The Alaska fishing industry is the most vital of our natural resource industries and the salmon fishery is the single most important fishery in the state. In Southeast Alaska this resource has been well managed biologically, but is facing complex economic problems. The state mandate is to manage the fisheries in a way that insures sustained yields and results in the economic benefit of the people of the state. By ignoring the economic problems of the fishery, the Alaska Legislature has failed to address this crucial responsibility. If elected I will address these issues with the support and input of fishermen.

The three major issues facing the salmon fisheries of Southeast Alaska are the Federal takeover of the subsistence fisheries, the extremely low ex-vessel prices obtained in the fishery, and the lack of an effort to build substantial domestic market demand without placing its total cost on fishermen.

This is no longer a question of "what should be", but rather a question of "what is." Because the legislature defied the wishes of the people of Alaska and failed to act on a constitutional amendment that would have provided rural preference while addressing some of the more ambiguous language specifics for clarification, the federal government has taken control of subsistence fisheries. It does not matter whether one feels this is "fair", it is simply a fact. I support a constitutional amendment resolution be passed to give Alaskans the opportunity to vote on this most important issue.

Federal management of subsistence fisheries poses a threat to the commercial fisheries of the state. Area closures or reductions in commercial harvests in order to insure adequate subsistence catches are a distinct possibility. There are even graver dangers in that federal agencies and federal courts will determine what constitutes legitimate subsistence activities. These issues should have been addressed here in Alaska through a meaningful dialogue with the parties concerned long ago.

Alaska should act at once to amend the state constitution to bring it into conformity with federal law. By so doing the state would regain control of subsistence management. Alaskan interest groups could then enter a dialogue to resolve the unique concerns of each without the outside pressure of the federal government affecting each of these groups in ways they may not be able to control. Alaskans would then be making these important decisions.

If elected I will propose and support a constitutional amendment providing rural preference for subsistence fisheries. Like any other amendment, it will be submitted to popular approval by the voters of the state. It is essential that Alaska regain management authority in this area for the good of all of our people.

The problem of low ex-vessel salmon prices is complex, yet the state can act in a number of ways to improve prices.

1. Forgive Hatchery Loans: The non-profit hatchery programs of NSRAA and SSRAA have been extremely successful in their biological enhancement efforts. These programs are funded by taxes on commercial fishers. Yet 40% of SSRAA returns must be taken in "cost recovery" to service the debt on state loans. These terminal harvests create a situation where fishermen are funding a program that competes with them economically.

   By forgiving the state loans as an investment in economic development, "cost recovery" hatchery harvests could be eliminated, and commercial fishers could realize the full benefits of enhancement. If elected I will introduce legislation to forgive all state loans to regional aquaculture associations currently in place.

2. Federal Purchases of Surplus Salmon from Processors: For the last six years, the federal government has purchased surplus canned and pouched pink salmon in an effort to reduce the salmon "glut" and improve market conditions for processors and fishermen. I will support efforts to assure fishermen receive direct benefit from these purchases.
3. Disclosure: The legislation passed this year requiring timely disclosure of first wholesale prices of all salmon products is a step in the right direction and I fully endorse this action. Fishermen cannot effectively bargain for ex-vessel prices without this knowledge. In terms of canned salmon, ex-vessel prices represented approximately 35% of the first wholesale value throughout the 1970s and has fallen to approximately 10% of the first wholesale value in recent years. This would indicate fishermen have not benefited from increased sales of sujiko, ikura and frozen products by some processors. By requiring processors to share this information, fishermen are in a better position to negotiate fair prices for their fish. Processors can be protected from compromising proprietary information while providing assurance to fishermen that they have data necessary to achieve fairness for their fish.
4. Study of Processor Salmon Tax: Alaska's oil revenues are based upon a severance tax. This tax is based upon a percentage of the average first wholesale price obtained by oil companies over a certain period of time. The salmon tax, by contrast, is based upon ex-vessel prices and is a deterrent to processors raising prices paid to fishermen. The legislature should undertake a study of tax revision in the salmon industry.

   As ex-vessel prices increase, tax liability increases for the processors are holding down fish prices. The percentage of first wholesale value paid fishermen was approximately 35% throughout the 1970s. Since that time, ex-vessel prices have eroded to approximately 10% of first wholesale value today. This trend should be reversed. Fishermen need to get fair value for fish if they are to survive and prosper.

   The current tax structure is a strong disincentive for processors to expand and add value to fish products because as processing is added the tax liability increases. Processors should be given incentives to process more product in Alaska by reducing their tax liability as value is added in-state. A restructuring could potentially increase profits for both fishermen and processors. It would also encourage and expansion of products produced and build jobs for Alaskans.

Alaska has a great deal at stake in building its economic future as the impact and resources of the oil industry continue to decline. Its efforts toward marketing Alaskan wild fish has declined to the point where its cost is shouldered solely by fishermen through ASMI. I propose the State of Alaska get involved in shouldering the responsibility to help build strong domestic and foreign markets for our most important renewable resource. Every increase in demand brings a direct return to Alaska fishermen and processors and it builds jobs. Foreign countries have been subsidizing farmed fish marketing in the United States for years. It is time to study the possibility of building a national coalition of fishers, processors and state governments to build a public-private partnership that will put an effective national marketing plan in place similar to those taken by dairy farmers, citrus growers and others.

I support increased funding for the ADF&G to do its job. We need accurate surveys of stock abundance in every fishery. Sound development of our resources requires research and accurate knowledge of what resources we have, what harvests are sustainable and what methods are appropriate for harvest and enhancement.

In terms of employment, the salmon industry affects more Alaskans than does the oil industry. It is time the Alaska Legislature paid attention to the needs of this renewable resource based industry and the people dependent upon it. For too long the "health of the industry" has been assessed in terms of multinational profits derived in Seattle, Vancouver and Tokyo. If elected, I will work to promote the interests of Alaska fishermen and to develop polices responsive to their needs.

VOTE GREG MIDDAG FOR STATE SENATE.
RUNNING FOR ALL THE RIGHT REASONS.