Alaska Legislature: House Finance - April 29, 2026 9:00am

Okay, I'll call this meeting, the House Finance Committee, to order. Let the record reflect that the time is currently 9:09 AM on Wednesday, April 29th, 2026. And, uh, present we have Representative Moore, Representative Co-Chair Sharagi, Co-Chair Josephson, Representative Galvin, Representative Tomaszewski, Representative Hannan, and myself, Co-Chair Foster. And just a reminder, if we can mute our cell phones. And we also have with us Representative Stepp.

And we have one bill before us today, and that's Senate Bill 130. That is the Fisheries Production Development Tax bill. And With that, I'd like to invite up— oh, Senator President Stevens is here. Wow. And his staff, Mr. Tim Lemkin.

And if you could please put yourselves on the record and thank you for being here this morning and give us an introduction to the bill. Thank you, Mr. Chairman. Senator Gary Stevens Kodiak, appreciate your hearing the bill this morning. It's been an unusual day. I spent most of my morning being abused by members of the house over our session yesterday.

I know you got a tickle out of it, but at least we survived. We appreciate your hard work. Thank you. Thank you. Well, this is an important piece of legislation.

I really appreciate your hearing it. It came from the Seafood Task Force 2024-25, met during the interim and came up with important pieces of legislation. And this is one of the key priorities, this particular piece of value-added tax credits, and really leads to the extension and the modification of the industry. Adding seafood value-added production tax credit. It builds on what we've done for several years here in the legislature, starting in 2002 with Salmon Fisheries Task Force and passage of Senate Bill 33 in 2022.

And all both of those acknowledge the importance of including not just salmon, but herring and also pollock and Pacific cod and sablefish eligible fishery— fisheries eligible species for this tax credit. Senate Bill 130 before you today proposes to include all fish species in the program and to further incentivize investments in new technologies that move the industry forward and innovative processes that need to happen to enhance the— firstly, the value of the fisheries products, but also the quality. At a time when Alaska's seafood industry faces major problems— historically poor market conditions, declining value of products, competition with other countries unfairly— Senate Bill 130 is intended to strengthen the competitiveness of Alaska's fishing industry, improving the bottom line for both processors and consequently for fishermen as well. So thank you very much for your consideration of this important piece of legislation, Mr. Chairman. Thanks.

Great, thank you very much, Senator Stevens. And let's see, what we're going to do is we do have, I believe, 4 invited testifiers, and so we'll have them up. Then maybe as each one provides their testimony, if we have some questions, members are welcome to ask questions of them. And then we also have Mr. Jeremy Woodrow, Executive Director of the Alaska Seafood Marketing Institute, otherwise known as ASMI, also available for questions online. So first invited testifier is, is Ms. Julie Decker, President of the Pacific Seafood Processors Association.

I believe you're here, and if you could put yourself on the record and provide your testimony.

Thank you, Mr. Chair. For the record, my name is Julie Decker. I live in Wrangell, and I'm testifying today on behalf of the Pacific Seafood Processors Association. PSPA is a trade association which represents seafood processing companies that purchase fish from thousands of commercial fishermen across the state in 22 communities and approximately 50 facilities.

PSPA strongly supports SB 130, which would extend and augment the existing Fisheries Product Development Tax Credit. SB 130 provides an incentive for Alaska seafood processors to invest in new equipment that produces higher-quality value-added products within Alaska. These one-time capital outlays will provide long-term economic benefits to the state, coastal communities, fishermen, and processors. This tax credit was first enacted by the legislature in approximately 2004 after the salmon price crash in the early 2000s. At that time, the legislature created a Salmon Task Force, and this tax credit was one of the bills that was recommended by that task force.

Since that time, the tool has been demonstrated, um, that is successful for Alaska to incentivize private investment to increase the value of Alaska's seafood resource. This is supported by previous analysis by McKinley Research Group completed in 2021, which showed the tax credit grew the state's general fund by a net of $114 million for its investment of $37 million in credits. That's a return on investment of about 300%. The health of the seafood industry is critical to Alaska as it generates about $6 billion in economic activity in Alaska annually. It creates 42,000 direct jobs, is the state's largest manufacturing sector, and lowers costs of transportation for all Alaskans.

