[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]
CATCH SHARES AS A
MANAGEMENT OPTION:
CRITERIA FOR ENSURING
SUCCESS--PARTS 1 & 2
=======================================================================
OVERSIGHT HEARINGS
before the
SUBCOMMITTEE ON INSULAR AFFAIRS,
OCEANS AND WILDLIFE
of the
COMMITTEE ON NATURAL RESOURCES
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED ELEVENTH CONGRESS
SECOND SESSION
__________
Tuesday, March 16, 2010 and Thursday, April 22, 2010
__________
Serial No. 111-48
__________
Printed for the use of the Committee on Natural Resources
Available via the World Wide Web: http://www.gpoaccess.gov/congress/
index.html
or
Committee address: http://resourcescommittee.house.gov
U.S. GOVERNMENT PRINTING OFFICE
55-542 WASHINGTON : 2010
-----------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing
Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC
area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC, Washington, DC
20402-0001
COMMITTEE ON NATURAL RESOURCES
NICK J. RAHALL, II, West Virginia, Chairman
DOC HASTINGS, Washington, Ranking Republican Member
Dale E. Kildee, Michigan Don Young, Alaska
Eni F.H. Faleomavaega, American Elton Gallegly, California
Samoa John J. Duncan, Jr., Tennessee
Frank Pallone, Jr., New Jersey Jeff Flake, Arizona
Grace F. Napolitano, California Henry E. Brown, Jr., South
Rush D. Holt, New Jersey Carolina
Raul M. Grijalva, Arizona Cathy McMorris Rodgers, Washington
Madeleine Z. Bordallo, Guam Louie Gohmert, Texas
Jim Costa, California Rob Bishop, Utah
Dan Boren, Oklahoma Bill Shuster, Pennsylvania
Gregorio Sablan, Northern Marianas Doug Lamborn, Colorado
Martin T. Heinrich, New Mexico Adrian Smith, Nebraska
George Miller, California Robert J. Wittman, Virginia
Edward J. Markey, Massachusetts Paul C. Broun, Georgia
Peter A. DeFazio, Oregon John Fleming, Louisiana
Maurice D. Hinchey, New York Mike Coffman, Colorado
Donna M. Christensen, Virgin Jason Chaffetz, Utah
Islands Cynthia M. Lummis, Wyoming
Diana DeGette, Colorado Tom McClintock, California
Ron Kind, Wisconsin Bill Cassidy, Louisiana
Lois Capps, California
Jay Inslee, Washington
Joe Baca, California
Stephanie Herseth Sandlin, South
Dakota
John P. Sarbanes, Maryland
Carol Shea-Porter, New Hampshire
Niki Tsongas, Massachusetts
Frank Kratovil, Jr., Maryland
Pedro R. Pierluisi, Puerto Rico
Vacancy
James H. Zoia, Chief of Staff
Rick Healy, Chief Counsel
Todd Young, Republican Chief of Staff
Lisa Pittman, Republican Chief Counsel
------
SUBCOMMITTEE ON INSULAR AFFAIRS, OCEANS AND WILDLIFE
MADELEINE Z. BORDALLO, Guam, Chairwoman
HENRY E. BROWN, JR., South Carolina, Ranking Republican Member
Dale E. Kildee, Michigan Don Young, Alaska
Eni F.H. Faleomavaega, American Jeff Flake, Arizona
Samoa Doug Lamborn, Colorado
Frank Pallone, Jr., New Jersey Robert J. Wittman, Virginia
Gregorio Sablan, Northern Marianas John Fleming, Louisiana
Donna M. Christensen, Virgin Jason Chaffetz, Utah
Islands Bill Cassidy, Louisiana
Diana DeGette, Colorado Doc Hastings, Washington, ex
Ron Kind, Wisconsin officio
Lois Capps, California
Carol Shea-Porter, New Hampshire
Frank Kratovil, Jr., Maryland
Pedro R. Pierluisi, Puerto Rico
Nick J. Rahall, II, West Virginia,
ex officio
Vacancy
------
CONTENTS
----------
Page
Hearing held on Tuesday, March 16, 2010.......................... 1
Statement of Members:
Bordallo, Hon. Madeleine Z., a Delegate in Congress from Guam 1
Prepared statement of.................................... 2
Brown, Hon. Henry E., Jr., a Representative in Congress from
the State of South Carolina................................ 3
Prepared statement of.................................... 4
Hastings, Hon. Doc, a Representative in Congress from the
State of Washington........................................ 5
Prepared statement of.................................... 6
Jones, Hon. Walter B., a Representative in Congress from the
State of North Carolina, Prepared statement of............. 118
Statement of Witnesses:
Backus, Edward H., Vice President, Community Ecosystem
Services, Ecotrust......................................... 39
Prepared statement of.................................... 41
Response to questions submitted for the record........... 48
Cobb, Leesa, Executive Director, Port Orford Ocean Resource
Team....................................................... 54
Prepared statement of.................................... 57
Response to questions submitted for the record........... 62
Fina, Mark, Ph.D., J.D., Senior Economist, North Pacific
Fishery Management Council................................. 21
Prepared statement of.................................... 22
Response to questions submitted for the record........... 30
Rosenberg, Andrew A., Ph.D., Senior Vice President for
Science and Knowledge, Conservation International.......... 34
Prepared statement of.................................... 36
Schwaab, Eric, Assistant Administrator for Fisheries,
National Marine Fisheries Service, National Oceanic and
Atmospheric Administration, U.S. Department of Commerce.... 7
Prepared statement of.................................... 9
Response to questions submitted for the record........... 12
Additional materials supplied:
Anderson, Lee, University of Delaware; Trevor A. Branch,
University of Washington; Mark Carr, University of
California, Santa Cruz; Christopher Costello, University of
California, Santa Barbara; David B. Eggleston, North
Carolina State University; Steven D. Gaines, University of
California, Santa Barbara; John C. Ogden, University of
South Florida; Michael K. Orbach, Nicholas School of the
Environment, Duke University; Stephen Palumbi, Stanford
University; Charles H. Peterson, University of North
Carolina at Chapel Hill; Pete Raimondi, University of
California, Santa Cruz; James N. Sanchirico, University of
California, Davis; Wolfram Schlenker, Columbia University;
and Bob Steneck, University of Maine, Letter submitted for
the record................................................. 87
Arnold, Stephen A., Kingston Trawlers, Inc., West Kingston,
Rhode Island, Statement submitted for the record........... 90
Bowman, Ben, Policy Analyst, Food & Water Watch, Washington,
D.C., Letter and attachment submitted for the record....... 90
Brooks, Glen, President, Gulf Fishermen's Association, Letter
submitted for the record................................... 95
Carroll, Richard, Ocean Gold Seafoods Inc., Westport,
Washington, Statement submitted for the record............. 97
?
Christiansen, Fred, Chairman, and Gale K. Vick, Executive
Director, Gulf of Alaska Coastal Communities Coalition
(GOAC3), Joint statement submitted for the record.......... 98
de Poutiloff, Mary Beth, Fisherwoman, F/V Blue Ocean, F/V
Patience Too, Provincetown, Massachusetts, and Harrington,
Maine, Statement submitted for the record.................. 106
Dochtermann, Shawn C., Executive Director, Crewman's
Association, Statement and attachments submitted for the
record..................................................... 107
Dooley, Robert E., President, United Catcher Boats, Seattle,
Washington, Statement submitted for the record............. 82
Hansen, Kathy, Executive Director, Southeast Alaska
Fishermen's Alliance, Juneau, Alaska, Letter submitted for
the record................................................. 117
Kozak, Linda, Consultant, Crab Group of Independent
Harvesters, Kodiak, Alaska, Statement submitted for the
record..................................................... 119
Odlin, James A., Commercial Fisherman, Portland, Maine,
Statement submitted for the record......................... 122
Phillips, Mark, F/V/ Illusion, Greenport, New York, Statement
submitted for the record................................... 123
Poulsen, Edward, Executive Director, Inter-Cooperative
Exchange Policy Advocacy Committee, Statement submitted for
the record................................................. 124
Preble, David E., Narragansett, Rhode Island, Rhode Island
Representative, New England Fishery Management Council
(NEFMC), U.S. Commissioner to the Northwest Atlantic
Fisheries Organization (NAFO), Statement submitted for the
record..................................................... 126
Shackelford, Britton, President, North Carolina Watermen
United, Letter submitted for the record.................... 127
Swetzof, The Honorable Simeon, Jr., Mayor, City of Saint Paul
Island, Alaska, Statement submitted for the record......... 128
Taufen, Stephen, Groundswell Fisheries Movement, Kodiak,
Alaska, Statement submitted for the record................. 130
Zuanich, James and Shirley, Bellingham, Washington, Letter
submitted for the record................................... 136
(iv)
CONTENTS
----------
Page
Hearing held on Thursday, April 22, 2010......................... 139
Statement of Members:
Bordallo, Hon. Madeleine Z., a Delegate in Congress from Guam 139
Prepared statement of.................................... 140
Brown, Hon. Henry E., Jr., a Representative in Congress from
the State of South Carolina................................ 141
Prepared statement of.................................... 141
Statement of Witnesses:
Alexander, Captain Terry Arnold, Fishing Vessels Jocka and
Rachel T................................................... 204
Prepared statement of.................................... 205
Response to questions submitted for the record........... 206
Angers, Jefferson, President, Center for Coastal Conservation 163
Prepared statement of.................................... 164
Response to questions submitted for the record........... 167
Donofrio, James A., Executive Director, Recreational Fishing
Alliance................................................... 182
Prepared statement of.................................... 184
Response to questions submitted for the record........... 188
Dooley, Robert E., President, United Catcher Boats........... 190
Prepared statement of.................................... 191
Goethel, Captain David T., Owner/Operator, Fishing Vessel
Ellen Diane................................................ 142
Prepared statement of.................................... 144
Response to questions submitted for the record........... 146
Magras, Julian, Chairman of the Board, St. Thomas Fishermen's
Association................................................ 149
Prepared statement of.................................... 150
Response to questions submitted for the record........... 153
Moody, Captain Wayne, Fishing Vessel Capriccio, and Member,
Board of Directors, Morro Bay Commercial Fishermen's
Organization............................................... 154
Prepared statement of.................................... 156
Response to questions submitted for the record........... 161
Rothschild, Brian, Ph.D., Montgomery Charter Professor of
Marine Science and Technology, University of Massachusetts
Dartmouth.................................................. 194
Prepared statement of.................................... 195
Response to questions submitted for the record........... 201
Additional materials supplied:
Allen, Richard B., Commercial Fisherman and Fishery
Consultant, Westerly, Rhode Island, Statement submitted for
the record................................................. 213
Bellavance, Rick, President, Rhode Island Charter and Party
Boat Association, Statement submitted for the record....... 215
Charterboat and Headboat Captains in the Gulf of Mexico,
Letter submitted for the record............................ 216
de Poutiloff, Mary Beth, Scallop Fishing Family, F/V Patience
Too, Provincetown, Massachusetts, Letter submitted for the
record..................................................... 220
Dochtermann, Shawn C., Executive Director, Crewman's
Association,
F/V Isanotski, Kodiak, Alaska, Statement submitted for the
record..................................................... 221
Food & Water Watch, Washington, DC, Letter submitted for the
record..................................................... 223
Fussell, Troy, Gulf of Mexico Reef Fish Fisherman, F/V Irma
Lee, Morriston, Florida, Statement submitted for the record 224
Gilmore, Jim, At-sea Processors Association, Statement
submitted for the record................................... 227
Grachek, Dick, Stonington, Connecticut, and Point Judith,
Rhode Island, Statement submitted for the record........... 229
Lewis, Brian, Clearwater, Florida, Email submitted for the
record..................................................... 241
?
Mack, Hon. Henry, Mayor, City of King Cove, Alaska, Letter
submitted for the record................................... 244
Mack, Hon. Stanley, Mayor, Aleutians East Borough, Letter
submitted for the record................................... 245
Marchand, A. Pierre, President, Jessie's Ilwaco Fish Co,
Inc., Letter submitted for the record...................... 246
Mose, Brian, Nanoose Bay, British Columbia, Canada, Letter
submitted for the record................................... 247
Norvell, Bernard, Sr., F/V Donna J,; Michelle Tarantino-
Norvell; Vince Doyle, F/V Verna Jean 3; Tom and Shelley
Estes, F/V Tara Dawn; Brian Jourdain, F/V Blue Pacific;
Richard Kelley, F/V Miss Hailee, F/V Miss Kelley, F/V Miss
Kelley II; and Randall Schlect, F/V Northern Light, Fort
Bragg, California, Statement submitted for the record...... 248
Pennisi, Giovanni (John), F.V. Irene's Way, Monterey,
California, Letter submitted for the record................ 250
Robinson, M. Sunny, on behalf of Citizens for Gloucester
Harbor, Gloucester, Massachusetts, Letter submitted for the
record..................................................... 250
Selby, Hon. Jerome M., Borough Mayor, Kodiak Island Borough,
Letter and resolution submitted for the record............. 252
Walker, Captain David, Letter submitted for the record....... 255
(vi)
OVERSIGHT HEARING ON ``CATCH SHARES AS A MANAGEMENT OPTION: CRITERIA
FOR ENSURING SUCCESS''
----------
Tuesday, March 16, 2010
U.S. House of Representatives
Subcommittee on Insular Affairs, Oceans and Wildlife
Committee on Natural Resources
Washington, D.C.
----------
The Subcommittee met, pursuant to call, at 10:05 a.m. in
Room 1324, Longworth House Office Building, Hon. Madeleine Z.
Bordallo [Chairman of the Subcommittee] presiding.
Present: Representatives Bordallo, Christensen, Capps,
Shea-Porter, DeFazio, Brown, Wittman, Chaffetz, Cassidy,
Inslee, and Hastings.
STATEMENT OF HON. MADELEINE Z. BORDALLO, A DELEGATE TO CONGRESS
FROM THE TERRITORY OF GUAM
Ms. Bordallo. The oversight hearing by the Subcommittee on
Insular Affairs, Oceans, and Wildlife will now come to order.
Today we will hear testimony on ``Catch Shares as a
Management Option: Criteria for Ensuring Success.''
Rebuilding fisheries has clear, ecological, and economic
benefits for fish and fishers. To achieve these benefits,
fisheries must be managed using the best available science and
a suite of management tools, including catch restrictions and
gear modifications.
Included in these tools are catch shares, in which
individual fishermen, cooperatives, or communities are
allocated a specific portion of a total allowable catch.
The management of fisheries using catch shares has thus far
been limited in the United States. However, under the new
Administration, the National Oceanic and Atmospheric
Administration has taken steps to actively promote the use of
this particular tool, through a draft policy and a Fiscal Year
2011 budget request of $54 million for a national catch share
program.
There is no universal agreement on the merits of the use of
catch shares. Proponents argue that they reduce bycatch,
increase efficiency, and enhance the industry's role in
fisheries conservation.
Opponents, on the other hand, are concerned that catch
shares will result in fleet consolidation and the loss of
fishing communities. The amount of anecdotal evidence to
support either side is considerable, but research about the
impacts of catch shares on both the fish and the fishers is
quite slim.
One thing is clear. As we continue to rebuild fisheries in
the United States, there will be much debate about which tools
are most effective and appropriate for different fisheries.
What everyone seems to agree on, however, is a growing need for
better data to make those management decisions. Because before
any tool, including catch shares, can be implemented, managers
must determine how much fish can actually be caught.
In fact, the Regional Fishery Management Councils are
required to set annual catch limits, or ACLs, and
accountability measures by 2010 for all fisheries subject to
overfishing, and for all other fisheries by 2011. Establishing
ACLs and accountability measures require the most current
information possible. Yet many stock assessments are outdated,
and NOAA's new Recreational Fishing Data program is still not
providing timely information needed to make management
decisions.
Investing in stock assessments, cooperative research, and
collecting more accurate and timely recreational fishing
information should be the highest priority. But these programs
did not receive increases in the President's budget request,
while the Catch Share program enjoyed an increase of more than
100 percent.
The concern of some Members of Congress and some in the
industry is that this push for catch shares by the agency is
coming at the expense of other management responsibilities and
fundamental data needs.
So I look forward to hearing from our witnesses today to
better understand how catch share programs, if well designed,
can be a valuable tool in our management toolbox to sustain
healthy fish populations and fishing communities. Still, we
must ensure that the push to adopt catch shares does not
undermine the fundamental data needs that all fisheries
management plans must be built on.
Now it is my pleasure to recognize Mr. Brown, the Ranking
Republican Member of the Subcommittee, for any statement that
he may have.
[The prepared statement of Chairwoman Bordallo follows:]
Statement of The Honorable Madeleine Z. Bordallo, Chairwoman,
Subcommittee on Insular Affairs, Oceans and Wildlife
Rebuilding fisheries has clear ecological and economic benefits for
fish and fishers. To achieve these benefits, fisheries must be managed
using the best available science and a suite of management tools,
including catch restrictions and gear modifications. Included in these
tools are ``catch shares'', in which individual fishermen,
cooperatives, or communities are allocated a specific portion of a
total allowable catch.
Management of fisheries using catch shares has thus far been
limited in the United States. However, under the new Administration,
the National Oceanic and Atmospheric Administration has taken steps to
actively promote the use of this particular tool through a draft policy
and a Fiscal Year 2011 budget request of $54 million for a National
Catch Share Program.
There is no universal agreement on the merits of the use of catch
shares. Proponents argue that they reduce bycatch, increase efficiency,
and enhance the industry's role in fisheries conservation. Opponents
are concerned that catch shares will result in fleet consolidation and
the loss of fishing communities. The amount of anecdotal evidence to
support either side is considerable, but empirical research about the
impacts of catch shares, on both the fish and the fishers, is quite
slim. One thing is clear--as we continue to rebuild fisheries in the
United States, there will be much debate about which tools are most
effective and appropriate for different fisheries. What everyone seems
to agree on, however, is growing need for better data to make those
management decisions, because before any tool, including catch shares,
can be implemented, managers must determine how much fish can actually
be caught.
In fact, the Regional Fishery Management Councils are required to
set annual catch limits, or ACLs, and accountability measures by 2010
for all fisheries subject to overfishing, and for all other fisheries
by 2011. Establishing ACLs and accountability measures require the most
current information possible, yet many stock assessments are outdated
and NOAA's new recreational fishing data program is still not providing
timely information needed to make management decisions. Investing in
stock assessments, cooperative research, and collecting more accurate
and timely recreational fishing information should be the highest
priority, but these programs did not receive increases in the
President's budget request, while the catch share program enjoyed an
increase of more than 100%. The concern of some Members of Congress and
some in the industry is that this push for catch shares by the agency
is coming at the expense of these other management responsibilities and
fundamental data needs.
I look forward to hearing from our witnesses today to better
understand how catch share programs--if well designed--can be a
valuable tool in our management tool box to sustain healthy fish
populations and fishing communities. Still, we must ensure that the
push to adopt catch shares does not undermine the fundamental data
needs that all fisheries management plans must be built on.
______
STATEMENT OF HON. HENRY E. BROWN, JR., A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF SOUTH CAROLINA
Mr. Brown. Thank you, Madame Chair. Just a few weeks ago,
thousands of fishermen--recreational, charter, commercial
fishermen--came to Washington, D.C., to air their concerns
about the direction fishery management has taken in this
country. Rarely do we see all the fishery sectors speaking with
one voice, but in this case we did.
The fishermen came to D.C. to make sure we heard their
concerns that Federal agencies are making decisions without
good science, and that agencies ignore the fishermen when
making fishery management decisions. I share their concerns.
If the agency cannot collect adequate information on how
many fish are out there, how can they set harvest levels? If
they do not collect the adequate information on the harvest
levels of recreational and commercial fishermen, how will they
know how many fish are being taken?
This is not rocket science, but it does take money. It
seems that while the agency is willing to increase funding by
$810 million for one satellite program to gather climate
information, it apparently can only find about $1 million in
increase for the stock assessment for the 530 fishery stocks
that NOAA manages. This does not reflect the actual need of the
agency for fishery management.
Where do catch shares fit into all of this? We have some
catch share programs across the country that require funding,
and we should fund those. But I cannot see why we need to spend
$54 million in one year on a new initiative to spread these
catch share programs further, especially when fishermen do not
appear to be asking for them.
Madame Chair, I know that at the budget hearings we
requested a breakdown of how the $17 million for catch share in
2010 is being spent, and how the agency intends to spend the
$54 million in 2011. I don't believe we have received that
information yet.
But I would also like to ask the agency to provide us with
how that 2011 budget proposal will enable us to keep the Red
Snapper Fishery open next year. Maybe we should use the $54
million that is proposed for catch share to either get the
information necessary to reopen the fishery, or compensate
those who have lost their jobs as a result of the closures.
Fishermen are frustrated. And hearing that the budget will
not make their fishing opportunities any better next year is
not what they want to hear. Nor do they want to hear that catch
shares are the answer to all of their problems.
I would like to suggest that NOAA concentrate on figuring
out how many fish are out there, and how to keep fishermen
working, rather than spending $54 million to tell fishermen how
great catch shares are.
Thank you, Madame Chair, and I am interested in listening
to the witnesses this morning.
[The prepared statement of Mr. Brown follows:]
Statement of The Honorable Henry E. Brown, Jr., Ranking Republican,
Subcommittee on Insular Affairs, Oceans and Wildlife
Good morning, Madam Chairwoman.
Madam Chairwoman, just a few weeks ago, thousands of fishermen--
recreational, charter, and commercial fishermen--came to Washington, DC
to air their concerns about the direction fisheries management has
taken in this country. Rarely do we see all of the fisheries sectors
speaking with one voice, but in this case, we did.
The fishermen came to DC to make sure we heard their concerns that
Federal agencies are making decisions without good science and that
agencies ignore the fishermen when making fishery management decisions.
I share that concern. If the agency cannot collect adequate information
on how many fish are out there, how can they set harvest levels? If
they do not collect adequate information on the harvest levels of
recreational and commercial fishermen, how will they know how many fish
are being taken? This is not rocket science, but it does take money.
It seems that while the agency is willing to increase funding by
$810 million for one satellite program to gather climate information,
it apparently can only find about $1 million in increases for the stock
assessments for the 530 fishery stocks that NOAA manages. This does not
reflect the actual needs of the agency for fisheries management.
Where do catch shares fit into all of this? We've got some catch
share programs across the country that will require funding and we
should fund those, but I cannot see why we need to spend $54 million in
one year on a new initiative to spread these catch share programs
further--especially when fishermen do not appear to be asking for them.
Madam Chairwoman, I know at the budget hearing we requested a break
down of how the $17 million for catch shares in FY2010 is being spent
and how the agency intends to spend the $54 million in FY2011. I don't
believe we have received that information yet, but I would also like to
ask the agency to provide us with how their FY2011 budget proposal will
enable us to keep the red snapper fishery open next year. Maybe we
should use the $54 million that is proposed for catch shares and use it
to either get the information necessary to reopen the fishery or
compensate those who have lost their jobs as a result of the closures.
Fishermen are frustrated and hearing that the budget will not make
their fishing opportunities any better next year is not what they want
to hear. Nor do they want to hear that catch shares are the answer to
all of their problems. I would like to suggest that NOAA concentrate on
figuring out how many fish are out there and how to keep fishermen
working rather than spending $54 million to tell fishermen how great
catch shares are.
Thank you, Madam Chairwoman.
______
Ms. Bordallo. I thank the gentleman from South Carolina. I
would now like to recognize--first of all, I would like to ask
for unanimous consent that the gentleman from Oregon and member
of the full Committee, Congressman Peter DeFazio, be allowed to
join us on the dais for this hearing. Hearing no objection, so
ordered.
I would like to now recognize the Ranking Member of the
full Committee, Mr. Hastings, for his opening statement.
STATEMENT OF HON. DOC HASTINGS, A REPRESENTATIVE IN CONGRESS
FROM THE STATE OF WASHINGTON
Mr. Hastings. Thank you, Madame Chair, and thank you for
your courtesy.
I appreciate your holding this hearing on the issue of
catch shares. Catch share fishery management plans have proven
to be an effective management tool in some regions, and in some
fisheries. But they are not appropriate, in my mind, for every
fishery.
Catch share programs, if desired, should be developed from
the bottom up through the Regional Fishery Management Council
system, and not forced or mandated by the agency. The agency
should not be pushing catch shares where they are not wanted.
A recent presentation by NOAA claims that there are 37
catch share programs that will either be implemented or are in
the development stage within the next two-and-a-half years.
Where there have been approximately a dozen catch share plans
implemented in the last 20 years, expecting three times that
number to be implemented or developed in the next two-and-a-
half years is unreasonable--especially when the Regional
Fishery Management Councils are not aware of which fisheries
the agency intends to turn into catch share plans.
There are some who feel that NOAA is pushing catch shares
because the agency believes they will solve all of the
management problems that face the agency. Implementing catch
shares does not replace the need for basic stock assessments,
data collection, and enforcement. These are fundamental
requirements for effective management of the fishery, whether
under a catch share program or some other fishery management
plan.
The agency needs to focus its energy on collecting the
basic data it needs to effectively manage the fisheries, rather
than imposing a new initiative.
There is also growing concern about where the funding for
the 37 new catch share programs will come from. At the
Subcommittee's hearing on the President's Fiscal Year 2011
budget request, concern was raised that the new catch share
program initiative request for $54 million is taking funding
away from other agency needs, such as stock assessments,
cooperative research, and data collection on recreational
fishing activities.
The agency needs to make sure it funds basic fishery
management activities, and does not take money away from other
fishery management priorities.
NOAA must seek long-term solutions to resolve fishery
allocation conflicts. Catch share programs have been, and can
be, effective, but only when the fishermen are active
participants in the development and the design of those
programs. Catch shares will not replace the need for other
management activities, and funding for new catch share programs
should not come at the expense of existing priorities within
the agencies.
Finally, Madame Chair, on a more parochial note, I would
like to follow up on a request for a legislative hearing on
H.R. 3910, whose bill sponsor is my colleague from Washington
State, Rick Larson. The bill would allow members of the
longline catcher-processor sector of the Bering Sea to approve
a co-op management plan if 80 percent of the members agree. I
am an original co-sponsor of this bipartisan bill, and would
encourage the Subcommittee to hold a hearing on this
legislation.
