Prince William Sound Aquaculture Corporation (PWSAC) was incorporated on December 30, 1974 in Alaska as a nonprofit corporation.  It was designated to be tax exempt by the Internal Revenue under Code § 501(c)(3).  The State of Alaska has recognized PWSAC as a qualified regional association under the terms of Chapter 161 of the 1976 Session Laws.
From its origin, the hatchery system was intended to protect the fisheries from cyclical weaknesses in the wild salmon returns.  During the 1970’s, salmon runs were in decline throughout the state.  In Prince William Sound, seining did not open at all in 1972 and 1974 because the wild returns were so low.
Under the leadership of Governor Egan and Governor Hammond from 1974 to 1982, the State of Alaska began a major effort to restore Alaska’s salmon fisheries.  The Fisheries Rehabilitation, Enhancement, and Development (FRED) Division was created within the Department of Fish and Game in 1971.  A constitutional amendment provided the basis for Limited Entry legislation for commercial salmon fisheries, and for passage of the private, non-profit Hatchery Act in 1974.
The state adopted the user-group structure in a 1976 amendment to the private non-profit hatchery statutes.  Today, five regional aquaculture associations from Southeast Alaska to Kodiak produce salmon via the wild salmon enhancement program for the common property fisheries.
Alaska statutes provide that aquaculture associations may only be nonprofit.  By design, the associations are allowed to recover operating and capital expenses, costs for research and development, and expansion of the production system, including wild stock rehabilitation work.  The system is designed to provide benefits to the common property resource users.  These private non-profit (PNP) associations have no stockholders, owners, or members.
Fish Sales:  PNP associations may harvest and sell a portion of their returning adult salmon for cost recovery.  At PWSAC, the management policy is to define target revenue goals to meet their annual budget needs.  Annual Management Plans stating how many fish will be harvested to meet those revenue goals are submitted to the Alaska Commissioner of Fish and Game for approval.  PWSAC licenses a portion of the returning hatchery-born salmon for a fee to processors who in turn catch and sell the fish within the hatchery special harvest areas.  The live fish are valuable to the processors because of their absolute freshness and dependable availability.
Enhancement Tax:  This revenue source is available only to those PNPs which are classed as regional aquaculture associations.  By state law, salmon permit holders in their regional area can vote in an enhancement tax in whole number increments up to 30%.  In March 1985, the Department of Commerce and Economic Development conducted a written ballot election.  This election voted in a 2% salmon enhancement tax for the Area E salmon permit holders.  Every salmon permit holder at that time was mailed a ballot.  The enhancement tax was voted in with 73% of the voters in favor of the tax.  The tax is levied on the gross income from salmon deliveries in the region.  The tax is collected by the processors, submitted to the Department of Revenue, allocated to the Department of Commerce by legislative action, and then disbursed to the corporation on an annual basis after July 1 each year.  The average annual enhancement tax revenue amount is approximately $1.5 million.
Revolving Loan Funds:  Alaska aquaculture associations are eligible to apply for loans from the Alaska Fisheries Enhancement Revolving Loan Fund, which can provide funds for capital construction and operations.  PWSAC has made use of this fund primarily for hatchery construction.