JOINT MEETING HOUSE SPECIAL ECONOMIC DEVELOPMENT AND TOURISM COMMITTEE HOUSE SPECIAL COMMITTEE ON WORLD TRADE & FEDERAL/STATE RELATIONS HOUSE SPECIAL COMMITTEE ON FISHERIES April 28, 1999 5:10 p.m. COMMITTEE CALENDAR TLINGIT & HAIDA CENTRAL COUNCIL, JOB PARTNERSHIPS; LOCAL HIRE PREFERENCES TO CREATE JOBS FOR RURAL AK (5 TO 6:00 PM) AK SEAFOOD INTERNATIONAL MANUFACTURING PLANT, INNOVATIVE CONCEPT FOR AK; PRESENTATION ON VALUE-ADDED PRODUCTS (6 TO 7:00 PM) TAPE(S) 99-7, SIDE A & B (See EDT Tape 7) CALL TO ORDER CHAIR GAIL PHILLIPS called the Joint House Special Economic Development and Tourism Committee meeting with the House Special Committee on World Trade and State/Federal Relations and the House Special Committee on Fisheries to order at 5:10 p.m. PRESENT Committee members present at the call to order were: HOUSE SPECIAL COMMITTEE ON ECONOMIC DEVELOPMENT AND TOURISM Representatives Phillips, Cissna, Barnes, Dyson, Rokeberg. Representatives Kerttula and Halcro were excused. HOUSE SPECIAL COMMITTEE ON WORLD TRADE AND STATE/FEDERAL RELATIONS Representatives Barnes, Cowdery, Phillips, Green, Berkowitz, and Joule. Representatives Masek was excused. HOUSE SPECIAL COMMITTEE ON FISHERIES Representatives Dyson, Whitaker, Harris, Morgan and Smalley. Representatives Hudson and Kapsner were excused. OTHER MEMBERS PRESENT Representative Bill Williams SUMMARY OF INFORMATION TERESA GERMAIN, Job Developer, Tribal Employment Rights Office (TERO), Tlingit and Haida Central Council, who informed the committee about TERO activities toward implementing local hire preferences that enhance economic development at the local level. The organization provides outreach and knowledge of local community economics to orchestrate employment and training opportunities for local residents. MS. GERMAIN explained that welfare reform has been a driving force for developing local hire employment programs. She wants the Legislature's support for development of partnership agreements between regional non-profits and state agencies to implement local hire. SHARON OLSEN, Alaska Native Coalition on Employment and Training (ANCET), told the committee that ANCET, formed in 1982, is comprised of representatives from the regional non-profit Alaska Native organizations and tribes. It oversees education, welfare reform, employment, training and economic development issues relevant to Native people. Alaska Natives make up only about 6.5 percent of the more than 13,000 state employees, but 36 percent of the total number of welfare recipients, in both urban and rural areas. ANCET is working with the Governor to develop a memorandum of understanding to improve employment for qualified Alaska Natives. Several presenters gave examples of successful local hire projects: DAN MORENA, Regional Representative, Sitka Tribe of Alaska, spoke of several construction projects that were able to put local workers on the job with Native-hire preference. Some of the projects included the Mt. Edgecumbe High School renovation project, U.S. Coast Guard Air Station renovation projects, HUD housing projects, Municipality of Sitka road projects and the Alaska Marine Highway System. JOSEPH MOUNTS, Student, University of Alaska Southeast; Intern, Ketchikan Indian Corporation, told of success in local hire with the Ketchikan Indian Health Clinic, the Alaska Marine Highway System and University of Alaska Southeast retraining courses for displaced pulp mill workers. MS. GERMAIN, Central Council Tlingit and Haida Indian Tribes, listed a number of programs that enhance local-hire and training such as Housing Authority Projects, Kensington mine, Indian Health Service clinics, Sealaska Corporation tree thinning projects and various vocational training opportunities. The Angoon Road Project had 65% local hire, as a result of cooperative efforts between the Angoon Community Association, the City of Angoon, Bureau of Indian Affairs Roads and the Department of Transportation. MS. GERMAIN concluded by stating that the Council encourages the Legislature to adopt a resolution supporting the memorandum of understanding (MOU) between state agencies and regional non-profit organizations. The purpose of the MOU is to develop partnering relationships for local hire provisions on both state and local levels. REPRESENTATIVE COWDERY asked if local hire agreements are made when a project is unionized and was told, Yes. REPRESENTATIVE PHILLIPS asked Ms. Germain if she felt that the memorandum of understanding signed in 1994 with several state agencies had worked. MS. GERMAIN answered that it was a good idea, but not recently supported. Since the signing of that original agreement, there is now a new administration, with new commissioners and staff unfamiliar with the history behind the MOU. REPRESENTATIVE WILLIAMS asked about the Angoon Road Project and the problems encountered with establishing an Alaska Native hire preference since the project was funded with federal aid. The Federal Highway Administration ruled that a rural preference is allowed under federal law, but the actual decision is at the discretion of the state. REPRESENTATIVE WILLIAMS said this is a problem because the TERO provisions in state-administered contracts that call for a Native-hire preference can be construed in violation of the Constitution of the State of Alaska. CHAIR PHILLIPS said the committee would discuss the draft resolution proposed by the Council and the other areas the Council would like the Legislature to support. GREG GALIK, Alaska Seafood Industrial's (ASI) marketing and public relations director, who explained that ASI's plant in Anchorage is a state-of-the art, value-added seafood manufacturing plant the largest operation of its kind in North America. HOWARD BENEDICT, Owner and Partner, informed the committee members that the plant is 75 percent complete with anticipated opening the end of June. The plant houses 6.5 acres of highly automated equipment that will mass-produce raw and frozen seafood product into gourmet, portion-sized frozen entrees for grocery chains and restaurants. JOHN BRADY, Chief Executive Director, explained to the committee members that ASI is committed to using all Alaska products in its value-added process. He said the plant would not be retailing seafood to the general public, but rather manufacturing only to certain specifications for its specific clientele. Many restaurants, because of difficulty in hiring competent help, prefer a single portion size, seasoned and/or sauced, that can be quickly cooked. MR. BRADY said that ASI has an aggressive Alaska-hire and welfare-to-work program, will use a number of Matanuska Valley produce and dairy products in its finished product, and meets the ISO9000 certification standards (highest manufacturing standards in the United States). REPRESENTATIVES BARNES AND JOULE asked Mr. Brady to look into bringing back fresh or frozen seafood from remote areas via shipment in the empty postal carriers returning to Anchorage (bypass mail). CHAIR PHILLIPS invited all present to join the committee members and presenters in Room 408 for a sampling of ASI's prototype products. ADJOURNMENT CHAIR PHILLIPS adjourned the Joint House Special Economic Development and Tourism Committee with the House Special Committee on World Trade and State/Federal Relations and the House Special Committee on Fisheries meeting at 6:30 p.m. NOTE: The meeting was recorded. A copy of the tape may be obtained by contacting the House Records Office at 130 Seward Street, Suite 211, Juneau, Alaska 99801-1182, (907) 465-2214, and after adjournment of the second session of the Twenty-first Alaska State Legislature, in the Legislative Reference Library.