Legislature(2003 - 2004)

04/04/2003 01:10 PM House RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HB 163-NONRES. GAME TAG FEES/WILDLIFE TOUR PASS                                                                               
CHAIR FATE  announced that the  final order of business  would be                                                               
HOUSE  BILL NO.  163,  "An  Act relating  to  an annual  wildlife                                                               
conservation  pass  and  the  fee  for  that  pass;  relating  to                                                               
nonresident  and  nonresident  alien   big  game  tag  fees;  and                                                               
providing for an effective date."                                                                                               
Number 0897                                                                                                                     
REPRESENTATIVE  MASEK  moved  to  adopt  the  proposed  committee                                                               
substitute (CS),  version 23-GH1098\D,  Utermohle, 3/18/03,  as a                                                               
work draft.                                                                                                                     
CHAIR FATE, hearing no objection,  announced that [Version D] was                                                               
Number 0832                                                                                                                     
JIM  POUND,  Staff  to Representative  Hugh  Fate,  Alaska  State                                                               
Legislature,  addressed   changes  from  the   previous  version,                                                               
indicating  Version  D  consolidated   several  amendments.    On                                                               
page 1, line 11, new [paragraph] (3) reads:                                                                                     
          (3) a large portion of the financial resources                                                                        
     expended by  the state to maintain  healthy populations                                                                    
     of  wildlife directly  benefits  nonresidents who  view                                                                    
MR. POUND noted that [paragraph] (4) reads:                                                                                     
          (4)  the $15 fee charged to nonresidents for an                                                                       
     annual  wildlife  conservation  pass is  less  than  or                                                                    
     equal  to Alaska  residents' pro  rata  share of  state                                                                    
     revenue  that is  devoted  to wildlife-related  matters                                                                    
     associated  with   nonconsumptive  uses  of   fish  and                                                                    
     wildlife, including wildlife viewing;                                                                                      
MR.  POUND  turned  attention to  [paragraph]  (8),  language  on                                                               
page 2, line  12, that had been  on line 5 in  the original bill.                                                               
In that  paragraph, "individuals"  is changed  to "nonresidents",                                                               
and on  line 13  the words  "a portion"  have been  replaced with                                                               
"their fair share".  Thus paragraph (8) reads:                                                                                  
          (8)  nonresidents who do not obtain a hunting or                                                                      
     fishing license  and employ  a commercial  provider for                                                                    
     an opportunity to view wildlife  should bear their fair                                                                    
     share  of  the  cost  of wildlife  management  in  this                                                                    
Number 0736                                                                                                                     
MR. POUND  explained that on page  4, line 18 [Section  6], which                                                               
relates  to bonding  requirements for  the Alaska  Marine Highway                                                               
System (AMHS)  and the Alaska Railroad  Corporation (ARRC), those                                                               
entities don't have to post a  bond in order to sell the wildlife                                                               
viewing passes.  And line 26  [Section 7] allows AMHS and ARRC to                                                               
collect a fee as any  private-sector vendor would.  Both entities                                                               
will incur costs from having to  sell these passes, and should be                                                               
able to  keep the funds  just like any  other vendor in  order to                                                               
offset those costs.                                                                                                             
Number 0605                                                                                                                     
MR. POUND  drew attention to [Section  12, paragraphs (c)(5)-(7),                                                               
beginning] on  page 6, line  15.   He noted that  several similar                                                               
amendments  change "person"  to  "resident" in  order to  clarify                                                               
between  residents  and  nonresidents.   The  exceptions  to  the                                                               
change  to "resident"  are a  person under  the age  of 16  years                                                               
[paragraph (c)(1)]  and a  person who  is currently  employed and                                                               
has verifiable proof of employment  in the commercial provider or                                                               
transportation industry and provides  direct services to tourists                                                               
in  Alaska  [paragraph  (c)(8)],  which he  said  is  individuals                                                               
working on cruise  ships and so forth; they  wouldn't be required                                                               
to have this pass.                                                                                                              
Number 0525                                                                                                                     
MR.  POUND said  the only  other  change is  on page  7, line  26                                                               
[paragraph (f)(5)], where the word  "ferry" has been added to the                                                               
list of transportation  modes; he said this "rolls  back in" with                                                               
the Alaska Marine Highway System.                                                                                               
Number 0481                                                                                                                     
CHAIR  FATE asked  whether anyone  wanted to  testify who  hadn't                                                               
testified previously.                                                                                                           
Number 0369                                                                                                                     
BRIAN  PETERSON, Licensed  Master Guide  and Outfitter,  spoke on                                                               
his own behalf.   He began by proposing an  amendment to the bill                                                               
