Court sides with state on fishing fees

1984 suit filed by nonresident commercial fishermen claims higher fees are unfair

Posted: Friday, October 17, 2003

ANCHORAGE - The U.S. Supreme Court for the second time has refused to hear arguments in a 19-year fight over the higher fees Alaska charges nonresident commercial fishermen.

"This is a positive step that will allow the Alaska courts to continue on their way toward resolving this long-standing dispute," said Attorney General Gregg Renkes.

At stake is about $50 million in back fees and interest the state may have to pay if the class action lawsuit ultimately tilts against Alaska.

But the state attorney litigating the dispute says Alaska is unlikely to have to pay anything close to that. Instead, he will argue that over the years Outside commercial fishermen have paid on average about 16 cents too much when all the different classes of fees are calculated.

"Our argument is 16 cents is within the bounds of substantial compliance. If we prevail and convince the court this is the way to look at it, we won't owe anything," said Stephen White, the assistant attorney general who argued the case.

A class action was filed in 1984 by nonresident commercial fishermen who paid triple what in-state fishermen do to fish Alaska waters. For some permit holders, the nonresident fee would amount to $750 a year, versus $250 for residents.

The Alaska Supreme Court, which has ruled three times in the case, has said the state may charge somewhat higher fees for nonresidents.

But the state's high court said Alaska may charge only enough to compensate for the added enforcement burden or for any conservation expenses from taxes that only residents pay.

Because Alaska does not impose a statewide tax, the courts have construed state revenue from oil as taxes. The reasoning is that Alaskans, including commercial fishermen, own the oil.

Juneau attorney Loren Domke filed the lawsuit after the state tried to require a resident to pay the higher amount, arguing he spent too much time Outside.

Domke could not be reached for comment on Thursday but he has argued that the state's fee structure violates the federal Commerce Clause.

The U.S. Constitution bars states from interfering with interstate commerce and these higher fees do just that, he told The Associated Press in March.

This marks the second time the U.S. Supreme Court has refused to consider the arguments of the plaintiffs in the lawsuit, Renkes said.

During the course of the litigation, the courts have fashioned a complex formula for determining the difference between out-of-state and in-state fees.

Now the case goes back to Anchorage Superior Court Judge Peter Michalski to determine whether nonresidents have paid too much in the intervening years under this formula, White said.

By the state's calculations, nonresident fishermen paid an average of $141.97 more than nonresidents, White said. Under the formula, the state could have charged about $141.81 more, White said. The difference - 16 cents - is close enough to be considered fair, he said.

That's not what all Outside permit holders paid and, in fact, most crew members paid very low fees, White said. Over time, about 80 percent of out-of-state fishermen paid less than was allowable, White said.

Currently, nonresident fishermen are charged a flat $115 above the rate of commercial permits and fees, said Mary McDowell, of the state Commercial Fisheries Entry Commission.

Last year, the state sold 16,553 in-state permits and 4,675 nonresident permits, McDowell said.

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