HOUSE BILL REPORT

HB 2267

BYRepresentatives R. King, Bowman, Haugen, Morris, Sayan, Brumsickle, Vekich, Basich, Raiter, Brooks, Spanel, Smith, Jacobsen, May, S. Wilson, R. Meyers, McLean, Holland, Jones and Kremen; by request of Department of Fisheries

Providing a funding mechanism for regional fisheries enhancement groups.

House Committe on Fisheries & Wildlife

Majority Report:  The substitute bill be substituted therefor and the substitute bill do pass.  (10)

      Signed by Representatives R. King, Chair; Morris, Vice Chair; S. Wilson, Ranking Republican Member; Basich, Bowman, Brooks, Cole, Smith, Spanel and Vekich.

House Staff:Pamela Madson (786-7310)

Rereferred House Committee on Appropriations

Majority Report:  The substitute bill by Committee on Fisheries & Wildlife be substituted therefor and the substitute bill do pass.  (26)

      Signed by Representatives Locke, Chair; Grant, Vice Chair; H. Sommers, Vice Chair; Silver, Ranking Republican Member; Youngsman, Assistant Ranking Republican Member; Appelwick, Belcher, Bowman, Braddock, Brekke, Dorn, Doty, Ebersole, Ferguson, Hine, Inslee, McLean, Nealey, Padden, Peery, Rust, Sayan, Spanel, Sprenkle, Wang and Wineberry.

House Staff:      Randy Acker (786-7130)

AS REPORTED BY COMMITTEE ON APPROPRIATIONS FEBRUARY 2, 1990

BACKGROUND:

The 1989 Legislature established regional fishery enhancement groups to encourage and assist volunteer efforts to enhance the salmon resource of the state.  To accomplish this goal, each regional group must maximize volunteer efforts and private donations, and work with Washington's Department of Fisheries to supplement their efforts to enhance the salmon resource and double the catch by the year 2000.

Though the governor indicated support for the concept of volunteer enhancement groups, he substantially vetoed the 1989 bill.  He indicated several concerns with the bill as written and outlined the following as reasons for the veto:  (1) the lack of accountability in statute for the use of state funds by the groups; (2) a requirement that the Legislature approve loans that could be authorized under the bill; and (3) a failure to require the groups to be formally incorporated as non-profit corporations.  The governor pledged in his veto message to direct the Department of Fisheries to implement the intent of the bill in a more workable and accountable manner.

In June, 1989, the Department of Fisheries formed a working task force that included advisors from the various interest groups.  A bill outlining a funding source and establishing a dedicated fund was recommended, and rules were proposed to organize and administer the groups.

Proposed administrative rules create 12 geographic groups, and require that the groups organize as non-profit corporations and obtain tax- exempt status under IRS regulations before being eligible for start-up funds.  The department will provide technical assistance and will work with each group through a representative member designated by the group.  Criteria is established for group formation and for selecting among competing groups in a region.

The Grays Harbor Fisheries Enhancement Task Force, operating since 1980, was used as a model for the proposed program and is a non- profit corporation with tax-exempt status.

SUMMARY:

SUBSTITUTE BILL:  Regional fishery enhancement groups are encouraged to include in their membership representatives from all user groups and other participants interested in salmon, plus members from the general public.  Groups must be organized and incorporated as non- profit corporations.

A dedicated account is created to be known as the regional fisheries enhancement group account.  The account is funded by a surcharge on both recreational and commercial salmon fishing licenses issued by the Department of Fisheries.  Recreational salmon license holders pay an additional $1 and commercial salmon license holders pay an additional $100 per license.  Additional account revenue may come from the sale of surplus salmon eggs and carcasses that return to a group's facility. Only the director of the Department of Fisheries may authorize expenditures from the account.

A regional fishery enhancement group's advisory board is established with members appointed by the director of the Department of Fisheries to include two commercial fishing representatives, two recreational fishing representatives, and three members from the general public.  Two additional members are nominated through the Northwest Indian Fisheries Commission and the Columbia River Intertribal Fish Commission and serve ex officio.

The advisory board makes recommendations to the director on rearing project proposals made by the individual groups and on the funding of the proposals.  The board also reviews and recommends what amount should be paid to the department for its assistance to the groups. Payment to the department cannot exceed 20 percent of the annual contribution to the account.

Funds from the enhancement account cannot serve as replacement funding for current department-operated salmon projects.

A biennial report is required from the department and the advisory board beginning October of 1991.

The Department of Fisheries must study methods of collecting and accessing the names and addresses of surcharge license holders and report their findings to the Legislature by October 1, 1990.

