HOUSE BILL NO. 128 "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 providing for an effective date." 9:45:58 AM Co-Chair MacKinnon highlighted the history of the bill in committee. 9:46:40 AM REPRESENTATIVE DAN ORTIZ, SPONSOR, introduced himself. 9:46:51 AM MARY HAKALA, STAFF, REPRESENTATIVE DAN ORTIZ, introduced herself. Representative Ortiz stated that the bill dealt with shellfish enhancement projects, and set up the regulatory framework for the mariculture industry. He announced that the bill was a priority for the Mariculture Task Force that had worked for two years to present a cohesive, well- considered plan to move mariculture forward in the state. He shared that the bill was an important component of the plan, and was excited about the economic opportunities presented within the bill. He thanked Senator Stevens for being a cosponsor of the bill, and for carrying mirror legislation in the Senate. Senator Olson queried any opposition to the fee. Representative Ortiz stated that the increase in the fee was due to an unchanged fee in the past. He stated that he had not heard concern about the fee increase from the industry. He felt that there would not be a restriction in accessing the funds. Senator von Imhof wondered whether the bill addressed any for-profit organizations. Representative Ortiz replied that the enhancement organizations had been historically nonprofit organizations. He asserted that he was not opposed to profit-based organizations in the industry. 9:50:42 AM Senator von Imhof wondered how the nonprofit and for profit organizations interact through the cycle of a biological species. Ms. Hakala stressed that the bill related to only nonprofit organizations, and mirrored the salmon enhancement statutes. Co-Chair MacKinnon noted that there were some questions from Department of Fish and Game (DFG). She remarked that there would be questions about the cost recovery fishery in the bill. She asked for a contemplation about crabs. She noted that there were different creatures that reproduced differently, and were different than the salmon enhancement. 9:54:29 AM SAM RABUNG, CHIEF, STATEWIDE AQUACULTURE PLANNING AND PERMITTING, DEPARTMENT OF FISH AND GAME, introduced himself. Senator von Imhof remarked that she was concerned about when it was appropriate for the state to insert itself into a commercially viable profit cycle. She noted that there was a point in this industry where there was not commercial viability, so perhaps a kickstart was a requirement. She wondered why no commercial entity would insert itself into the niche that the state sought to fill. Mr. Rabung replied that the bill was modeled after the salmon fishery enhancement bill, which had been law since 1974. The model was developed because the fisheries resources of the state were owned by all the people of the state. He shared that allowing enhancement programs be for profit allowed an ownership aspect. He stated that the for profit aspect came in during harvest, therefore anything produced by the programs were available for all of the common property fisheries of the state. He noted that the nonprofit corporations must pay taxes, and operated similarly to a for profit with the exception of the ability to pay dividends. Vice-Chair Bishop wondered whether the nonprofit corporation employed an Alaskan workforce. Mr. Rabung replied in the affirmative. Senator Micciche noted that the bill set a regulatory framework for some species that were either challenged in production or were new commercially. He queried the function of the bill. Mr. Rabung replied that the bill enabled several models of fisheries enhancement. Senator Micciche asserted that the reason for the bill allowed for the regulation of the new species. Mr. Rabung agreed. 10:01:35 AM AT EASE 10:03:36 AM RECONVENED 10:03:43 AM Senator Stevens queried similarities in other parts of the world. Mr. Rabung replied that there were similar behaviors in other parts of the world, but Alaska was very unique. He noted that Alaska had high sideboards in the salmon enhancement program. Alaska was restricted to using local genetically appropriate stocks for each projects. He furthered that there was no breeding. He remarked that there were other very stringent health policies. He stressed that there was no empirical evidence of any harm to natural production to salmon from the salmon fishery enhancement program. He stressed that there was an ability to maintain sustainability certifications. 10:05:38 AM Co-Chair MacKinnon queried feedback about invasive species in Alaskan waters. Senator Micciche asked about monitoring of the health and disease in the raising process prior to release. Mr. Rabung replied that there was a stringent fish health policy. He stated that it specifically dealt with practices and disease prevention, and monitoring for all species. The species must be inspected and approved before release. He noted that there were pathology labs in Juneau and Anchorage that processed every sample. Co-Chair MacKinnon announced the current discussion for the children in the audience. Co-Chair MacKinnon queried the species who would be in the enhancement project. 10:11:33 AM GINNY ECKERT, PROFESSOR COLLEGE OF FISHERIES AND OCEAN SCIENCES, UNIVERSITY OF ALASKA FAIRBANKS, (UAF) replied that the bill applied to shellfish. She stated that the definition was in the bill as a species of crustacean mollusk or other invertebrate in any stage of its life cycle that was indigenous to state waters, and excluded any invasive species. She stated that any species of crab and clam would fall into that category. Co-Chair MacKinnon asked how to prioritize approval toward a species that might be closed to harvesting in Alaskan waters. Mr. Rabung replied that it was designed to be a user-driven project. He stressed that the department would not take action until there was an application. He noted that there would be guidance about the appropriate review process, which was the same as salmon. Vice-Chair Bishop queried the work of Ms. Eckert. Ms. Eckert replied that she worked as faculty at the university. She explained that faculty taught classes, conducted research, and provided service. She shared that she had done research on king crab, and their early life history to determine rehabilitation. 10:15:04 AM Co-Chair MacKinnon noted that there was a predator problem on shellfish. She remarked that there was an attempt to get national attention especially about abalone. She noted that the otters were causing an unsustainability. Ms. Eckert replied shared that she had conducted research on sea otter diets, and the complex ecological interactions. She remarked that there had to be an examination of where to do the enhancement. Co-Chair MacKinnon wondered whether the review process would include a geographic location of the application. Mr. Rabung replied that each project would be assessed locally. The projects were intended to enhance localized fisheries, and would be evaluated on a case by case basis. Senator Micciche noted that there were public opportunities in the process. Mr. Rabung responded that there was no ownership of the resource until harvest. Senator Micciche stressed that it was heartbreaking when batches were required to be destroyed. Vice-Chair Bishop discussed the fiscal notes. 10:23:33 AM Vice-Chair Bishop MOVED to REPORT HB 128 from committee with individual recommendations and accompanying fiscal notes. There being NO OBJECTION, it was so ordered. HB 128 was REPORTED out of committee with a "do pass" recommendation and with one new indeterminate fiscal note from the Department of Fish and Game, one new zero fiscal note from the Department of Fish and Game, and one new zero fiscal note from the Department of Revenue. 10:23:46 AM AT EASE 10:26:05 AM RECONVENED