HB 188-COMM. FISH. ENTRY PERMITS; LOANS; TRUSTS    11:39:52 AM CHAIR STUTES announced that final order of business would be HOUSE BILL NO. 188, "An Act relating to commercial fishing entry permits; establishing regional fisheries trusts and fisheries trust regions; relating to commercial fishing entry permits held and leased by a regional fisheries trust; relating to the duties of the Alaska Commercial Fisheries Entry Commission and the Department of Commerce, Community, and Economic Development; and providing for an effective date." 11:40:04 AM REPRESENTATIVE KREISS-TOMKINS, speaking as prime sponsor of HB 188, pointed out a proposed committee substitute (CS) [Version L] that was conceptually discussed at a previous committee hearing on 2/22/18 incorporates changes for issues raised during committee hearings. He pointed out letters from the Bering Sea Fishing Corporation and Afognak Corporation in support of the bill, and one from BBFA. He said his staff would answer specific questions. 11:41:09 AM REPRESENTATIVE TARR moved to adopt the proposed committee substitute (CS) for HB 188, labeled 30-LS0389\L, Bullard, 2/22/18 as the working document. There being no objection, Version L was before the committee. 11:41:50 AM REPRESENTATIVE KREISS-TOMKINS expressed his gratitude to the Legislative Legal and Research Services attorneys for all their work and for working through these revisions in a timely and helpful manner. 11:42:14 AM REID MAGDANZ, Staff, Representative Kreiss-Tomkins, Alaska State Legislature, on behalf of the sponsor, Representative Kreiss- Tomkins, offered to explain changes between the prior CS for HB 188 as it was at the start of the 2018 legislative session [Version M] to the proposed CS for HB 188, Version L. He stated that he would quickly review these changes but offered to provide more detail if needed. 11:42:48 AM MR. MAGDANZ indicated he would be working from a document titled "Summary of Changes, ver U ver L | HB 188 Regional Fisheries Trusts." He directed attention to the heading after paragraph one, titled "ver M - Ver L." The first change was to remove three references to Alaskans entering fisheries or Alaska communities to improve the constitutionality of the bill. MR. MAGDANZ stated that [Version L] would add Section 29, which arose from committee discussions for emergency transfers. Section 29 of Version L would provide that a regional fisheries trust must approve the emergency transfer of any permit that has been temporarily transferred from the fisheries trust. The emergency transferee must also be qualified under [AS 16.44.080], the provisions covering the original temporary transferee. MR. MAGDANZ said the next changes begin on page 13, lines 18-20, to Section 30, and Section 32 [on page 15, lines 21-26, to proposed AS 16.43.850 subsections (c) and (d), which would reword the language to conform with the addition of Section 35. He directed attention to proposed Section 35 [AS 16.43.844(d)] on page 16 [lines 29-28]. He explained that the CFEC commissioners flagged some changes to the prior version which could have affected how demerit points are assessed to people who are emergency transferees. The addition of Section 25 would ensure that the status quo remains the same for individual permit holders and that the same rules would apply to a temporary transferee. 11:44:48 AM MR. MAGDANZ directed attention to proposed Section 36, which was amended to clarify the original intention. MR. MAGDANZ directed attention to page 19, lines 6-15, to proposed Section 39, AS 16.43.960(l). He stated that the previous version did not reflect the original policy intent in terms of when a temporary transfer could be revoked in cases in which the temporary transferee's fishing privileges were suspended. These changes remedied that issue. 11:45:35 AM MR. MAGDANZ identified the next two changes to proposed AS 16.44.010(b)(2) and (3) [Section 41], which were in line with the first change mentioned, to remove references to state residents because [Version L] would allow the temporary transfer to be made to anyone. This change deletes a provision that would allow the Department of Commerce, Community & Economic Development (DCCED) to audit fisheries trusts and that function and responsibility would be with the Legislative Audit Division [Legislative Agencies and Offices]. He explained that the sponsor continues to work with the DCCED on the regulatory authority in the bill. As those discussions are ongoing, Version L, would eliminate one section that referred to specific regulatory authority because it caused some confusion, he said. MR. MAGDANZ said the next change would add proposed AS 16.44.050(d) to allow a fisheries trust board to prohibit certain individuals from receiving temporary transfers from the fisheries trust. Version L would give a fisheries trust authority to choose to prohibit temporary transfers to anyone who already holds a limited entry permit in another fishery or who has had their fishing privileges suspended by CFEC. MR. MAGDANZ stated the next change [to proposed AS 16.44.060(b)] would clarify that only one fisheries trust was eligible to hold any given type of limited-entry permit. He explained that was always the sponsor's intention; however, the prior version was not totally clear on that matter. This language also would allow fisheries trusts more flexibility in the types of permits they acquire; he directed attention to the language in AS 16.44.060(c). 