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QUICK TRIP TO HOMER
It was fortunate that the Constitutional Budget Reserve negotiations broke for the weekend of March 5th so I could enjoy a
quick trip back home for the North Pacific Fisheries Association annual seafood dinner. It was great to be able to see
everyone at the most successful dinner in memory and to help serve the excellent seafood chowder. Another highlight of my
trip was getting the opportunity to watch part of the local talent show at the high school.
BUDGET NEGOTIATIONS
We had a frustrating couple of days in the House last week. One night most members waited around until midnight ready to
go to the floor for a vote if negotiations between the minority and majority caucus leaders broke down. Today, March 8th, we
should vote on the Constitutional Budget Reserve authorization for 2004 and 2005. This will ensure that we have the money
to fund the school foundation formula before teacher layoffs are required. Funding education before pink slips have to be
issued on March 15th would be a historic move.
SHALLOW NATURAL GAS LEGISLATION UPDATES
HB 364 is scheduled for a hearing on Tuesday, March 9th at 3:15pm. The Sponsor Substitute for HB 364 accomplishes three
goals. First, it establishes a moratorium on future shallow natural gas leases in the Homer area. Second, it precludes the
Commissioner of the Department of Natural Resources (DNR) from reissuing the current shallow natural gas leases in the
Homer area if the leases do not produce gas in paying quantities within the terms of the three-year lease, or if there is a breach
of contract. Third, it gives the Director of the Oil and Gas Division some guidelines in exercising his/her discretion in extending
these leases if he/she does not believe that an extension will expedite shallow natural gas development. This new version of
the bill is a much more politically feasible and less expensive approach than the buy-back. Exploration permits for the current
shallow natural gas leases have not been applied for yet, and I do not anticipate that these leases will produce paying quantities
of gas by the end of their three-year term.
STATE AFFAIRS COMMITTEE
The State Affairs Committee met three times last week to work on a large number of bills. We passed out two bills, HB 422
and HB 516. HB 422 relates to the elimination of a separate sub-account in the Constitutional Budget Reserve to incite higher
investing for a small portion of the CBR. In recent years thought has been that the CBR will be spent and spending extra time
and money on an account that will ultimately disappear seems fruitless. As passed by the State Affairs Committee, HB 422
will maintain the CBR as one big account. HB 516 mandates that all bad check writers would be charged a flat $30 fee per
check. Currently, differing businesses and banks charge fees ranging from $10 to $25. However, the way statutes now read,
the fees must relate to actual cost incurred by the insufficient check. This has opened the door up to recent litigation for local
businesses. This bill corrects the fee system and removes the liability that presently exists for businesses and banks that charge
fees for bad checks.
EDUCATION FUNDING
HB 236, a bill placing a $100 dollar a year tax on all employed persons over the age of 19, will be heard in the House Ways
and Means Committee on Wednesday, March 10th, at 7:00am. HB 236 would raise approximately $40 million for education
annually. HB 471 passed out of the Health Education and Social Services Committee (HESS). HB 471 would increase the
base student allocation by $210 and increase it every year by 2%. This amounts to a total increase of $42.3 million dollars to
the foundation formula this year. The HESS Committee has introduced HB 521, which includes another $46.4 million dollars
to fill the Public Employee’s Retirement System/Teacher’s Retirement Systems (PERS/TRS) gap in the school district’s and
University’s budget. HB 521 is currently in the House Finance Committee. The Senate passed SB 35, which would increase
education funding to $4,576 per student, totaling $82 million, including funds to fill the PERS/TRS hole. If Senate Bill 35
becomes law, the Kenai Peninsula Borough School District would not have to lay off any teachers. Recognizing that the
school districts have to issue pink-slips by March 15th, education funding has come to the forefront of the legislative agenda.
On March 5th, a Senate vote to access the constitutional budget reserve for the purpose of funding education failed. The
House Republicans and Democrats are currently negotiating to approve adequate funding for education and other important
parts of the budget. Hopefully, we will have reached an agreement by Monday, March 8th so we can vote on a funding
package.
HESS COMMITTEE
The House Health, Education and Social Services Committee met and passed HB 471, the bill to fund education through a
base student allocation increase of $210. This bill includes a 2% annual increase for education funding. An amendment was
introduced to remove the 2% increase, but it was soundly defeated. There are members of the legislature that do not want
include this annual increase because they are worried about setting a precedent that could be duplicated in other parts of the
budget, therefore creating a financial commitment that the state may not be able to keep. I have two concerns about the 2%
increase; I am concerned that some legislators will not support the bill for the reasons listed above simply because of the 2%
provision and I also worry that future legislators will use the 2% provision as an excuse not to further fund education, even
though 2% will not be enough to prevent further cuts to programs and teachers in years to come. We also heard extensive
testimony on HB 511, which relates to Certificate’s of Need for healthcare facilities. The Committee members had some
specific questions for the Department of Health and Social Services relating to how CON’s are evaluated and approved, but
the HSS Dept. liaison was not available at that time. This is a difficult bill; much testimony has been heard, and more will
come the next time HB 511 is up for consideration. I will weigh all sides and listen carefully to the information we get from
the HSS Dept. before making my decision.
