Owner state share?

Alaska Department of Fish and Game graphic

The Bristol Bay Regional Seafood Development Association (BBRSDA) is touting the Southwest Alaska fishery as worth more than $2.2 billion in 2019, but most of that wealth appears to leave the so-called “owner state.”

Of the $2.2 billion, only $990 million – or about 45 percent – circulates in the Alaska economy, according to a report prepared for the Bristol Bay Defense Fund by the McKinley Research Group and now being circulated by the BBRSA.

The late Gov. Walter J. Hickel long promoted Alaska as owner state based on a unique state constitution that stipulates “fish, wildlife, and waters are reserved to the people for common use” and are to be managed “for the maximum benefit of (Alaska’s) people.”

Buoyed by global warming, sockeye (red) salmon harvests in the Bay have been booming for a decade, but most of the benefit appears to have been accruing to Outside businesses and fishermen.

More than 116,000 salmon totaling almost 504,000 pounds did go to the common use of 40 Alaska communities, “including many beyond Bristol Bay,” in 2019, the report says.

But the catch of 44.5 million salmon in the commercial fisheries dwarfed that so-called “subsistence” take. What the owners of the owner state got out of the commercial catch is hard to tell from the full report.

It does say that from fiscal years 2018 through 2020 “the state’s annual retained portion” of tax revenue from the catches “averaged $5.1 million.” The state collected more than $5.4 million per year on average, according to the report, but some of those funds are shared with communities in the region.

The state’s main revenue from Bay fisheries comes from a 1 percent to 5 percent “Fisheries Business Tax,” commonly referred to as “raw fish tax,” imposed on salmon delivered to processors in the region.

The tax has sometimes been criticized as inadequate in that the state loses money on the salmon-fishing business when the costs of management and policing exceed revenues. The report didn’t get into this issue, but did promote “additional salmon-derived benefits and activities” in the form of fisheries-associated public sector jobs in the Bay.

“The State of Alaska Department of Fish and Game is responsible for regulating the salmon fisheries in Bristol Bay,” the report notes. “Alaska Department of Fish and Game workers, including 50 fish and wildlife technicians, two fish and game program technicians, three biologists, and one maintenance person, support the commercial fishing industry in Bristol Bay. All together (six), these 56 employees earn $5.3 million in wages including cost-of-living-allowances and premium pay.”

Those numbers would indicate the state is as a whole is subsidizing the Bay fishery to the tune of $200,000 per year before the costs of policing by the Alaska Wildlife Troopers are factored in.

Jobs, jobs, jobs

The big return for the subsidy comes in the form of employment, which is largely seasonal. The report puts total employment in the fishery at 15,000, but the devil is in the details.

Approximately 8,500 of the people involved in the fishery are employed “harvesters,” according to the report’s summary. Forty-seven percent of them – 4,000 – live somewhere other than Alaska. Of the other 4,500, 56 percent – 2,500 – live somewhere in Alaska other than the Bay, most commonly in the Anchorage Metropolitan area home to most of the state’s population.

Many of the 2,000 commercial fishermen left living in the Bay are set gillnetters who fish low-budget, shore-based operations that, according to the report, earned them a total of $50 million in 2019, or about $25,000 per fisherman.

Including that $50 million, the full report says, “Alaska resident fishermen earned $151 million from Bristol Bay salmon in 2019….Non-resident fishermen earned an additional $192 million in 2019.”

By that measure, about 56 percent of the funds paid Bay fishermen in 2019 went into the pockets of people living somewhere other than Alaska.

Most of those non-resident fishermen are drift gillnetters who are in the Bay for only a couple of months per year, although some may be involved in commercial fishing elsewhere in the state during the rest of the year.

Along with 8,000 commercial fishermen, the report says, 6,000 people are employed in processing salmon during the season. The report does not say how many of them are non-residents, but according to the Alaska Department of Labor, non-residents filled an average of just over 87 percent of those jobs in the 10 years from 2009 to 2018.