to also  increase the bison  tag fee, suggesting that  fee should                                                               
correlate  directly  with the  current  musk  ox  tag fees.    He                                                               
explained that bison are the  wildlife resource in highest demand                                                               
in  the state,  with approximately  10,000-12,000 applicants  for                                                               
100-130  permits.   Presently,  he  said, that  would  be a  $500                                                               
resident  tag fee,  a $1,100  nonresident tag  fee, and  a $1,600                                                               
nonresident  alien tag  fee.   The system  used to  harvest bison                                                               
would then  be incorporated by  the Board of Game,  he suggested,                                                               
using an alternate system that  is presently already used by [the                                                               
Department  of Fish  and Game  (ADF&G)] in  managing some  of the                                                               
state's brown bear hunts and the musk ox hunt on Nunivak Island.                                                                
MR. PETERSON offered  his belief that this  would benefit Alaskan                                                               
residents because  of the need  to generate revenue;  he surmised                                                               
there'd be no shortage of applicants,  even with the tag fee.  He                                                               
acknowledged that  the bill's title  would have to be  changed if                                                               
this were added, but said  [the bison] isn't a subsistence animal                                                               
because it was  introduced.  Mr. Peterson said musk  ox and bison                                                               
have similar histories  and he feels it would  be very beneficial                                                               
to make this change now.   Offering his understanding that such a                                                               
tag-fee change  can only occur  through statute, he  told members                                                               
that this [bill] is the first  vehicle that has come along in the                                                               
several years since nonresident tag fees were updated.                                                                          
Number 0181                                                                                                                     
MR. PETERSON turned  attention to the bill in  general, saying he                                                               
supports it.   Noting that he is a member  of the Alaskan hunting                                                               
community   and   several    professional   hunting   and   other                                                               
associations in the  state as well as  national and international                                                               
ones, Mr.  Peterson said the  industry has a 100-year  history of                                                               
supporting itself.  He told members:                                                                                            
     Right  now, we  support 80  to 90  percent of  wildlife                                                                    
     management,  harvesting approximately  8 to  12 percent                                                                    
     of the game.   And we will continue to  do that because                                                                    
     we do believe in supporting our industry.                                                                                  
     The one  thing I  do want  to stress  is that  when you                                                                    
     compare  our  nonresident  tag fees  for  some  of  the                                                                    
     animals  that   we're  looking  at,  relative   to  the                                                                    
     Canadian  provinces  that  we  are  having  competition                                                                    
     with,  we  are  beginning to  get  significantly  above                                                                    
     them.   And the  thing you have  to realize,  under the                                                                    
     present system in Title 8,  the product we offer has to                                                                    
     be  better  than what  the  Canadians  are offering  in                                                                    
     order for  us to compete.   The  last thing we  want to                                                                    
     see  is   a  decrease  in  nonresident   use  of  these                                                                    
MR.  PETERSON,  speaking  for  himself   and  not  the  industry,                                                               
although he said  he'd spoken with many members  of the industry,                                                               
spoke in  favor of  funding for the  industry, but  expressed the                                                               
need to have support for his industry and to have enforcement.                                                                  
TAPE 03-24, SIDE A                                                                                                            
Number 0001                                                                                                                     
MR.  PETERSON  expressed  concern  that Title  8  isn't  enforced                                                               
anymore,  and suggested  the need  for a  new assistant  attorney                                                               
general to pursue  wildlife-related crimes.  He said  a few years                                                               
ago 30 to  40 violations weren't prosecuted by  the Department of                                                               
Law  because   of  lack  of   resources.    Although   these  are                                                               
misdemeanors, Mr.  Peterson indicated  each carries  a punishment                                                               
of a year  in jail and $10,000 to $30,000  in fines.  Reiterating                                                               
support for the bill and  surmising that the industry supports it                                                               
as well,  he concluded  by stating the  need for  "enforcement on                                                               
the issues" and saying [Alaska] is  getting out of whack with the                                                               
international industry on these resources.                                                                                      
Number 0140                                                                                                                     
BRAD  PHILLIPS, Owner  and Operator,  Phillips' Cruises  & Tours,                                                               
noted that his company is  in Anchorage and Prince William Sound.                                                               
He began  by questioning  whether the  bill's drafter  knows much                                                               
about the tourism  industry.  Calling the bill  "a deadly thing,"                                                               
Mr.  Phillips  said he  has  been  in  the industry  since  1947,                                                               
helping to  build it and  taking lots of  risks.  In  those early                                                               
days, it was considered a good  year if there were 2,000 visitors                                                               