Thank you once again for your consideration, and thank you
for holding this hearing on this issue. I yield back my time.
[The prepared statement of Mr. Hastings follows:]
Statement of The Honorable Doc Hastings, Ranking Republican Member,
Committee on Natural Resources
Madam Chair, I appreciate you holding this hearing on the issue of
catch shares. Catch share fishery management plans have proven to be
effective management tools in some regions and in some fisheries, but
they are not appropriate for every fishery.
Catch share programs, if desired, should be developed from the
bottom up through the regional fishery management council system and
not forced or mandated by the agency. The agency should not be pushing
catch shares where they are not wanted. A recent presentation by NOAA
claims that there are 37 catch share programs that will be either
implemented or in the development stage within the next 2 1/2 years.
While there have been approximately a dozen catch share plans
implemented in the last 20 years, expecting three times that number to
be implemented or developed in the next 2 1/2 years is unreasonable--
especially when the regional fishery management councils are not aware
which fisheries the agency intends on turning into catch share plans.
There are some who feel that NOAA is pushing catch shares because
the agency believes they will solve all of the management problems that
face the agency. Implementing catch shares does not replace the need
for basic stock assessments, data collection, and enforcement. These
are fundamental requirements for effective management of the fishery--
whether under a catch share program or some other fishery management
plan. The agency needs to focus its energy on collecting the basic data
it needs to effectively manage the fisheries rather than imposing a new
initiative.
There is also growing concern about where the funding for 37 new
catch share programs will come from. At the Subcommittee's hearing on
the President's FY 2011 budget request, concern was raised that the new
National Catch Shares Program initiative request for $54 million is
taking funding away from other agency needs such as stock assessments,
cooperative research, and data collection on recreational fishing
activities. The agency needs to make sure it funds basic fishery
management activities and does not take money away from other fishery
management priorities.
NOAA must seek long term solutions to resolve fishery allocation
conflicts. Catch share programs have been and can be effective, but
only when the fishermen are active participants in the development and
the design of the program. Catch shares will not replace the need for
other management activities and funding for new catch share programs
should not come at the expense of existing priorities within the
agency.
Finally, Madam Chair, I would like to follow up on a request for a
legislative hearing on H.R. 3910 made by the bill's sponsor,
Congressman Rick Larsen. The bill would allow members of the longline
catcher processor sector in the Bering Sea to approve a coop management
plan if 80 percent of the members agree. I am an original cosponsor of
the bill and would encourage the Subcommittee to hold a hearing on the
legislation.
Thank you for your consideration, and, again, thank you for holding
today's hearing.
______
Ms. Bordallo. I thank the gentleman for his opening
statement.
Before I introduce the witnesses of our panel, I would like
to welcome Congresswoman Lois Capps from the State of
California, Congresswoman Donna Christensen from the Virgin
Islands, Mr. Cassidy from Louisiana, and Mr. Wittman from
Virginia. Thank you for being with us this morning.
Now it is my pleasure to introduce our panel. First, Mr.
Eric Schwaab, Assistant Administrator for Fisheries, National
Oceanic and Atmospheric Administration; Dr. Mark Fina, Senior
Ecologist, North Pacific Fishery Management Council; Dr. Andrew
A. Rosenberg, Senior Vice President for Science and Knowledge,
Conservation International; Mr. Edward Backus, Vice President
for Community Ecosystem Services, Ecotrust; and Ms. Leesa Cobb,
Executive Director of the Port Orford Ocean Resource Team. I
welcome you all this morning, and I would like to thank you for
being here.
As we begin, I would note that the red timing light on the
table will indicate when five minutes have passed, and your
time has concluded. We would appreciate your cooperation in
complying with these limits. Be assured, however, that your
full written statement will be entered into the record.
We will begin now with Mr. Schwaab. This is your first time
appearing, I understand, before the Subcommittee, and I believe
your first time testifying before Congress, since you were
appointed as the new Director of the National Marine Fisheries
Service. Congratulations on your appointment. I thank you for
being here today, and look forward to working with you to
rebuild the bridge between the fishing industry and the agency.
With that, please proceed.
STATEMENT OF ERIC SCHWAAB, ASSISTANT ADMINISTRATOR FOR
FISHERIES, NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION,
U.S. DEPARTMENT OF COMMERCE
Mr. Schwaab. Madame Chairwoman, members of the Committee,
thank you for the opportunity to testify before you today on
catch shares.
My name is Eric Schwaab, and I am the new Assistant
Administrator for Fisheries at NOAA. It is a pleasure to
testify before you for the first time in that capacity. Thank
you.
In my career in public service, one of my primary
objectives has been to focus on creative problem solving that
works to fix systemic challenges that we face, working to
address the underlying root causes of problems, rather than
using a Band-Aid approach to fix symptoms.
The use of catch shares provides an important and effective
mechanism to address some of the systemic problems,
particularly on the economic side of fisheries management.
As you are aware, we are currently implementing annual
catch limit and accountability provisions of the Magnuson-
Stevens Act to end overfishing and rebuild fish stocks. In many
cases around the country, this requires us to ratchet down
fishing levels, which can lead to significant short-term
economic impacts in our coastal communities.
However, in the long term, rebuilding U.S. fisheries has
the potential to increase the value of fish brought into our
ports by an estimated $2.2 billion annually, a 54 percent
increase over current values.
In too many cases current management systems have not
controlled overfishing, or have done so through the blunt
instruments of closures, dramatically shortened seasons, or
other economically disruptive measures. Thousands of fishing
jobs have been lost as fish stocks have declined. Adverse
impacts continue as additional valuable fisheries face large
closures or dwindling seasons having undesirable impact on
fishing jobs, safety at sea, and the economic vitality of
coastal communities.
Catch share systems provide, in many cases, innovative
solutions that keep fishermen fishing while resources recover.
Rather than employing closures or other very restrictive
seasons which push fishermen off the water, catch shares can
provide for continued fishing even as stocks recover.
Within a framework of scientifically established annual
catch limits, catch share systems give more direct control of
fishing activity back to fishermen, allowing fishermen to plan
their seasons and be more selective about when and how they
catch their allotment.
Because there are shares allotted in the fishery, fishermen
gain an economic incentive to catch their allocation at the
least cost, when market values are most advantageous, and
without going over their allotment. Because as stocks rebuild,
the holder's share increases in value.
The security and predictability that comes with catch
shares has the potential to help us get out in front of some of
the boom-and-bust cycles that we have been dealing with in
fisheries for decades. However, I will caution that while catch
shares have been successful in many instances, they are not
appropriate for every fishery. We need to remain mindful of
potential drawbacks that programs may have.
By their nature, catch shares can result in consolidation
of the harvesting sector, because some fishermen holding shares
will decide to sell or lease privileges to someone else. There
have also been concerns about catch share effects on
recreational fisheries, the ability to contribute to job losses
on shore, or threaten small boat communities as shares are
transferred among vessels and ports. All of these concerns can
be resolved through proper catch share design.
NOAA's draft catch share policy, released last December and
open for comment until April 10, encourages regional fishery
management councils to consider the use of catch shares where
appropriate.
Catch shares have a great deal of design flexibility to
support diverse fleets of both small and large vessels,
encourage owner-operated fleets, protect the interests of
fishery-dependent communities, set aside shares for specific
sectors, including recreational participants, and provide
opportunities for future generations to enter the fisheries.
Councils must pay particular attention to these design issues.
I would like to spend the last minute I have speaking about
the budget situation. The President's Fiscal Year 2011 budget
requests a total of $54 million for catch shares nationwide.
This request supports analysis and evaluation of fisheries for
catch share programs, development of fishery management plans
and regulation, and increased investment in observing and
monitoring cooperative research and other activities.
This funding is not requested at the expense of other
important fisheries research and management programs. Our
overall budget has increased from $724 million in 2009 to $908
million in 2011. This $184 million increase demonstrates that
fisheries research and management has been a clear priority,
and continues as a clear priority, for NOAA.
Many councils face extremely difficult choices as we work
to rebuild stocks and improve economic profitability. NOAA is
committed to working with the Councils to take the necessary
steps to recover these fisheries, and ensure that we are on the
path to long-term sustainability of both the resources and the
fishing communities.
At this time, or at the appropriate time, I would be
pleased to address questions. Thank you.
[The prepared statement of Mr. Schwaab follows:]
Statement of Eric Schwaab, Assistant Administrator, National Marine
Fisheries Service, National Oceanic and Atmospheric Administration,
U.S. Department of Commerce
Madam Chairwoman and members of the Committee, thank you for the
opportunity to testify before you today on NOAA's draft Catch Share
Policy. My name is Eric Schwaab and I am the Assistant Administrator of
the National Marine Fisheries Service, within the National Oceanic and
Atmospheric Administration (NOAA).
Catch shares are a fishery management tool that has been
recommended for consideration by the National Research Council and the
U.S. Commission on Ocean Policy, as well as several Members of
Congress. In appropriate circumstances, catch share programs can play
an essential role in meeting our national goal of rebuilding and
sustaining our fishery resources. Such outcomes are a key ingredient to
achieving our larger objective of healthy and resilient marine
ecosystems.
On December 10, 2009, NOAA released a draft national policy
encouraging the use of catch shares, a powerful tool for managing
fisheries. The draft policy encourages but does not require the use of
well-designed catch share programs. In appropriate circumstances, these
programs can help end overfishing, rebuild fisheries, and sustain
fishing jobs and fishing communities. In the development of the draft
policy, NOAA received individual input from representatives of each of
the eight regional fishery management councils (Councils) as well as
NOAA experts. NOAA has also worked with individuals from key
stakeholder groups before and after the issuance of the draft policy to
get their input on this important policy initiative.
In catch share programs, a portion of the scientifically-based,
total allowable catch for a species is apportioned to individual
fishermen or groups, according to the allocation rules recommended by
the regional fishery management councils and approved by NOAA. Each
holder of a catch share must stop fishing when his/her specific quota
is reached. Catch share programs, which include a variety of approaches
like individual fishing quotas and Limited Access Privilege Programs,
authorized by the Magnuson-Stevens Fishery Conservation and Management
Act (MSA), have operated successfully in the United States since 1990.
Currently, there are 15 different catch share programs in place,
stretching from Alaska to Florida, and several additional programs are
expected to start over the next year.
NOAA's goals in developing a national policy on the use of catch
shares are to: (1) reduce administrative or organizational impediments
to the Councils' consideration of catch shares; (2) inform and educate
stakeholders of the different options and capabilities of catch share
programs; and (3) help organize collaborative efforts among interested
councils, states, communities, fishermen and other stakeholders on the
design and implementation of catch share programs. The draft catch
share policy itself is quite simple. It states that: To achieve long-
term ecological and economic sustainability of the Nation's fishery
resources and fishing communities, NOAA encourages the consideration
and adoption of catch shares wherever appropriate in fishery management
and ecosystem plans and amendments, and will support the design,
implementation, and monitoring of catch share programs.
While the draft policy encourages the careful consideration of
catch shares, it does not mandate catch shares be used in any specific
fishery or sector (e.g., commercial vs. recreational fisheries). In
fact, we believe that catch shares may not be the best management
option in some fisheries. Catch shares are but one tool among several
for effectively managing fisheries, and they are not a panacea. The key
to developing any successful fishery management program is active
involvement from fishermen and other stakeholders in the regional
fishery management council where the programs are designed.
Under traditional fishery management approaches, a scientifically-
based total allowable catch is established for a species overall, and
is not allocated to specific individual fishermen or groups. Under this
approach, anyone who wants to participate in the fishery can fish,
until the overall total allowable catch limit is reached. This can lead
to a competitive environment, with fishermen racing each other to catch
as many fish as they can before the total allowable catch is reached
and the fishery is closed for the season. We have also seen this
approach result in more boats and gear in the water than is either
biologically or economically necessary to catch the available harvest.
The results of this type of management system often are shorter fishing
seasons, unsafe fishing practices and high levels of bycatch. Finally,
one other serious drawback to this system is that too many fish may be
brought to market at once, depressing the price of fish for fishermen
and coastal communities.
Conversely, catch share programs allow fishermen to plan their
fishing seasons and be more selective about when and how they catch
their allotment, knowing their individual shares are secure. Fishermen
participating in catch share programs are able to plan their fishing
effort around the weather, markets, or other business considerations.
Because they are allotted a share in a fishery, fishermen gain an
economic incentive to catch their allocation at the least cost and
without going over their allotment because as a fish stock rebuilds the
holder's share increases in value. In addition, fishermen need not take
unnecessary risks because they can fish whenever they want, and they
can fish at times when there is not a glut in the market.
Catch share programs have a proven track record of success in many
fisheries in the United States and around the world. Here are a few
examples:
The Crab Rationalization Program allocates Bering Sea and
Aleutian Islands (BSAI) crab resources among harvesters, processors,
and coastal communities. The program was implemented in 2005 when
overcapacity in BSAI crab fisheries had resulted in a frenzied race for
crab. Harvesting and processing capacity had expanded to accommodate
highly abbreviated seasons, encouraging unsafe fishing practices and
resulting in significant portions of the capacity to be idle between
seasons. Under the rationalization program, season lengths have
increased from 3-5 days to 93-230 days, revenues from the fishery have
increased by 40 percent (in constant dollars) in just three years, and
fatalities and U.S. Coast Guard search and rescue cases have declined
to historic lows.
The Halibut Individual Fishing Quota Program in Alaska,
now more than a decade old, eliminated a dangerous derby fishery that
lasted less than a week per year and replaced it with a program
allowing for a longer, more profitable and much safer fishing season,
and has helped sustain local fishing-dependent communities and jobs.
Gulf of Alaska rockfish were historically caught in a
limited entry derby fishery during 3 weeks in the middle of the busy
Alaska salmon season. Product quality was low, and bycatch and discard
rates were high. In 2005 the North Pacific Council adopted a catch
share-based management program which permits harvesters to form
voluntary cooperative associations. Revenues for northern rockfish and
Pacific perch have since doubled (in constant dollars) as a longer
fishing season (7 months) allows fishermen to produce more high value
products, and deliver their catches to processors at times that do not
conflict with the salmon season. Notably, the incidental catch of
halibut has been reduced substantially, as have discards of other
species. Participants report that cooperative management has allowed
them to adopt conservation-minded practices without sacrificing their
overall opportunity in the fishery.
A two-year-old catch share program in the Gulf of Mexico
is helping rebuild Gulf of Mexico red snapper fish stocks, reducing
overcapacity in the fishery and boosting profits for participating
fishermen. NOAA scientists announced that overfishing has ended in the
Gulf of Mexico red snapper fishery after more than two decades of
overfishing. The use of catch shares in the commercial fishery has
helped maintain the fishing industry while strict management measures
have been in place to end overfishing and move toward rebuilt stocks.
In British Columbia, the multispecies groundfish fishery
use of individual vessel quotas for all species has resulted in
sustainable catch levels, greatly reduced bycatch, improved cooperation
among fishermen, and safer fishing practices.
While catch shares have been a successful tool in many instances,
it is important to note that catch shares are not appropriate for every
fishery, and we need to remain mindful of the negative impacts these
programs can have. By their nature, catch shares can result in some
consolidation of the harvesting sector because some fishermen holding
shares make a willing business decision to lease or sell their
privileges to someone else. While they are compensated for their exit,
others are impacted by their decisions. For example, in the Bering Sea
crab fishery noted above, the rate and extent of vessel consolidation
surprised many observers, and the traditional number of crew positions
was reduced significantly in the first year as vessel owners sold their
shares and their vessels left the fishery. Many part-time crew jobs
were lost, although catch shares typically lead to an increase in the
number of full-time jobs. There have also been other concerns expressed
about how catch shares programs might affect recreational fisheries,
contribute to job losses on shore, or threaten the sustainability of
small boat communities as shares are transferred among vessels, ports
and sectors.
NOAA's draft policy encourages the regional fishery management
councils to carefully design catch share programs to effectively avoid
or mitigate these issues, using the tools available in the MSA. With
the development of any new catch share program, there is a great deal
of design flexibility to allow fisheries to support diverse fleets of
both small and large vessels, encourage owner-operated fleets, set
aside shares for specific sectors such as recreational participants,
and provide opportunities for new entrants to enter the fisheries.
NOAA recommends that Councils pay particular attention to the
following critical design issues:
Set Specific Goals: Identification of specific management
goals for each catch share program is critical, such as eliminating
overfishing; ending a race for fish; reducing bycatch; or creating
socio-economic stability for fishermen and communities. The more
specific the goals, the more precisely a catch share design can be
structured to attain them.
Define Transferability: Councils need to work directly
with harvesters and the larger fishing community to choose whether,
when, and to whom to allow transfers of catch shares to ensure the
long-term success of the program. This is a balance between promoting
maximum flexibility for fishermen's business decision making and
controlling the rate and scale of change in a fishery to address
harvesting, processing and community sustainability goals.
Consider New Entrants: Councils need to evaluate catch
share designs that allow new generations of fishermen or small
businesses into the fishery. Besides set-asides and proper design of
initial allocation and transfer criteria, loan programs and permit
banks can help ensure continued fishery access in traditional ports.
Help Communities: Thoughtful catch share design can
promote sustainable fishing communities, including good jobs,
preservation of wharfs, processing facilities, fuel and ice suppliers
and other coastal businesses essential to a working waterfront. There
are several recently added provisions in the Magnuson-Stevens Act to
help sustain fishing communities and small owner-operator fleets via
catch shares. These provisions include special allocations to fishing
communities and regional fishing associations, and loan programs for
small vessel--and entry level--fishermen.
Consider Recreational Impacts: Councils allocate the
total allowable catch among sectors in all fisheries, regardless of
whether a catch share is used to further distribute the allocation
among eligible participants in a sector. Councils can opt to manage the
commercial sector with catch shares and manage the recreational sector
by other means. The draft policy states that where catch shares are
proposed for the commercial sector but not the recreational sector,
Councils should evaluate the effects of catch shares on all sectors
associated with a fishery.
Improve Data: A key component in any well designed
fishery management system, catch shares or otherwise, is accurate and
credible data in which managers and stakeholders have confidence. Every
limited access privilege program collects a fee of up to 3 percent of
the ex vessel value of the landings to support management, data
collection and enforcement. Additional appropriated funds have been
requested to support expanded data collection, monitoring and observer
programs. These funds will support both the science and management
needs of catch shares in the areas of stock assessments, catch and
bycatch monitoring, research, and catch share compliance and
management.
Review Progress: Councils should periodically review all
catch share and other fisheries programs to gauge whether they are
meeting the goals and objectives; no program will be perfect the first
time and Councils should plan for making adjustments over time. Getting
feedback on management plan performance and being adaptive makes good
sense, and already is required by law for limited access privilege
programs.
NOAA has already and will continue to meet with stakeholders and
seek broad input on these and other aspects of its draft policy, and we
welcome your feedback as well, to ensure the policy addresses any
concerns your constituents may have. We continue to schedule
constituent briefings, and are traveling to all eight Councils to
present the policy and take public comments. We are accepting comments
through April 10, 2010.
The President's fiscal year (FY) 2011 budget request a total of $54
million to accelerate and enhance the implementation of catch shares
nationwide. The request supports analysis and evaluation of fisheries
for catch share programs, development of fishery management plans and
regulations, observing and monitoring at sea and on shore, and
enforcement activities.
I want to assure you that this catch share funding is not requested
at the expense of other fisheries research and management programs. The
FY 2011 budget sustains funding for Fisheries Research and Management
and adds to investments to implement the Magnuson-Stevens Fishery
Conservation and Management Reauthorization Act. The National Marine
Fisheries Service Operations, Research, and Facilities budget request
increased from $724.2 million in Fiscal Year 2009 to $907.8 million in
FY 2011; this $183.6 million increase demonstrates that fisheries
research and management has been, and continues to be, a clear priority
for NOAA.
In addition, to collect the foundational data required for
fisheries research and management NOAA has invested significantly in
its fleet of fisheries survey vessels (FSV). In 2007, Henry B. Bigelow
was commissioned and started fisheries research in the northeast in FY
2008. Since then NOAA has received delivery of Pisces and Bell M.
Shimada to support fisheries science efforts in the near future. The FY
2011 budget includes requested funds for two fisheries survey vessels,
FSV5 and FSV6.
In closing, many Councils face extremely difficult management
choices as we work to rebuild stocks and improve economic
profitability. NOAA is committed to working with Councils to take the
necessary steps to recover these resources and ensure we are on the
path to long-term sustainability of both the resource and the fishing
community. Whether catch shares are ultimately the option chosen for a
fishery or another tool is selected, NOAA is committed to keeping
fisheries viable and helping to ensure a future for fishermen, fishing
communities and working fishery waterfronts. NOAA will be there
supporting and coordinating the science and management actions
necessary to attain this shared goal of sustainable fisheries, but we
can't do it without help, and we need everyone's support.
Thank you for allowing me to speak with you this afternoon. At this
time, I would be pleased to take your questions.
______
Response to questions submitted for the record by Eric Schwaab,
Assistant Administrator for Fisheries, National Oceanic and Atmospheric
Administration, U.S. Department of Commerce
Questions from Chairwoman Madeleine Z. Bordallo (D-GU)
1. Notwithstanding Section 303A of Magnuson-Stevens Act, which affirms
that catch shares are privileges, how will NMFS ensure that
these shares are not perceived and do not become property
rights?
Answer: The Magnuson-Stevens Fishery Conservation and Management
Act (Magnuson-Stevens Act) tasks the Regional Fishery Management
Councils (Councils) with the responsibility to control the eligibility,
allocation, transfer, duration and revocation requirements of catch
share privilege programs. NOAA's National Marine Fisheries Service
(NMFS) will work with the Councils on the design of any catch share
programs the Councils choose to design, and lead the transformation of
these public policy decisions into federal regulations through notice
and comment rulemaking processes. In addition, NMFS will provide
guidance and oversight to the Council process to ensure the
requirements and standards of the Magnuson-Stevens Act are met for
governing the limited and revocable private use of a permit privilege
to harvest a portion of the Nation's public fishery resources.
2. How has NMFS studied the impacts of allocating harvest shares to
processors? What percentage of catch would give processors the
ability to influence dockside prices?
Answer: Each time a fishery management plan is completed, an
environmental and economic impact analysis is conducted, in addition to
an overall assessment of compliance with the ten National Standards for
fishery conservation and management outlined in the Magnuson-Stevens
Act. For catch shares, the analysis includes specific assessment of
limited access privilege requirements of section 303A of the Magnuson-
Stevens Act governing consideration of processors and other fishery-
dependent businesses. Eligibility to receive initial shares or to allow
purchase or lease of catch share privileges by processors is determined
by Councils on a fishery-by-fishery basis, and takes into account the
unique fishery circumstances and the specific goals that have been
developed by the Council for that fishery.
There are as many factors affecting a processor's ability to
influence dockside prices as there are fishing ports. Such factors
include location of alternative ports and access to/influence of other
markets; the species fished and the availability of domestic or
imported substitutes; and local financial relationships (such as
processors owning vessels or advancing credit from processors to
harvesters).
Councils are required to establish what constitutes an ``excessive
share'' for each fishery whereby a privilege holder acquiring shares in
excess of this amount may, among other consequences, have undue market
power over price. Any catch share program established by the Councils
would therefore set a limit and issue controls on eligibility,
allocation and transfers to control this occurrence.
3. How do current programs prevent absentee ownership of shares? Have
these programs been able to meet this objective?
Answer: Each of the current U.S. catch share programs (15) have
different objectives relative to absentee ownership of shares. In the
development of these programs, the Councils and their stakeholders have
placed different values on the prevention of absentee ownership of
shares as a management plan goal. Some regions have expressed little or
no concern about this issue, while others have adopted specific
measures designed to prevent absentee share or privilege holders. The
most stringent absentee controls are in the halibut/sablefish program
where the Council has adopted owner or master on board requirements
(i.e., generally the holder of the catch share privilege must be on
board the vessel actually fishing). These provisions have worked
overall but have required adjustment over time. For example,
traditionally as captains age and no longer wish to go to sea, they
have turned over responsibility to run their vessel to another family
member or a hired master. Owner on board requirements have to be
cognizant of the fishery's cultural and business traditions and balance
those considerations with other societal goals to minimize or prevent
absentee share holders.
On a coarser scale, the Councils control the overall eligibility,
allocation, transfer and duration of shares and can thus control which
entities, in addition to fishermen, receive or are allowed to hold
privileges (e.g., limiting speculators, ``Wall street investors,''
holding companies, etc.). Such controls must be consistent with the
goals and objectives of the fishery and consistent with the
requirements of the Magnuson-Stevens Act. Note that precise data on
ownership interests must be obtained and tracked, although experience
has shown that at times it can be hard to trace and verify this
information.
4. Who pays for data collection under existing catch share programs?
Are cost recovery mechanisms being applied to cover the cost of
monitoring in any catch share program today?
Answer: Funding for data collection under existing catch share
programs is a mix of appropriated and industry sources. The Magnuson-
Stevens Act only authorizes cost recovery for data collection of
Limited Access Privileges Programs (LAPP) satisfying the definitions
under section 303A. In these programs, costs for management, data
collection and enforcement directly attributable to the catch share
program are recoverable subject to a limit of 3 percent of the ex-
vessel value of the fishery. The Alaska halibut/sablefish, Bering Sea
crab, and Gulf of Mexico red snapper and grouper/tilefish fisheries
currently are applying cost recovery mechanisms. The Mid-Atlantic surf
clam/ocean quahog fishery (cost recovery program is being developed)
and the South Atlantic wreckfish fishery (no recovery because of the de
minimus costs of monitoring the two active vessels) comprise the other
two eligible LAPPs. The New England sector catch share program is not
authorized under section 303A as a cost-recoverable LAPP.
5. How will NMFS address the concern that a commercial catch share
program may lock in shares, preventing the recreational sector
from expanding their shares?
Answer: Regional Fishery Management Councils allocate the total
allowable catch among different sectors, including commercial and
recreational sectors, under all management options, not just catch
shares. Properly designed management programs ensure these allocations
use an appropriate range of criteria to ensure fair and equitable
allocations, and provide the means to periodically re-evaluate the
allocations to confirm their ongoing relevance to changing biological,
economic and social conditions. Catch share management options can
expand these options through the consideration of inter-sector
transfers of allocations between recreational and commercial sectors.