The percent of wages they took home when they left the state ranged from 83.5 percent in 2013 to 91.1 percent in 2016.

Bristol Bay has seen monster returns of sockeye (red) salmon in recent years and partly as a result, the number of jobs has steadily increased since 2010. Some of the increase, however, may be tied to turnover.

Working in a fish processing plant is not a coveted job in the U.S., and thus the industry often has to resort to recruiting foreign workers on temporary visas.  They, like many of the commercial fishermen, are in-country for the short warm season and then gone.

According to the report, those 15,000 Bay jobs are the equivalent of but 3,770 full-time jobs. Surprisingly, the region’s small tourism industry does better in translating seasonal employment into earnings over the longer term.

When the report’s authors analyzed the 2,300 seasonal “visitor industry” jobs, they annualized them to the equivalent of 1,400 jobs. But the visitor industry is small potatoes in the bay.

Its $155 million in in-state economic output in 2019 was less than a sixth of the $990 million in in-state output coming out of the commercial sector.

Whether Alaska salmon are worth more in commercial or sport fisheries in Alaska has become a much-debated topic in some areas of the state in recent years as commercial fishermen and anglers fight for bigger allocations of a limited catch.

The Bay study would indicate that on a fish-by-fish basis, salmon are more valuable in the sport fisheries than the commercial fisheries, but only if the demand is there to ensure a harvest.

A salmon caught by no one benefits only nature.

Far, far away

The bears of the Bay almost surely catch more salmon there now than any visiting anglers.

According to the report, the Bay near the far northwestern edge of the North American continent attracts only 40,000 to 50,000 visitors per year to watch grizzly bears, fish for sport, camp, hike, hunt, sightsee or otherwise enjoy the surrounding wilderness.

Disneyland, for comparison, reported an average daily attendance of 51,139 in 2019. But it is in the Los Angeles Metropolitan Area home to more than 18.7 million people.

The Bay is the global opposite of the LA. It is now home to only about 7,000 people scattered across 40,000 square miles, an area the size of Ohio. Bears are extremely difficult animals to census accurately, but there are indications the bears in the area might well outnumber the people.

The report does indicate the few tourists who do visit the area bring and leave a significant amount of wealth behind. Thirty-three sport fishing lodges in the region reported serving 14,000 anglers in 2019, “with total spending estimated at $77 million,” the report said.

That comes out to an average of about $5,500 left by every angler visiting the region.

Bear viewing now appears to have surpassed angling as the top visitor attraction in the area, according to the report, but the bear viewers do not spend nearly as much money, largely because of the in-and-out nature of their visits.

Most of them are day-trippers dropping in on small planes from Anchorage or the Kenai Peninsula, and those that stay at the few bear-viewing lodges in the region tend to linger for less time than anglers.

The one thing they all share with commercial fishermen is that they are largely in the Bay and gone. The Bay is a place where many visit but few stay.

The economic report was prepared for the Bay Defense Fund as part of its ongoing effort to block development of the Pebble copper mine in the Lake Iliamna drainage of the Bay.

“Overall, the numbers show that the world’s last great wild sockeye run is an economic powerhouse that must not be endangered by the proposed Pebble Mine, and comes as tribes, commercial fishermen, sportsmen, conservationists and others have called on President Biden and the Environmental Protection Agency (EPA) to use the Clean Water Act to protect Bristol Bay,” the BBRSDA says on its website. 







3 replies »

  1. Thinking of how many Bay limited entry permits were originally held by Alaskans, particularly Bay residents, as compared with the greatly decreased number today, it is so “too bad.” Being one who sold to an outsider, I well understand that each seller had his own usually carefully considered reasons for deciding to sell out, and made his own choice of who to sell to. All in all, however, it resulted in what could have been an increased Alaskan economy and especially a far more vibrant Bay village economy being handed away. We can only lament that we did it to ourselves. I am reminded of Esau, in his hunger, selling his inheritance away to brother Jacob, for a bowl of pottage.

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