HB 80-SPT FSH HATCHERY FACIL ACCT; SURCHARGE  4:18:03 PM CHAIR REVAK reconvened the meeting and announced the consideration of CS FOR HOUSE BILL NO. 80(FSH) "An Act establishing the sport fishing enhancement account; establishing the sport fishing enhancement surcharge; and providing for an effective date." He advised that the committee heard the companion bill, SB 60, on April 12 and public testimony was taken. He noted that HB 80 has a finance referral after it leaves this committee. He asked Commissioner Vincent-Lang and Ms. Hanke to discuss the differences between the two bills. 4:19:13 PM RACHEL HANKE, Legislative Liaison, Alaska Department of Fish and Game, Juneau, Alaska, read the following changes from version A to version B for HB 80: Page 1, lines 1-14  In the previous version of the bill, the surcharge was allocated to "ongoing maintenance and operation of the department's sport fish hatchery facilities and sport fishing stock enhancement intended to directly benefit license purchasers." In version B, the allocation of the surcharge was split into two subsections (h)(1) and (h)(2). • (h)(1) allocates $2.50 of each surcharge towards fisheries management, fisheries research, invasive species suppression and eradication and habitat restoration. • (h)(2) allocates the remainder of the surcharge to sport fishing stock enhancement and ongoing maintenance of the department's sport fishing hatchery facilities. Page 2, line 24 through Page 3, line 1  all surcharge prices were increased by $2.50. 4:20:19 PM DOUGLAS VINCENT-LANG, Commissioner, Alaska Department of Fish and Game, Juneau, stated the $4 surcharge that was originally proposed was primarily meant to support hatchery operations in Southeast that went away with the sunset. HB 80 was amended to add $2.50 to the surcharge, specifically for fisheries research, fisheries management, and invasive species. The department is also required to report periodically on how the money is spent. He highlighted that most of the fees would be paid by nonresidents. 4:21:27 PM SENATOR MICCICHE noted the surcharge was a 60 percent increase. He asked what the vision was above the governor's that was largely status quo. COMMISSIONER VINCENT-LANG answered he believes the committee felt there were people that would be paying the surcharge that would not directly benefit from hatchery programs. They saw this as an opportunity for the surcharge to go toward other non- hatchery-related activities, specifically fisheries management, fisheries research, and invasive species such as pike in lakes the department is stocking. SENATOR MICCICHE asked if the administration supports the 60 percent increase of the $4 surcharge. COMMISSIONER VINCENT-LANG answered had not discussed the $2.50 increase with the governor, but "from the discussions that I have had, I think we would consider that, yes." 4:23:16 PM SENATOR MICCICHE commented, "So you don't know if the administration supports the increase above the $4 increase." COMMISSIONER VINCENT-LANG repeated he had not had that conversation with the governor. He added that his recommendation would be to support the additional increase. 4:23:38 PM SENATOR STEVENS observed that invasive species was not mentioned in the original bill. He asked if there was other funding for invasive species. 4:23:50 PM COMMISSIONER VINCENT-LANG replied the department is able to do invasive species work through the state wildlife action grants. There is no dedicated funding to match those grants, and this would provide a funding source. SENATOR STEVENS asked if invasive species includes plants and fish. He asked him to identify the specific concerns. 4:24:15 PM COMMISSIONER VINCENT-LANG answered the bill is written to add a surcharge on sport fishing licenses so the funds could only be used to benefit sport fisheries. Invasive species that do not affect sport fishing would not qualify. 4:24:40 PM SENATOR KIEHL asked where most of the nonresident licenses are sold and if the cash from those sales will be used in that region or for a particular purpose. COMMISSIONER VINCENT-LANG answered the $4 hatchery piece of the surcharge would be used to fund operations for the Fairbanks and Anchorage state hatcheries and $500,000 would also flow to fund operations in Southeast. The remaining $2.50 surcharge would be spent on the highest needs statewide. SENATOR MICCICHE recalled that the original surcharge was $9 and HB 80 initially called for a $4 surcharge but that was increased by $2.50 during the committee process. He asked if his recollection was accurate. COMMISSIONER VINCENT-LANG recounted that the original $9 sport fishing license sunsetted. HB 80 was introduced and initially proposed a $4 increase and a committee added $2.50 so the increase is $6.50, which results in $3.50 savings. 4:26:55 PM SENATOR MICCICHE calculated that the expected revenue change statewide would be $1.5 million. MS. HANKE confirmed that was the difference between the original version of the bill and this version. 4:27:22 PM SENATOR KAWASAKI asked how the department will report to the legislature how much was spent on fisheries management, fisheries research, and invasive species/habitat restoration, and in what areas the funds were spent. COMMISSIONER VINCENT-LANG explained the department will report to the legislature what was spent to fund the two hatcheries in Southeast as well as any capital outlays. The department will also report annually to the legislature the location and how much was spent for fisheries management, fisheries research, and invasive species/habitat restoration. SENATOR MICCICHE asked if the bill had a wider reach than just for Southeast hatcheries. COMMISSIONER VINCENT-LANG recounted that when the original bill with the surcharge passed, $500,000 was subcontracted to the Crystal Lake and DIPAC hatcheries in Southeast Alaska because there were no state-owned hatcheries in the region, and it was not feasible to ship hatchery fish to Southeast from either of the state hatcheries in Anchorage and Fairbanks. When the surcharge sunset, the ability to subcontract also disappeared. When the decision was made to reinstitute the surcharge, it again included $500,000 to support stock fisheries in Southeast that are important to sport fisheries. 