The Magnuson-Stevens Act states that limited access privileges do
not create a right, title or interest in a fishery or to any fish
before the fish is harvested. The privilege can in fact be revoked,
limited or modified at any time in accordance with the law. The
Councils need to acknowledge these attributes when they design
provisions governing catch share eligibility, distribution, duration,
and transferability.
NOAA's draft policy provides specific guidance to the Councils on
this topic. NOAA recommends the Councils use the flexibility in catch
share program design to implement a fair and equitable distribution of
the total allowable catch among the various sectors, including the
commercial and the recreational sectors, as appropriate. This means
considering the inclusion of allocation criteria such as past, current,
and projected fishery participation; current and historical landings;
and the economic, social, and cultural characteristics of the fishery.
In practice, a Council could set aside a certain percentage of the
allocation of the total allowable catch to be allocated on an annual
basis to account for contingencies and changing circumstances or data.
Alternatively, a Council could include time schedules in their fishery
management plan design to consider reallocation of quota at a future
date, or provide a process for future transfers of allocations when
certain thresholds or triggers are reached. NOAA recommends such
reallocative elements be specified and analyzed up front in the program
design, not after the fact.
Additionally, it is important to note that the grant of a catch
share privilege to someone is not made in perpetuity. The law defines a
limited access privilege as a permit, issued for a period of not more
than 10 years. A formal and detailed review 5 years after
implementation of the catch share program (and at least every 7 years
thereafter) is also required by law. The program can be amended at any
time as specified by the Council. Therefore, it is important to set
specific management goals with respect to the distribution of benefits
and impacts, and consider future reallocation plans and implications in
the initial program design.
6. How will NMFS address recreational catch share without sufficient
real-time catch data?
Answer: During Council development of any fishery management plan,
the data collection, monitoring and compliance aspects of the program
design are developed. Experience with existing U.S. catch shares
programs have required additional frequency and timeliness in data
reporting for the commercial fisheries coming under catch shares. If a
Council were to choose to implement a catch share in a recreational
sector, additional real time data collection requirements may need to
be adopted in that sector as well.
7. Who should be allowed to purchase catch shares? For example should
environmental organizations be permitted to purchase catch
shares and set them aside for conservation?
Answer: Regional Fishery Management Councils are given the
responsibility under the Magnuson-Stevens Act to determine the
eligibility, allocation, transferability, revocation and duration of
limited access privilege programs subject to the requirements of
section 303A. The Councils can control who is allowed to purchase catch
shares, consistent with provisions of the Magnuson-Stevens Act and the
goals and objectives identified for their specific fishery management
plan. A Council catch share program typically distributes an annual
catch limit that is based on a scientifically established total
allowable catch. The annual catch limit accounts for scientific and
management uncertainty and also accounts for biological, economic, and
social factors important to that specific plan. It would be contrary to
a Council's publically developed and approved plan to permit catch
shares to be used in a manner inconsistent with the stated goal,
purpose and administrative record of the program. This may include
precluding the sale of shares to be set aside for conservation if that
was not an express intent or purpose of the plan.
8. The budget request includes $12.6 million to implement the west
coast groundfish catch share program that has been approved by
the Council and is pending approval by the secretary. Why is it
so much? Is this a one-time cost?
Answer: In the FY 2011 President's budget, NOAA requested $12.7
million for the implementation and operation of the new Pacific Coast
groundfish trawl rationalization program. A higher level of monitoring
may be needed in the trawl rationalization program in order to ensure
that individual or group quotas are adhered to, particularly because it
is a mixed-stock fishery, and monitoring and enforcement costs will be
greater than for the previous program. Of the $12.7 million, $10
million would be for the training and deployment of monitors/observers
and data collection. The remaining $2.7 million requested funding would
also support other implementation and operational activities including
program administration, enforcement, establishing of program specific
share accounting databases and reporting systems, catch monitoring,
identifying eligible participants, issuing annual quota for each
participant, and adjudicating administrative appeals of the eligibility
and catch share decisions.
Some or all of the incremental operational costs for the catch
share program can be recovered once the catch share program is
operational. Agency cost recovery is capped at a maximum of 3 percent
of the ex-vessel value of the fishery. The shore-based commercial
groundfish fishery had an ex-vessel value of $59.3 million in 2007.
Additionally, NOAA expects that once this program is more established
and the fishery is more profitable, industry will also pay some of the
monitoring costs associated with this program. As a result, as this
catch share program matures, resources planned for this fishery will be
reallocated in future years to support the transition to and
implementation of catch share programs in additional fisheries.
9. Given that large sums of public funds are being spent to buy back
permits/quotas so that these can be subsequently leased to
fishers from private ``community'' permit banks, what advantage
is there to such a system versus just directly vesting
municipalities with catch allocations that could be leased
directly to fishers?
Answer: The present use of appropriations to support permit banks
is partially based on the exigency of time. It is possible to directly
vest catch allocations to communities under the Magnuson-Stevens Act
section 303A(c)(3). Councils can develop a limited access privilege
program that allocates shares to ``Fishing Communities'' comprised of
residents who conduct commercial or recreational fishing, processing or
fishery-dependent support businesses within the Council's management
area.
Questions from Republican Members
1. Concern has been raised that NOAA is ``pushing'' catch shares. NOAA
claims that they are merely providing information on how catch
share programs could help fisheries management. How do you
explain the graphic from a NOAA presentation that claims there
are 37 potential plans to be developed or implemented in FY
2011 and FY 2012?
Answer: The draft NOAA policy states that NOAA is not recommending
catch shares be used in all fisheries. There is no mandate to adopt
catch shares. Moreover, the draft NOAA policy repeatedly stresses that
Councils and stakeholders need to evaluate the range of fishery
management programs available and choose the one that best fits their
goals and objectives.
The 36 potential catch share programs were identified by the eight
Councils for possible development. This list is subject to change and
NOAA does not expect that all of these fisheries will necessarily be
brought under catch share management.
Councils were already choosing to adopt catch shares for their
fisheries well before this draft policy was conceived. Six of the eight
Councils have implemented 15 catch share programs around the country.
The first was in 1990, with nine additional programs in just the last 6
years. NOAA has learned many lessons regarding the best practices for
implementing catch shares over the last 20 years. The Magnuson-Stevens
Act contains more than 10 pages of new statutory language on using this
one approach, and therefore NOAA developed a draft policy to provide
guidance on the use of catch shares.
NOAA's draft policy closely aligns with the findings and follows
the recommendations in the Congressionally-chartered report of the
National Research Council (NRC) \1\ associated with the 1996 moratorium
on individual fishing quota programs. The NRC Report, the U.S.
Commission on Ocean Policy, and the 2006 revisions to the Magnuson-
Stevens Act all suggest that catch shares be considered as an option
where appropriate, and that is what the draft NOAA policy states.
---------------------------------------------------------------------------
\1\ National Research Council. 1999. Sharing the Fish: Toward a
National Policy on Individual Fishing Quotas. National Academy Press,
Washington, D.C.; http://www.nap.edu/catalog.php?record_id=6335
---------------------------------------------------------------------------
2. Can you tell us what fisheries make up these 37 potential catch
share programs?
Answer: The following table shows 36 potential catch share
programs. This number includes 4 recently implemented programs and 1
more program that is in the process of being implemented. Thirty-one
additional fisheries remain on the list of potential programs. These
fisheries have been identified by the Councils for possible development
of catch shares, but the list is subject to change, and NOAA does not
expect that all of these fisheries will necessarily be brought under
catch share management.
[GRAPHIC] [TIFF OMITTED] 55542.013
[GRAPHIC] [TIFF OMITTED] 55542.014
We are told that two of the three being proposed for the
Pacific Council are limited access plans for albacore tuna and
sardines and that the industry participants do not want limited
access for either fishery. Are these two of the fisheries that
are considered by NOAA to be potential catch share plans for
the Pacific region?
Answer: Currently, the U.S. West Coast Northern Albacore tuna
fishery is an open access fishery. The Pacific Fishery Management
Council may consider developing a limited entry program to control
excess capacity. The Council adopted a control date of March 9, 2000,
in case a limited entry program is needed in the future, and any new
entrants in the fishery after the control date may not qualify for a
permit if a program is implemented in the future. Control dates are
established to minimize the rush of new entrants into a fishery that
often occurs when limited entry is being considered. Meanwhile, a
limited entry system has been in place in the Pacific Sardine
commercial fishery since 1999.
The Council has identified the U.S. West Coast Northern Albacore
and the Pacific Sardine fishery as potential catch share programs. NOAA
is committed to working with the Councils and stakeholders in
evaluating catch share management in the U.S. West Coast Northern
Albacore tuna and Pacific Sardine fishery, as it works towards our
shared goal of long-term sustainability of both the resource and the
fishing community. Whether catch shares are ultimately the option
chosen for a fishery or another tool is selected, NOAA is committed to
keeping fisheries viable and helping to ensure a future for fishermen,
fishing communities and working fishery waterfronts. NOAA will support
and coordinate the science and management actions necessary to attain
sustainable fisheries.
4. Can you tell us where the funding for the $17.4 million for catch
shares in FY 2010 was taken from? Can you tell us how it is
being distributed (region specific or fishery specific)?
Answer: The source of the FY 2010 enacted $17.4 million for catch
shares is comprised of those funds expended for catch shares in 2009
under the Fisheries Research and Management and the Cooperative
Research (NE Multispecies Sectors) lines. Please see below for more
detail.
[GRAPHIC] [TIFF OMITTED] 55542.015
.epsThe $6 million in the new Catch Share line item dedicated to
Cooperative Research will continue to focus on enhanced stock
monitoring and conservation engineering (including technology transfer)
to support the transition to sectors and annual catch limits (ACLs).
Priority will be given to:
Fisheries currently managed under a catch share program
or for fisheries which are transitioning into catch share management
Fisheries with interaction with fisheries under catch
share management or in transition to catch share management
Fisheries with significant data gaps for ACLs
5. Can you tell us how the $54 million for FY 2011 will be used? I
understand approximately $12 million will be used to implement
the Pacific Council's groundfish trawl plan. Is that accurate?
What fisheries will the remaining $42 million be spent on? Are
these costs expected to be annual costs or are there increased
costs associated with the initial implementation?
Answer: NOAA has requested an increase of $36.6 million, for a
total of $54 million, in FY 2011 to support the consideration of catch
share programs by Councils, and to enhance the implementation of catch
shares nationwide. The requested increase would support analysis and
evaluation of fisheries for catch share programs, development of
fishery management plans and regulations, observing and monitoring at
sea and on shore, and enforcement activities. As catch share programs
in specific fisheries mature, resources spent to assist those fisheries
in transitioning to catch shares could then be reallocated to support
the transition to and implementation of catch share programs in
additional fisheries.
In FY 2011, of the $54 million:
$10.6 million would support activities and capabilities
common to many catch share programs that are more efficient to
implement at a regional or national level, rather than managing each
specific catch share program individually. Examples of such activities
include overall program management, improvements in fishery dependent
data collection systems to support future catch share programs, quality
control on historic catch data to support individual or group
allocations, fishery data management, social and economic data
collection or analysis, and adjudication of administrative appeals of
program participants. Funding requested under this line item would also
support electronic reporting, quota accounting, and a lien registry.
Some regions have implemented catch share programs, and therefore have
a base of expertise and capability to add programs. Other regions need
capacity building to begin development of, and will eventually
implement and operate, catch share programs.
$2.0 million would support analysis and development of
new catch share programs through the Regional Fishery Management
Council process. Catch share programs typically take several years of
analysis, stakeholder participation, and Council deliberation before
being adopted. Catch Share Plans are more complicated than many fishery
management plan amendments, and thus carry increased costs for analysis
of alternatives and their impacts. Special stakeholder committees and
workgroups, requiring funds for staff support and meetings, are often
established to advise the Council on appropriate alternatives.
$41.45 million would support implementation and operation
of specific catch share programs for 17 fisheries (16 LAPPs plus the
Northeast multispecies sectors), including four new catch share
programs: Gulf of Mexico grouper & tilefish ($6.6 million), Mid-
Atlantic tilefish ($0.5 million), Northeast multispecies ($4.4
million), and Pacific groundfish ($12.7 million). Following Regional
Council adoption and Secretarial approval of a catch share program, an
implementation period of one to two years is common. Key implementation
activities include hiring management and enforcement staff,
establishment of program specific share accounting databases and
reporting systems, identification of eligible participants, issuance of
catch shares, computation of annual quota for each participant, and
adjudication of administrative appeals of the eligibility and catch
share decisions. These activities need to be completed before fishermen
begin fishing under the catch share program. The operational costs
include program administration, monitoring, enforcement, and science
evaluation. Included in this $41.45 million is $6 million for
cooperative research related to catch share programs, and is offset by
a corresponding reduction in the cooperative research line. NOAA
believes that cooperative research is important to develop the most
effective catch share programs. Some or all of the incremental
operational costs for the catch share programs that meet the definition
of a Limited Access Privilege Program under the Magnuson-Stevens
Fishery Conservation and Management Act of 2006 can be recovered once
the catch share program is operational. Agency cost recovery is capped
at a maximum of 3 percent of the ex-vessel value of the fishery.
[GRAPHIC] [TIFF OMITTED] 55542.016
.eps6. Does NOAA consider permit stacking to be a form of catch share?
Answer: Permit stacking is the registration of more than one
limited entry permit for a single vessel, where a vessel is allowed
additional catch for each additional permit registered for use with the
vessel. Permit stacking may be a form a catch share depending on the
specific provision of the fishery management plan developed by the
Council. If each permit is not tied to a specific share of the catch
limit that a fisherman has the right to harvest, the fishery would not
be considered a catch share program. However, if the permits are tied
to a specific share of the catch limit that a fisherman has the right
to harvest, as is the case in the Pacific sablefish fishery, it can be
considered a form of catch share.
7. Concern has been raised that the President's budget request for
catch shares is taking funding away from other priorities. Do
you agree? If not, why not?
Answer: Catch share funding is not requested at the expense of
other priorities. The FY 2011 budget strongly supports NOAA's continued
investment to implement the Magnuson-Stevens Act with a total request
of $135.2 million. NOAA's National Marine Fisheries Service Operations,
Research, and Facilities budget request increased from $724.2 million
in fiscal year 2009 to $907.8 million in fiscal year 2011; this $184
million increase demonstrates that fisheries research and management
has been, and continues to be, a clear priority for NOAA.
8. Is level funding for stock assessment work adequate?
Answer: There was a $10 million increase for expanded stock
assessments in FY 2010, for a total of $52 million. This funding is
sustained in the FY 2011 President's budget request. Although there is
no specific budget increase in the FY 2011 request, NOAA's proposed
budget will maintain its efforts to steadily increase the percentage of
stocks with adequate assessments from only 52 percent in FY 2005 to 60
percent in FY 2011; this improvement is associated with the FY 2008-
2010 increases to Expand Annual Stock Assessments (EASA) funding. In FY
2011, NOAA's National Marine Fisheries Service (NMFS) will be able to
bring 139 of the 230 priority stocks to an adequate level of
assessment. The particular assessments that will be updated in FY 2011
are being determined through regional processes in consultation with
the Regional Fishery Management Councils and other partners. Those
stocks that have been experiencing overfishing or are on rebuilding
plans have the highest priority for immediate assessment. With EASA
budget increases in FY 2010, NOAA is initiating new fish abundance
surveys that can support additional assessments over the next several
years.
9. When will the Atlantic red snapper stock assessment be completed?
Will this give the council time to approve fishing measures for
the summer or do you expect the closure to be extended?
Answer: The South Atlantic Fishery Management Council (Council) is
scheduled to approve Amendment 17A to the Snapper-Grouper Fishery
Management Plan (Red Snapper Rebuilding Plan) for Secretarial review in
June 2010, which means regulations implementing the area closure could
be effective by the end of the year.
The tentative schedule for the South Atlantic Red Snapper Benchmark
Assessment is listed below:
Data Workshop: May 24-28, 2010, Charleston, SC
Assessment Workshop: A series of webinars June 21-
September 29
Review Workshop October 12-14, Savannah, GA (proposed)
The new Southeast Data Assessment and Review benchmark assessment
for red snapper will be completed in October 2010, reviewed by the
Council Scientific and Statistical Committee in November 2010, and
presented to the Council in December 2010. NOAA's National Marine
Fisheries Service is committed to working with the Council to respond
to the new assessment findings with any needed management adjustments
as quickly as possible. The agency anticipates such adjustments could
be implemented by spring 2011.
10. How are recreational fisheries affected when the commercial sector
of the same fishery moves toward a catch share program?
Answer: Within a mixed-use fishery, Regional Fishery Management
Councils can recommend management of the commercial sector with catch
shares and still manage the recreational sector by other means. Catch
share programs are focused on the commercial sector of a fishery
because they are built on limited access, whereas no recreational
fishery sector has limited access to a fishery and no commercial catch
share program limits recreational access to fishery resources.
Commercial catch shares can benefit all sectors of a fishery by
limiting commercial harvests to scientifically based quotas and
providing economic incentives for conservation. This will have a
positive impact on fish stock health, which is essential for both the
commercial and recreational sectors. NOAA's draft catch shares policy
stresses that the Councils should carefully evaluate the potential
effects of catch shares on all sectors associated with a fishery,
regardless of whether they are in the catch share program.
Additionally, NOAA recommends that Councils periodically review the
performance of all catch share programs to determine, among other
things, impacts on the fishing community and changes in participation
in the fishery at large. Councils are directed to periodically review
all catch share and non-catch share programs to ensure they are meeting
the intended goals for the fishery, the fishermen, and the fishing
communities. The key to success is a thoughtful program design process
in which these issues are considered and planned for up-front. NOAA is
committed to working with recreational, commercial, and other
stakeholder groups to help them assess the pros and cons of adopting a
catch share program for their sector.
11. Is NOAA considering catch share programs for any charter
fisheries? How would that work? How would that affect
recreational anglers?
Answer: In 2009, NOAA implemented a limited access system for
charter vessels in the guided sport fishery for Pacific halibut in
waters of International Pacific Halibut Commission (IPHC) Regulatory
Areas 2C (Southeast Alaska) and 3A (Central Gulf of Alaska). Charter
halibut permits are issued to licensed charter fishing business owners
based on their past participation in the charter halibut fishery. All
charter halibut permit holders are subject to limits on the number of
permits they may hold and on the number of charter vessel anglers who
may catch and retain halibut on permitted charter vessels. The intended
effect is to curtail growth of fishing capacity in the guided sport
fishery for halibut. The North Pacific Fishery Management Council found
that the charter vessel sector was the only halibut harvesting sector
that was exhibiting growth in IPHC Areas 2C and 3A. Some harvesting
sectors have specified catch limits that cause fishery closures when
reached, while others have been relatively stable over time. The
Council recommended this limited access system to provide stability for
the guided sport halibut fishery and to decrease the need for
regulatory adjustments affecting charter vessel anglers while the
Council continues to develop a long-term policy on allocation between
the commercial and charter vessel sectors.
Last summer, the Gulf of Mexico Fishery Management Council
established a new Ad Hoc Limited Access Privilege Program Advisory
Panel to provide feedback and ideas regarding the potential application
of catch share programs to recreational and commercial fisheries. Some
for-hire fishermen are advocating to be separated from the private
recreational sector and allocated a percentage of the red snapper
recreational quota under a catch share program. Such a program would be
expected to provide charter fishermen greater flexibility to fish when
they want and to improve the economic profitability of individual
program participants; although fishery managers may continue to rely on
fixed seasonal closures to provide specific biological benefits in some
situations (e.g., protect fish during their spawning season, reduce
bycatch). NOAA is committed to assisting the Regional Fishery
Management Councils and constituents in evaluating the pros and cons of
sector separation and catch share management; however, the for-hire
sector is currently deeply divided in its support for such a program,
the implementation of which would likely require a positive referendum
vote.
NOAA is currently evaluating public comments solicited on its draft
policy that encourages the development of well-designed catch share
programs to help rebuild fisheries and sustain fishermen, communities,
and vibrant working waterfronts. The draft policy provides a foundation
for facilitating the wide-spread voluntary consideration of catch
shares, while empowering local fishermen to be part of the process.
12. Do you believe limited access is necessary for a catch share
program to be effective?
Answer: Limited access is necessary for a catch share program to be
effective because there has to be a defined number of participants.
Limited access involves limiting participation in a fishery to a
specific group that has met certain eligibility criteria; a Limited
Access Privilege Program involves a separate permit issued for
exclusive use by a person as part of a limited access system to harvest
a quantity of fish expressed by a unit or units representing a portion
of the total allowable catch of the fishery. Meanwhile, catch share is
a general term for several fishery management strategies, including
Limited Access Privilege Programs, that allocate a specific portion of
the total allowable fishery catch to individuals, cooperatives,
communities, or other entities. Each recipient of a catch share is
directly accountable to stop fishing when its specific quota is
reached. Although there must be a defined number of participants and/or
quota shares, both limited access and catch share programs provide
mechanisms for new entrants into the fishery.
______
Ms. Bordallo. Thank you very much, Mr. Schwaab, for further
explaining NOAA's draft catch share policy.
Now I recognize Dr. Fina. Thank you for being here today,
and please proceed.
STATEMENT OF MARK FINA, Ph.D., SENIOR ECOLOGIST, NORTH PACIFIC
FISHERY MANAGEMENT COUNCIL
Mr. Fina. Good morning, Madame Chair and members of the
Committee. I am Mark Fina, Senior Economist for the North
Pacific Fishery Management Council.
I appreciate having the opportunity to offer comments to
you on our experience with catch shares in the North Pacific.
Our Council will be finalizing its comments on NOAA fisheries
catch share policy at its April meeting.
A primary focus of those comments will be ensuring that the
guidance in no way impinges on Council authorities provided by
the Magnuson-Stevens Act for introducing and designing catch
share programs for the fisheries it manages.
The Council's use of that authority, together with the
flexibility it provides, has been critical to determining when
and what type of catch share management is appropriate for our
fisheries.
The North Pacific Council manages groundfish and shellfish
fisheries in the Federal waters off Alaska. All of these
fisheries are managed under annual catch limits and some type
of limited access program. As a part of our evolution of our
management, we have adopted a variety of programs, which now
might be characterized as catch shares or limited access
privilege programs.
These programs were adopted for a variety of reasons, and
serve a variety of objectives, including improvements of safety
and production efficiency, and reductions in bycatch. Each is
tailored to the specific needs and circumstances in the
fishery. Each was developed through years of Council
deliberation, supported by hundreds of pages of analysis.
Stakeholders and the public had several opportunities for
input, with significant and meaningful effects on the outcome.
This open, deliberative process is critical to both stakeholder
acceptance of a program, and achieving an appropriate balance
among often divergent interests.
While the Council's public process is intended to ensure
that a program achieves its goals with minimal negative
consequences, decision makers should be prepared to critically
review the effects of these programs and adopt modifications as
needed. In some cases, subsequent actions intended to mitigate
negative effects may carry equally undesirable consequences.
These practical barriers to reversing catch share programs to
remedy hardships suggests the catch share programs should be
approached with caution.
When considering a catch share program, the stakeholder and
management burdens should not be overlooked. Stakeholders' and
managers' time is greatly taxed by the extensive public
process.
The time for rulemaking and implementation of catch share
programs after Council action can exceed two years. Care must
be taken to ensure that these time commitments do not constrain
our ability to address other pressing management needs.
Monitoring and enforcement burdens may also rise, as each
permit represents a privilege to harvest a certain quantity of
fish, rather than the general privilege to participate
represented by a limited-entry license.
Despite these caveats, the Council believes that when
appropriate for a fishery and carefully designed, catch shares
are a very effective management measure.
In the North Pacific we have five major catch share
programs: the Halibut and Sablefish IFQ program; the Bering Sea
Pollock Cooperatives, as defined by the AFA; the Bering Sea and
Aleutian Islands Crab Rationalization program; the Amendment 80
Cooperative program in the Bering Sea and Aleutian Islands; and
the Central Gulf of Alaska Rockfish Pilot program. My written
testimony includes brief descriptions of each of those
programs.
In two other fisheries, after extensive deliberations, the
Council elected not to adopt catch share programs. This
reflects its view that some fisheries may not lend themselves
to catch share management. In all of the catch share programs
in the North Pacific, program elements reflect a balance of
competing interests of those who rely on the fisheries,
including vessel owners, processors, crew, communities,
environmental interests, and the public. Yet several important
management concerns, such as habitat and endangered species
protections, are unlikely to be addressed by catch share
management, and may require independent management measures.
Catch share management, however, may provide a benefit when
addressing these environmental concerns by allowing for new
adaptive management measures that might otherwise be
unworkable.
In addition, the flexibility provided to participants by
catch share management may ease the burden associated with
complying with those management measures. Understanding both
the benefits and limitations of catch share programs is
important to their successful use.
Over the past 15 years, catch share programs have become an
important part of the fishery management regime in the North
Pacific. By using the authority to establish catch share
programs with discretion, the North Pacific Council has
developed an array of programs that serve a variety of
interests in the fisheries it manages.
The Council looks forward to advancing its management of
North Pacific fisheries, and appreciates the authority
entrusted to it by Congress under the Magnuson-Stevens Act,
including the authority to develop catch share management as
appropriate.
Thank you for this opportunity. I would be happy to answer
questions at the appropriate time.
[The prepared statement of Dr. Fina follows:]
Statement of Mark Fina, Ph.D., J.D., Senior Economist,
North Pacific Fishery Management Council
Good morning Madam Chair and members of the committee. I am Mark
Fina, Senior Economist for the North Pacific Fishery Management
Council. I appreciate having the opportunity to offer comments to the
Subcommittee on our experiences with catch shares in the North Pacific.
Our Council will be finalizing its comments on NOAA Fisheries catch
share policy at its April meeting. A primary focus of those comments
will be ensuring that the guidance in no way impinges on Council
authorities provided by the Magnuson-Stevens Act for introducing and
designing catch share programs for the fisheries it manages. As you
will note throughout my comments, the Council's use of that authority,
and the flexibility it provides, has been critical to determining when
catch share management is appropriate for a fishery and the development
of programs that equitably balance the interests of stakeholders. I
would be happy to share those comments with you when they are
completed.