SUBSTITUTE BILL COMPARED TO ORIGINAL:  The commercial license surcharge is increased from $50 to $100 per license, and the department's maximum percentage for reimbursement is reduced from 25 percent to 20 percent.  Research is included as an option for a regional enhancement project.  Funds from the dedicated account may not serve as replacement for department-operated salmon projects.  This change allows volunteer cooperative projects to be adopted by a regional enhancement group.  A biennial report is required beginning in 1991. The department must study methods for collecting and making accessible lists of surcharge license holders.  The advisory board will include two ex officio members nominated by the Northwest Indian Fisheries Commission and the Columbia Intertribal Fish Commission.

CHANGES PROPOSED BY COMMITTEE ON APPROPRIATIONS:  None.

Revenue:    The bill has a revenue impact.

Fiscal Note:      Available.

House Committee ‑ Testified For:    (Fisheries & Wildlife) Judith Merchant, Department of Fisheries; Rob Zuanich, Purse Seine Vessel Owners' Association and Salmon for Washington;  Irene Martin, Columbia River gillnet fisher; Bob Eaton, Salmon for All; John Sayre, Long Live the Kings; Bob Lake, Willapa Gillnet Association; Don Samuelson, Grays Harbor Fish Enhancement Task Force; Bruce Crookshanks, Columbia River Fishermen's Protective Union; Keith Herrell, Pacific Salmon Sport Fishing Council; Tom Pentt, Trout Unlimited; Toimi Maki, Grays Harbor Gillnetters Association; Gene Woodwick, Grays Harbor Economic Development; Fawn Sharp, and Curt Stanley, Quinault Indian Nation; James Brummert, hunter, fisher and trapper; Don White, Washington Public Ports Association; and Karl Wallin, Port of Grays Harbor.

(Appropriations) Dave Rogers, Washington Public Port Association; and Judith Merchant, Department of Fisheries.

House Committee - Testified Against:      (Fisheries & Wildlife) No one.

(Appropriations) No one.

House Committee - Testimony For:    (Fisheries & Wildlife) The underlying principles in developing this bill and proposed regulations are to make it work, and to include in the notion of enhancement both fish production and habitat improvement.  To insure success of the projects, close association between the groups and the department is necessary.  Three biologists, who would be employees of the department, would be financially supported from the enhancement account and would work with the 12 groups.  The groups should involve as many citizens as want to be involved.  The department will assign an employee to assist formation of the groups.

The following concerns and suggestions were made:

(1)  Level of contribution - Increasing the level of contribution by commercial fishers to $100 per license will allow more equality of contribution between recreational and commercial fishers.  Because of recent downturns in the market price of salmon, perhaps the source of funding for commercials could be tied to the landing tax that is paid by both fishers and processors.  That measure would better reflect the market.  However, this could result in an unstable source of funding for on-going projects.  The tribes are benefiting from enhancement but are not paying their fair share.

(2)  Make up of advisory board - The make up of the advisory board should be two tribal fishers and one at-large citizen rather than three at-large citizens.  As co-managers, it may not be appropriate to have tribal fishers sit on the advisory board that advises the Department of Fisheries.  Their presence on the advisory board would allow input from their managers and biologists.  The tribes are a part of the fishery. Tribal participation in the regional groups is anticipated.  Other interests that should be included in board representation are economic development, planning, and port districts.  Such input has been very helpful on the Grays Harbor Task Force.

(3)  Expenditure of account funds - No funds should be expended from the dedicated enhancement account for Department of Fisheries' reimbursement.  However, there needs to be a stable source of funding for support people and some consistency in support staffing.  There is a need for someone to work with the groups and help facilitate interests that have historically been in conflict.  The use of funding for this purpose from this account was the product of consensus from the working task force that met during the interim and agreed to a maximum of 25 percent.

(4)  Setting a sunset date - A sunset date should be included to require evaluation of the program and the license surcharge with dates ranging from 1992 to 1994.  However, setting a sunset date may seem too negative.  A requirement for a report or evaluation may allow some oversight of the project.  A sunset date of 1992-1994 may not allow for one cycle of salmon production.  Once groups are formed as non-profit corporations, they can continue whether the statute terminates or not.

(5)  Accounting for enhancement - There needs to be a way to account for enhancement and the ability to harvest that enhancement.

(6)  Group matching - Groups should have to match at least 10 percent of the funds received.  However, this suggestion could become a deterrent to some projects.

The bill will allow more flexibility to cooperate with efforts going on in adjacent states and provinces.

The money that has been raised from private sources for enhancement projects is getting harder to raise.  It's time those who benefit from the enhancement pick up part of the tab.

This effort helps solidify support between recreational fishers and commercial fishers, maximizes funding from a variety of sources including Indian tribes, and serves as an educational tool to raise public awareness for keeping a good environment.

(Appropriations) This bill takes steps to implement legislation enacted during the 1989 session by creating a funding mechanism and a process that can make regional fisheries enhancement work.

House Committee - Testimony Against:      (Fisheries & Wildlife) None.

(Appropriations) None.