In response to critically challenging economic conditions in the Alaska seafood industry in 2023, the industry increased efficiencies and reduced operational costs, evaluated and refocused businesses leading to rightsizing, reorganizing, and expansion.

Double down on each company's core strengths, leading to a reinvestment in these areas. The next phase will require investment and innovation with new technologies, systems, products, and market growth. However, in 2026, there are still significant risks related to trade and tariffs. In 2024, as the senator, uh, described, the Alaska legislature created the Legislative Seafood Task Force to look across state government at the actions the state could take to help support the seafood industry. The task force report focused on a few key items within the state's purview that would make a difference, with the primary understanding that in order to move the needle, we needed to lower operating costs and increase product value.

The final report of the task force recommended updates to this tax credit as one of the short-term, uh, actions the state could take to make a positive difference. In closing, SB 130 will Implement this recommendation of the Legislative Seafood Task Force. It is a proven tool for policymakers which provides increased returns to the state and communities as fish taxes are based on fish value, and it will encourage one-time private investment in equipment that year after year will increase long-term value of fishery resources to the state, communities, fishermen, and processors. So Very much appreciate the efforts of the legislative seafood task force, and thank you for your time today. Great.

Thank you very much. I'd just like to recognize that we have with us Representative Allard, Representative Bynum, Representative Jimmy, and do we have any questions for Ms. Decker? Representative Bynum. Thank you, Co-Chair Foster, through the chair, Ms. Decker. Thank you very much for being here.

Appreciate all the hard work you put into industry and fisheries and supporting our community of Wrangell. Representative Moore. Thank you. Yes, through the chair, thanks for being here, Ms. Decker. I have a quick question.

Can you explain how this tax credit impacts at-sea processors? Through the chair, yes, Representative Moore. Not at all. They don't qualify for tax credit and they can't use it. Okay, thank you.

Appreciate it. Okay, do we have any further questions? Seeing none, thank you very much, Ms. Decker. Next up, we have Abby Frederick, Vice President of Investor and External Affairs for Silver Bay Seafoods. And looks like you're in person.

Thank you very much for being here. And if you could put yourself on the record. Yes, for the record, my name is Abby Frederick. I'm a 30-year resident of Juneau, and I represent Silver Bay Seafoods and our fishermen partners. Today I am here in support of SB 130.

Silver Bay is a unique fisherman-owned seafood processing company that started operating in 2007 when a group of fishermen pooled their savings together and started processing their own catch in Sitka. This model of sharing in the profits of the processing of their fish was so successful that it spread to nearly every region of the state, and today we partner with over 1,600 fishermen organized regionally and in nearly every fishery and gear group. Senate Bill 130 would extend the seafood product development tax credit for currently 10 years with an amendment. We feel this is legislation that is a win-win-win. It benefits a broad range of Alaska stakeholders.

And I'm going to talk about fishermen benefits. So the more value you can get out of our PAC, the better ex-vessel prices paid to fishermen. It's really that simple. And you can do this through full value-add production like fillets or premium ikura, canned or pouch products, and then full utilization with mince or belly trim and even grinding up waste into pet food products to get every single ounce of value. This bill provides the ability for processors to make these significant investments that many times are infeasible without the tax credit.

There's community and state benefits. We pay a fisheries business tax to the state and local fish taxes to fishing communities, all based on value. If the ex-vessel price is higher because the product is higher value, that directly increases the taxes to the state and local communities. So increased value means more direct benefits to community, community funding for schools, transportation, public safety, or other critical local services. Healthy processing sector.

These benefits also support a stable and healthy seafood processing industry, which is the largest private direct employer in Alaska. Increasing value for our seafood products requires investment, and through this initiative, that investment would be incentivized by Alaska with the goal of returning on that investment to Alaskans. And there's evidence of that, that this is working, which was covered by a previous testifier. To provide examples how the tax credit can push new investment, Silver Bay Seafoods has recently invested in a couple of exciting value-add pilot projects that fit under the seafood tax credit program. Pink salmon— this is a large-volume fishery, so any increase in value can make a significant difference to Alaska.