The North Pacific Council manages groundfish and shellfish
fisheries in the Bering Sea, Aleutian Islands, and Gulf of Alaska in
federal waters off Alaska. Major groundfish fisheries include pollock,
Pacific cod, rockfish, flatfish, sablefish, and Atka mackerel. In
addition, allocations in the halibut fishery are determined by the
Council, in concert with the International Halibut Commission, which
manages the biological aspects of the fishery. The North Pacific
Council also jointly manages crab and scallop fisheries with the Alaska
Department of Fish and Game.
All federal fisheries off Alaska are managed under annual catch
limits and some type of limited access program. Over time, the Council
has adopted a variety of management measures to address specific,
relevant issues that have arisen in particular fisheries. These
measures address a range of concerns from social and economic issues,
such as those addressed by the Community Development Quota program, to
environmental issues, such as area closures to protect habitat. As a
part of the evolution of our management, we have adopted ``individual
fishing quotas'' (IFQs), ``community quotas,'' ``fishery
cooperatives,'' and ``rationalization'' programs--all of which allocate
portions of the total allowable catch to fishery participants--in
several of our fisheries. These programs (which now might be
characterized as ``catch shares'' or ``limited access privilege''
programs) were adopted for a variety of reasons; each tailored to the
specific needs and circumstances of the fishery, its participants, and
stakeholders. Each program was developed through years of Council
deliberation, supported by hundreds of pages of analysis. Stakeholders
and the public had several opportunities for input throughout the
Council's development of these programs, often resulting in the
inclusion and revision of important elements. This open, deliberative
process is critical to both stakeholder acceptance of a program and
achieving an appropriate balance among often divergent interests.
The gravity of the radical change in management to catch shares for
some stakeholders should not be underestimated. As with all management
programs, catch shares programs, particularly at the initial
allocation, define ``winners'' and ``losers''. While the Council's
public process is intended to ensure that a program achieves its goals
with minimal negative consequences, decision makers should be prepared
to critically review the effects of these programs and adopt
modifications as needed. In some cases, subsequent actions intended to
mitigate negative effects may carry equally undesirable consequences.
For instance, redistributing shares after the initial allocation to
rectify inequities in that initial allocation may be considered unfair
by some participants, particularly if shares are taken from persons who
used loans to fund their purchases based on an expected stream of
income that would be derived from those shares. These practical
barriers to reversing catch share programs to remedy hardships suggest
that catch share programs be approached with caution.
When considering a catch share program, the stakeholder,
administrative, management, and monitoring burdens should not be
overlooked. Stakeholders' and managers' time is greatly taxed by the
extensive stakeholder and public input, alternative analysis and
review, and Council deliberations associated with development a catch
share program. In our experience, the time for rulemaking and
implementation of catch share programs after Council action has in some
cases exceeded 2 years. Care is taken to ensure that these Council and
staff time commitments do not constrain our ability to address other
pressing management needs. Additional monitoring and observer coverage
may also be necessary to oversee catches and landings of exclusive
allocations, particularly in multispecies fisheries where catch shares
may allow a vessel to improve returns by discarding less valuable
catch. Enforcement burdens may also rise, as each permit represents a
privilege to harvest a certain quantity of fish, rather than the
general privilege to participate represented by a limited entry
license. These added costs and burdens are an important consideration
for both fishery managers and stakeholders, when considering whether to
advance a catch share management program in a fishery. Despite these
caveats, the North Pacific Council believes that, when appropriate for
a fishery and carefully designed, catch shares are a very effective
management measure.
I would like to spend the remainder of my time briefly reviewing
some aspects of the different catch share programs that we have adopted
in the North Pacific. I will touch on the Council's rationale for each
program, design characteristics reflecting the rationale, performance
of the program, some unanticipated consequences, and the Council's
responses to mitigate those consequences. I will conclude with a brief
summary of some considerations that I believe are critical to the
development of effective catch share programs.
Halibut and sablefish Individual Fishing Quota (IFQ) program
The halibut and sablefish fisheries support a large number of small
vessels with strong community ties. In 1995, NOAA Fisheries implemented
the halibut and sablefish IFQ program approved by the Council in 1992.
These two fisheries are similar in many respects. Both species are
targeted with fixed gear, primarily longlines, and command a relatively
high ex-vessel price. Prior to implementation of the IFQ programs, the
fisheries were open access, regulated by managers monitoring catch in-
season with closures timed to coincide with harvest of the total
allowable catch. The catching power of this fleet posed several
management challenges. To limit total catch to the level needed to
protect stocks, managers progressively shortened fishing seasons,
creating a derby as fishermen raced to obtain a share of the fishery.
At the extreme, in some regulatory areas, halibut seasons were reduced
to 24-hour derby openings. Managers had difficulty regulating harvests,
as harvest levels could not be accurately gauged for these very short
openings. Gear losses were believed to be excessive, resulting in an
estimated 2 million pounds of halibut mortality annually, as
unretrieved gear continued to catch fish. Safety was compromised, as
owners of smaller vessels felt compelled to fish, regardless of the
weather, to maintain their participation. Catch quality suffered as
some vessels queued at processing plants for up to a week waiting to
offload. The IFQ program--the result of years of Council
deliberations--was largely intended to control expansive growth in
participation in the fisheries and the end the derby.
The IFQ program is designed to balance a number of goals and
interests. To reflect historic participation and fishery dependence,
initial allocations of shares were based on catches from the fishery
over three years. Over 4,800 persons received initial allocations in
the halibut fishery that drew approximately 3,500 participating vessels
annually in the years leading up to implementation of the IFQ program.
To maintain fleet composition, shares are classified for use by vessel
type (catcher processor or catcher vessel) and length, with limits on
the use of shares outside of their designated vessel type and size
class. Most shares are divisible and transferable subject to
consolidation limits. To maintain the small vessel, owner-operator
character of the fleet, catcher vessel shares carry owner-on-board
requirements, limits on the use of hired skippers, leasing
prohibitions, and may be transferred only to individuals (not
corporations or partnerships). In addition, only persons able to
demonstrate active time as crew in commercial fisheries are permitted
to acquire shares. To provide entry opportunities, consolidation of
small blocks (or allocations) of quota is limited and loans are
available to aid newcomers and small vessel operators. Seasons extend
several months allowing share holders to time their harvests to avoid
poor weather and sell to desired markets.
Since implementation of the program, several changes have been
observed in the fisheries. The number of share holders and number of
vessels in both the halibut and sablefish fisheries have declined
substantially. A new type of cooperation has developed as share holders
consolidate their holdings and fish them off fewer vessels to reduce
costs. This tendency is borne out, as the number of active share
holders substantially exceeds the number of vessels. This practice is
significant, as it demonstrates that the program provides an
alternative, more gradual, means of entry, when compared to purchasing
a license and vessel to enter a limited entry fishery. In the halibut
fishery, in particular, product quality has improved dramatically with
a substantially larger share of the catch being sold to fresh fish
markets. Gear losses and associated mortality are believed to be
inconsequential under IFQ management. In addition, safety improvements
in the fishery have been documented through declining fatalities and
U.S. Coast Guard search-and-rescue missions.
Despite these benefits, not all stakeholders are satisfied with the
outcome of the IFQ program. In many cases, the Council has taken action
to address these concerns. The first amendments to the program,
intended to improve entry opportunities, were implemented
simultaneously with the IFQ program itself. In addition, many quota
holders in Alaska's smaller coastal communities have chosen to transfer
their quota to others or have moved out of these communities. As a
result, the number of residents of small communities holding quota and
the total amount of quota that they hold have substantially declined
since the implementation of the IFQ program. In response, ten years
after the original implementation, the Council revised the IFQ program
to authorize certain remote coastal communities with few economic
alternatives to purchase and hold shares to ensure their access to, and
sustained participation in, the IFQ fisheries. The Council is currently
conducting a five-year review of this community purchase program,
giving particular attention to program elements and market factors that
might contribute to a dearth of community purchases to date. While some
may suggest that a redistribution of shares to communities might
address this issue, such a redistribution might be view as inequitable
by persons who purchased shares, on the expectation of receiving
returns from those purchases for several years.
Bering Sea pollock cooperatives (under the American Fisheries Act)
The Bering Sea pollock fishery is a high volume industrial fishery,
with large scale shore-based and at sea processing sectors. In 1998,
Congress adopted a cooperative management program for the Bering Sea
pollock fisheries. This Congressional action followed a prolonged,
contentious allocation debate between the inshore sector (who deliver
their harvests to shore-based plants for processing) and the offshore
sectors (who process their catch at sea). The program divides the total
allowable catch among the sectors, with 50 percent allocated to the
inshore sector, 40 percent to the catcher processor sector (including
the catcher vessels that deliver to catcher processors), and 10 percent
to the mothership sector (floating processors that receive deliveries
from catcher vessels at sea), after set asides to the Community
Development Quota program and to support catches in other fisheries.
Although an allocation dispute was the catalyst for the development
of the program, the cooperative structure is intended to address a
variety of interests and issues. Allocations are made to vessels based
on historic catches. Eligible vessel may then join a cooperative to
access exclusive annual allocations. Management burdens are reduced as
NOAA Fisheries monitors catch at the cooperative level, with all
members of a cooperative jointly and severally liable for violations of
their cooperative. Under the system, cooperatives distribute
allocations among member vessels and oversee individual vessel harvests
with contractually defined and privately administered penalties for
violations of the cooperative agreement. In part due to processor-
voiced concerns about the redistribution of landings under the halibut
and sablefish IFQ program, the catcher vessel program creates a closed
class of shore-based processors. To access an exclusive allocation, a
catcher vessel must join a cooperative in association with one of the
shore-based processors. Vessels that elect not to enter such a
cooperative may fish a limited access fishery, without the benefit of
an exclusive allocation. The program also recognizes potential
spillover effects on other fisheries that could arise if vessels
consolidate harvests or time of harvests to allow for greater
participation in other fisheries. To prevent encroachment of pollock
vessels and processors in these other fisheries, ``sideboards'' limit
pollock fishery participant catches and processing in these other
fisheries.
In the catcher processor and mothership sectors, ending the derby
fishery has allowed for greater attention to production costs and
product quality and the development of a broader range of products and
higher utilization rates. In the inshore sector, the cooperative/
processor structure has induced similar gains. Landings are coordinated
by cooperatives to avoid gaps in processing and offload delays that
might compromise product quality and increase processing costs. Many
participants in the fishery use revenue sharing arrangements, under
which both catcher vessels and the processors that they delivery to
share gains from additional product revenues. In addition, the
exclusive allocations under the program gave participants a secure
interest that facilitated improved cooperative efforts to pursue added
value for the fishery as a whole through Marine Stewardship Council
certification.
While the pollock cooperative program, in and of itself, is
considered a success by many stakeholders, some of the greatest effects
of the program have arisen through ancillary management measures that
are not directly part of the cooperative program. Almost simultaneously
with the implementation of the cooperative program, NOAA Fisheries
introduced area closures and measures to spatially and temporally
disperse pollock catch to protect Steller sea lions. While these
measures clearly impinged on fishing activity, participants were able
to comply more readily and effectively through coordination of fishing
in cooperatives using their exclusive allocations under the program.
For example, rather than a concentrated derby developing in areas from
which a limited portion of the allowable catch could be harvested,
vessels coordinated harvests from those areas distributing catches over
a greater period of time. More recently, a series of Chinook salmon
bycatch measures that require extensive fleet coordination have been
adopted. First, the Council adopted an industry managed system of
``rolling hot spot closures,'' which rely on real time bycatch
information to close areas of high Chinook salmon bycatch, as an
alternative to a less flexible, regimented system of area closures that
had unacceptable effect on Chinook salmon bycatch rates. To further
Chinook salmon avoidance, the Council recently adopted an incentive
program, under which participants who enter contractual agreements that
contain incentives for Chinook salmon avoidance at all bycatch levels
will be subject to a higher Chinook salmon bycatch cap. A performance
standard requires that participants in this incentive program maintain
bycatch well below the elevated cap in a majority of years to continue
to receive the benefits of the elevated cap. The program is intended to
accommodate uncertainties in Chinook salmon bycatch rates by creating
incentives for Chinook salmon avoidance in years of low bycatch that
would not exist under simple fixed quantity bycatch limits. Both the
``rolling hot spot closures'' and the proposed incentive agreements
depend heavily on fleet sharing of catch and effort information that
would likely have been inaccessible prior to implementation of the
cooperative program.
Bering Sea and Aleutian Island crab rationalization program
Since their inception, the Bering Sea and Aleutian Islands crab
fisheries attracted participants willing to undertake great financial
and personal risks. This large vessel, industrial fishery has a large
scale onshore processing sector with strong community dependence.
Notwithstanding the adoption of measures to limit entry, several of
these crab fisheries attracted excess capital with overcapacity
resulting in a race for crab. In the each of the last four Bristol Bay
red king crab fishery derby seasons (prior to the rationalization
program), the entire season's allowable catch (between 8 million pounds
and 14 million pounds of crab annually) was harvested in 5 or fewer
days; in each of the last three Bering Sea C. opilio (snow crab) derby
seasons, the season's allowable catch (in excess of 20 million pounds
of crab annually) was harvested in fewer than two weeks. This derby
management compromised safety as crews worked around the clock to
maximize catch; economic returns were sacrificed by this race; and
management and conservation of the resource was complicated as managers
attempted to time each fishery's closing to avoid overruns of the
allowable catch. In response to these concerns Congress directed the
Council to consider ``rationalization'' alternatives for these
fisheries. In response, the Council developed its Bering Sea and
Aleutian Islands (BSAI) crab ``rationalization'' program, which
Congress later authorized.
The Council's rationalization program reflects its desire to
accommodate the interests of several groups dependent on these
fisheries--vessel owners, processors, captains and crew, and
communities. Under the program, 97 percent of the harvest share pool
was initially issued to limited access license holders based on catch
histories. The remaining 3 percent of that pool was allocated to
captains, based on their fishing histories, for exclusive use by
persons active in the fisheries. Processors were issued processing
quota shares base on their processing histories in the fisheries. Under
these allocations, 90 percent of the catcher vessel owner harvest
shares are designated for delivery to holders of corresponding
processing shares. Shares are divisible and transferable subject to
limits. Share holders are permitted to form cooperatives to aid in the
coordination of harvests. Community interests are protected through
several measures including community landing requirements that
maintained the historic distribution of landings in the first two years
of the program, a regionalization program that requires that catch made
with certain shares be landed and processed in designated regions, and
community rights of first refusal on transfers of processing shares. An
arbitration system is included in the program to resolve price
disputes, which could arise because of the constraints on markets
created by the dual harvester/processor share allocations.
Many harvesters were concerned about the price effects of the
market restrictions of processor shares. Yet, in the first few years of
the program, the arbitration program has effectively ensured that
harvesters have continued to receive an ex vessel price that reflects
their historic division of first wholesale revenues for landings, in
lieu of a competitive price. In addition, the processor share component
of the program has limited redistribution of landings from historic
processing plants, which have substantial investments in the fisheries.
Regional landing requirements have been particularly important in
maintaining the distribution of landings to remote communities,
particularly the Pribilof Island community of St. Paul. St. Paul is
home to one of the largest crab processing plants and derives a notable
share of its annual tax revenues from the Bering Sea C. opilio (snow
crab) fishery. The rationalization program, together with a progression
of U.S. Coast Guard safety measures, is believed to have improved
safety in the fisheries by allowing captains to remain in harbors or
stop fishing in inclement weather and take time to service vessels in-
season without risking loss of catch. Some participants have also
credited the program with allowing vessels to slow operations,
resulting in significant fuel savings.
As expected, the program facilitated the removal of a substantial
number of vessels from the fleet in the first year of the program,
reducing the Bristol Bay red king crab fleet from approximately 250
vessels to fewer than 100 vessels and the Bering Sea C. opilio (snow
crab) fleet from approximately 175 vessels to fewer than 80 vessels.
This removal of capacity is believed to have provided a substantial
return to those vessel owners who sold their shares and retired their
vessels or deployed them in other fisheries, with sale revenues being
used to pay outstanding vessel mortgages or other vessel related costs
(if the vessel is maintained for use in other fisheries) and remaining
amounts being profits to the share holder.
Although this reduction in capacity was intended and expected, its
immediacy and magnitude were not. The effect was a dramatic change in
the number and nature of crew positions in the fisheries. With each
vessel employing approximately 6 crewmembers, under the rationalization
program the Bristol Bay red king crab fishery employs approximately 975
fewer crew, while the Bering Sea C. opilio (snow crab) fishery employs
approximately 675 fewer crew. Because of the relatively small allowable
catches in the fisheries in years leading up to the rationalization
program, most crew worked only a month or so in the crab fisheries.
Crew typically worked other jobs (including crew jobs in other
fisheries) throughout the remainder of the year. In addition, since
crew pay was (and is) typically based on vessel revenues, in the derby
fishery, pay was subject to risk, as vessel breakdowns or poor catches
could leave crew with little or no compensation. The relatively short
tenure of crab crew jobs was attractive to many crew, particularly
those with other employment who were able to take short periods away
from that other employment to fish crab. Notwithstanding the relatively
short term of these jobs, for many crew, crab fishing jobs were
reported to have provided important contributions to annual income.
Particularly in the case of crew from remote communities with few job
opportunities, replacing income from lost crab crew jobs is reported to
be problematic.
Overall, data and anecdotal reports suggest that the crew positions
remaining in the crab fisheries are more stable and better paying under
the rationalization program. Crew typically know the amount of shares
that will be harvested and terms of payment prior to beginning fishing,
allowing them to project income for a season. Prior to implementation
of the rationalization program, compensation hinged entirely on success
in the limited access derby fishery. The consolidation of catch under
the rationalization program has reportedly allowed some crew to rely
exclusively on crab fishing for their incomes. Other crew are reported
to work on the crab vessel in other fisheries or tendering catches from
catcher vessels to processors, relying on employment from their crab
fishing vessels for all of their income. Vessel owners hiring crew
generally give priority to crew willing to work in all crab fisheries
that the vessel participates in (and non-crab fisheries or tendering,
if the vessel engages in those activities). These preferences have led
to changes in crew composition, as some former participants are
unwilling to give up other employment to work exclusively for a crab
vessel. Maintaining a steady crew, however, can greatly simplify vessel
management, reduce hiring costs arising from high turnover, and improve
efficiency and safety, as crew become more familiar with the vessel's
operation and fellow crew. Although these benefits arise for most crew
remaining in the fishery, many crew have lost the relatively high
paying, short term work in the crab fisheries since implementation of
the program.
The Council undertook two reviews of the program in its first three
years and has adopted several amendments to address concerns that have
arisen. Another review is scheduled later this year. One amendment
frees shares initially allocated to captains from the landings
limitations of processing shares, to increase harvest flexibility and
allow active crew to receive greater value for their share holdings.
Amendment packages have also been initiated to consider measures to
strengthen community protections and increase the portion of the
harvest share pool available only to active crew. Although these
reviews and modifications may not allay concerns of all stakeholders,
they demonstrate the Council's receptiveness, willingness, and
commitment to consider changes to address program shortcomings.
Bering Sea and Aleutian Islands non-pollock groundfish trawl catcher
processor cooperatives (Amendment 80)
In 2008, NOAA Fisheries implemented a Council approved cooperative
program for the Bering Sea and Aleutian Island non-pollock groundfish
trawl catcher processor sector, commonly known as Amendment 80. The
fleet governed by this program participates in a variety of
multispecies groundfish fisheries. Most vessels in the fishery have
limited factory space and processing capability, producing only whole
and ``headed and gutted'' frozen fish. These factors, in concert, led
to disproportionately high discards rates in this fleet, as vessels
discarded fish that were deemed to have no or very limited market
value, given the processing constraints. To address this discard
problem, the Council developed a ``groundfish retention standard,''
which imposes stepwise increases in required retention over a period of
years. In tandem with this retention standard, the Council developed
the Amendment 80 cooperative program. The program allocates shares to
vessels, which can then access exclusive annual allocations by joining
a cooperative. The cooperative program allows vessels to manage (and
meet) retention requirements in the aggregate at the cooperative level.
Cooperative management typically increases communication among members,
which should facilitate the exchange of information concerning fishing
patterns and practices and their effects on catch composition, and
consequently retention. In addition, application of retention standards
at the cooperative level allows member of a cooperative to develop
contracts defining terms under which vessels with relatively high
retention rates derive a benefit from that retention from vessels with
relatively low retention rates. The intended outcome is a system in
which all vessels have an incentive for retention improvements. The
exclusive share allocations under the cooperative program allow
participants to slow fishing effort without losing a share of the
allowable catch, refocusing that effort toward retention improvement.
Exclusive share allocations also provide an opportunity for improved
production efficiency, which should ease the cost burden associated
with complying with the retention standard.
Two years into this program, most participants believe that the
program has provided much of the expected benefits. Despite this
consensus, the Council is currently considering two amendments to
further improve the program. One amendment would modify cooperative
formation standards (i.e., minimum membership requirements for
cooperative formation) to more equitably distribute of negotiating
leverage. The second amendment would allow for vessel replacement,
which could improve safety, retention capability, and economic
efficiency in the fleet.
Central Gulf of Alaska rockfish pilot program
The Council developed the Central Gulf of Alaska rockfish pilot
program after the Secretary of Commerce received a directive from
Congress to establish, in consultation with the North Pacific Council,
a two-year pilot program for management of the directed fisheries for
three rockfish species in the Central Gulf of Alaska--Pacific ocean
perch, northern rockfish, and pelagic shelf rockfish. Congress later
extended the program's duration to five years. Prior to implementation
of the pilot program, these rockfish fisheries were prosecuted by trawl
catcher vessels and catcher processors as a derby fishery during the
first few weeks of July. These vessels all participate in other
fisheries throughout the year. Landings from the rockfish fisheries
often conflicted with landings from the summer salmon fisheries that
are prosecuted at the same time. This conflict often led to delays in
offloading, resulting in a decline in the quality of products. The
program is intended to eliminate the race for fish and also allow
participants to time fishing effort to avoid processing conflicts with
other fisheries. These changes were intended to achieve improvements in
product quality and value, provide stability to processing labor force,
reduce bycatch, and improve habitat protections.
Based on the Congressional directive, stakeholder input, and public
testimony, the Council developed a cooperative management program under
which historic participants receive allocations of those three rockfish
species, along with allocations of other important species typically
harvested in these directed rockfish fisheries (including Pacific cod
and sablefish). Shares are allocated to licenses, holders of which may
access exclusive annual allocations by joining cooperatives. In the
catcher vessel sector, each harvester is eligible for a single
cooperative that must associate with the processor to which the
harvester delivered the most landings to during a specific time period.
Eligible vessels that choose not to join a cooperative may fish in a
limited access fishery without an exclusive allocation. Although this
constraint on cooperative membership choices is very rigid, the Council
believed that the cooperative/processor associations that would arise
would achieve the program's objective of reducing processing conflicts
with other fisheries and that, given the limited life of the program
and potential for future modification, any competitive advantage
arising under the structure would not be unduly exploited. The
distribution of landings across several months in each of the first
three years of the program suggests that the structure has facilitated
the redistribution of landings to avoid those processing conflicts.
Anecdotal reports also suggest that this redistribution has been used
to reduce down time at processing plants, allowing for steadier
employment of processing crews. Although processors made efforts to
expand markets for higher value products in the first year of the
program, product prices have not risen appreciably under the program.
While some in the catcher vessel sector have been quick to suggest that
the cooperative/processor associations of the program have diminished
any incentive for quality improvements, the challenges associated with
the development of new product markets in a down economy should not be
overlooked.
Improved habitat protection and reductions in bycatch under the
program are also notable. Since implementation of the program, habitat
protection improvements have arisen as a substantially greater share of
the fishery is prosecuted with ``semi-pelagic'' gear, which has less
(and less forceful) contact with the seabed than the bottom trawl gear
traditionally used in the fishery. In addition, bycatch reductions are
achieve through a few aspects of the program's design. Discards are
prohibited for all allocated species (with the important exception of
halibut, as halibut retention is not permitted in any trawl fishery).
Allocations of halibut under the program are strict limits on the catch
of halibut. Any cooperative that has fully caught its allocation of
halibut is required to stop fishing. To create an incentive for greater
reductions of halibut catch in the fishery, halibut remaining at the
end of the rockfish fishery in the November is reallocated to other
trawl limited access fisheries. Under this system of binding halibut
allocations, accompanied by the incentive of the reallocation, the
fishery has cut halibut mortality per ton of directed rockfish to less
than half the level of the best year preceding program implementation.
The Council is currently considering options to reallocate less than
100 percent of the unused halibut allocation, in a manner that would
maintain the incentive to avoid halibut bycatch while reducing total
trawl fishery halibut mortality. The overall structure of the program
has led some fishermen to acknowledge a wholesale change in their
fishing objectives under the pilot program. Under limited access
management, their objective was simply to ``out fish'' others in the
fishery to maximize catches of the three directed species, while
supplementing their income with allowable retention of other valuable
non-directed species (such as Pacific cod and sablefish). Under the
pilot program, their primary objective is to time fishing to
accommodate both processor delivery schedules and personal time
demands. When fishing, their objective is to fully harvest the various
retainable species allocations as agreed with the cooperative and
scheduled with the processor with minimal halibut bycatch. Because the
pilot program is scheduled to expire at the end of the 2011 season, the
Council is currently considering alternatives to perpetuate catch share
management of the fishery.
Conclusion
Our experience in the North Pacific indicates that catch share
management should be undertaken only as specific fishery and management
needs dictate, rather than mandated through sweeping and general
initiatives. In each case in which the North Pacific Council has
advanced catch share management, the program was shaped, through an
arduous, protracted process, to serve the specific needs of the fishery
and the Council's management objectives for that fishery. Each program
was developed against the backdrop of existing annual catch limits. In
one case in particular--the development of a comprehensive
``rationalization'' program for all Gulf of Alaska groundfish
fisheries--the Council determined after preliminary analysis and
deliberations that its efforts to develop a catch share program should
be abandoned for a variety of practical, social, and other reasons.
