A RESOLUTION URGING THE ALASKA LEGISLATURE AND WALKER ADMINISTRATION TO ANALYZE CUMULATIVE IMPACTS PRIOR TO IMPOSING NEW TAXES ON THE SEAFOOD INDUSTRY.
WHEREAS the seafood industry is the largest private sector employer in Alaska and provides approximately 60,000 jobs each year and directly employed 26,700 Alaskans in 2013-2014; and
WHEREAS, the seafood industry averaged $5.9 billion in economic activity statewide in those years, with an associated labor income of $2.1 billion; and
WHEREAS, over 31,500 commercial fishermen operating 8,600 vessel delivered 5.7 billion pounds of seafood in 2014 with a first wholesale value of $4.2 billion, and the processing sector employed more than 25,000 workers who were paid $460 million; and
WHEREAS, the seafood industry paid $138.6 million in fishing related taxes and fees that was distributed to Alaska’s general fund (55%), local governments (38%), and federal agencies (7%), and over $100 million in royalties to Community Development Quota (CDQ) groups in western Alaska, salmon hatchery cost recovery programs, and Regional Seafood Development Associations (RSDAs) assessments, in addition to various local taxes and fees; and
WHEREAS, 65 Alaskan cities, boroughs, and municipalities receive half of the fisheries business and landing taxes paid by the seafood industry each year, which greatly reduces reliance on the capitol budget and provides infrastructure they could not otherwise afford; and
WHEREAS, the seafood industry is managed under a Constitutional mandate to ensure sustainability and has provided a consistent source of jobs and revenue to the state of Alaska and Southeast region for over 100 years and will continue to contribute indefinitely ; and
WHEREAS, 291 million pounds ofseafood, valued at $260 million, was harvested in 2014 by fishermen in Southeast Alaska, where nine communities typically number among the nation’s top ranked fishing ports for volume and/or value – three (Sitka, Ketchikan, Petersburg) consistently in the Top 20; and
WHEREAS, 54 shorebased operations in Southeast Alaska processed 235 million pounds of seafood in 2014, with a first wholesale value of $520 million; and
WHEREAS, seafood is responsible for 20% of the average annual monthly employment in Southeast Alaska and provided nearly 10,000 full time equivalent jobs to the region in 2013 and 2014; and
WHEREAS, more than 12,000 people in were directly employed harvesting, processing, or working at hatchery facilities Southeast Alaska during 2013 and 2014; and
WHEREAS, the seafood industry has expressed concern about the cumulative effects of a wide range of proposed taxes and fees on small businesses that already carry a heavy tax burden, which could cause a decline in growth or recession within the industry; and
WHEREAS, the Alaska Legislature and Walker Administration are considering options to impose new and increased taxes and fees on such things as: seafood landings, motor fuel, permit and vessel licenses, and individual income tax; the combined effect of which could have far reaching ramifications to the health of the seafood industry in the State and Southeast Alaska; and
WHEREAS, the seafood industry is currently facing significant challenges, due to the worldwide economic downturn, fluctuating currency rates, and a Russian embargo; and
THEREFORE BE IT RESOLVED that our businesses specifically oppose the 12.5% royalty proposed through Senate Bill 198, and views the measure as an unreasonable tax burden on an industry composed of small businesses that provide more jobs than any other and currently pays the second highest combined tax rate in the State; and
THEREFORE BE IT RESOLVED that our businesses urge the Alaska Legislature and Walker Administration to carefully analyze the cumulative impact of any additional taxes and fees levied on the seafood industry, so as not to create an unfair tax burden and disincentive for investment, or otherwise lead to destabilization and job loss in the seafood industry and our communities.
The following organizations and businesses operating in Southeast Alaska issued support for this resolution on February 29, 2016:
Fishing Organizations
Linda Behnken, Alaska Longline Fishermen’s Association
Dale Kelley, Alaska Trollers Association
Megan O’Neil, Petersburg Vessel Owner’s Association
Kathy Hansen, Southeast Alaska Fishermen's Association
Cynthia Wallesz, United Southeast Alaska Gillnetters
Robert Thorstenson, Southeast Alaska Seiners
Phil Doherty, Southeast Alaska Dive Fishermen’s Association
Processors
Tom McLaughlin, Seafood Producers Cooperative
Mike Erickson, Alaska Glacier Seafoods
Greg Indreland, Yakutat Seafoods
Terry Barry, Hoonah Cold Storage
John Garner, North Pacific Seafoods
Vern Phillips, Pacific Seafood
Eric Norman, Taku Fisheries
Sandy Souter, Alaska General Seafoods
Aquaculture Associations
Dave Landis, Southern Southeast Regional Aquaculture Assn
Steve Reifenstuhl, Northern Southeast Regional Aquaculture Assn
Eric Prestegard, Douglas Island Pink and Chum
Jeff Lundberg, Prince of Wales Hatchery Association
Ian Fisk, Armstrong-Keta, Inc.
Individual Seafood Businesses
Mark Tupper, Triad Fisheries
George Eliason, Owner Tammy Lin Fisheries
Sources
The Economic Value of Alaska's Seafood Industry, McDowell Group, December 2015.
http://ebooks.alaskaseafood.org/ASMI_Seafood_Impacts_Dec2015/pubData/source/ASMI%20Alaska%20Seafood%20Impacts%20Final%20Dec2015%20-
%20low%20res.pdf
2015 ADOR Annual Report
http://www.tax.alaska.gov/programs/documentviewer/viewer.aspx?1107r
Top Major Ports by Pounds ; Top Major Ports by Value
http://www.st.nmfs.noaa.gov/commercial-fisheries/commercial-landings/other-specialized-programs/total-commercial-fishery-landings-at-major-u-s-ports-summarized-
by-year-and-ranked-by-poundage/index
http://www.st.nmfs.noaa.gov/commercial-fisheries/commercial-landings/other-specialized-programs/total-commercial-fishery-landings-at-major-u-s-ports-summarized- by-year-and-ranked-by-dollar-value/index