11:47:20 AM MR. MAGDANZ said the next few changes to proposed AS 16.44.060(d) and (e) were non-substantive. The change to proposed AS 16.44.070(b) referred to an issue raised by Representative Eastman at the previous hearing, which is that the six-year cap is a lifetime cap and was not a cap per fishery. MR. MAGDANZ stated that the change to proposed AS 16.44.080 [on page 27, lines 1-23 of Version L] was in response to feedback from fishermen and gives the fisheries trust greater ability to ensure that anyone bidding on a permit would be able to safely and successfully participate in the fishery. 11:47:59 AM MR. MAGDANZ stated that the change to proposed Section 56 [page 31, beginning on line 23 of Version L] simply clarifies that fishery trust regions should encompass both land and water area in the state. The change to proposed Section 56, (a)(1) would change the date the department should use when drawing fisheries trust boundaries, he said. The last change was to proposed Section 56, (b)(2) which states that all fisheries trusts shall have at least five communities, he said. He explained that the regional structure does not work very well if the region consists of only one or two communities. 11:48:46 AM REPRESENTATIVE EASTMAN asked whether he could address what happens when someone applies to multiple fisheries. MR. MAGDANZ related his understanding that if an individual was selected as a temporary transferee by a fisheries trust, the person could not just back out of it at-will; therefore, anyone should be careful before applying to multiple trusts. 11:49:39 AM The committee took a brief at-ease. 11:50:05 AM REPRESENTATIVE TARR, referring to a letter of opposition [not specifically identified], asked whether the sponsor had considered any of the ideas expressed. MR. MAGDANZ responded that the idea described at the end of the letter is complicated. He was unsure if the sponsor has had time to fully evaluate if the concerns had merit or value in the specific recommendations. 11:51:26 AM CHAIR STUTES opened public testimony on HB 188. 11:51:55 AM BEN STEVENS, Director, Hunting and Fishing Task Force, Tanana Chiefs Conference (TCC), said the TCC was a regional non-profit and tribal consortium for the 42 villages of Interior Alaska. He also served on the advisory panel to the North Pacific Fishery Management Council (NPFMC); however, his comments were limited to his role as director. The fishing industry provides the most viable opportunities for fishermen to earn a living in communities along Alaska's coastline. It has been well substantiated that there has been a huge decline in the number of limited entry permits held by local fishermen. This decline represents lost jobs, lost opportunities and economic distress for fishermen, their families, and the communities. MR. STEVENS said that the regional fisheries trust program envisioned in HB 188 would complement efforts already being made in the western coastal communities of the Bering Sea, as well as fisheries in the communities in the Gulf of Alaska. The regional fisheries trust shows significant promise to restore opportunities to those fishermen who need it the most. He stated that rural communities stand to benefit greatly from retention and restoration of access to those fisheries. He offered TCC support for HB 188 to make this a reality. He characterized HB 188 as a "no nonsense" bill. He urged members to move HB 188 out of committee and the legislature as soon as possible. 11:54:49 AM NICOLE BORROMEO, Executive Vice President; General Counsel, Alaska Federation of Natives (AFN), asked to testify in support of HB 188. The AFN believes in thriving economic and culturally vibrant communities in all Alaska, especially in rural coastal communities of Alaska, she said. MS. BORROMEO stated that when the full board met on February 13 there was adamant support for this bill because the AFN believes it is essential to bringing back sustainable economies in rural coastal communities. These fisheries trust have a real potential for making a difference in these communities. She concluded by stating that AFN was firmly behind this bill and she urged members to move it out of committee today. 11:56:32 AM CHAIR STUTES closed public testimony on HB 188. 11:56:53 AM CHAIR STUTES said that the committee has held numerous hearings. She offered her belief the bill needed some additional work; however, it was time to move it forward. She directed attention to the two fiscal notes in members' packets, a zero-fiscal note from the Division of Banking & Securities, Department of Commerce, Community, & Economic Development (DCCED). The fiscal note from the Division of Economic Development estimated a cost to the state of approximately $476,200 in the first year and $400,000 in subsequent years; however, these fiscal notes have not been updated to proposed committee substitute (CS) for HB 231, Version L. 11:57:49 AM REPRESENTATIVE EDGMON moved to report the proposed committee substitute (CS) for HB 188, labeled 30-LS0389\L [Version L], out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, CSHB 188(FSH) was reported from the House Special Committee on Fisheries.