These fisheries all continue to be managed under strict catch limits,
with a variety of other management measures, including sector
allocations for some species. The Council similarly retracted its
decision to advance a catch share program for the halibut charter
fishery it manages and has instead advanced a variety of other
management measures in that fishery, including separate commercial and
charter annual catch limits, a moratorium on entry to the charter
sector, bag limits, and limited opportunities for charter operators to
acquire IFQ from the commercial sector. The Council is also considering
a variety of other long term measures for the charter halibut fishery.
The Council's decision to pursue management measures other than catch
shares in these fisheries reflect its view that some fisheries may not
lend themselves to catch share management.
In all of the catch share programs in the North Pacific, program
elements reflect a balance of competing interests of those who rely on
the fisheries, including vessel owners, processors, crew, communities,
environmental interests, and the public. The resulting programs
establish a balance of conservation and social goals against economic
efficiency gains. Beyond the implementation of program allocations and
mechanical regulations governing their use, monitoring and enforcement
measures were adapted with the change to catch share management. Even
applying an abundance of care, indirect and unanticipated effects arose
in all of these programs. Consequently, the Council has (and must
continue to) attend to unanticipated effects and adopt mitigating
measures. In addition, several important management concerns (such as
habitat and endangered species protections) are unlikely to be directly
addressed by catch share management and require independent management
measures. Catch shares management of a fishery may allow for new
adaptive management measures that might be unworkable under other
management programs. In addition, the flexibility provided to
participants by catch share management may ease the burden associated
with complying with those management measures.
Over the past 15 years, catch share programs have become an
important part of the fishery management regime in the North Pacific.
By using the authority to establish catch share programs with
discretion, the North Pacific Council has developed an array of
programs that serving a variety of interests in the fisheries it
manages. The Council looks forward to advancing its management of North
Pacific fisheries and appreciates the authority entrusted to the
Council by Congress under the Magnuson-Stevens Act (including the
authority to develop catch share management, as appropriate).
______
Response to questions submitted for the record by Mark Fina, Ph.D.,
Senior Economist, North Pacific Groundfish Management Council
Questions from Chairwoman Madeleine Z. Bordallo (D-GU)
1. How have different catch share designs had different impacts on
Alaska's fisheries and fishers? How are the fisheries and
communities doing after catch shares?
Response: In the halibut and sablefish IFQ program, certain shares
may only be acquired by individuals and must be actively fished by the
share holder. These components have contributed to maintaining the
owner-operator character of that fleet. In Bering Sea pollock
cooperative program and the crab program (both of which have
historically been more industrial fisheries) no such requirement
exists. In these fisheries, many vessel owners oversee business
operations and hire skippers to operate their vessels. In the pollock
cooperative program and the crab program, historic processing
dependencies are recognized by cooperative/processor associations and
the allocation of processing shares, respectively. These processor
provisions have led to increased coordination of harvesting and
processing in these two fisheries that generate primarily highly
processed products (and have limited opportunities for fresh product
markets). The halibut IFQ program includes no processor provisions.
Allowing this redistribution of landings both among processors and
geographically (to locations with better access to transportation hubs)
is believed to have contributed to the expansion of the fresh fish
market in that fishery.
The fisheries that are subject to catch share management are all
prosecuted under sustainable allowable catch limits that have
contributed to the health of the fisheries. All other fisheries in
Alaska are also prosecuted under sustainable allowable catch limits.
The fisheries under catch share management are believed to be among the
most lucrative in this region, in part, due to the efficiencies
afforded by catch share management and the endowment of the initial
allocation.
Communities, in general, have benefited from the stability provided
by catch shares management, although exceptions do exist. In some
cases, fleet consolidation has reduced the number of vessels in some
Alaska ports, vessels that have remained in these fisheries typically
spend more time in those ports, providing a more stable contribution to
the local economy. Under the previous derby management, many vessels
spent brief periods in these ports, resulting in intense spikes in
economic activities, which were followed relatively long periods of
lower levels of economic activity. In some fisheries, landings have
been geographically redistributed, with a resulting shift in economic
activity and fish tax revenues between communities. In other fisheries,
the extent of this redistribution has been limited by both regional and
port landing requirements and processor provisions that have indirectly
maintained the geographic distribution of landings. In the halibut and
sablefish fishery, some residents of small communities proximate to the
fisheries have either divested of their share holdings or moved from
those small communities. These actions of small community residents
have reduced the overall access of those small communities to the
fisheries. The Council established a community purchase program to
address this situation.
2. Is it true that lease fees are as much as 70% of the landed value
in some Alaskan fisheries? Are there ways to create a more
equitable balance between fishing and non-fishing share owners?
Response: In some instances, lease fees for quota are reported to
have reached as high as 70 percent of the landed value. Although some
observers might suggest that these lease rates reflect disproportionate
negotiating leverage between active fishermen and inactive share
holders, the lease rates are largely a reflection of the value of the
quota (which is paid in the lease fee) and the costs of harvesting that
quota (which is retained by the active harvester). To the extent that
these private lease rates are viewed as inappropriate, a variety of
measures could be considered, which will differ depending on the policy
objective. For example, if the objective is simply to ensure that
active persons hold quota in a fishery, owner-on-board or other active
participation requirements for share holders could be adopted. While
such a provision would ensure that only active participants hold
shares, recipients of the initial allocation who elect to divest are
likely to receive a substantial windfall for the sale of their shares.
In other words, it is the initial allocation that determines the
distribution of benefits (regardless of these recipients lease their
annual allocations or divest of their allocations altogether).
3. In the crab catch share program in Alaska, binding arbitration was
included to resolve price disputes. Can you briefly summarize
why this is necessary and if it is working as intended?
Response: Under the crab program 90 percent of the annual share
allocations to catcher vessel owners are required to be delivered to a
processor holding individual processor quota (i.e., annually allocated
processor shares). These two share types are allocated in equal
amounts, so each landing must be supported by individual fishing quota
and a matching amount of individual processing quota. While some
harvesters may have a variety of choices of which holder of individual
processing quota to deliver their catch to, near the end of the
matching of these share types, remaining harvesters will be left with
little (or no) choice of who to deliver their landings to. Prior to the
catch share program being implemented, harvester/processor standoffs
delayed fishing. The arbitration program is intended to prevent similar
standoffs, particularly those arising from the limit on market choices
arising under the program. The arbitration system has prevented
standoffs that might delay fishing under the program. In addition, the
system is believed by most to have effectively resolved any problem of
disproportionate market leverage that might arise out of the market
limitations of processing shares. Most participants (particularly those
in the harvest sector) believe that the arbitration system has resulted
in fair pricing for landings in the fishery.
4. What analysis has the Council conducted on the impacts of
allocating harvest shares to processors in the Gulf of Alaska
rockfish fishery? How will the Council address concerns that
processors, depending on their allocation, may be able to
influence dockside prices?
The current analysis of the rockfish program alternatives considers
the effects of the allocation of harvest shares to processors on both
the future profitability of harvesting operations and the use of those
allocations by processors to affect dockside prices. It is clear, and
anticipated, that some processors will use these allocations in the
negotiation of delivery terms (including landings prices) with
harvesters. The Council will need to determine the portion of the
harvest share pool allocated to processors (should the Council elect to
make such an allocation) to maintain a fair distribution of negotiating
leverage between harvesters and the processors receiving those
allocations.
Questions from Republican Members
1. Your testimony details a number of catch share programs in the
North Pacific. How many fisheries are managed under what are
considered catch shares? Are all (or any) of the North
Pacific's catch share plans alike? Can you explain a few of the
differences?
Response: Currently, 5 catch share programs are in place in the
North Pacific, which apply to 38 different directed species/area
allocations (each of which might be considered a target fishery). While
programs may share similar elements, no two programs are alike. The
halibut and sablefish IFQ program includes relatively strict owner-on-
board requirements, leasing prohibitions, and vessel length
designations on shares to maintain the owner-operator, small vessel
character of those fisheries. The Bering Sea pollock cooperative
program includes processor/cooperative associations that are believed
to be important to the coordination of harvesting and processing
activities in that fishery. The Bering Sea and Aleutian Island crab
program includes regional landing requirements that are believed to be
important to maintaining the geographic distribution of landings. The
Amendment 80 program in the Bering Sea includes several allocations of
cooperative bycatch quota and a ``groundfish retention standard'' to
ensure that bycatch limits in that fishery are not exceeded and that
discards do not exceed acceptable standards, respectively. The Central
Gulf of Alaska rockfish pilot program includes the allocation of
important non-rockfish species historically harvested in the fishery to
maintain the economics of the fishery and establish an appropriate
limit on the catch of those valuable species.
2. Can you tell us how long it took to develop the halibut/sablefish
plan? How long did it take to develop the Bering Sea crab plan?
The Council spent several years deliberating means of addressing
problems in both the halibut and sablefish fisheries and the Bering Sea
and Aleutian Islands crab fisheries, prior to beginning direct
development of catch share management programs for those fisheries.
The Council spent several years debating various limited entry
measures in the halibut fishery, prior to abandoning those efforts, and
subsequently, taking up the development of the IFQ program. The Council
began direct development of the halibut and sablefish IFQ program in
1987. The Council took final action adopting the program in December of
1991. NOAA Fisheries implemented the program in 1995.
The Council began direct development of the Bering Sea and Aleutian
Islands crab rationalization program in 1999 after receiving testimony
from an industry workgroup that proposed the development of the
rationalization program to address a variety of concerns in the
fishery. The program was then defined through Council deliberations
over a series of meetings with input from a number of stakeholder
committees, culminating with its final adoption by the Council at its
June 2004 meeting. Various aspects of the program were defined
throughout this period, beginning in June of 2002 and continuing until
the Council's final action adopting the program in June of 2004.
3. Can you tell us how many times these plans have been amended?
The Council has adopted several amendments to the halibut and
sablefish program, including 5 omnibus amendment packages that each
incorporated a variety of program changes.
The Council has adopted approximately 10 amendments to the crab
program, to date. The Council is also currently considering several
amendments to the program.
4. Do you know what 5 fisheries NOAA thinks could be managed under a
catch share plan by FY 2012?
Response: No.
5. Other witnesses express concern about community impacts and the
effect on new entrants. Can you describe some of the components
of the North Pacific plans that address these concerns?
Response: In the crab program, permanent regional landing
requirements and temporary community landing requirements apply to most
catcher vessel harvest shares and processing shares to limit the
geographic redistribution of landings. In addition, community entities
hold rights of first refusal on certain transfers of processor shares.
In both the crab program and the halibut and sablefish IFQ program,
community entities may purchase harvest shares. In the crab program
substantial portions of the harvest share pool have been purchased by
community entities. The Council is currently exploring the reasons for
few purchases of halibut and sablefish IFQ purchases by community
entities. In both the Bering Sea pollock cooperative program and the
Gulf of Alaska rockfish program, processor/cooperative associations and
limits on processor entry have limited the redistribution of landings
among communities.
All programs include excessive share limits intended to limit
consolidation of share holdings and fishing activity. These measures
might indirectly increase entry opportunities. Vessel length categories
in the halibut and sablefish IFQ program are intended to reduce
consolidation of catch on large vessels. In addition, to improve entry
opportunities in the halibut and sablefish fisheries, the Council
developed the ``block program'' that prevents persons from
consolidating holdings of small allocations of shares. A loan program,
funded with cost recovery funds, is also included in the halibut and
sablefish IFQ program to increase entry opportunities. A similar loan
program is incorporated into the crab program, but that loan program
has yet to be implemented. Entry to the crab fishery is also aided by
the creation of a separate class of shares available only to persons
who meet active participation requirements. The Council is considering
increasing the portion of the harvest share pool subject to these
requirements from 3 percent to as high as 10 percent.
6. How do you view the idea of Mr. Bachus that 10-25 percent of every
catch plan be mandated for communities?
Response: While community allocations might be appropriate in some
fisheries and programs, in some cases, those allocations could have
undesirable effects, and therefore, should not be mandated. For
example, in a fishery that is fully utilized, community allocations may
jeopardize the operations of current participants who depend on the
fishery (including some residents of coastal communities). In these
instances, it may be possible to mitigate (or prevent) harmful impacts
on communities through other measures, such as regional and port
landing requirements or limits on transfers and consolidation of
harvest shares.
7. Can you tell us why the Council backed off from the Gulf
rationalization plan? Is this an example of where council
flexibility allowed you to change direction when it was clear
that the fishing industry did not support the direction the
Council was taking?
Response: The Council elected not to advance the Gulf
rationalization program for several reasons. As a comprehensive
program, the program would have regulated all gear types and fisheries
in the Gulf. The challenge of developing a single system to address the
variety of interests and needs in these different fisheries was viewed
as insurmountable. The inability to develop a comprehensive program
addressing the variety of stakeholder interests led to opposition to
the program from some of those stakeholder interests.
8. Are you concerned that NOAA might push for a Gulf rationalization
plan? How would this be viewed by the fishermen and the
Council?
Response: I do not believe that NOAA will inappropriately pressure
the Council to develop a rationalization program for the Gulf. Efforts
to inappropriately advance any management would be frowned on by both
the Council and fishermen.
9. NOAA seems to think that catch shares are the only answer for
overfished fisheries. Do you agree?
Response: Establishing annual catch limits and a management and
monitoring program that ensures that those limits are not exceeded is
likely the most effective means to address overfished fisheries. These
limits can be established with or without catch share management.
10. Did the halibut/sablefish ITQ plan include any community
provisions when first implemented? If not, when was that added
and why was it added?
Several components of the halibut and sablefish IFQ program (as
initially adopted) are intended to provide some level of protection to
community interests. These including vessel length categories, owner-
on-board requirements, and prohibitions on leasing, all of which are
believed to aid small vessel fishermen and residents of remote coastal
communities, whose participation in the fisheries is more likely as
active, small vessel fishermen. In addition to these indirect measures,
in 2002, seven years after implementation of the IFQ program, Council
adopted the community purchase program amendment, which directly
authorizes community representatives to acquire shares in the program.
NOAA Fisheries implemented that program in 2004.
11. Concern has been raised that there is not enough coordination
between councils and that some councils are not learning from
the mistakes made by other councils in developing catch
shares--in particular that the Pacific Council may not have
learned from some of the mistakes made by your council. Do you
agree with this concern?
Response: I was contacted periodically by the Pacific Council staff
during the development of their catch share program, but did not
participate directly in that process. Additional coordination among
Councils is achieved through Council Chair meetings and workshops on a
variety of specific issues. I do believe that additional coordination
among regional and Council staff would be beneficial to the development
of all management programs (including catch share programs). If such
coordination is developed, it is important that it facilitate direct
communication across the regions, rather than through intermediaries
that have no (or less) direct experience with the development of
management actions.
12. In your experience, are there any particular things that you
believe MUST be in all catch share plans (community
protections, allowance for new entrants, etc.)?
No. In the development of a catch share program, a Council should
be required to consider a variety of factors (such as entry
opportunities and community protections) and develop a program that
adequately addresses those needs. A variety of means to achieving those
ends are available. The appropriateness of these various measures may
differ across fisheries and provide different results. For example,
allowance for new entrants may do little to facilitate full scale entry
to a fishery, if persons fishing that allowance have no meaningful
opportunity to acquire shares in the main catch share program.
Alternatively (and depending on the circumstances), ensuring that small
allocations are available for acquisition could facilitate a more
meaningful entry to the fishery. Likewise, a variety of measures are
available to protect community interests, including community
allocations, regional and port landing requirements, and limits on
share transfers. The appropriateness (and effectiveness) of these
measures may vary across fisheries.
13. In your experience, in a fishery where there is both a
recreational component and a commercial component, is it
possible to develop a catch share program that will allow the
traditional percentage split between the sectors to be altered
as the fishery is rebuilt? For example, if a fishery is split
50/50, as the fishery rebuilds and the biomass increases, could
anything above a specific biomass or TAC level be split in a
different proportion? Are there any examples that you can think
of where this has already been done?
Yes, it is possible to alter the distribution of the total
allowable catch (or annual catch limit) between sectors as the annual
catch limit changes. A few examples of those distributions are present
in the North Pacific.
In the halibut fishery, an estimate of non-guided (non-charter)
recreational catch is deducted from the annual catch limit prior to
allocations to the charter (guided recreational) sector and commercial
IFQ program. This non-guided recreational fishery set aside is a
relatively small portion of the annual catch limit in the fishery. The
tonnage of that allocation is not affected by changes in the annual
catch limit. In addition, the new catch sharing plan for the halibut
fishery will also change the percent of the annual catch limit
available to the charter fishery as the annual catch limit changes. At
annual catch limits below 5 million pounds, the charter sector is
allocated 17.3 percent of the annual catch limit; at annual catch
limits of 5 million pounds or above, the charter sector is allocated
15.1 percent of the annual catch limit. So, at low annual catch limits,
the charter sector gets a larger share of the fishery, with more of the
burden of downward annual catch limit changes borne by the IFQ fishery.
As the annual catch limit increases, the IFQ fishery will receive a
greater share of the increase. Similarly, the percentage of the annual
catch limit of certain species allocated to the Amendment 80 catch
share program fluctuates with the annual catch limit.
In addition, in most of the catch share fisheries in the North
Pacific, set asides for incidental catches in fisheries that are not
subject to catch share management are established prior to any
allocation to the catch share fishery. Many of these set asides are a
small part of the total allowable catch and many are unaffected by
changes in the total allowable catches.
______
Ms. Bordallo. Thank you very much, Dr. Fina, for sharing
your experiences with catch shares in the North Pacific.
Now it is my pleasure to introduce Dr. Rosenberg. Please
begin.
STATEMENT OF ANDREW A. ROSENBERG, Ph.D., SENIOR VICE PRESIDENT
FOR SCIENCE AND KNOWLEDGE, CONSERVATION INTERNATIONAL
Dr. Rosenberg. Madame Chairwoman and members of the
Subcommittee, thank you very much for the opportunity to
testify today. I am Andrew Rosenberg, Senior Vice President for
Science and Knowledge at Conservation International, and I am
Professor of Natural Resources at the University of New
Hampshire. But I should say that I am not speaking on behalf of
either of my organizations today. Conservation International
has no position on this issue. I am speaking from my experience
in fisheries over the last 25 years.
Catch shares are a general term for fishery management
strategies that allocate a specific portion of the total
allowable catch to individuals, cooperatives, communities, or
other entities, and the concept isn't new. Nor is the
controversy.
The controversy is so intense because catch shares are
ultimately about allocation, allocation of fishing privileges
on a public resource to different users. In fact, most fishery
management controversy is about allocation between fleets,
gears communities, areas, and so on.
The increased interest has been prompted in part by ongoing
problems of overfishing that, despite years of difficult and
time-consuming management efforts, persist in many fisheries in
the U.S. and internationally. The requirements of the Magnuson-
Stevens Act to end overfishing and rebuild overfished stocks as
soon as possible is exactly the right thing to do, and the
setting of annual catch limits is the key to ending
overfishing.
There are methods for setting such limits in a sensible,
proactive manner, even when data are incomplete or limited. I
would refer you to a range of publications on that topic.
For the purposes of this hearing, I would note that in my
opinion, the setting of annual catch limits and the
implementation of catch share systems do not necessarily have a
greater data and information requirement than other fishery
management approaches. The requirement is there for any fishery
management approach, not just catch shares.
Catch share systems can increase the value of the catch,
reduce the cost of fishing, thereby increasing profitability,
and can engender a greater sense of resource stewardship in the
fishery because of the durability of fishing opportunities for
participants.
One of the greatest potential benefits for the catch share
system is that in principle, many of the decisions about
fishing tactics are internalized to the fishery, rather than by
regulation. All of these benefits have been shown to occur in
some fisheries, domestically and internationally, and I think
many of those benefits are shown in the North Pacific fisheries
we just heard about.
In my observation, those participating in catch share
systems usually become strong supporters of the approach. But
the corollary is that those who opt out or are left out usually
seem to assign all problems of the fishery to that same catch
share approach.
In reality, catch share systems can have substantial
benefits, but may not suit all situations, nor will they suit
all participants.
Careful design of catch share programs is critical to their
success, and many of the potential negative impacts, such as
excessive consolidation and decline of traditional fishing
communities, can be minimized or avoided by incorporating
specific policies, if done carefully.
Nevertheless, the transition to catch share systems
represents fundamental change from a long tradition of race to
fish to get dedicated privileges, to catch a specific amount of
fish, from competition to cooperation, from maximizing fishing
opportunity to maximized profits, to minimizing costs to
maximized value and profit.
In deciding whether a catch share system is appropriate,
key design elements include setting of goals, including social
and economic goals; setting the comprehensiveness of this
issue, of the system--does it cover the entire fishery;
allocation and transferability of shares of the catch;
monitoring, reporting and enforcement policies, communication
and decision-making processes.
These elements are challenging for managers and
stakeholders to address, but are very much resolvable by
specific policies that have been developed for existing catch
share programs. Of course, new policies can be developed as we
gain additional experience.
In any particular program, however, the choices are
critical because fisheries vary so much, one to the other. And
those choices will result in strong or weak programs to achieve
the goals, or simply engender more controversy.
I would simply refer to a few key points in design
structure, and then leave you to my written testimony for other
details.
While the Magnuson-Stevens Act sets broad national goals,
the specific goals within those national goals are going to
vary greatly from place to place. And managers need to work
with stakeholders to identify biological, ecological, social,
and economic goals to shape catch share systems. You can't
leave out that goal-setting step.
In a transition strategy, in order to meet that set of
goals, there needs to be very careful consideration to the
design, rules, fees, eligibility requirements, and
transferability requirements--and to funding transition costs
into a new system. Public funding of the administration of a
system is critical to the evolution of that system into an
effective way to prevent overfishing, as well as to manage the
fishery.
Finally, monitoring and reporting and enforcement are
critical to catch share systems, but that is true of other
fishery management systems, as well. In principle, much of that
monitoring enforcement requirement can be done by sectors,
shares, or catch share holders themselves; therefore, not
making it solely a governmental program.
The agency can, in that situation, be in a position of
working with fishermen in monitoring and enforcement, as
opposed to focusing on the enforcement side.
Thank you very much, Madame Chair. I would be happy to
answer questions.
[The prepared statement of Dr. Rosenberg follows:]
Statement of Andrew A. Rosenberg, Ph.D., Senior Vice President
for Science and Knowledge, Conservation International
Madam Chairwoman, Thank you and the members of the subcommittee for
the opportunity to testify today concerning the design and
implementation of catch share programs for the management of fisheries.
I am Andrew A. Rosenberg, Senior Vice President for Science and
Knowledge at Conservation International and a Professor of Natural
Resources and the Environment at the University of New Hampshire. I was
a member of the U.S. Commission on Ocean Policy and a current member of
the Joint Ocean Commission Initiative. I have been involved in the
science and management of ocean resources, particularly fisheries,
throughout my career. I served as a scientist, then Northeast Regional
Administrator and Deputy Director of NOAA Fisheries during the 1990's
before moving to the University of New Hampshire.
Catch shares are a general term for fishery management strategies
that allocate a specific portion of the total allowable catch to
individuals, cooperatives, communities, or other entities. Some
fisheries across the nation, and indeed internationally, employ catch
share systems for a range of commercial fisheries. The concept of catch
share systems is not new, though the approach has used different labels
at various times. Nor is the controversy over catch share systems new.
In fact, from the one sentence description of catch share systems that
I just gave, it is clear why the controversy occurs and why it is so
intense and durable I might add; because catch shares are ultimately
about allocation of a portion of the catch or fishing privileges. In
fact most fishery management controversy is about allocation; between
fleets, gears, communities, areas and so forth.
The increasing interest in catch share systems has been prompted in
part by ongoing problems of overfishing that, despite years of
difficult and time consuming management efforts, persist in many
fisheries in the U.S. and internationally. The requirements in the
Magnuson-Stevens Act to end overfishing and rebuild overfished stocks
as soon as possible is exactly the right thing to do, but the
management measures needed to do so are difficult for managers,
fishermen, and all stakeholders to come to grips with. It is the
requirement to set annual catch limits that is the key to ending
overfishing. The catch limits themselves are often controversial
because restricting the size of the catch intensifies the difficulties
of allocation.
There are methods for setting such limits in a sensible, proactive
manner even when data are limited and I would refer you to reports I
have co-authored on this topic for further information. For the
purposes of this hearing I would note that in my opinion, the setting
of annual catch limits and the implementation of catch share systems do
not necessarily have a greater data and information requirement than
other fishery management approaches. In other words, it is almost
always helpful to have more stock assessment and other fishery
information, not just for annual catch limits and catch share
approaches. But the lack of full information doesn't prevent or obviate
the need for moving forward with better more effective management
approaches.
This hearing is about catch shares and why such a system may, or
may not, help address problems in fisheries management. After all, if a
catch limit is set and adhered to fully, then overfishing should no
longer occur. The role of catch shares is not to end overfishing but to
address allocation, and more importantly, catch share systems can
increase the value of the catch, reduce the costs of fishing, thereby
increasing profitability, and can engender a greater sense of resource
stewardship in the fishery because of the durability of fishing
opportunities for participants. One of the greatest potential benefits
of a catch share system is that, in principle, many of the decisions
about fishing tactics are internalized to the fishery, rather than by
regulation. That is, fishermen make decisions on tactics and
regulations in principle can be simplified to those that address annual
catch limits rather than fishing tactics. All of these benefits have
been shown to occur in some fisheries domestically and internationally.
In my observation, those participating in catch share systems
usually become strong supporters of the approach. But the corollary is
those that opt out or are left out usually seem to assign all the
problems of the fishery to the catch share approach. In reality, catch
share systems can have substantial benefits, but may not suit all
situations nor will they suit all participants. I think this simple
statement is factual and is clear in the NOAA draft catch share policy.
Careful design of catch shares programs is critical to their
success and many of the potentially negative impacts, such as excessive
consolidation and decline of traditional fishing communities and
methods, can be minimized or avoided by incorporating specific
policies. Nevertheless, transitions to catch shares systems represent
fundamental change--from a long tradition of the race-to-fish to
dedicated privileges to catch specific amounts of fish; from
competition to cooperation, from maximizing fishing opportunity to
maximize profit to minimizing costs and value to maximize profit.
