COMMITTEE SUBSTITUTE FOR SENATE BILL NO. 283(RES) "An Act establishing the shore fisheries development lease program account and the timber receipts account; relating to the accounting for and appropriation of revenue from the state land disposal program, the shore fisheries development lease program, and the state timber disposal program; and providing for an effective date." BOB LOEFFLER, Director, Division of Mining, Land and Water, Department of Natural Resources testified that the bill provides for a land disposal income fund for similar shore fisheries and for timber harvests. He detailed that this bill provides a separate accounting system for a land sale program to allow the legislature and the public to understand the benefits and the physical consequences of the land sales. Mr. Loeffler continued that the bill promotes the concept that state land sale programs should return revenues, not only for the sake of more land sales, but should also provide a return to the state. While he did not think these land sales would close the state's budget gap, he noted they would provide revenue above the amount needed to fund a stable land disposal program. Mr. Loeffler detailed that the bill allows the department to use the income from past and present sales to fund more land disposals up to $5 million, with the remaining revenues going to the general fund. Mr. Loeffler addressed the fiscal note, which he said contain the concepts discussed during hearings on SB 6, another lands disposal legislation. The amount of the fiscal note, he said is enough to "jump start" the program and to keep up with new acreage in future years. Mr. Loeffler spoke to the fisheries program, saying this bill provides a similar fund in the state treasury for the shore fisheries program. This program, he explained currently generates $360,000 for 1,200 shore fisheries leases and this bill would allow a portion of that revenue be used to fund the program. DAN CHALUP, Representative, Katchemak Bay Salmon Producers Co-op, testified via teleconference from Homer in support of Section 3 of the legislation. His organization thought that a portion of the proceeds should go into the program to protect it from any further budget reductions from the Department of Natural Resources. KARL KIRCHER, Kenai Peninsula Fisherman's Association, testified via teleconference from Kenai in favor of the bill and referred to written testimony submitted to the Committee. [Copies not provided.] He also gave details about the organization; its purpose and the existing shore lease problems. SANDY UMLAUT, President, Ugashik Set-netting Association, testified via teleconference from Kenai about the organization and to request that members of the Committee vote in favor of this bill. She stated that this bill would continue to provide stability for the set-net industry. PAUL SHADURA, member of a family that set-nets, testified via teleconference from Kenai telling about the successful fishing areas. His family supported the bill. Co-Chair Torgerson asked if new staff would be hired to implement the legislation. Mr. Loeffler said approximately eight people would run the program. He noted that three title-search positions already existed and would be staffed by employees whose funding was eliminated in the operating budget. He qualified that two new positions would be needed for the shore fisheries portion of the program to offset staff reductions from the previous year. Senator Phillips asked how the legislature should explain to the public that the state is adding new positions to the government. Mr. Loeffler said the division would contract out functions as best as it can, but cautioned that in order to have a stable lands disposal system, staff are needed. Senator Phillips contended that would not stop people from complaining. Co-Chair Torgerson asked about the increase of 55,000 acres up from the earlier 50,000. Mr. Loeffler referred to discussions regarding SB 6 and the five scenarios provided. He detailed that 55,000 acres was one of those scenarios, which is made up of 50,000 of re- offered, previously distributed parcels and 5,000 in remote sales and subdivisions. He explained how the funds allocated would be used to implement the lands disposal. Co-Chair Torgerson commented that he would not hold the bill, but the warned that the performance measures would be scrutinized thoroughly. He did not have problem with the additional funding for positions. Senator Leman stated that he holds a set-net shore fisheries lease. He attested that the personal cost to him would be the same whether or not this bill passes. Senator Adams offered a motion to move from Committee, CS SB 283 (RES) with two accompanying fiscal notes from the Department of Natural Resources, Division of Minerals, Land and Water. One fiscal note is $1,014,300 for the Land Sales and Municipal Entitlements component and the other fiscal note is $200,000 for the Claims, Permits and Leases component. Without objection, the bill MOVED from Committee. ADJOURNED Senator Torgerson adjourned the meeting at 7:55 PM. SFC-00 (23) 04/12/00