4:29:34 PM SENATOR MICCICHE asked how the original $4 million would benefit sport fishing statewide. COMMISSIONER VINCENT-LANG answered it will go to fund the operations of the Fairbanks and Anchorage hatcheries. He noted there are ongoing maintenance issues associated with both the hatcheries. Specifically, the complex water treatment facility at the Fairbanks hatchery will be replaced as necessary, and the Anchorage hatchery needs a new well. He said the hope is that funds from the surcharge will prevent the department from having to request more money in the capital budget for long-term maintenance associated with those two hatcheries. SENATOR MICCICHE asked him to confirm that the Fairbanks and Anchorage hatcheries are hatching and rearing fish that are distributed throughout the Interior and Southcentral Alaska. COMMISSIONER VINCENT-LANG clarified that the Anchorage and Fairbanks hatcheries produce fish for sport fishing, primarily for lake stocking throughout Interior and Southcentral Alaska. The $500,000 that goes to the subcontracted hatcheries is used for the same purpose in Southeast Alaska. CHAIR REVAK found no further questions or comments and announced the committee would consider amendments. 4:31:37 PM CHAIR REVAK moved Amendment 1. 32-GH1609\B.10 Bullard 5/12/21 AMENDMENT 1 OFFERED IN THE SENATE BY SENATOR REVAK TO: CSHB 80(FSH) Page 1, line 7, following "fund.": Insert "The department shall submit an annual report describing capital improvements and other projects funded by money in the account to the senate secretary and chief clerk of the house of representatives on or before the first day of each regular session of the legislature and shall notify the legislature that the report is available." Page 1, lines 10 - 11: Delete all material and insert: "(1) $5.00 of each surcharge collected to the construction and maintenance of capital improvements that directly support sport fishing access or sport fishing but may not be allocated under paragraph (2) of this subsection; and" Page 2, line 24: Delete "$6.50" Insert "$9.00" Page 2, line 25: Delete "6.50" Insert "9.00" Page 2, line 26: Delete "6.50" Insert "9.00" Page 2, line 27: Delete "27.50" Insert "30.00" Page 2, line 28: Delete "22.50" Insert "25.00" Page 2, line 29: Delete "12.50" Insert "15.00" Page 2, line 30: Delete "7.50" Insert "10.00" Page 2, line 31: Delete "42.50" Insert "45.00" Page 3, line 1: Delete "6.50" Insert "9.00" Page 3, following line 1: Insert a new bill section to read: "* Sec. 4. AS 37.05.146(c) is amended by adding a new paragraph to read: (80) money in the sport fishing enhancement account within the fish and game fund (AS 16.05.130(h))." Renumber the following bill section accordingly. SENATOR STEVENS objected for discussion purposes. 4:32:02 PM At ease 4:32:13 PM CHAIR REVAK reconvened the meeting and asked Mr. Craft to explain Amendment 1. 4:32:34 PM DIRK CRAFT, Staff, Senator Josh Revak, Alaska State Legislature, Juneau, Alaska, stated Amendment 1 adds a requirement for the department to report annually to the legislature the capital improvements and other projects that were funded by money in this account. The second change replaces the language in paragraph (1) on page 1, lines 10-11. He read the new language that states, "$5 of each surcharge collected to the construction and maintenance of capital improvements that directly support sport fishing access or sport fishing but may not be allocated under paragraph (2) of this subsection; and". He said the third and final change adds a new Section 4 that amends AS 37.05.146(c). The new paragraph reads, "(80) money in the sport fishing enhancement account within the fish and game fund (AS 16.05.130(h))." 4:33:35 PM SENATOR KIEHL asked if the amendment effectively eliminates funding that might go to eradicate pike, Elodea or Milfoil. MR. CRAFT replied the amendment seeks to narrow the language to benefit only sport fishing and the users who pay the surcharge. 4:34:13 PM SENATOR KIEHL said he received the report and he understands that the amendment deletes money for fisheries management and fisheries research, but the question was whether it deletes money for invasive species. MR. CRAFT replied the amendment removes the invasive species and habitat restoration language and he was not sure whether or not the funds could still be used for that purpose. 4:35:09 PM SENATOR KAWASAKI offered his perspective that the amendment could be interpreted to allow the money to be spent more broadly. MR. CLARK added that part of the concern was that without the amendment, the funds could be used for things unrelated to sport fishing. 4:36:03 PM SENATOR STEVENS recalled that a bill he carried in 2000 raised the price of licenses for nonresidents and it was considered unconstitutional. He questioned whether HB 80 would face the same challenge. MR. CRAFT deferred the question to the department. 4:36:56 PM COMMISSIONER VINCENT-LANG said his interpretation of the amendment is that it would reinstate the surcharge that was assessed to pay off the hatchery bonds initially. He was not aware of any constitutional challenge to that surcharge. 4:37:41 PM At ease 4:41:19 PM CHAIR REVAK reconvened the meeting and asked if there were additional questions about Amendment 1. 4:41:30 PM SENATOR KIEHL said he believes there is value in capital improvements for sport fishing access, but he was concerned with the changes the amendment would make. He explained, "We can put a great fishing dock on a lake, but if it's full of pike there's not much to catch in that lake; and if it's full of invasive weeds, there is nothing to catch in that lake." CHAIR REVAK offered his perspective that the amendment was focused narrowly to apply only to this surcharge. 4:42:26 PM At ease 4:42:47 PM CHAIR REVAK reconvened the meeting and announced he would withdraw Amendment 1 and take it up with members of the next committee of referral. He solicited a motion. 4:43:25 PM SENATOR MICCICHE moved to report the CS for HB 80, work order 32-GH1609\B, from committee with individual recommendations and attached fiscal note(s). 4:43:44 PM CHAIR REVAK found no objection and CSHB 80(FSH) was reported from the Senate Resources Standing Committee.