We partnered with fishermen in Southeast to get a premium, premium-quality pink salmon fillet that is frozen and ready to ready to be portioned and marinated domestically. This is a newly developed product, and we are seeing a positive response from our customers who have received samples this fall and winter. But this would require investment in every pink salmon processing facility to expand fillet capacity and increase our cold chain improvements. Sockeye in Bristol Bay— we invested in a technology never before used in Alaska salmon fisheries, a nano ice technology popular in other Arctic regions of the globe, used to maximize quality and create primo finished products. We're able to create a bougie sockeye product that we are calling A5 sockeye, which is kind of a nod to the wagyu of salmon for your— for you steak lovers.

Fillets of this sample product were catching prices almost double the normal fillet price when they were introduced to the market last fall. These were pilot projects and include some R&D. We learned a lot and we know where to target our energy and resources next, but the bottom line is there's room for added value in these important fisheries, particularly in cold chain enhancements. Keeping fish cold is critically important to adding value, and we need to keep up with the competing countries that also produce a ton of salmon. Continues— continuing the seafood product development tax credit will support the necessary investment that otherwise is a lot less likely to happen.

In closing, I want to thank you that participated in this— thank all of those legislators that participated in the seafood task force. For prioritizing this legislation for a strong future. This approach, a tax credit that incentivizes private investment in higher quality value-add products coming out of Alaska, was a strong recommendation of the task force, and we agree with that. Thank you very much for your testimony. Representative Hannon.

Thank you, Chair Foster. Miss Fredericks, Silver Bay has a sort of a unique and a very contemporary story of its growth from a few fishermen banding together for sale of salmon. And I think one of the key changes in this bill is taking out the limit on species. But I'm hoping perhaps you could just describe real quickly Silver Bay's growth. You mentioned 20— but just expand a little bit on that story of how it's changed and what it's dealing with besides salmon and in the variety of locations that you're now working?

Yeah, thank you for the question. And through the chair, we've expanded regionally. I think fishermen caught wind of this dynamic and wanted to share in the profits of their own fish. And so it went— I guess Silver Bay spread to Prince William Sound, Bristol Bay, the Alaska Peninsula, and Kodiak is a good example of other fisheries for which we're participating in. And so we started there with a fleet of salmon fishermen who invested in the facility.

And those salmon fishermen have diversified portfolios in which fisheries they can participate in so that they can do this as their livelihood year-round. And that includes, you know, crabbing and longlining and other fisheries. And so we expanded the processing in that facility for other species, and we now participate in all the fisheries in that region. All right. Thank you, Chair Foster.

I'm planting the seed for a fishery that we don't even have here in Alaska. But your fishermen followed, followed a fishery. And perhaps in the next decade we are going to see commercial squid, I would expect.

Thank you for the question for the chair. I— we operate in squid fisheries actually in California. So there are some salmon fishermen that migrate down to California to participate in that fishery. And there are fishermen that have, through a commissioner's permit, explored whether or not we could expand squid fisheries in Alaska. I don't have a lot of details on, on that, but there are developing fisheries in Alaska.

Okay. Seeing no further questions, thank you very much, Ms. Frederick. Okay. Next up, we have Megan O'Neill, Director of Government Government Affairs for Canfisco, and looks like you're calling in online. If you could put yourself on the record.

Good morning, House Finance Committee members. My name is Megan O'Neill. I'm the Director of Government Affairs for Canfisco Group, and I live in Petersburg, Alaska. Canfisco Group comprises several seafood processing companies you're likely more familiar with. These are Alaska General Seafoods, Cedar Creek Fisheries, Uni Foods, and North Pacific Seafoods, operating 11 seafood processing plants.