to Alaska,  whereas there  are more than  1.5 million  visitors a                                                               
year now.   He said:                                                                                                            
     That just didn't happen.   We've been doing most of the                                                                    
     marketing ourselves in  the industry.  And  the last 10                                                                    
     years the  state hasn't helped  very much, and  we have                                                                    
     slipped from  number 3 of  all the 50 states  to number                                                                    
     37 in marketing ... of what we have to sell here.                                                                          
     We've taken  it on  the chin  several times  during ...                                                                    
     this  period   of  time.    The   1964  earthquake  was                                                                    
     devastating, and  we had  no recovery  on that  - also,                                                                    
     the '89  oil spill.   Then when [the  terrorist attacks                                                                    
     of September  11, 2001] came  along, that next  10 days                                                                    
     we   lost   a  quarter   of   a   million  dollars   on                                                                    
     cancellations, and ... most of  our operators in Alaska                                                                    
     were off somewhere between 20  and 25 percent last year                                                                    
     because  people ...  aren't traveling.    And this  war                                                                    
     that came on didn't help:   I've had cancellations from                                                                    
     overseas   clients   constantly  'cause   they're   not                                                                    
     And this  [proposed legislation]:   we've  already sold                                                                    
     three-quarters  or  80  percent  of  our  tickets,  and                                                                    
     there's no way that I can  go back and ask somebody for                                                                    
     $15  more for  their cruise.  ...  I'd lose  all of  my                                                                    
     customers, and  I'm already losing some  tour operators                                                                    
     that, when  they hear about  this ... -- it's  going to                                                                    
     do a lot of damage ....                                                                                                    
MR. PHILLIPS  questioned whether many committee  members had been                                                               
involved in  the tourism industry,  and asked them  to understand                                                               
the  damage from  the proposed  $15  fee.   He concluded,  "We're                                                               
being targeted  for something that  we don't have anything  to do                                                               
with, on that $15 thing.  And  I am absolutely opposed, and so is                                                               
the rest of our industry."                                                                                                      
Number 0370                                                                                                                     
REPRESENTATIVE GATTO asked Mr. Phillips  whether his company does                                                               
the glacier cruise.                                                                                                             
MR. PHILLIPS affirmed that.                                                                                                     
REPRESENTATIVE  GATTO  asked whether  that  is  usually the  only                                                               
[excursion]  for people  visiting Alaska,  or whether  it may  be                                                               
their second, third, or fourth one.                                                                                             
MR. PHILLIPS said it depends on the tour operator.  He added:                                                                   
     They ...  usually have a  land program, and  we're part                                                                    
     of it.  If there are  people that just fly up - they're                                                                    
     independents  - they  may do  one  or two  things.   If                                                                    
     there are  crewmembers on,  say, Alaska  Airlines, that                                                                    
     want  to  have  a  day   there  and  they  want  to  do                                                                    
     something,  they  come down.    But  there isn't  [one]                                                                    
     answer to that ....                                                                                                        
     And I think  the administration of this  thing would be                                                                    
     a nightmare. ...   We don't sell all  the tickets; they                                                                    
     go through  travel agents  all over  the world  ... and                                                                    
     tour operators, ... and there  isn't any way I can know                                                                    
     who qualifies and who doesn't                                                                                              
Number 0468                                                                                                                     
REPRESENTATIVE GATTO asked  whether a person who buys  a $15 pass                                                               
wouldn't just have  it, and the person collecting  the charge for                                                               
the trip would see  the pass and would be able  to write down the                                                               
number of the existing pass.                                                                                                    
MR.  PHILLIPS replied  that first  of all,  he wouldn't  sell any                                                               
passes  but  would  let  somebody  else worry  about  that.    He                                                               
disagreed  with Representative  Gatto's perception,  however, and                                                               
said  somebody who'd  booked a  tour in  San Diego,  for example,                                                               
wouldn't be  seen by Mr.  Phillips until they stepped  aboard his                                                               
boat.  Not  all people who go  on the boat are seen  in the sales                                                               
office.  He reiterated that it looks like a nightmare.                                                                          
[Chair Fate  called upon  John Hall, but  he wasn't  available on                                                               
Number 0605                                                                                                                     
ALAN LeMASTER,  Owner, Gakona Junction Village,  noting that he'd                                                               
testified  the previous  week, concurred  with  the testimony  by                                                               
Brad Phillips in opposition to HB 163.                                                                                          
Number 0663                                                                                                                     