Allocation of the available catch among fishermen often leads to
impassioned debate about what is ``fair'' among members of industry and
managers.
Design Considerations for Catch Shares Programs
In deciding whether catch shares are appropriate for particular
fisheries several key elements requires careful consideration. These
include aspects of initial program design including goals of the
program including social and economic considerations and its
comprehensiveness; allocation and transferability of shares of the
catch; monitoring, reporting, and enforcement policies; communication
and decision making processes. These elements are challenging for
managers and stakeholders to address, but are very much resolvable via
specific policies that have been developed in existing catch shares
programs around the U.S. and internationally. In any particular program
however, the choices are critical and will result in strong or weak
programs that will achieve the goals or simply engender more
controversy.
Goals and objectives: Setting clear and measurable goals and
objectives to guide management is critical to the success of any
fisheries management system, including catch shares. While the
Magnuson-Stevens Act sets broad national goals, goals for specific
regions and fisheries often vary greatly from place to place. During
transitions to catch shares, stakeholders often express concern that
the goals of programs are unclear. Managers should work with
stakeholders to identify measurable biological, ecological, social, and
economic goals and objectives at appropriate region- and fisheries-
specific scales and articulate how catch shares programs can meet them.
In addition, if some of the catch is not allocated but remains in a
common pool, i.e., in a given fishery if the catch share system is not
comprehensive covering the whole fishery, then the rules for the common
pool must be designed such that the conservation program is not
undermined such that the catch limits cannot be adhered to. This will
very likely mean that the regulations for the common pool, recreational
or commercial, will need to be quite restrictive compared to those for
vessels in the catch share systems. It is not surprising that if only a
partial system is implemented then those not in the system will be in
conflict with those in the share system and potentially the benefits of
a catch share system will dissipate. However, a partial system may
still be better than the alternative, even with partial benefits.
Initial allocation: One of the greatest challenges decision makers
and stakeholders face in transitioning to catch shares is determining
the initial formula for allocation of the TAC because the decision is
grounded in varying interests' ideas of what is fair. What seems fair
to any one group of fishermen will often seem unfair to others. Key
considerations include how the decision will be made, what the formula
will be, how catch history or fishing capacity will be calculated, how
errors in government records will be corrected so that fishermen
receive accurate allocations, what kind of appeals process will be put
in place, and which kind of entities will be allocated quota shares.
Transition strategy: Transitioning to any fishery management system
that confines harvesting to sustainable catch limits can be initially
difficult for fishermen. However, a well-designed and executed
transition strategy can ease the burden of change for fishery
participants and managers alike. Transition strategies can include
limits on quota transfers in the early years of implementation, public
funding for administration of catch shares until industry returns to
sufficient profitability to shoulder these costs, and step-wise
evaluation of biological, ecological, and socioeconomic impacts that
prompt improvement in programs over time.
Harvesting strategies and policies: Maintaining sustainable harvest
rates is not the only requirement for protecting and restoring
ecosystem health, but also minimizing impacts of harvesting on habitat
and bycatch of nontarget species. For this reason, habitat and gear
considerations must be taken into account in catch shares systems.
Catch shares programs should include requirements and incentives
related to use of selective harvesting strategies and gear. If the TAC
is applied to catch--instead of landings--incentives to reduce bycatch
through gear selectivity will be built automatically into the system. A
caution here is that the strategies for addressing ecosystem issues
should not result in dissipating the benefits of catch share systems
more generally. The same principle of allowing flexibility in fishing
tactics if the conservation outcomes are achieved must be maintained.
Transferability of quota: Allowing transfers of quota via sale,
trade, or lease among fishery participants is critical for economic
efficiency, a key goal for most catch shares programs. However, there
are potential downsides to providing unlimited transferability that are
often of major concern to those interested in protecting small-boat
fleets and traditional fishing communities. These impacts can include
excessive consolidation and inflated quota purchasing and leasing
prices that can undermine the ability of independent and small-
operation fishermen to compete. In order to meet social and economic
goals, important considerations in program design include the rules,
fees, and eligibility requirements placed on transferability of quota
shares at vary points of maturity of catch shares programs. These
issues can be dealt with but it is very much harder to do so after the
implementation of the system than as part of the initial
implementation.
Adaptive management set-asides: Setting aside part of the TAC for
adaptive management can provide decision makers flexibility to take
action to address unintended consequences without having to reduce
shares of fishermen's catch mid-season. Managers need to decide the
appropriate level of set-aside for this purpose and for how long they
should hold that quota into the fishing year before releasing it to
harvesters. In addition to setting aside quota for adaptive management,
managers should consider providing incentives for fishermen to engage
in cooperative research. Cooperative research is an important way for
fishermen and scientists to learn from one another, gain better
understanding of fisheries, and provide costs savings for scientists
and extra income for fishermen.
Monitoring, reporting, and enforcement: Reliable catch monitoring
and reporting are critical for the success of any fishery management
system. For catch shares programs, where harvesters are held
accountable for staying within strictly defined catch limits,
enforcement must rely on collective responsibility of the group holding
quota. In other words, if any member of the group does not adhere to
the rules all members of the group must have some accountability.
Choosing appropriate monitoring and reporting levels, methods, and
technologies should be partly decided on statistical grounds and partly
decide upon perception of the monitoring program. The statistical
issues are usually fairly clear with a certain level of monitoring or
sampling resulting in a certain level of confidence in the results. The
perception issues are much more difficult such that participants and
the public have confidence in the system. Further, determining who will
pay the administrative and infrastructure costs is an important
decision that can make or break a catch shares program. Adequate and
fair enforcement will also be critical for meeting program goals and
improving relationships among managers and fishermen. Furthermore, if
there is a common pool portion of the fishery then enforcement will be
complicated because two sets of rules will be in operation. Ensuring
that participation in the fishery as a whole is contingent upon
following the rules is an appropriate level of accountability for a
public resource, in my opinion.
Forums for improving trust and communication: A long history of
conflict among fishermen, managers, and scientists in many regions of
the U.S. complicates meaningful improvements to fisheries management,
including the establishment of catch shares programs. Decision makers
should ensure that a diversity of stakeholders are productively engaged
in program design by providing neutral forums for discussing and
learning about various design elements of catch shares.
Information to support decision making: Effective policies can
feasibly be implemented even when the information on the fishery is not
complete. Nevertheless, better analyses of baseline conditions,
projections for impacts under proposed management systems, and tracking
of progress toward biological and socioeconomic goals can improve any
fisheries management program. Managers should identify early in the
process any special studies that will be needed to support informed
design and implementation of programs, as well as ways information can
be shared with fishermen in forms useful to their business decision
making and for their productive contribution to program design.
Quantity and quality of jobs: Social and economic characteristics
that are important to fishermen and their communities, which ultimately
depend on healthy fish stocks for long term success, are necessarily
constrained by the limitations of the natural environment. However,
within those limitations are abundant opportunities to define social
and economic goals for fisheries and incorporate policies into catch
shares programs that can help regions and communities achieve those
goals. Unfortunately, fishermen often disagree among themselves about
these details, putting managers in a difficult position of having to
make decisions in the face of some guaranteed measure of opposition.
Key factors that will require clarification for fisheries transitioning
to catch shares include the appropriate mix of vessel and ownership
types, definitions of excessive consolidation and what measures are
appropriate to prevent it, how social and economic impacts will be
measured through time in light of confidentiality restrictions on the
collection of such data, and how to address the unintended transfer of
effort from fisheries transitioning to catch shares to others.
Concluding remarks: Overall, catch share systems can be affective
tools for allocating fishing privileges and engendering greater
accountability and stewardship in a fishery, while increasing value and
profitability. Because these benefits can be obtained, it doesn't mean
they always will be if the system isn't designed well. Whether there is
a catch share system or not, it is essential that fisheries are managed
to stay within prudent catch limits that avoid overfishing and resource
declines that have plagued fishery management for many years.
Proponents of catch share systems need to accept that the design issues
are important to the result for the resource, fishermen and fishing
communities. Opponents of catch shares need to suggest alternatives
that do not continue the overfishing and resource declines of the past
while changing the dynamics of the fisheries debate.
Madame Chair, thank you for the opportunity to testify today and I
look forward to your questions.
______
Ms. Bordallo. Thank you, Dr. Rosenberg, for your statement,
and for being here today.
Now I would like to recognize Mr. Backus. Please proceed.
STATEMENT OF EDWARD BACKUS, VICE PRESIDENT, COMMUNITY ECOSYSTEM
SERVICES, ECOTRUST
Mr. Backus. Good morning, Chairman Bordallo and members of
the Subcommittee. My name is Edward Backus, and I am the Vice
President for Community Ecosystem Services at Ecotrust, a
nonprofit organization based in Portland, Oregon.
I am also founder and Chair of the North Pacific Fisheries
Trust, a $6 million community fishing quota revolving
investment fund. I very much appreciate the opportunity to
speak before you today.
Ecotrust's mission is to work toward creating economic
opportunity, social equity, and environmental well-being. We
work in a wide variety of economic development activities,
including banking, ecological forest management, fisheries,
finance, marine spatial planning, green building, and organic
farm market development.
In fisheries, we regard catch share programs as having
several valuable features, including increasing vessel safety,
extending fresh market seasons, and, most important,
accountability and incentives at the level of individual
vessel.
But the dark side of fisheries quota programs is that they
create an intangible asset, which can then migrate away from
communities, displacing the economic benefits of fishing in a
painful manner.
These are not trivial issues. Some of the most successful
fishing communities in Alaska and the U.S. West Coast are
struggling with the transition to the next generation of
fishermen. How catch shares are treated can well determine
whether such communities make it or not into the future.
Catch shares create markets and market value from this
public trust asset. But they must remain a public trust asset,
whether at the state, Federal, or local community level.
Quota programs empower the first generation of recipients,
but hamper future generations. An examination of the patterns
of quota transactions in Alaska and British Columbia shows an
emerging pattern of market price, debt, leasing, and wage
effects.
Some observers say that catch shares privatize fisheries.
An example of this is when quota shares are leased. Ownership
structures are key. Our national policy should not allow the
creation of perpetual leasing operations by corporations or
family trusts.
The current Pacific Trawl IQ program does just this, and
will stifle innovation, reduce the benefits of liquid trade of
quota shares, create barriers for new entrance, divert revenues
from crew, communities, and economic multipliers.
So what do communities want? From our observations,
Ecotrust recommends a required implementation of the community
provisions as part of any catch share program, as provided for
in the Magnuson-Stevens Act, Section 303 [a], the limited
access privilege programs.
These provisions should become mandatory policy, not just a
requirement for fishery management councils to consider the
provisions. There should be some teeth in them so that fishery-
dependent communities receive appropriate priority in the
decision-making process as a matter of good public policy.
The policy should require that some proportion of fisheries
quota shares be anchored in communities through entities like
community trusts, such as the Community Quota Entity program in
Alaska.
Why? As the 2004 Government Accountability Office report,
GAO 04277, found, the easiest and most direct way to help
protect communities under an IFQ program is to allow the
communities themselves to hold quota. The unpredictable
political process of the fishery management councils does not
guarantee that community issues will be addressed, even using
the current standards, presumed requirements, and options now
in the MSA.
I would like to point out that the Pacific Fishery
Management Council just last week again delayed the treatment
of community fishing associations, effectively regarding it as
not an integral part of the pending trawl individual quota
program.
Recommendations. That NOAA strengthen the new policy on
catch shares to set the following required standards of U.S.
fishery management councils, if and when they undertake catch
share programs.
Mandate the direct allocation to community ownership of at
least 10 percent of all quota shares in each fishery management
council region.
Require the development of community fishing associations,
regional fishing associations, and other community structures
now authorized in Magnuson.
Initiate a national quota-share trading registry to promote
ownership transaction and pricing transparency, a feature which
has been law since 1996.
Last, the National Marine Fishery Service has not yet
issued the rule for limited access privilege program criteria
or guidelines for the development of regional fishery
associations and other community structures. The agency
requested public input in 2007; here in 2010 we do not have any
guidelines, criteria, or rules.
The Councils themselves are required to provide these
criteria, and we are still waiting for them. NOAA and Congress
need to provide mandatory oversight in any U.S. catch share
program to address these community issues.
Thank you for the opportunity to make this statement this
morning. I look forward to your questions.
[The prepared statement of Mr. Backus follows:]
Statement of Edward H. Backus, Vice President
for Community Ecosystem Services, Ecotrust
Good morning, Madam Chairwoman, Honorable Members of Congress,
fellow witnesses, and distinguished guests. My name is Edward Backus,
and I am the Vice President for Community Ecosystem Services at
Ecotrust a non-profit organization based in Portland, Oregon.
Ecotrust's mission is to inspire fresh thinking that creates
economic opportunity, social equity and environmental well-being.
Ecotrust works within a wider family of organizations which includes
important partners such as Ecotrust Canada, ShoreBank Pacific--a for-
profit commercial bank, ShoreBank Enterprise Cascadia--a non-profit
rural community development financial institution, and Chicago's
ShoreBank Corporation. We own and manage commercial timberlands through
Ecotrust Forests LLC including carbon credit sales. Together, we have a
collective staff of over 130 professionals and more than $300 million
in assets.
Ecotrust believes we need fresh thinking--innovation--that creates
market (economic), environmental, and social ``value.'' We need an
innovative systems approach to our challenges because social, economic
and environmental conditions are all interconnected and interdependent
parts of a larger system of life support. Only systemic solutions solve
systemic problems. And we need resilience in order to survive and
restore in times of stress. We need to innovate our way towards more
resilient ecosystems, economies and social systems.
The deepest, most powerful ``fresh'' thinking is inspired by nature
because we are a dependent part of natural systems. Over the
evolutionary history of life on Earth, nature has solved all the
fundamental design challenges of resilient, adaptive organisms, living
communities, natural economies and robust ``institutions.'' We can
achieve ``reliable prosperity'' by practicing a natural model of
development not because it is a better model, but because it is the
only one (Jane Jacobs).
The Economist defined innovation is as ``fresh thinking that
creates market value.'' Fresh thinking inspired by nature is deep
innovation. Crisis creates the opportunity to scale deep innovation for
transformational change.
Market Design is Critical in Public Trust Assets
To the point of this hearing, I am the Founder/Chair of the North
Pacific Fisheries Trust, a $6M community quota revolving investment
fund.
We are working with longline fishermen in Southeast Alaska on the
Alaska Sustainable Fisheries Trust, working with many communities in
the Community Quota Entity program in Gulf of Alaska, and community
fishing associations in Port Orford, Oregon, San Francisco and San
Diego, California.
Our finance activities are but tailpipe solutions that struggle to
work as a result of some weak policy choices that have been made in
existing catch share programs. Choices that we are on the verge of
repeating in the pending Pacific trawl IQ program on the U.S. west
coast.
Catch shares (known as limited access privilege programs in the
Magnuson-Stevens Fishery Conservation and Management Act) are a good
tool for establishing individual vessel accountability in a fishery
with a clear Annual Catch Limit, can stop the ``race for fish'' thereby
increasing the safety of fishing and fishing fleets, and creating a
more even flow of fresh, higher value seafood products to consumer
markets.
But catch share programs also generate powerful financial
incentives that can warp the long-term outcomes and success of such
programs. These effects are growing stronger and in some cases just
manifesting themselves.
Catch share programs need to be carefully designed need to address
long term issues in community stability, economic viability, and
intergenerational processes. We call this the 3E's: ecosystems,
economics, and equity. Fisheries are a public trust and community
economic development asset and should remain as such. In October 2007,
Ecotrust developed a Market Design Workshop for Limited Access
Privilege Programs in U.S. Fisheries at the Harvard Business School.
Many new markets have been created from public trust assets. Catch
share programs in fisheries should learn from these experiences.
Recommendations:
NOAA needs to strengthen the new policy on Catch Shares to set the
following required standards of U.S. fishery management councils if and
when they undertake catch share programs:
Create catch share design pilot programs with fixed terms
for quota ownership, periodic auctioning of all or part of the catch
shares, triple bottom line (ecological, economic, social) performance
based allocations, and other strategies to understand the effects of
quota programs on long-term sustainability.
Mandate direct allocation of quota shares to community
entities.
Mandate community ownership of at least 10-25% of all
quota shares in each fishery management council region.
Require the development of Community Fishing
Associations, Regional Fishery Associations and other community
structures now authorized in the Magnuson-Stevens Act as enacted.
Initiate a national quota share trading registry to
promote ownership, transaction and pricing transparency.
NOAA should also act to:
Fund the National Fisheries Innovation Fund of the
National Fish and Wildlife Foundation for the support of community
entities interested in participating in catch share programs.
Review existing catch share programs in terms of their
performance to date, to determine what those experiences can offer for
the design of new programs, rather than putting in motion a set of
parallel efforts that are not informed by what has happened on the
ground/dock/ocean already.
Why do I make these recommendations?
The recently issued NOAA Catch Shares Policy is a set of program
goal statements but that the agency is challenged to actually implement
the policy. Many of the desired policy elements that fishing
communities would like to see as outcomes are there, but the reality is
quite different.
For example, the policy states:
Fishing Community Sustainability: NOAA encourages Councils to take
advantage of the special community provisions in the MSA to help assure
sustainable fishing communities, including the continuation of working
fishery waterfronts, fishery infrastructure, diverse fishing fleets,
and resource access... To this end, NOAA will help support community-
based design and investment in innovative fishery management options.
This partnership would include providing technical assistance in the
development and submission of community sustainability plans under MSA
Section 303A, and providing technical assistance in the creation of
fishing community trusts or permit banks to help retain access to
fisheries resources by fishermen in local communities.
The capricious political process of the fishery management councils
does not guarantee that community issues will be addressed even using
the current standards, presumed requirements, and options now in the
Magnuson-Stevens Fishery Conservation and Management Act (MSA). NOAA
needs to provide mandatory oversight measures in any U.S. catch share
program to address these community issues.
Key Issues
Ecotrust, and its finance subsidiary the North Pacific Fisheries
Trust, have been monitoring and evaluating several issues related to
the patterns emerging from the quota fisheries that are in place in
Alaska and British Columbia.
History in these fisheries shows that groundfish are an important
economic development asset that provides the broadest set of benefits
when access is tied to the traditional pattern of fishing communities
on our coast. The IQ program needs the flexibility to meet the multiple
goals it has defined either explicitly or implicitly such as bycatch
avoidance, rebuilding of stocks, community stability, and economic
``effectiveness'' (not necessarily always efficiency) via different
incentives. In changing resource, policy, and business environments,
stability and flexibility can foster innovation and adaptation in new
markets, fishery methods, and adaptive organizations such as Community
Fisheries Associations.
Community stability: quota can migrate away
Fishery quota shares are intangible assets that can migrate away
from communities. A NMFS study found that in the small communities of
the Gulf of Alaska, the number of persons holding halibut quota shares
dropped by 46% from 1995-2004.
[GRAPHIC] [TIFF OMITTED] 55542.001
.epsQuota programs empower the first generation of recipients and
hamper the future.
Testimony from the recent North Pacific Fisheries Management
Council February 2010 meeting from the Alaska halibut fishery shows
that second generation (even with gifting of quota--which generates
capital gains tax stress) does not earn the same revenues as those who
were initially issued quota. An examination of fifteen years of data on
quota transactions also shows an emerging pattern of market price,
debt, and social effects.
Leasing and debt kills the culture of fishing and fishing communities
Ownership structures are key; our national policy should not allow
the creation of perpetual leasing operations (family corporations or
otherwise). The current Pacific Trawl IQ program does just this, and
will stifle innovation, reduce the benefits of liquid trade of quota
shares (one of the presumed benefits of catch share programs),
individual ownership, incentives for new entrants, divert revenues from
crew, communities, and economic multipliers. The Pacific Trawl IQ was
set up for economic efficiency, not as a strategy for conservation or
community viability.
In the pending Pacific trawl TIQ program, the current definition of
``eligible to own'' quota shares does not limit the ability of
prospective owners of quota shares to lease those shares into the
future. The biggest risk associated with leasing is the dissipation of
fishing revenues away from active vessel owner/operators, new entrants,
crewmembers and communities as leasing fees come ``off the top'' before
regular expenses and wages are paid. In some cases lease fees are 70%
of gross landing receipts (Alaska crab fisheries). Whenever and
wherever lease rates reach these levels, it is very difficult for non-
owners to earn a fair return on their fishing assets and time.
``Desperation''
Two recent publications 1 (see endnote) from the British
Columbia quota fisheries experience have demonstrated that leasing of
quota undermines the financial stability of remaining fleets after the
implementation of an IQ program, particularly in situations where non-
fishing owners and processors control quota share.
---------------------------------------------------------------------------
\1\ ``A Cautionary Tale About ITQs in BC Fisheries'', Briefing,
Issue 8, 2009, Draft 13 May 2009, Vancouver, BC: Ecotrust Canada.
Pinkerton, E. and D. Edwards, 2009, ``The elephant in the room: The
hidden costs of leasing individual transferable fishing quotas'',
Marine Policy 33:707-713.
[GRAPHIC] [TIFF OMITTED] 55542.002
.eps 75% of the landed value in BC halibut fishery goes to
pay lease fees to the non-fishing owners of quota.
84% of the total costs in the BC halibut fishery is lease
fees.
Evelyn Pinkerton of Simon Fraser University, in a long term study
of the effects of leasing in British Columbia quota fisheries, heard
characterizations of small boat fishermen as ``desperate'' in the
control of processors who dominate the holdings of quota shares. Vito
Giacalone of Gloucester, Massachusetts, who operates a permit bank for
trawlers, says leasing will lead to fishermen being sharecroppers.
[GRAPHIC] [TIFF OMITTED] 55542.003
.eps 30-50% decline in crew shares occur when all quota on
BC groundfish trawler is leased.
[GRAPHIC] [TIFF OMITTED] 55542.004
.epsDebt:
A serious issue that will face the next generation of fleet members
is debt associated with Quota Share purchases. In order to enter the
fishery, new entrants will buy quota shares, be gifted Quota Share, or
lease them from initial recipients.
We are empowering the current generation of quota recipients, who
have certainly earned their way by building businesses, but we are
saddling all future generations of fishermen with debt (unless you have
quota issued already in the family--but even that generates capital
gains pain...gifting quota from one family member to another is a
taxable event.)
As a specific example, 25,000 lbs. of halibut QS at $24/lb. =
$600,000. If a new entrant could acquire a NMFS loan at 30% down, the
cash upfront required would be $180,000. The remaining debt would be
$420,000. At 8% interest for 30 years, payments would total $1.12M
including principal and interest (interest of $700k, which is 166% of
the principal.)
Prices Escalate: Price/Earnings Ratios of Fisheries Quota
We can use the data from the Alaska halibut IQ fishery from the
period 2000-2007 as a benchmark example. Every year, between 38 and 52%
of transfers in that period were financed. The Alaska halibut QS price
has been tracking with dock prices but has inflated on a relative basis
from 1995 to 2009 2 (see endnote). The historical ratio of
QS/ex-vessel prices has been generally in the range of 3-5:1, but has
been substantially above that range for the past several years.
Recently, both QS and ex-vessel (dock) prices have been coming down,
but dock price has fallen much faster (back to historic long term
levels near $2.50 - $3.00/lb.), with the result being that the QS
price/dock earnings index is now double historical norms at
approximately 8:1, worse by 100%. New entrants that need to finance QS
in order to enter the fishery have been and are continuing to face a
strong headwind in this environment.
---------------------------------------------------------------------------
\2\ Ex-vessel prices based on data from Alaska Commercial Fisheries
Entry Commission for 1995 thru 2007. Estimated prices reflect weighted
average ex-vessel prices reported for all fixed gear types (longline,
troll, jig, and handline) and all delivery/condition types. Estimates
reflect deliveries by catcher vessels to shoreside processors. 2008 and
2009 values based on anecdotal evidence.
2) IFQ market value based on NMFS/RAM data for1995 thru 2005,
PermitMaster for 2006 thru 2009.
[GRAPHIC] [TIFF OMITTED] 55542.012
.epsOne issue driving the run-up in this ratio appears to be
Gifting of QS to new entrants. Gifting of AK QS halibut shares was 18-
28% from 2000-2007 3. Gifting cuts the cost basis of
acquiring new QS substantially, creating a major competitive advantage
for further accumulation of QS by the Giftee. On the other hand,
Gifting usually comes with an implied revenue commitment of at least
50-70% to the Giftor. Thus the Price/Earnings ratio is at least 25%
better for the Giftee compared to a new entrant.
---------------------------------------------------------------------------
\3\ Table of Alaska Halibut Transfer data summary (2000-2007),
courtesy of the Restricted Access Management Program, NOAA Fisheries,
Juneau, AK, prepared March 2009.
---------------------------------------------------------------------------
What do we need to do?
We need firm program requirements as national standards that must
be implemented in all catch share programs.
Community Fisheries Trusts: creating different incentives
Require Councils to make at least a 10% (or more) allocation to
Community Trusts:
Why?
Having an allotment of quota that is permanently anchored
in communities can help community and geographic stability.
Trusts with no debt can lease for 8-12% overhead rates.
New entrants to the fishery have an incentive to stay and
fish in that community if they can get a start with low rate leases of
quota.
New entrants can then bootstrap themselves into gradual
individual ownership of quota as they earn greater revenues with less
overall debt.
Trusts can offer capital gains tax solutions to retiring
fishermen, thus investing additional amounts of quota into the
community.
Community or Regional Fishery Associations as written the
Magnuson Act can function as Trusts.
Community Fisheries Trusts (including Regional and Community
Fishing Associations) can contribute to environmental, economic, and
community needs, including:
Protecting smaller ports and smaller-scale fishermen.
Community Trusts can help protect smaller ports and smaller-scale
fishermen by initiating strategies to (a) anchor fishing quota in the
community; (b) facilitate intergenerational transfer of fishery access;
(c) incentivize and leverage affordable catch share financing; (d) help
fishermen diversify their fishing ``portfolios''; and (e) deliver
health care to fishermen and their families. In turn, these activities
will support the maintenance of fisheries related infrastructure in
communities and attract new entrants to the fishing community.