Located in the communities of Kodiak, Naknek, Igigiak, Kenai, Kodiak, Yakutat, Sitka, and Ketchikan. These companies employ 900 full-time staff and 4,000 workers during our peak each summer. CanFisco supports 1,750 small businesses in Alaska through our purchases of seafood from individual fishermen. I'm testifying today in support of SB 130, the Fisheries Product Development Tax Credit, to allow processors to deduct up up to 50% of their fishery business tax liability to offset the cost of new equipment used predominantly in the production of value-added products and freezing capabilities. Sanfisco supports the language to expand this tax credit to further incentivize value-added products for all species, new technologies, and equipment that improves quality.

In the past, we have used the tax credit on equipment that enabled us to expand our ability to retain and process salmon eggs for the creation of ikura, helping us to better utilize as much of the salmon as possible. We've also used the tax credit to purchase fillet machines that enable us to produce high-quality end product salmon fillets that are fully processed in Alaska and sold as vacuum-packed fillets. Without the passage of this bill, the tax credit will end this year. We have short and long-term modernization product— projects we hope to use this tax credit for. We plan to use it to update aging freezer infrastructure at one of our Naknek plants and at our Kodiak plant.

In the near term, we also plan to purchase equipment to increase our ability to recover fish oil from salmon heads, again, helping us to use more of a salmon and derive value out of what would otherwise be a part of the waste stream. In the long term, we're looking to use it to purchase new cod skinning filleting technology coming out of Europe that would enable us to produce a finished vacuum-packed product in-state. Again, projects we hope to use the tax credit for would not be accomplished in one year. I'm describing elements of a 5- and 10-year plan. Finally, I want to thank you all for hearing this bill and the opportunity to testify today.

Great, thank you very much, Ms. O'Neill. And I don't see any questions from the committee, so we appreciate your calling in. Uh, the last testifier that we have is, uh, Mr. Tom Enlow, CEO of UNICEF. Mr. Enlow, looks like you're calling in from Unalaska. If you could put yourself on the record.

Good morning, Chair Foster and members of the committee. For the record, my name is Tom Enlow, President and CEO of Unisea Incorporated. Unisea is a multi-species shore-based processor that has operated in Alaska for over 50 years. I am testifying this morning in strong support of Senate Bill 130. Alaska seafood competes in a global marketplace, and right now the challenge isn't just volume, it's value.

To keep seafood as a primary economic base for Alaska, we have to raise the value per pound by improving quality, increasing recovery, and producing more value-added products here in the state of Alaska. Senate Bill 130 helps do exactly that by extending and updating the Fisheries Product Development Tax Credit to encourage private investment in equipment that measurably improves quality, utilization, and value. This includes critical upgrades to the cold supply chain because in seafood, time and temperature determine quality. These investments are expensive, especially in remote coastal communities, but they pay off through the years through better product, higher yields, and stronger prices. Importantly, Senate Bill 130 keeps the tax credit capped at 50% of a company's Alaska Fishery Business Tax.

It requires that the equipment be used in-state and clarifies that it must be used predominantly for its qualifying purpose. In other words, this is a targeted incentive that supports real on-the-ground improvements. When Alaska seafood value goes up, fishermen benefit, coastal communities benefit, and the state benefits. Because fisheries taxes are based on value. This approach also aligns directly with the legislative seafood task force call to improve quality, utilization, and competitiveness through targeted policy actions.

For these reasons, uh, Chair Foster and committee members, the industry respectfully urges you to support and pass Senate Bill 130. Thank you. Great, thank you very much, Mr. Enloe. Do we have any questions of the committee for Mr. Enloe? Representative Ballard?

Not to— are these individuals testifying experts on this or are they just call-ins? They are invited testimony. I do and I'm not sure who. Maybe it would be better if it went to the sponsor's office and I could wait. Unless you want me to—.

We have Mr. Tim Lampkin here if you would like to If you could put yourself on the record, Mr. Lampkin.

For the record, Tim Lampkin, staff to Senator Stevens and the Seafood Task Force. Apologies, I missed the question. Please repeat. I haven't said it yet, so this is good. Okay, thank you.

And through the cook here. So I have a little bit of concern in regards to the species to all fish and shellfish. That's a little bit— I wanted to know if you can expand on it. That's a a lot of change. And it's—.

For me, it's not necessarily technical. Like, that's a huge policy change. And then the other one would be the absence of any aggregate fiscal cap. Can you talk and hit on those two points for me?