LEN  LAURENCE, Mariner  Inc., testified  that he  is a  marketing                                                               
consultant  in tourism  in Ketchikan,  representing  a number  of                                                               
businesses; has  been involved  with the  travel industry  for 35                                                               
years; and is past president  of the Alaska Visitors Association.                                                               
He  specified that  he  was  opposing not  HB  167,  but the  $15                                                               
wildlife conservation pass.  Saying  he would echo the sentiments                                                               
of Brad  Phillips 100  percent, Mr. Laurence  said the  tax poses                                                               
"significant legal, administrative, and policing prohibitions."                                                                 
MR.  LAURENCE  explained  that  this  particular  tax  is  highly                                                               
targeted; will impact  a large segment of  the industry, creating                                                               
adverse  publicity  for  Alaskan tourism  nationwide  because  no                                                               
other state has  a similar viewing fee; and falls  on the tourist                                                               
industry   without  putting   additional  revenue   into  tourism                                                               
marketing.  He concluded by adding  that he, along with others in                                                               
the  travel industry,  isn't opposed  to a  broad-based tax  that                                                               
will  raise  money  for  the state  budget  and,  in  particular,                                                               
tourism marketing.                                                                                                              
[Chair  Fate  called upon  Brien  Salazar,  but was  informed  he                                                               
wasn't available on teleconference.]                                                                                            
Number 0841                                                                                                                     
ROD ARNO  testified that he  has been a licensed  wilderness tour                                                               
guide since  1974 and today  mainly does big-game  hunting tours.                                                               
He spoke  in support of the  bill, but said he  believes it needs                                                               
amendments and  deletions.   Referring to  Section 2,  page 2, he                                                               
mentioned  separate   accounts  and   said  he  believes   it  is                                                               
inappropriate;  instead,   it  should   say  that   the  wildlife                                                               
conservation pass fee  shall be deposited into  the general fund;                                                               
under that,  then, it would  say the legislature  may appropriate                                                               
matching funds out of the general  fund to match the federal CARA                                                               
[Conservation and  Reinvestment Act] money, "which  is similar to                                                               
the Pittman-Robertson  money, which  is hunter money  that's come                                                               
into  the  state before  statehood  to  the  tune of  about  $170                                                               
million for wildlife management to date."                                                                                       
MR. ARNO explained  his reasoning, saying there isn't  a need for                                                               
millions of  additional dollars  to go  to ADF&G  for management.                                                               
He  said the  money that  goes to  management today  from hunters                                                               
hasn't  achieved much.    Asking  what can  be  done to  increase                                                               
viewing,  he mentioned  educational programs  and suggested  CARA                                                               
money  could  certainly take  care  of  that,  "but not  at  that                                                               
MR. ARNO referred to  a survey done in the summer  of 1993 by the                                                               
McDowell [Group].   He indicated it was  entitled "Alaska Visitor                                                               
Expenditures" and was  done with the state's  Division of Tourism                                                               
in what was  then called the Department of  Commerce and Economic                                                               
Development.   Mr. Arno said  the greatest impact to  Alaska from                                                               
this "tourist  industry that  puts very little  back into  it" is                                                               
infrastructure in rural areas.   He reported that the 1993 survey                                                               
showed that three-quarters  of tourists who came to  Alaska - 1.2                                                               
million  - stayed  in  urban  areas doing  day  tours and  salmon                                                               
bakes.  By contrast, 1,200  people [surveyed] took adventures for                                                               
wildlife viewing.   Clearly, Mr.  Arno said, there is  an expense                                                               
to the  state:   "the infrastructure,  the hotels,  the railroad,                                                               
the airport, all of that that  these tourists are using, and that                                                               
there's no money  back to the state  to take care of  these."  He                                                               
said he believes that is more important.                                                                                        
Number 1051                                                                                                                     
MR.  ARNO proposed  having a  resident fee  as well  as a  higher                                                               
nonresident fee  of perhaps $100, for  instance.  As to  the idea                                                               
that  guides who  are "operators  for  watchable wildlife"  don't                                                               
have to  buy the license,  he indicated every [hunting]  guide in                                                               
Alaska has  to buy a  state license,  and also must  purchase and                                                               
carry a  hunting license,  regardless of  whether that  person is                                                               
hunting.   Calling this bill  a step  in the right  direction, he                                                               
reiterated his  concern that  the tourist  industry has  put very                                                               
little into the general fund in the last 10 years.                                                                              
Number 1123                                                                                                                     
CHAIR FATE asked  whether anyone else wished to  testify; he then                                                               
closed  public testimony.   He  announced  that HB  163 would  be                                                               
held over.                                                                                                                      

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