CUTS TO HEALTH AND SOCIAL SERVICES BUDGET
It was recently brought to my attention that a large portion of Kachemak Bay Family Planning Clinic’s funding may be cut due
to an amendment offered in the House Finance Subcommittee on Health & Social Services (HSS). The funding for KBFPC is
Title 10 money from the federal government. Alaska is slated to receive $412,000 in Title 10 funds this year. This is funding
for Women and Adolescent Services and is used to provide abstinence counseling, pregnancy testing, vasectomies,
contraceptives, physical exams, sexually transmitted infection tests and treatment to low-income individuals. About 5,000
Alaskans received free or low-cost services from this funding last year and I am working to keep the funds in place. Also of
particular concern to District 35 communities are cuts to state Medicaid expenditures recommended by the Finance
Subcommittee on HSS. Physicians who accept Medicaid patients already receive decreased compensation for their services,
which has caused many practices to stop accepting Medicaid patients. I do not agree with further reduction of payment to
those practitioners who still accept Medicaid. I am much more optimistic than the members of the HSS Finance
Subcommittee. I believe that the legislature has the determination to pass several revenue-generating measures, which will
make these and other cuts unnecessary.
HOUSE FISHERIES COMMITTEE MEETING HIGHLIGHTS TO DATE
House Joint Resolution 34 (asking the federal government to consider revising the Trade Adjustment Assistance program to
be more specific and beneficial to Alaska’s fishermen) already passed the House. House Bill 409 would transfer the authority
to specify the 58-foot salmon seine vessel length requirement to the Board of Fish (BOF). The BOF may determine that the
requirement be used on district-by-district or on a statewide basis. HB 409 has moved on to the Senate. HB 415 would
remove the BOF authority to limit salmon net fishermen from fishing in more than one salmon administrative area per year.
Support and opposition on HB 415 appeared to be regionally based. The Joint Legislative Salmon Industry Task Force will
soon look at funding additional meetings for the BOF to consider restructuring and consolidation of the salmon industry. I
have requested inclusion of HB 415 in those additional BOF meetings. HB 444, the direct marketing bill, passed out of
Committee. HB 444 reduces the taxable value of semi-processed fish produced by direct marketers and helps direct marketers
simplify the paperwork process while creating incentives for value added Alaska fisheries.
HOUSE FISHERIES COMMITTEE-LAST WEEK
On March 1st, the Fisheries Committee heard and passed; HB 478, which is a technical bill requested by the Commercial
Fisheries Entry Commission to make clear their authority to issue “interim use permits” in fisheries when limited entry is not
pending.
ALASKA SEAFOOD MARKETING INSTITUTE FUNDING
Funding for ASMI and the restructuring of their board face uncertain futures in SB 273. There is a proposal to remove the 1%
salmon marketing assessment and increase the processing assessment from 0.3 to 0.5%. If SB 273 passes, the size of the
ASMI board would be reduced from 25 to 7 or 9 members. I am investigating the possibility of allowing fisherman to vote on
continuing the 1% assessment while having the generated funds directed to regional marketing efforts.
GULF RATIONALIZATION REVIEW
Gulf rationalization is currently being considered to address commercial fishing that occurs in state and federal waters in the
Gulf of Alaska. SB 347 places a moratorium on entrants into fisheries in State of Alaska water’s. Currently, the federal
government manages fish in waters more that 3 miles offshore while the state manages the same fisheries within 3 miles of the
shore. Governments at both levels are collaborating to prevent over harvesting of species, while ensuring that fisheries are
economically viable for future generations. Current plans incorporate regionalization lines, which would require harvesters to
deliver fish in the areas in which the fish were caught. Regionalization of harvested fish could be detrimental to economic
opportunities in Homer and Seward. I am requesting analysis of a timed phase out of regional landing restrictions to let the
free market work over time.
FISH AND GAME FUNDING RECAP
Cuts proposed to the Alaska Department of Fish & Game’s budget would have affected fishing time and fisheries openings
available to fishermen while creating as much as a $3 million revenue shortfall. Rep. Wilson and I focused our resources and
worked with other members of the House Finance Subcommittee on Fish & Game to restore funding.
UNITED FISHERMAN OF ALASKA MEETINGS
United Fishermen of Alaska, the largest fishing alliance in Alaska, met last week in Juneau. I appreciate UFA’s interest and
input in the legislative process. It is important to note that there are often positions other than UFA’s that need to be
considered. The UFA board recommended that the Governor appoint Art Nelson and Paul Shadura to the Board of Fisheries.
UFA supported the following legislation: HB 409-Removes Seine Vessel Length from Statute, HB 410 - Debt Payback in
CFEC Buyback Programs, HB 433 and SB 281 - Labeling of Genetically Modified Fish & Fish Products, HB 435 - Seafood
Labeling, HB 458 - One Day Crew License, HB 478 - Issuance of Commercial Fishing Interim-Use Permits, SB 28 -
Requesting Exxon Mobil Corporation to pay claimants for court-ordered damages resulting from the Exxon Valdez oil spill, HB
419- Allowing for 1% self-assessment to be used for regional marketing campaigns, and SB 26- Regarding Aerial Pesticide
Spraying. The board also supported reorganization and changing of the funding assessment for the Alaska Seafood Marketing
Institute. Their recommendations will not necessarily be the will of the Fisheries Committee, but we appreciate their
perspective.
BILL ACCESS SYSTEM
All bills can be found on the State’s BASIS system. You can
see what committee a bill is in, when it will be heard, how
committee members voted, and much more. You can access the
system from the website below:
LIVE ON THE WEB
Remember that you can hear most committee hearings or tune into just about any legislative session, present or past, by going to Gavel to Gavel, which transmits TV and public radio broadcasts of the state legislature as they occur. Gavel to Gavel also has an online archive of past meetings. Click on the link below to connect to Gavel to Gavel:
If you need to contact the staff please click on one of the links below:
Lauren Radcliffe,
Cameron Yourkowski,
Chris Knight,
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