Participating in the development and design of effective
fisheries management. Trusts can provide a key role in emerging catch
share systems (e.g. program design, planning, permit auctions, finance,
marketing) by bringing fishermen's voices to FMC meetings or by
retaining specialized expertise. In addition, they can participate in
bycatch reduction initiatives such as gear modification, mapping
bycatch hotspots, improved fishing practices, etc.
Creating fishery conservation networks. Community Trusts
can serve as vehicles for information sharing, contribute to scientific
research, reduce carbon footprints, and mentor young fishermen.
Building and participating in new emerging markets for
sustainable community-based seafood products. In recent years,
increases in aquaculture production and seafood imports have had a
profound effect on the domestic ocean fishing industry. While
aquaculture and foreign seafood may have a competitive advantage in
price, U.S. fishermen still have several advantages over producers of
these product types. First, many domestic wild fisheries have the
advantage of being closer to markets and therefore a shorter supply
chain to the consumer. At the same time, the demand for both fresh and
locally caught seafood is growing rapidly. A CFA could capitalize on
these advantages by (a) supporting development of regional brand; (b)
initiating marketing to reach key consumers and providing increased
coordination for existing marketing efforts; and (c) promoting
awareness among consumers about local and seasonal seafood options.
The Magnuson-Stevens Act now allows for the creation of these kinds
of community-based fishing support organizations and innovative fishing
communities around the country have already been finding ways to meet
the major challenges they face. We need to support the development
process of Community and Regional Fishery Associations early and
widely, however, so that communities may engage in the creation of the
standards or guidelines to be developed to encourage these alternatives
to mature.
Experiences from Alaska fisheries: one that works, one that does not.
Let us look at the Community Development Quota corporations in
Alaska--successful due to allocation (vs. Community Quota Entities--
which have to purchase on open market, not competitive).
Two experiences in Alaska with Community Fisheries Trust-like
entities are instructive for developing the Community FA framework:
Community Quota Entities (CQEs) and Community Development Corporations
(CDQ).
CDQs were established 15 years ago by an act of Congress and were
allocated 10% of overall quota in many species. Today they are vibrant
multi-million dollar revenue community based economic development
engines.
Community Quota Entities (CQEs) were formed 10 years into the
Alaska IFQ program by the North Pacific Fishery Management Council and
were not allocated any Quota Shares and must buy them on the open
market. They do this with great difficulty, given the price for quota
and the capital barriers to entering into the market.
Both CDQs and CQEs are examples of Community Fisheries Trusts. The
management processes of both organizations create a sense of cohesion
and cooperation at the scale of communities. Both forms have evolved
considerable managerial skill and capacity. In terms of viability,
however, one system is healthy, one is not.
The major lesson here is that it is beneficial to establish Trust
type institutions immediately when starting an IFQ program.
As a 2004 Government Accounting Office report found (GAO-04-277),
``the easiest and most direct way too help protect communities under an
IFQ program is to allow the communities themselves to hold quota''.
Recommendations:
NOAA needs to strengthen the new policy on Catch Shares to set the
following required standards of U.S. fishery management councils if and
when they undertake catch share programs:
Create catch share design pilot programs with fixed terms
for quota ownership, periodic auctioning of all or part of the catch
shares, triple bottom line (ecological, economic, social) performance
based allocations, and other strategies to understand the effects of
quota programs on long-term sustainability.
Authorize direct allocation of quota shares to community
entities.
Mandate community ownership of at least 10-25% of all
quota shares in each fishery management council region.
Require the development of Community Fishing
Associations, Regional Fishery Associations and other community
structures now authorized in the MSA as enacted
Initiate a national quota share trading registry to
promote ownership, transaction and pricing transparency.
NOAA should also act to:
Fund the National Fisheries Innovation Fund of the
National Fish and Wildlife Foundation for the support of community
entities interested in participating in catch share programs.
Review existing catch share programs in terms of their
performance to date, to determine what those experiences can offer for
the design of new programs, rather than putting in motion a set of
parallel efforts that are not informed by what has happened on the
ground/dock/ocean already.
Thank you for your time and I look forward to your questions.
______
Response to questions submitted for the record by Edward Backus,
Vice President, Community Ecosystems Services, Ecotrust
Questions from Chairwoman Madeleine Z. Bordallo (D-GU)
1. If properly designed, catch share programs can play an effective
role in a multi-faceted approach to responsibly managing
fisheries. However, poorly designed catch shares can create as
many problems as they solve. Would you agree with this
statement?
Yes I would. Poor design can generate a variety of negative social
and economic effects including; impacts to the culture and structure of
fishing communities, increasing debt loads among existing and second
generation fishing participants, reduced revenues and access from the
practice of leasing, disenfranchisement of crew and their role in
successful fishing businesses, disruption of the geographically
proximate relationships between communities and natural resources via
the migration of the intangible asset of quota shares away from
communities through market trading, among other effects.
Well designed catch share programs will draw on the market design
principles from other industries where new markets have been created
using public trust assets (e.g. the wireless spectrum). In fisheries,
good design should address economic, ecological, and social issues.
Market design experts suggest that all of these issues can addressed by
market approaches. Some of these approaches were explored by Ecotrust
during a market design workshop for catch shares programs in U.S.
fisheries at the Harvard Business School in October 2007 (proceedings
at: http://www.ecotrust.org/cbfm/WPS4--Fisheries--Mrkt--Design.pdf)
Julia Olson, social scientist with NOAA Fisheries, NE Fisheries
Science Center in Woods Hole Massachusetts has conducted a social
impact assessment of catch shares in fisheries in detail in the context
of the New England scallop fishery. Her report is available here; the
New England Fishery Management Council's September 22-24, 2009 Council
Discussion Documents. #9a Environmental Impacts Section 1.5.2 - Pages
93-103.
2. How can catch shares give fishers a ``false sense of security?''
The emergence of catch shares as a defacto ``property right'' has
supported the creation of much wealth in the U.S. fisheries sector. But
it is hard for fishermen to remember that quota is a privilege that can
be revoked, especially after many participants have engaged in
successful market transactions to buy or sell quota shares.
First, in terms of allocations, quotas provide no more legal
protection to fishermen than regular fishing permits or licenses.
Whether a fisherman owns a permit or quota, the government can
reallocate commercial catches to settle international or other
treaties, or to meet demands of the sports-fishing sector. By way of
example, in British Columbia, 12 percent of the commercial halibut
catch was reallocated to the sports-fishing sector in 2003. There is a
similar ongoing process in Southeast Alaska in the halibut sector, this
time with litigation. This was done without compensation to halibut
quota holders. Catch share quotas don't strengthen the property rights
of fishermen to prevent reallocations or in seeking compensation.
Second, catch share quotas do nothing to mitigate ecological
uncertainty. Climate change, marine survival rates, habitat damage,
predation and other factors cause fish stock levels to fluctuate and
thereby create the greatest uncertainty for fishermen. It must be
remembered that quotas are generally a defined percentage of the total
allowable catch (TAC) and don't represent a specific poundage of fish
(even though quota shares are often sold in units of pounds). As a
result, when fish stock levels rise and fall from year to year because
of environmental conditions so do fishermen's quotas. Quotas will do
nothing to mitigate this kind of ecological uncertainty. In fact when
TACs decline, fishermen have a tendency to lobby Councils and other
management entities (International Pacific Halibut Commission) to set
the TAC higher than biological recommendations would suggest. This
happened at the IPHC in 2010. In this sense, catch shares tend to
develop a sense of entitlement and a resulting sense of betrayal when
things must change due to ecological or biological limits.
Third, in terms of market forces, quotas can help fishermen respond
better to the market by giving them flexibility to deliver catches when
demand and prices are high. However, many fishermen lease quota in pre-
season agreements, locking themselves into lease rates per pound. In
some fisheries, 60 to 75 percent of the landed value goes to paying
quota lease fees. If fish prices drop or fuel costs rise, their profits
could disappear. As a result, quota leasing can actually increase
fishermen's risk and exposure to changing market forces.
One certain aspect of catch share programs is that some fishermen
will opt to lease their quotas if allowed, thus guaranteeing themselves
revenue without any risk of having to actually go fishing.
3. In your testimony, you reference the research of Evelyn Pinkerton
of Simon Frasier University, who found British Columbia small
boat fishermen as ``desperate'' in the control of processors
who dominate the holding of quota shares. Can you expand upon
this point?
The term ``desperation'' demonstrates how extreme the results,
feelings, and impacts of allowing leasing in catch share programs can
be. The context of the fisheries examined by Pinkerton also
demonstrates that the effects are not just about economic efficiency,
but have everything to do with fishing culture, community structure and
well-being, inter-generational hope, and maintaining a sense that
fisheries are a viable business to enter. It is critical to learn from
the experience in British Columbia to prevent catch share programs from
undermining small boat fishing as a viable small business. Fishing is
not viable if it becomes just the labor component in a larger equation
of control by non-fishing entities.
Quoting from the Pinkerton and Edwards paper in Marine Policy...
``Of the 182 active halibut fishing vessels in 2006, 37 vessels
leased 90% or more of the halibut quota they fished, 67 vessels
leased 70% or more of the halibut quota they fished, and 91
vessels (half the active fleet) leased 50% or more of the
halibut quota they fished.... It is impossible to know exactly
what percent of leasing creates a marginal operation, because
individual situations are varied and complex. But it is clear--
that leasing is by far the largest fishing cost and that
operations become increasingly less profitable, the more of
their quota they must lease. It is also clear--that a
significant number of operations...more than a third of the
fleet...currently fall in the less viable or marginally viable
category (those leasing 70% or more of the quota they fish).''
``Why do lessee skippers continue to fish if their operations
are marginal? Why do not they correctly receive the market
signals that they are financially non-viable? Economic theory
predicts that such marginal operations will simply cease to
lease quota and find more profitable employment. But there are
many reasons why marginal operations continue. Sometimes a
vessel owner leases quota to pay for the maintenance of the
vessel. A vessel may serve multiple subsistence,
transportation, identity, or prestige functions, or maintaining
it may simply represent the hope that the price will go up.
Operating a vessel may be the best or only way to offer a job
to a son to help pay for his education, and to have a working
experience with him. In some cases, fishermen know no other
life, have no other skills, subsidize their fishing with
another job or another fishery, or are unwilling to relocate to
places with more economic opportunity because they have
extended family and community and low cost housing where they
live.''
Pinkerton and Edwards conclude;
``Increasingly, those who have advocated ITQs as economically
efficient are making broader claims about the general health of
the industry and broader public benefits. So in the question of
``efficient for whom?'', the answer is assumed to be
``efficient not just for holders of ITQs but also for all
actors in the fishery and the owners of the resource, the
Canadian public''. This discussion has shown that this
assumption, as well other assumptions under- pinning the
indiscriminate promotion of ITQs, do not apply in the British
Columbia halibut fishery.''...
``The quota leasing market in the BC halibut fishery is
limiting efficiency, stifling innovation, and causing financial
hardship. It is clear that a well functioning ITQ fishery
requires greater forethought, oversight, and regulation in the
design and implementation of transferability rules.''
Reference: Pinkerton E, Edwards DN. The elephant in the room: The
hidden costs of leasing individual transferable fishing. Marine Policy
33 (2009) 707-713.
4. Could you describe the advantages that community entities could
provide in addressing the issues of leasing, debt, new
entrants, taxes, and other issues?
Fisheries are an important economic development asset that provides
the broadest set of benefits when access is tied to the traditional
pattern of fishing communities on our coasts. A catch share program
needs the flexibility to meet the multiple goals it has defined either
explicitly or implicitly such as bycatch avoidance, rebuilding of
stocks, community stability, and economic ``effectiveness'' (not
necessarily always efficiency) via different incentives. In changing
resource, policy, and business environments, stability and flexibility
can foster innovation and adaptation in new markets, fishery methods,
and adaptive organizations such as Community Fisheries Associations.
If, under the community provisions of the MSA, community entities
are set up such as Fishing Communities (yet needing definition by
Councils) or Regional Fishery Associations as non-profit 501c3 tax
exempt organizations under the IRS code, then these organizations can
provide economic incentives to address leasing, debt, taxes and other
issues.
Using the example of the pending Pacific trawl individual quota
program, a fisherman receives an allotment of quota. Let's say he
wishes to retire and sell his quota (not leasing it.) His cost basis
for receiving the quota is zero and so he will have to pay capital
gains taxes. Selling his quota at a discount to a non-profit community
entity creates a multi-year capital gains tax abatement strategy. The
discount is a charitable donation, an ``investment'' in that
fisherman's own community that has supported him during his fishing
career.
To continue this same example, now a new generation fisherman
wishes to get into the business, and he has just enough capital to buy
the active vessel from the retiring fisherman, but he cannot afford a
loan to buy quota shares which are required to go fishing. Now he can
lease that quota from the Community Entity at rates well below sub-
market (assuming the Community Entity has no debt--which it might'') 8-
12% rates which help pay the low overhead for the Community Entity.
The issue of whether the Community Entity has any debt is germane
to the initial allocation issue. Again, in the case of the Pacific
trawl individual quota program, there is a 10% set aside known as the
Adaptive Management Program, the specific use or allocation of which is
yet undefined by the Pacific Council. This 10% might be allocated to
processors in fact as one of the options. But, it could be (should be)
allocated to community entities thus combining the program ideas for
Adaptive Management and Community Fishing Associations that the Pacific
Council is considering in trailing actions after it submits this new
catch share program as an amendment to its groundfish management plan.
One potential use of the 10% Adaptive Management allocation could
be to reduce capital requirements for in-season needs to cover overages
incurred by vessels (disaster tows). The Groundfish Management Team
report on this matter indicates that this allocation should be ``used
for reasons beyond generating profit, for a broad sector benefit.'' For
example, the Adaptive Management 10% could also be used to buffer the
``margin'' needed to address Over Fished Species (OFS) allocations.
Allocating this 10% set-aside to Community Fishing Associations for
these purposes could also reduce in-season transaction costs by making
it easier for vessels to find and lease the needed marginal Quota Share
to address these bycatch or overage issues.
Community Entities as described in the MSA are conceived of exactly
to provide ``broad sector benefits'' as described by Pacific Council
process.
5. In the Magnuson-Stevens Fishery Conservation and Management Act,
the language of part of the Limited Access Privileges Program
section describes Regional Fishery Associations. Can you
explain the term Community Fishing Associations and describe
how either of those entities can function to help communities?
As described in the previous question the MSA contains two specific
community provisions in relation to catch share (limited access
privileges) programs; Fishing Communities and Regional Fishery
Associations. One can be allocated catch share quota--Fishing
Communities, and one cannot--Regional Fishery Associations.
In the case of the pending Pacific trawl individual quota program,
the Pacific Fishery Management Council began to explore using the
concept of the Regional Fishery Associations (RFA) in March of 2009,
well into to the design process of the program. The Council decided to
name them Community Fishing Associations (CFA), which we interpret as
the same as the RFA structures defined the Magnuson-Stevens Fishery
Conservation and Management Act.
In any case, RFA or CFA entities can function as community entities
(trusts) as described in the previous question. The overall functions
of a CFA/RFA are to provide fishing communities a way to hold quota
share assets within catch share programs, either through purchase or
donation thus providing tax advantages. Having a CFA entity in a
community also can provide incentives to keep fishermen, landings, and
infrastructure in place, and therefore tax revenues, and economic
multipliers from other businesses.
CFAs will require community boards to run them, and this will
enhance the transparency of the quota process, leasing, market prices
of quota sales and other functions. Markets work best when there are
multiple sources of information about prices and community entities can
be a source.
To reiterate the functions and benefits of CFA/RFA structures, I
quote from my prior written testimony;
Having an allotment of quota that is permanently anchored
in communities can help community and geographic stability.
Trusts with no debt can lease for 8-12% overhead rates.
New entrants to the fishery have an incentive to stay and
fish in that community if they can get a start with low rate leases of
quota.
New entrants can then bootstrap themselves into gradual
individual ownership of quota as they earn greater revenues with less
overall debt.
Trusts can offer capital gains tax solutions to retiring
fishermen, thus investing additional amounts of quota into the
community.
Community or Regional Fishery Associations as written the
Magnuson Act can function as Trusts.
In addition, Regional and Community Fishing Associations can
contribute to environmental, economic, and community needs, including:
Protecting smaller ports and smaller-scale fishermen.
Community Trusts can help protect smaller ports and smaller-scale
fishermen by initiating strategies to (a) anchor fishing quota in the
community; (b) facilitate intergenerational transfer of fishery access;
(c) incentivize and leverage affordable catch share financing; (d) help
fishermen diversify their fishing ``portfolios''; and (e) deliver
health care to fishermen and their families. In turn, these activities
will support the maintenance of fisheries related infrastructure in
communities and attract new entrants to the fishing community.
Participating in the development and design of effective
fisheries management. Trusts can provide a key role in emerging catch
share systems (e.g. program design, planning, permit auctions, finance,
marketing) by bringing fishermen's voices to FMC meetings or by
retaining specialized expertise. In addition, they can participate in
bycatch reduction initiatives such as gear modification, mapping
bycatch hotspots, improved fishing practices, etc.
Creating fishery conservation networks. Community Trusts
can serve as vehicles for information sharing, contribute to scientific
research, reduce carbon footprints, and mentor young fishermen.
Building and participating in new emerging markets for
sustainable community-based seafood products. In recent years,
increases in aquaculture production and seafood imports have had a
profound effect on the domestic ocean fishing industry. While
aquaculture and foreign seafood may have a competitive advantage in
price, U.S. fishermen still have several advantages over producers of
these product types. First, many domestic wild fisheries have the
advantage of being closer to markets and therefore a shorter supply
chain to the consumer. At the same time, the demand for both fresh and
locally caught seafood is growing rapidly. A CFA could capitalize on
these advantages by (a) supporting development of regional brand; (b)
initiating marketing to reach key consumers and providing increased
coordination for existing marketing efforts; and (c) promoting
awareness among consumers about local and seasonal seafood options.
6. There are two community entity structures in Alaska, the Community
Quota Entities and the Community Development Corporations.
Could you explain their functions and similarities or
differences?
Let us look at the Community Development Quota corporations in
Alaska--successful due to allocation vs. Community Quota Entities--
which have to purchase on open market, and therefore not competitive
nor successful.
Two experiences in Alaska with Community Fisheries Trust-like
entities are instructive for developing a Community Entity framework:
Community Quota Entities (CQEs) and Community Development Corporations
(CDQ).
CDQs were established 15 years ago by an act of Congress and were
allocated 10% of overall quota in many species. Today they are vibrant
multi-million dollar revenue community based economic development
engines.
Community Quota Entities (CQEs) were formed 10 years into the
Alaska IFQ program by the North Pacific Fishery Management Council and
were not allocated any Quota Shares and must buy them on the open
market. They do this with great difficulty, given the price for quota
and the capital barriers to entering into the market.
Both CDQs and CQEs are examples of Community Entities. The
management processes of both organizations create a sense of cohesion
and cooperation at the scale of communities. Both forms have evolved
considerable managerial skill and capacity. In terms of viability,
however, one system is healthy, one is not.
The major lesson here is that it is beneficial to establish
community entity organizations immediately when starting any catch
share program.
7. If access to the federal fisheries finance program were expanded,
would that help the situation in communities?
Representatives for the Community Quota Entity Program in Alaska
and the North Pacific Fisheries Trust have had discussions with the
headquarters (Silver Spring/NOAA) and regional offices of the federal
fisheries finance program. The headquarters office was not aware of the
CQE program.
The current federal program which finances the purchase of quota
shares is only accessible by individuals. This is a very successful
program in financial terms and has the enviable record of no defaults
on loans the program has made for quota purchases.
It would be of great benefit to communities if the access to this
federal finance program was provided for community entities, such as
the Community Quota Entity Program in Alaska, as well as Community
Fishing Associations and Regional Fishery Associations.
Our understanding is that this would require legislative action by
the Congress, and we endorse such a potential action.
Questions from Republican Members
1. Are you familiar with the North Pacific halibut plan? How would
that fishery have changed if your idea of requiring up to 25
percent of the fishery be giving to communities?
I am familiar with the halibut quota program as implemented by the
North Pacific Fishery Management Council. The North Pacific Fisheries
Trust is active in many Alaska communities that fish halibut, own
quota, or seek to acquire quota.
The halibut fishery experienced a 25% consolidation in the early
years (1-4) of the program. Based on studies by Alaska-based university
social scientists and economists and NOAA program administrators, one
would project that community allocations would have dampened the
negative effects of the program (see references at end of section). In
fact the subsequent allocations to the Community Development Quota
Corporations managed to allow many communities to recover from those
effects.
In general with community allocations, one would expect to see far
less quota migrate away from communities, more stable communities from
a social and economic structural perspective, far more viable small
fishing communities, less human migration away from communities, a
greater sense of hope in communities which became marginalized through
the process, more time for people to understand the creation of a new
``asset''--quota shares and how the value of that asset would change
over time and more incentives for fishing businesses to stay in
particular communities in order to access the community-based quota.
Fishing businesses are not independent in their relationship to
communities, although many of them migrate around with the seasonal
fisheries, even as they may be based in another state or larger
community somewhere else in the same state. Crews, gear shops, fuel
docks, processors, secondary businesses in supplies and other services
must be part of the equation when considering the design of catch share
programs with public trust fisheries. Owners should not be the sole
beneficiaries of the ``conversion'' catch shares. One way to recognize
the role and relationship of communities in this process is to allocate
a modest amount (10%) to community entities (either Fishing Communities
or Regional Fishery Associations) as provided for in the Magnuson-
Stevens Fishery Conservation and Management Act (as revised 2006).
References:
Enclosing the Fisheries: people, places, and power. Marie E. Lowe
and Courtney Carothers, editors. 223 pages. Published by the American
Fisheries Society, December 2008. Bethesda, MD. ISBN: 978-1-934874-05-9
Report on Holdings of Individual Fishing Quota (IFQ) by Residents
of Selected Gulf of Alaska Fishing Communities 1995--2004, March 2005.
Alaska Region, NOAA Fisheries Service (NMFS) Restricted Access
Management Program , Juneau, AK 99802 www.fakr.noaa.gov
2. Do you think that taking a percentage of the quota off the top for
communities would work in New England fisheries?
Yes I do. But in fact the sector allocations could effectively
generate the same result. However they are not designed consistently
for geographic coherence. In other words some sectors have boats from
Maine and Martha's Vineyard in the same sector, boats that do not
share/fish the same waters and stocks, or use/participate in the same
ports. This is not an approach that supports the connections between
``people and place''--the natural affinities and knowledge that
fishermen have for fisheries resources--the patterns of seasons,
stocks, and their inherent variability.
If sectors, which are effectively co-operatives, were delimited
geographically, such as the Cape Cod hook sector, then you would have a
set of community supporting structures, assuming you require all
fishery participants in that cluster of related communities to
participate in the sector in order to fish. That way all of the issues
subordinate to the initial allocation of potential harvests to that
sector can be managed by the co-op approach to the sector; when and
where to fish, catch and bycatch sub-allocations, intra-sector in-
season exchange of sub-allocations to allow fishing to continue as long
as possible etc.
The goal of community allocations, either via community entities,
or community-based sectors is to provide an ``anchor'' for the quota or
allocations in communities to dampen the potential effects of quota
markets, escalating prices, quota and human migration, barriers to new
entrants, and so on. Some observers suggest that bycatch species or
stocks still under rebuilding plans overly limit the sector approach
and thus it will not work. Within an ecosystem-based approach to a
multispecies fishery (such as New England groundfish) I do not see any
other approach which could provide more flexibility in dealing with a
broad spectrum of issues while operating within the biological limits
of the marine ecosystem.
3. How would a community set-aside work in an area where there are
many small communities? Would there be enough quota in any one
community to support a fleet? If not, how would a community
set-aside work?
In general, any community set-aside will not be enough to support
an entire fleet regardless of how many or few communities are involved.
However, the central concept is that a community allocation creates as
incentive for individual fishermen to stay fishing in that community as
there is an ``anchor'' of quota that will never leave that community.
The assumption is made in the community set-aside process that
individuals will have quota holdings that can be matched up with
community holdings to create larger pools in income. Thus there is an
incentive to stay and fish in that community.
In addition, the potential uses of that quota (based on experiences
in Alaska) could be to promote new entrants into a fishery--such as the
skiff class in the halibut fishery. The overall goal being to create
interactions between individual and community incentives, specifically
by helping new fishermen have access to low cost leases for quota, then
earning enough income to be able to save for their own quota purchases
in the same vessel class (again using the Alaska halibut example). Thus
you are using the community process to ``bootstrap'' individual
ownership of catch share quota, building community stability in the
process.
In Alaska, the Community Quota Entity program allows for multiple
communities to operate under one single Entity (organization) thus
pooling quota and representing a greater synergy of interests. This
option has yet to be used.
4. Most people believe that Councils should have flexibility in
developing fishery management plans. Why do you believe it is
okay to mandate community set-asides?
Flexibility has its place, but we need some boundaries on
flexibility. We need some mandates and as well limits on those
mandates, balance in other words. Sideboards or basic requirements are
needed, based on the lessons one can learn from the experience to date
from around the world with catch shares in fisheries. 10% set asides
have been established in Alaska in many quota fisheries, 10% has been
allocated--though not defined in its ultimate purpose--for adaptive
management in the Pacific trawl individual quota program being
proposed. We have enough experience with the negative effects of catch
share programs, and enough experience with community set-asides to show
that, done correctly, their economic and social effects are positive.
10% hardly impacts any flexibility the Councils have in designing catch
share programs.
5. You have harsh things to say about the fishery management councils.
Do you think we would have better fishery management plans if
NOAA wrote them? If you are concerned about NOAA's push toward
catch shares and you are concerned with the council, who do you
think should develop fishery management plans?
This question tries to frame the issue as ``one or the other'' e.g.
the Councils vs. NOAA as the decision maker or arbiter in fisheries
management. This is a false dichotomy. My point is that within the
democratic process of the fishery management councils, we commonly
observe that economic politics tends to highly influence the outcomes
of the voting process in the creation or amendment of fishery
management plans. If I appear critical of that process, I am only
making a realistic statement that describes the process.
