanks station, it would threaten the ability to keep them open.
He explained the budget cuts have been continuous since 1992. We
started in 1992 with about $3.7 million of state funds for the
experiment station and have lost approximately eight or nine
faculty members that have not been replaced. In addition, $3
million has been lost to the university administration. Now, the
School of Agriculture has to fight for that $3 million every year
for the Science and Technology Fund. Furthermore, another $1
million has been lost through cuts from the university and the
Governor. He reiterated we started with $3.7 million, we lost $4
million and we are still here. Somebody wants us here and it isn't
the university administration. There are clients, constituents and
a few legislators that continue to support the program. This year
the faculty contracts have been reduced from 12 to 11 months
because of another $500,000 cut. We are trying to look at things
positively to help keep the moral up.
Number 2038
MR. WARD stated it was scary to hear about the loss of the research
faculty members because he needs technical assistance to help him
operate for a profit. He wondered whether it was possible to move
the experiment station out of the university system to obtain
additional funding.
Number 2153
MR. HUSBY replied formula funding is based on rural population and
the gross national product of agriculture. Competitive grants are
usually very specific. Therefore, he did not see the federal
government helping more, but the state government could help more
in terms of quality faculty members. He suggested a tri-partied
appointment of faculty which included teaching, service and
research activities.
Number 2514
CHAIR JAMES reiterated her concerns of the reality check and the
serious budget problems of the state: a lack of growth.
Agriculture would be a good source of growth, but the budget
problem is a serious issue.
Number 2833
MR. HUSBY stated there has been $30 million in cash receipts from
agriculture and that number increases yearly. We know that we
cannot get more money; we would just like to make sure that no more
money is taken away. We are on-line in regards to revenue coming
into the state as an industry. We are all at a critical mass-point.
Number 3024
MR. HALL stated often times we are more interested in letting
someone do it for us, but in this case people are willing to do it
for themselves. The state should not wait to develop an industry
such as agriculture. Otherwise, what will the state do when the
oil wells go dry.
Number 3152
MR. WARD stated there is a need for the disposal of lands and
requested that the Division of Agriculture work on it. He asked
how much could be sold and put into production, and how much demand
is there.
Number 3316
MR. AROBIO replied the Division of Agriculture already knows the
amount of lands that are classified or potentially classified for
agriculture to be sold. The issue of demand would take more time,
however.
Number 3338
MR. PETTY stated he would like to see the university clear some of
its land and grow crops.
Number 3405
CHAIR JAMES replied it is an option. The university manages its
lands tightly.
Number 3411
MR. HUSBY explained a section in Eielson was requested to set up a
demonstration farm but the program would not have had any money to
develop it because of its declining budget.
Number 3558
MR. AROBIO stated the university has additional land in the Delta
Junction area, but the program does not have the budget to do
anything with it.
Number 3603
MR. HUSBY stated former Director Jay Kerttula of the Division of
Agriculture transferred 360 acres to the Delta project.
Number 3625
CHAIR JAMES stated she remembered the pork project a few years ago
when the university was willing to make land available for the
project in Nenana.
Number 3710
MR. AROBIO stated there is 175,000 acres classified for agriculture
use in Nenana. The problem is getting to it.
Number 3720
MR. HUSBY stated the university lands office was interested because
it believed that timber and agriculture were the best source of
revenue on the managed lands.
Number 3735
CHAIR JAMES stated she had a constituent in the Nenana area who was
talking about utilizing a section of university land for a game
bird project.
Number 3816
CHAIR JAMES thanked all of the participants and announced next week
the House State Affairs Standing Committee will be at City Hall in
Wasilla. She indicated the bill would be held over.
Number 3855
SENATOR WARD explained medical issues prevented Lyda Green, Chair,
Senate State Affairs Standing Committee, from being here today.
She is very interested and supportive of agriculture.
ADJOURNMENT
CHAIR JAMES adjourned the joint meeting of the House and Senate
State Affairs Standing Committees in Fairbanks at approximately
3:30 p.m.
| Document Name | Date/Time | Subjects |
|---|