Federal legislation, including the Magnuson Stevens Fishery Conservation and Management Act and the American Fisheries Act, refer to the CDQ groups as nontaxable entities, said Robin Samuelsen, president and chief executive officer of the Bristol Bay Economic Development Corp., a CDQ entity representing 17 communities.

"We are all nonprofits," he said. "We are asking the Alaska congressional delegation to reaffirm our position, to say we need it resolved. We are not asking for anything we don't have already. We are just asking to have IRS codification."

Arne Fuglvog, a fisheries aide to Alaska Sen. Lisa Murkowski, confirmed that the congressional delegation on Jan. 30 had received the request from the six CDQ groups, but said the delegation's energies are currently focused on the proposed federal economic stimulus package.

"We will probably have to take a look at the request and evaluate the strategies and look at a way forward," said Fuglvog, a commercial fisherman and former member of the North Pacific Fishery Management Council, who has worked CDQ legislation for the past 15 years.

Larry Cotter, chief executive officer of another CDQ, the Aleutian Pribilof Island Community Development Association, was another of the top executives of the six CDQs who made the request of the congressional delegation.

His organization's situation is unique among the six groups, he said.

Like the other CDQs, his group was formed to improve the economy of the communities it represents, based on development of the fisheries. "But from the beginning, we believed we would be subject to federal and state corporation income taxes for unrelated business income," Cotter said.

"This has been an ongoing discussion for many years. There are two perspectives here and it is really a point of law, a matter of relying on your legal and tax advisors. We had one position we adopted and implemented, and the others had another position. At this point in time, it is still unclear which side is correct," he said. "All I know is we took the steps necessary to protect ourselves and to operate in the world as we saw it, where we are subject to tax for unrelated business income."

Since 1992, each of the CDQ groups has developed business relationships and harvesting agreements with fishing companies and vessels to harvest and process their annual allocations of red king crab, halibut and groundfish. The CDQs and their business partners work cooperatively and share in revenues generated by the sale of CDQ-related fisheries.

In all, 65 coastal communities within a 50-mile radius of the Bering Sea coastline participate in the program.

In 2007, the CDQ groups collectively generated nearly $170 million in revenues, and showed an increase in net assets of nearly $44 million.

Aggregated financial statements contained in the report of the Western Alaska Community Development Association noted that they had combined assets totaling more than $543 million and liabilities totaling just under $75 million, bringing combined net assets to $465 million.

Of the nearly $170 million in revenues, roughly 41 percent came from CDQ royalties. Direct income exceeded royalty income for the first time in 2004, and that pattern has continued since, with direct income ranging from 54 percent to 59 percent annually, the report said. What, if any, portion of that income may be taxable could be determined if the CDQs' request to Congress proceeds forward.

The revenues have allowed the CDQs to invest in the fisheries, training and scholarship programs, community infrastructure and other activities designed to create sustainable fisheries-based economies and alleviate poverty, said Samuelsen, who also serves as chair of the CDQ association.

The association also represents the Central Bering Sea Fishermen's Association, Coastal Villages Regional Fund, Norton Sound Economic Development Corp. and Yukon Delta Fisheries Development Association.

Margaret Bauman can be reached at margie.bauman@alaskajournal.com.