Tim Lampkins, staff member, Stevens and the Seafood Task Force. First, as the task force went underway with its meetings in the fall of 2024 and leading into '25, The history of these species began in, uh, 2002-ish with the Salmon Task Force, and that group extended their work by a couple of years. And it, it, it was from 2002 to approximately 2004 or 2005 even, and that was a massive project focused just on salmon. And this project covered the entire seafood industry not just salmon. And we did that amount of work in about 6 months.

And during that time span, the task force found that the previous legislation focused on salmon and then later in about 2018 expanded to herring was proving to be successful. And for purposes of value adding these products, that it was decided as by consensus with the task force that they open it up to just any species. At one time it even was expanded— 2022, I should clarify. To include, um, Pollock and Pacific cod and sablefish. And that was starting to prove successful, and the task force felt that it was appropriate to go ahead and, for purposes of incentivizing these industries, economic development, job creation, so forth, to no longer limit it to any particular species but to open it up.

So that was the rationale behind that one. As regards aggregate fiscal, I guess I would ask you to please clarify. Well, I mean, what we're looking at here is we don't—. The—. Can you use your microphone?

Your microphone. Oh, I apologize.

I'm concerned about this is going to raise it to where there's— it used to be 50— let me refer to my notes. It used to be 50% or it was 50%. It's going to move up to the unlimited amount of individuals getting the benefit now, and I'm wondering how that's going to impact the state. So let me look at my notes here. I wrote quite a few things down.

So 51% or more of the time resolving the priority of ambiguity, but then when I read on, they were saying some of the drawbacks is the credit cap at 50% of tax liability now applies to a much larger universe taxpayers. So I'm concerned on—. Thank you, Tim. Tim, so the bill does not change the 50% cap on their tax liability. What it changes is the number of species of fish that processors would be able to apply for the credit.

The 51% is a different reference. That's, that's a, that's actually used in regs by the department, and I'm unable to call on the department to confirm that, but it's my understanding at least that the regulatory use of that 51% exists, or there was ask for clarification on what qualifies as an eligible asset to apply this credit toward, and that being that it be used predominantly— to define predominantly as a piece of equipment that's used at least or more than 51% of the time for that processing activity. [Speaker:COMMISSIONER ARKOOSH] Okay. And then just one quick follow-up. [Speaker:CHAIRMAN BRYANT] Representative Ballard?

[Speaker:COMMISSIONER ARKOOSH] Thank you for answering and explaining a little bit more. The reading on my notes here, the retroactivity of this is a— could set a legal precedent. And I am trying to wrap my head around some of these, but you are explaining your perspective of it. Can you kind of explain a little bit how I mean, it's going to set precedent, precedence, and I just want to make sure that we're doing the right thing. Through the chair, Representative Allard, thank you for that question.

That though the retroactivity and the final sections of the bill are legal technical conforming changes to the bill that we passed in 2022, Senate Bill 54,.

33, Which was when we changed, or rather added from just salmon to herring, we added sablefish, Pacific cod, and sablefish, also known as commonly as black cod. And so that bill passed. And so those, those retroactivity clauses are addressing to that session law that we passed in 2022. Okay. Thank you.

Okay. Any further questions for the sponsor or any of the invited testifiers? Representative Bynum. Thank you, Co-Chair Foster. Through the Chair, for the bill sponsor, one of the items in the bill is this retroactivity clause.

Let me grab it here. It is on page 2, I believe. I am sorry, it is not page 2. It is at the end of the bill. Page 4, line 6, and we are putting this retroactive January 1, 2026.

I just wanted to know the real impacts of having retroactivity clause in this bill as opposed to having the bill just be effective. I know that the sunset hasn't occurred yet, so all of the tax credits that are currently in place would apply still. Just a little more information on the retroactivity and the impact. Mr. Luebken, through the chair, Representative Bynum, again, I believe our previous testimony included the fact that those sections are resultant or of the Senate Bill 33 passed in 2022. And since that time, and I'm sure their processors can confirm this, but investments have been made with the expectation that they would be eligible for these credits and that this would make those expectations or promises, if you will, from the previous legislation sustained.

