Koplin: Loss of fish tax revenues would be devastating

HB 65 would repeal refunds of millions of dollars to municipalities

Cordova Mayor Clay Koplin speaks to conference members at the 2018 annual Alaska Shellfish Grower's Association conference on Thursday, Dec. 6. (Photo by Emily Mesner/The Cordova Times)

Legislation aimed at repealing revenue sharing of fisheries business taxes with municipalities is drawing strong criticism from leaders of fisheries-based communities, including Cordova Mayor Clay Koplin, who says the results would be devastating.

The estimated total of the municipal share of the raw fish taxes collected in Alaska in fiscal year 2020 is $29.1 million.  The bill has so far been set aside in committee.

“Our fish tax revenues were just over $1,400,000 last year, and to put this in perspective, this represents 15 percent of our general fund revenues,” Koplin told that Alaska House Fisheries Committee during a teleconferenced call to Juneau on April 25.

“There is no way that Cordova can cut beyond the $1,000,000 we have cut from our operating budget over the past two years and continue to keep our hospital, which is hanging on by a thread, and our schools, which have consumed all of our reserves to maintain a quality educational program, in operation without adding severe local taxes, which will cripple our economy,” he said.

“The tragedy,” said Koplin, “is that Cordova is positioned to grow into (one of) the top five seafood ports in the nation, alongside Kodiak and Dutch Harbor, and have strategically passed bonds and a one-half percent local fish tax and wharfage fee increases to renovate our formerly state-owned harbor and position for that growth. The effort we have put into doubling our fish tax over the past 10 years would be undermined by the state robbing all the fruits of those efforts.”

Kodiak Mayor Pat Branson, also noting the financial responsibilities that Kodiak has for its own former state port infrastructures, said the analysis behind the Dunleavy administration’s proposed legislation to repeal sharing of those fish taxes “lacks understanding of living in a resource economy in a geographically remote location. Cost shifting and revenue grabbing is not budget solving,” she said.


“For many this is the community’s largest revenue source,” said Unalaska Mayor Frank Kelty.

Loss of this money would be devastating to Unalaska, the nation’s top fishing port by volume of seafood deliveries. “The fishing industry of the Bering Sea is our only industry,” Kelty said.

“All other taxes would have to be raised if they lost the shared fisheries taxes. We use local tax revenues to pay our own way,” he said. “We maintain the roads, the school district, local medical clinic and local non-profits.”

The city of Unalaska recently completed a $40 million container dock, which was totally bonded by the city, he noted. “Fishing communities in Alaska produce 56 percent of the nation’s seafood,” he said. “We need to keep these communities strong.”

Gary Henning, city administrator for King Cove, also echoed the importance of shared fish taxes to that city’s budge, saying that without it King Cove would face a reduction in city services and employment in this Aleutian Chain community where the major employer of many years is Peter Pan Seafoods.

The fish tax for the city and borough of Yakutat brings in about $267,000, said Jon Erickson, city and borough manager. “We own the seafood dock and we plow the money right back into the dock. It is impossible for us to make up that amount.”

Testimony from Dillingham and Akutan also urged not passing HB 65 out of committee.

Nils Andreassen, executive director of the Alaska Municipal League, told legislators that if passed that HB 65 would impact one third of all communities in Alaska.

“It is relative not just for all coastal communities, but all communities,” he said. Those dollars share from fish taxes help the health and welfare of communities and improve their credit ratings, he said. Loss of these dollars would reduce quality of life programs, and result in job losses too, he said.

This bill, said Rep. Louise Stuttes, R-Kodiak, and chair of House Fisheries, “simply shifts the state burdens to local governments, who will be forced to raise taxes. I see no rational on why these communities should not share in taxes that support their fisheries infrastructure.”

HB 65 would severely cripple coastal communities in their ability to support infrastructure and families living there, she said.

Other committee members also spoke in support of continued sharing of these fish taxes, including Rep. Garen Tarr, D-Anchorage; Chuck Kopp, R-Anchorage; and Jonathan Kreiss-Tomkins, D-Sitka.