Stealth Revision of Alaska Fisherman’s Fund Completed

By Bob Tkacz

Uninsured Alaskan commercial fishers who are injured on the job should soon enjoy the first increase in 50 years in the payment they will receive to help cover their medical costs.

With no public testimony and a six-minute public hearing the bill that increased payments from Alaska Fishermen’s Fund was also amended to allow any skipper in Alaskan state fisheries who carries insurance to claim a payment up to $5,000 against their deductable expenses. Awaiting Gov. Sean Parnell’s expected signature, the bill allows skippers with protection and indemnity insurance for their crewmembers to claim the less of $5,000 or 50 percent of their policy deductable cost.

Whether the $11 million fund can handle the new generosity coming from the passage of SB 163 without an increase in fees from harvesters is uncertain because no long term projections of the new burden on the fund was ever done.

SB 163, sponsored by Fairbanks Sen. Joe Paskvan, started as a bill to increase the limit on payments from the fund to $10,000 from the 1959 limit of $2,500. The bill was introduced more than two-thirds of the way through the 90-day session after it became clear a twin proposal sponsored by Valdez Rep. John Harris was faced potentially unfriendly amendments in the Senate.

Harris introduced his bill, HB 207, in March of 2009. It reached the House Rules Committee on April 16, 2009 and never left again. Harris, senior assistant John Bitney explained, was fearful that his bill would be amended in ways he didn’t like while it was in the Senate and sent back to the House for a concurrence vote without the opportunity for Harris to fix his own bill.

As first introduced by Paskvan, SB 163 was identical to HB 207. It passed the Senate, 18-0, unamended, and got no hearing in any House standing committee until it was sent to the House Rules Committee where HB 207 was waiting, late in the session.

The Rules Committee is primarily a holding facility for bills until their sponsors show the chairperson they have enough votes in the majority caucus to win passage on the House floor. The committee also provides a last opportunity for corrections or amendments that were missed during the normal committee process.

When the Rules Committee met on April 9, a new version of SB 163 was introduced and quickly adopted with the “deductable” provision and other changes included.

Rep. Nancy Dahlstrom, the chair of the House Rules Committee this year, made clear at SB 163’s hearing that she didn’t want to waste time discussing the substance of any bill. “This committee is for technical changes, not whether a bill should or shouldn’t pass,” Dahlstrom said.
Jeff Hamburg, an aid to Paskvan, explained that, beside the $10,000 payment change the bill also provided authority for the Fishermen’s Fund Advisory and Appeals Council to rule on appeals for payments above the allowable limit. Since its inception the council, a panel of seven harvesters, has served as an appeals board on decisions by the commissioner of the Dept. of Labor on requests for higher payment amounts.

Through Feb. 8 for the fiscal year ending July 1 the council approved 58 payments in amounts between $2,500 and $10,000, including seven for payments greater than $20,000.

Unfortunately, the council never had the authority to approve higher payments. It acknowledged the lapse in a resolution it passed in April 2009 that also asked lawmakers the expanded authority.

State law, at least until the governor signs the bill, declares that the commissioner of labor must “consult” with the council before making a negative decision on an appeal for a higher payment. Under SB 163 the commissioner still gets the final word, but in a roundabout way on a question he or she may never be asked. The bill states that, subject to regulations now being written, the commissioner hears appeals of the council’s denial of appeals.

The Dept. of Labor projected just a $63,700 increase in draws on the fund from the increase in the payment cap alone. That estimate flies in the face of the department’s own data. Mike Monagle, manager of the Fishermen’s Fund, said it’s logical to assume every skipper carrying P&I insurance will apply to the fund for a payment but because the department has no count of the number of commercial fishing accidents per year the actual cost is “kind of a great unknown.”

The Fishermen’s Fund gets its money from a $50 payment from every limited entry permit holder, regardless of the number of permits they own, and a 39% share of crewmember license fees. That amounts to $48.75 of the $125 fee paid by nonresidents and $23.40 of the $60 paid by resident deckhands.

Unlike many fishermen’s benefits, payments from the fund are not limited to Alaskan residents. Over the past ten years nonresidents accounted for 16 to just over 39 percent of payments from the fund with the overall trend toward a higher share.

In the past four years benefit payments have outstripped revenues from $244,000 to $33,000. Through February of 2009, the fund had total expenses of $741,377 and receipts of $616,469. Monagle said at a Senate Finance Committee in February that the $11 million balance was “probably a higher amount” than needed.

“Because of the fund balance the council has been generous with some of the requests,” Monagle said. If the governor hasn’t already signed the bill he is likely to do so soon. If so Monagle expects to have a good idea of the bill’s real costs to the fund by the end of this summer.

The Labor Dept. supported passage of the bill and the governor gave no indication that he would veto it. “If the governor signs it in the next 30 days we will have a good idea (of actual costs) by the end of the summer,” Monagle said.