Okay. Representative Bynum. Thank you. Through the Chair, follow-up.

Do we know what the fiscal impact is if that retroactivity didn't occur? Mr. Lampkin. Through the Chair, Representative Bynum, I've got some soft numbers, but it's been difficult to get hard data from the Tax Division the change, I'm not confident in responding to that with a hard number, but I can say that the credits are in the neighborhood of— I shouldn't specify a number. I don't want to confuse anyone. It's not my place to, I think, answer that question.

Absolutely. Bynum. Thank you. And then one other question I have is I do like in the bill that we do change the species that we are expanding that to include shellfish and other items that can be enhanced. I think that's good for the bill.

But are you prepared, or is somebody prepared, to be able to talk a little bit more about the expansion species that would be covered and how that would be a benefit to the industry as a whole? Mr. Lampkin. Thank you. Through the chair, Representative Bitem, as has been indicated, there are other species that are taking interest by the, by the industry. This is very much a pro-business economic development incentivizing those explorations and activity.

But specifics, I'm going to have to defer to the processors to identify what specific activity they want to pursue.

Okay. Any further questions of the committee? Representative Moore. Thank you, Co-Chair Foster. And through the chair, thank you for being here.

So So the bill goes to incentivize certain fisheries in Alaska, including boats that engage in trawl. Is there a reason we would want to incentivize that method of fishing over a mom-and-pop fishery or, or drift gillnetters, etc.? Mr. Lampkin, through the chairperson Moore. So this bill specifically targets the Alaska Fisheries Business Tax Program, which is 4375.

Fish landed in or caught in state waters. Largely, the trawling fleet is fishing federal waters, which applies to the Fisheries Resource Landing Tax, which is Title 4377. And this bill does not incentivize that. It doesn't touch that program whatsoever. Great.

Thank you. I appreciate that answer. Further questions of the committee?

Sure. Representative. Thank you. Thank you for this bill. I did get a chance to hear from my constituents and really appreciate that.

This is one they've been waiting for for a while. My question is, does this bill single out any one company or is it just for the record? I want to make sure we're clear that this is for all fish caught in Alaskan waters and for all Alaskan companies. Mr. Lampkin, paying tax through the chair. Representative Galvin, thank you for that question.

I had hoped to have the opportunity to clarify for the record and point out that in your packet should be a long list of support letters. Oh yeah, that I'm sure aren't the entirety of the fleet that's our stakeholders and would benefit from this. Legislation. And if, with your permission, I'd like to list them off to clarify for their sake that their letter is on file. Mr. Alphabetically, that would include Alaska Glacier Seafoods, the Bristol Bay Regional Seafood Development Association, Canfisco Group USA, who testified this morning, Copper River Seafoods, Lynden Transport, Pacific Seafoods, the Pacific Seafood Processors Association, Testified earlier.

Resource Development Council, Savage Inc., Southeast Conference, Silver Bay Seafoods, Swampsy. Swampsy also has a resolution on file. Trident includes United Fishermen of Alaska, UFA, and Yakobi Fisheries. Thank you. Okay.

I don't see any further questions. Mr. Lampkin, I understand that your mother is in the audience, and I just wanted to see if maybe you'd like to give a shout out and introduce her. Mr. Chairman, I was unaware she was going to show up this morning. I'm pleased to amuse you this way. I'm pleased to announce my mother, Deb Jenkins, in the audience.

Welcome to House Finance. She came into town for this weekend's activities. Oh, great. Well, welcome. Okay.

I don't see any further questions. At our next meeting, I suspect we will be addressing the fiscal note. I know that we have some questions, and so we should have some folks available from our tax division, Department of Revenue. And I believe we will probably also have public testimony at that point. And so we are going to go ahead and set the bill aside for now.

Our next meeting is scheduled for today at 1:30, and at that meeting we will take up amendments for House Bill 210, and that is the Peace Officers and Firefighters Disability Bill. So if there's nothing else to come for the committee, it will be adjourned at 9:43 AM. Thank you.