The reason we have national standards (which do not carry the force
of law as does the rest of the Magnuson-Stevens Act) is to try and
provide some consistency in the outcomes of fishery management plans in
the U.S. But since these standards are open to wide interpretation by
Councils depending on the political pressures they are subject to, the
outcomes are inconsistent - for example National Standard 8 (the social
and economic effects on communities) requiring only the consideration
of these effects.
The Council process is a genuinely democratic process but it needs
to some minimum requirements. NOAA is pushing catch shares as a policy
but it cannot implement that policy except through the Councils (aside
from technical or financial assistance NOAA may provide). Catch shares
are complex market instruments. Few if any Council members, staffs or
committee members have expertise in market design.
Therefore, based on what is widely known on the social and economic
effects of catch shares on communities, in the process of creating
catch share programs it is time we established some mandates for
minimum requirements for Councils to implement the community provisions
that are already written in the Magnuson-Stevens Fishery Conservation
and Management Act (as revised 2006).
______
Ms. Bordallo. Thank you, Mr. Backus, for your remarks on
how catch shares can be improved.
Now I would like to recognize Ms. Cobb. Please proceed.
STATEMENT OF LEESA COBB, EXECUTIVE DIRECTOR,
PORT ORFORD OCEAN RESOURCE TEAM
Ms. Cobb. Good morning, Madame Chairwoman and members of
the Subcommittee. My name is Leesa Cobb. My husband is a
commercial fisherman on the southern Oregon coast, and I serve
as Executive Director at the Port Orford Ocean Resource Team,
which is a community fisheries program.
I have submitted written comments, and offer the following
summary.
After studying catch share programs worldwide, it is clear
that even the most carefully designed programs can have
negative impacts to communities, fishermen, and fisheries that
should be of concern to all of us.
For example, catch share programs established by sector or
gear do not include ecosystem management or marine spatial
planning principles, while at the same time ecosystem
management is called out by the Joint Ocean Commission Report,
and the importance of marine spatial planning has been elevated
in this Administration.
Also, vessels exiting catch share fisheries may increase
fishing pressure in non-catch share fisheries. For example,
when fishers that choose to sell their quota realize an
enormous financial gain and exit the catch share fishery, they
may then increase our effort in other regulated fisheries, and
the spillover effect happens.
I cannot even list one fishery on the West Coast that can
withstand additional capital infusion from a catch share
fishery.
In a catch share fishery, many ports can suddenly see their
access to fish disappear, as quota of something moves out of
smaller ports. Serial depletion may occur for some species due
to limited spatial controls because, as quotas are consolidated
in specific areas, effort increases closer to those home ports.
Catch share programs prevent people from entering the
fishery unless they come from established fishing families
already owning boats, or are wealthy enough to purchase quota.
For the purpose of the hearing today, let me start by
asking why an investment of $54 million in catch shares, and
why catch shares to the exclusion of other fishery needs?
I want to emphasize that catch shares are only one tool for
fisheries management, and you have heard that several times
today. But it seems disingenuous for NOAA to also acknowledge
catch shares as only one tool, and then in turn allocate $54
million to exclusively develop catch shares.
NOAA is not offering this funding to help councils decide
how to best manage for sustainable fisheries from the list of
management options. They are only providing them funding for
catch shares.
It is difficult to understand NOAA's push for catch shares.
The most confusing aspect of the campaign is a claim made by
groups that catch shares will end overfishing. It is the total
allowable catch based on good science that is responsible for
ending overfishing in any fishery. If the total allowable catch
is set at unsustainable levels, the fishery is likely to
collapse, regardless of allocating the TAC to quota.
Many fishermen have expressed concern that NOAA's new
budget to assist councils with catch shares comes at the
expense of funding for science that will actually provide the
data to determine total allowable catch that every fishery
needs to be sustainable.
I am troubled by NOAA and council saying that catch shares
are not a property right. If you can buy and sell quota, take
it to the bank and mortgage quota, and if you can fight over
quota in Divorce Court, quota is property. It seems the only
way to get quota back from second-generation quota holders who
have purchased it is going to be to buy it back.
The most important point is the language in the NOAA draft
catch share policies. The most ironic point is the language in
the NOAA catch share policy that states NOAA encourages
councils to take advantage of the special community provisions
in MSA to help ensure sustainable fishing communities, and so
on.
It is common knowledge that catch share programs improve
economic efficiency; and, by their very nature, result in
consolidation of the fleet. This, in turn, causes loss of jobs,
economic disruption to coastal communities that rely on fishing
jobs, and can cause a loss of infrastructure at ports that
traditional fishing relies on.
One wonders at an Administration that is concerned about
jobs, why catch shares would receive this level of support.
We also know that initial allocation of quota comes at a
high social cost. Many fishermen, including captains and crew,
are pushed out of these fisheries in an initial allocation, and
young fishermen are burdened with the expensive loans to pay
for buying their first quota share.
Additionally, in many fisheries, actual fishers are leasing
quota from so-called absentee landlords. This sharecropper
fishing, where independent fishermen are now fishing for
investors, will take money out of fishing communities.
If not carefully regulated, the balance of power between
processor and fishers may change greatly, as well. A
simplistic, one-size-fits-all approach to fisheries management
does a disservice to the diversity of fisheries management
options that have proven effective, and others that show
promise.
We do know that a catch share program if tightly regulated
with low accumulation caps, owner-operator provisions, and
opportunities for new entrance can be one way to manage a
fishery. Unfortunately, the catch share campaign has now
drowned out all the other ideas and approaches to fisheries
management in public discourse and among policy makers.
If NOAA decides to proceed with their full court press for
catch shares, the following will be critical; they should
require NOAA to establish a process for communities to
participate in the socioeconomic analysis of catch share
programs.
Presently, communities rely on the National Marine
Fisheries Service and the Councils' analyses; and frankly,
communities don't have the capacity to be able to do this work
for themselves.
This process should run parallel to catch share design, so
communities can participate as preferred alternatives are
selected. Require community quota be provided if communities
can show a community development plan and address catch share
impacts; require NOAA to set aside funds to mitigate damage to
fishing communities from unanticipated problems with catch
share programs; and this should be a long-term fund.
Madame Chairwoman and members of the Committee, I listed
several other examples, as well.
Thank you for the opportunity to testify today, and I
appreciate the opportunity to answer questions.
[The prepared statement of Ms. Cobb follows:]
Statement of Leesa Cobb, Executive Director,
Port Orford Ocean Resource Team
Good morning, Madam Chairwoman, Honorable Members of Congress,
fellow witnesses, and distinguished guests. I am pleased to testify
before this Subcommittee on Catch Shares. My husband is a commercial
fisherman from the southern Oregon coast. We fish for Dungeness crab,
albacore tuna, blackcod, nearshore live rockfish, and halibut. I have
served as Executive Director of the Port Orford Ocean Resource Team's
(POORT) since 2001. POORT is a community-initiated and inclusive
community-based management organization founded in 2001, focused on
maintaining a sustainable fishery and healthy marine ecosystem in local
nearshore waters and healthy upland watersheds. POORT seeks to combine
the best science and experiential knowledge available to the community
to make management decisions that: 1) sustain/improve the habitat and
population base of fish; 2) provide high quality, high value seafood
products to consumers; and 3) support the economic viability of Port
Orford, Oregon. Port Orford fishermen all fish boats under 40 feet and
participate in a portfolio of fisheries including salmon, crab,
blackcod, tuna, halibut and nearshore fishing. This traditional small
boat port has been delivering commercial fish since the late 1800's and
today 25% of our 1,200 population works directly on the fishing boats
or off loading produce at the dock. Our community is heavily dependent
on fishing. That is why we have formed a community-based fisheries
project; to sustain our fisheries and livelihood. It is in the capacity
as Executive Director of Port Orford Ocean Resource Team that I address
you today.
My experience with Catch Shares goes back to 1994 when I joined a
group of west coast fixed gear fishermen in asking Congress,
specifically Oregon Senators Hatfield and Packwood, to stop the Pacific
Fishery Management Council from implementing a blackcod Individual
Quota (IQ) program. We were concerned that the process was not
transparent, most of the IQ would be allocated to a small group of
fishermen, and little outreach had been done to help fishing
communities understand how they would be impacted. In 1994 Members of
Congress were reluctant to intervene in Council business, but they were
concerned, and stepped up to write to the Council requesting a delay in
Individual Quota Programs until more was learned about the impacts to
fish, fishing communities and fishermen. It is interesting to note that
sixteen years later, in 2010, after learning more, I have even more
concerns about the impact of Catch Share programs to fish, fishing
communities and fishermen. Today I will talk about my most recent
experience with Catch Shares being developed for the west coast trawl
groundfish program. I will talk about the importance of controls to any
catch share program. And lastly, I will talk about the fishing program
established in my community that serves as a model, different than
catch shares, of how to sustain fish stocks while sustaining the
fishing community. But let me start by asking WHY CATCH SHARES?
WHY CATCH SHARES AT THE EXCLUSION OF OTHER FUNDING NEEDS?
I want to emphasize that Catch Shares are only one tool for
fisheries management. It seems disingenuous for NOAA to say that they
understand Catch Shares is only one tool, and then NOAA in turn
allocates $54 million to exclusively develop Catch Shares. NOAA is not
offering this funding to help Councils decided how to best manage for
sustainable fisheries; they are only providing this money for Catch
Shares.
I find it difficult to understand NOAA's push for Catch Shares. The
most confusing aspect of the campaign is the claim made by groups that
Catch Shares will end overfishing. The Total Allowable Catch (TAC) is
based on good science that is responsible for ending overfishing in any
fishery. If the TAC is set at unsustainable levels, the fishery is
likely to collapse regardless of the method of allocating the TAC. If
quotas themselves are set too high, over-fishing will still occur. If
fisheries can be managed sustainably using biologically responsible
TAC, then there is no reason to privatize the fish by giving away
quota.
Many fishermen have expressed concern that NOAA's new budget to
assist Councils with Catch Shares comes at the expense of funding for
science that will actually provide the data to determine Total
Allowable Catch which every fishery needs to be sustainable. I
constantly hear at Council meetings that there are not enough resources
(money to buy capacity) for the work that needs to be done.
I am troubled by NOAA and the Councils saying that Catch Shares are
not a property right. If you can buy and sell quota, take it to the
bank and mortgage quota, fight over quota in divorce court--quota is
property. Why would the United States privatize and give away this
important public resource? I do not believe the United States should go
down this path and I do not think NOAA is making public what Catch
Shares will do to public ownership of fish.
The most ironic point is the language in the NOAA DRAFT Catch
Shares Policy that states:
NOAA encourages Councils to take advantage of the special
community provisions in the MSA to help assure sustainable
fishing communities, including continuation of working
waterfronts, fishery infrastructure, diverse fishing fleets,
and resource access.
It is common knowledge that Catch Share programs improve economic
efficiency and by their very nature result in consolidation of the
fleet. This in turn causes loss of jobs, economic disruption to coastal
communities that rely on fishing jobs, and can cause the loss of
infrastructure at ports that traditional fishing relies on. One wonders
in an Administration that is concerned about jobs, why Catch Shares
would receive this level of support.
We also know that the initial allocation of quota comes at a high
social cost. Many fishermen, including captains and crew, are pushed
out of these fisheries in an initial allocation, and young fishermen
are burdened with expensive loans to pay for buying their first quota
share. Additionally, in many fisheries, the actual fishers are leasing
quota from so-called ``absentee landlords'' or ``armchair fishermen''.
This share cropper fishing, where independent fishermen are now fishing
for investors, will not be good for fishing families or communities.
A number of concerns have been raised about Catch Share social
impacts, especially in terms of fairness and equity. Catch Shares will
concentrate power in the hands of fewer people, who can turn into quota
``landlords'' that do not themselves fish, but instead lease their
quota to the quota-less. The windfall gains of quota ownership accrue
largely to the generation who are fishing when ITQs are implemented,
while later fishers have to pay for their quota, hardly an equitable
outcome.
If not carefully regulated, the balance of power between processors
and fishers may change greatly; processors have greater access to
capital and may end up controlling most of the quota. An additional
problem is the impact to nonfishing members of small fishing
communities who may be harmed if the quota holders sell their shares to
other communities, thereby impacting their social and economic
stability of their community
A simplistic one-size-fits-all approach to fisheries management
does a disservice to the diversity of fisheries management options that
have proven effective, and others that show promise. We do know that a
Catch Share program, if tightly regulated with low accumulation caps,
owner-operator provisions, and opportunities for new entrants can be
one way to manage a fishery. The classic example, and one that is
mentioned in all the pro-IFQ literature, is the Alaskan sablefish/
halibut fishery. However, in practice IFQ fisheries are rarely
implemented in this fashion, and generally come under intense political
pressure to remove owner-operator requirements and accumulation caps as
fishermen age. This eventually creates consolidation that in the
beginning was deemed unacceptable.
Catch Shares can reduce the race to fish but are certainly not the
only way to do that. Unfortunately, the ``catch share'' campaign has
now drowned out all other ideas and approaches to fisheries management
in public discourse and among policy makers. Amidst all of the
discussion about catch shares, another approach to fisheries
management, community-based fisheries management, has gotten a lot less
attention despite its increasing popularity with many fishing
communities around the country.
The West Coast Trawl IQ Plan
I have participated in meetings, sent letters to the Council and
provided public input at Council meetings--all the time speaking from
the outside. The not so subtle message I continuously receive is that
this is a trawl program and fixed gear fishermen should mind their own
business. I know the reality is that the trawl IQ program will affect
species and fisheries that are not included in the program and impact
communities and fishermen that are not included in the program.
Problems with the trawl IQ plan:
1. It only addresses one gear group for groundfish and excludes
fixed gear and recreation fishermen. Fixed gear fishermen have no idea
what the future is for our fishery. The irony is that our gear is the
cleanest commercial gear for groundfish and we are completely left out
of any planning for the future of groundfish while the fishery is
handed over to the gear with the highest bycatch.
2. Vessels exiting from ITQ fisheries may increase fishing
pressure in non-ITQ fisheries. Fishers that choose to sell their quota,
realize enormous financial gain, and exit the ITQ fishery may increase
their effort in other less regulated fisheries--the spillover effect.
We saw this in Oregon with the west coast trawl buyback. Trawlers with
their hundreds of thousands of dollars of buyback money moved to crab,
salmon and other fisheries and contributed to further
overcapitalization of those fisheries. Increased capitalization in west
coast fisheries from trawlers selling their quota could be
devastating--there is not one fishery on the west coast that can
withstand additional capital.
3. In an IFQ fishery, many ports could suddenly see their access
to fish disappear as quota simply moves out of smaller ports.
4. The IFQ systems would likely only hasten the collapse of port
infrastructure already badly in need of repair, particularly when quota
leaves small port communities and fleet consolidation shifts efforts to
larger vessels in large ports.
5. Serial depletion may occur for some species due to limited
spatial control because effort increases closer to home ports. TACs are
still managed on a very large spatial scale (Golden 2005). In its
consideration of a limited entry trawl individual quota system, The
Pacific Fishery Management Council's Trawl Individual Quota Committee
(TIQC) considered alternatives that could have restricted distribution
of optimum yield (OY) and access privileges on an area basis. The
TIQC's analytical team prepared an analysis titled ``On the Need for
Spatial Management in West Coast Groundfish Fisheries.'' Several
arguments supporting the need to spatially manage groundfish on a finer
scale were made based on the life histories of groundfish,
documentation of instances of localized depletion of groundfish,
current management practices with spatial approaches, and potential
fleet behavior if spatial management of OY is not taken into
consideration. Despite these arguments, the TIQC did not recommend the
distribution and management of OY on a spatial scale any smaller than
presently used. Details of the analysis can be found at
www.oceanresourceteam.org. Our concern is that quota pounds will be
consolidated, or purchased into ports that will then become the entry
and exit point for the fish. We are concerned that quota pounds will
end up in Coos Bay, Oregon (for example). This increase in fishing
pressure on the grounds will impact the availability of fish to
everyone in their region
6. IFQs prevent people from entering the fishery unless they come
from established fishing families already owning boats or are wealthy
enough to purchase quota.
7. The trawl catch share program proposes to allow trawlers to
switch to fixed-gear with no analysis or consideration for how this
will impact the fixed-gear fleet. If trawlers switch to pot gear, that
gear is left in the grounds continuously and our opportunity to
longline will be impacted.
8. The extensive allocation process to cut off trawl quota from
other user groups allocated almost all the groundfish away from our
Limited Entry fixed gear permits. We had access to fish that is now
almost completely gone to us. This devalued our permits with one fell
swoop.
The Pacific Fishery Council is aware of each problem with the trawl
IQ program but they continue to push ahead.
Better Management
If NOAA decides to proceed with their full court press for Catch
Shares the following will be critical:
Require NOAA to establish a process for communities to participate
in socioeconomic analysis of Catch Share programs. Presently
communities rely on NMFS and the Council's analysis. Capacity should be
provided to communities to have their questions analyzed so they can be
informed participants in the process. This process should run parallel
to Catch Share design so communities can participate as preferred
alternatives are selected.
Require community quota be provided if communities can show a
community development plan that addresses Catch Share impacts.
Require NOAA set aside funds to mitigate damage to fishing
communities from unanticipated problems with Catch Share programs. This
should be a long-term fund.
Require Councils to include all gear groups and users in a Catch
Share program. Piecemeal programs will not work.
Use Catch Shares as an opportunity to promote sustainable fisheries
by designing programs to allocate fish to gears that minimize bycatch
and discards instead of using fishing history for allocation.
Require each Catch Share program to provide for new entrants to the
fishery.
FINAL COMMENTS
There are many different programs to manage fisheries in the United
States. Our community program rejected pursuing IQs because it would
reward a few and create many losers, while doing nothing to stabilize
the economy of our fishing community. We chose to develop community-
based fisheries to help sustain the fish and community into the future.
I have included information on our project below.
The next step for our community process is to form a Community
Fishing Association(CFA). as provided for in the MS Act. For our
community, this would be a framework to secure our opportunity to fish.
We would use this framework to hold permits and quota, allowing us to
stabilize our community economy as fisheries change.
At this time, no work has been done by the PFMC to provide
direction for CFAs, and we can't proceed. At the Sacramento Council
meeting last week, fixed-gear fishermen asked the PFMC to set up a CFA
committee. The Council declined to do so. Perhaps NOAA could work on
this issue.
In closing, I had the experience of traveling to New Zealand with
California Sea Grant and a group of commercial fishermen to examine the
New Zealand IQ programs. I was shocked at what I learned. Quota is
primarily held in New Zealand by processors. Fishermen told us horror
stories of the tactics used to push them out of the fisheries,
including processors lowering the price for several years so fishermen
couldn't make money (bleed them out of the fishery) to the overwhelming
amount of IQ paperwork they couldn't keep up with. Fishermen are now
unemployed or working for the processors running their boats and
fishing the processor quota. Those fishing jobs are low paying; the
fishermen commented that if they wouldn't work for the low pay there
was another fisherman right behind them that would because they are
desperate for work. We asked fishermen how they let this IQ program get
away from them, why didn't they have caps on ownership. They responded
that they thought they had that taken care of with a hard cap on
accumulation from the beginning. But as soon as the processors reached
the cap they lobbied successfully to have the cap increased, over and
over. Fishermen noted that the local fish and chip houses could not
even get fish to serve because it has been allocated away from their
communities.
In a question and answer forum, I asked the owner of Sea Lord, New
Zealand's largest processor, what happened to their fishing communities
when processors ended up with all the fish. His response was, ``there
were no fishing communities in New Zealand, next question''.
Ridiculous, the entire coast of New Zealand was one fishing community
after another. New Zealand has to rewrite their history to wave off the
impacts of IQs to their fishermen and communities. I believe the United
States is going to end up in the same situation. I encourage members of
the Committee to carefully examine this rush to privatize fisheries.
PORT ORFORD: IMPLEMENTING COMMUNITY-BASED OCEAN MANAGEMENT ON THE
OREGON COAST
INTRODUCTION
There is a growing interest in the use of community and ecosystem-
based ocean management approaches in the United States. This interest
is reflected in the U.S. Ocean Commission's Report to Congress and the
Sustainable Fisheries Act, and also evidenced in initiatives underway
in Alaska and New England..
Community-based management may be defined as a process where
citizens actively participate in local management efforts through
defining needs and goals, and making decisions through an inclusive and
transparent process. With respect to ocean resources, community-based
management allows for consideration of local environmental and economic
variables, as well as the integration of community knowledge into the
decision making process. Community-based ocean management may also be
incorporated into broader, coast-wide management plans, thereby
addressing important issues of scale.
The community-based management model can offer a number of
significant benefits as a complement to existing state and federal
management structures. Foremost among these benefits is an enhanced
level of stewardship for ocean resources among community participants.
Community-based management is also flexible and adaptive and may result
in greater equity and improved compliance with regulations from local
pressure. Finally, community-based management can allow for managing
complex systems at a finer scale through the integration of local
knowledge and the leveraging of collaborative science opportunities.
Our collaborative endeavor in Port Orford, Oregon may provide a
viable model for how community-based ocean management may be
effectively implemented. One key element to the success of community-
based initiatives is the presence of local leadership. In Port Orford,
this service is provided by the Port Orford Ocean Resource Team
(POORT), a locally run non-profit organization comprised of fishermen
and fishing family members. POORT provides the necessary local
infrastructure through which community-initiated marine policy and
research activities can be carried out. At the behest of POORT, other
non-profit organizations and individuals within leading academic
institutions and government agencies are helping identify ways in which
the community of Port Orford can actively engage in the management of
local marine resources.
BACKGROUND: Port Orford Ocean Resource Team
POORT is a community-initiated and inclusive organization founded
in 2001, focused on maintaining a sustainable fishery and healthy
marine ecosystem in local nearshore waters. POORT seeks to combine the
best science and experiential knowledge available to the community to
make management decisions that: 1) sustain/improve the habitat and
population base of fish; 2) provide high quality, high value seafood
products to consumers; and 3) support the economic viability of Port
Orford, Oregon.
POORT was created in large part because local fishermen felt
disenfranchised from the existing top-down fishery management system
during a period of increased restrictions. Over the last decade this
historic fishing community has lost its longline fisheries, experienced
dramatic losses in revenues as a result of declining salmon stocks, and
survived a boom and bust urchin fishery. Forty boats using fixed gear
currently fish out of the Port of Port Orford, targeting groundfish
(including several rockfish species for the Asian live fish market),
Dungeness crab, albacore tuna and blackcod.
As a local non-profit organization, POORT works to empower fleet
members and other citizens to participate in bottom-up ocean management
efforts. These activities include a significant focus on collaborative
science and stewardship, as well as marketing of local seafood
products.
POORT'S COMMUNITY-BASED PROCESS
The POORT process is guided by a formal board of five fishermen.
The POORT Board functions as the ultimate governing body of the
community process and is charged with advancing POORT's vision of a
sustainable fishery and healthy marine ecosystem. As such, the POORT
Board provides a transparent and functional mechanism for decision-
making--a key element to the success of any community-based process
(Dalton 2006).
The POORT Board's efforts are closely connected to the broader
fishing fleet. Facilitation is provided by staff from POORT and partner
organizations to assist fleet members in developing common goals and
objectives and determining alternatives for action. Fleet meetings also
include an educational component, as a recognized prerequisite of
empowerment at both the individual and community. Recent meetings have
included presentations on topics such as rockfish reproduction, state
and federal management authorities, and design considerations for
marine protected areas (MPAs).
The POORT process includes formal input from a Community Advisory
Team that provides recommendations and expertise to the POORT Board and
project partners. Comprised of stakeholders and community leaders, the
Team is intended to reflect the interests and concerns of the broader
Port Orford community. Engagement of the Community Advisory Team
ensures that different segments of the community are formally
represented within the POORT process. Such diverse participation is
important for improving understanding between different groups and can
also facilitate development of stronger solutions by community
participants.
The Community Advisory Team also includes a staff representative
from the Oregon Department of Fish and Wildlife (ODFW) to ensure that
community planning efforts are connected to existing management. By
involving agency staff early in the process, greater trust and
communication may be realized to support the community's efforts to
implement co-management strategies.
THE ROLE OF SCIENCE
A critical factor in implementing community-based ocean management
is the collection and application of relevant scientific information.
POORT is therefore in the process of developing a collaborative
research program to be run through the local science center.
Collaborative research programs provide opportunities for people with
diverse interests in fisheries to collectively resolve complex issues.
To inform development of this program, POORT staff regularly
convenes meetings with fishermen to identify important research
questions, data gaps, and monitoring priorities. During 2007, staff and
board members are collecting local ecological knowledge from fleet
members through personal meetings and facilitated forums. An at-sea
project to gather information on population dynamics of nearshore
rockfish species is underway.
POORT has also collaborated with Oregon State University, ODFW and
NOAA Fisheries to create a Geographic Information System (GIS) product
that includes geologic, bathymetric, and fish habitat information.
Finally, POORT recognizes that an advisory group of scientists that
can provide oversight and expertise for local research and management
efforts is necessary. Accordingly, POORT and its partners are currently
assembling a technical team representing various marine science
disciplines and affiliations.
STRATEGIES FOR CITIZEN ENGAGEMENT
To ensure transparency of the community process and promote ocean
literacy, POORT sponsors two public forums each year. Such forums
provide an important mechanism for disseminating information and
bringing together different stakeholders from the community. The first
of these forums was held in June 2006 and titled Orford Reef: Our
Heritage, Our Future. The event featured a short film on the reef, as
well as presentations from fleet members and project partners. Over 180
people attended, including community members and representatives from
agencies and non-profit organizations. In January of 2007, POORT and
its partners sponsored a second public forum coinciding with a local
meeting of the Oregon Ocean Policy Advisory Council (OPAC). Additional
public forums have been held each year.
POORT has also recently established a water quality testing
laboratory in partnership with Pacific High School and the Surfrider
Foundation. The lab supports a volunteer-based program that provides
water quality data for four locations within the area. Sampling and lab
analysis is conducted by Pacific High School students, Surfrider
members, commercial fishermen, and other interested volunteers. In
addition to providing important educational and citizen involvement
benefits, the program also provides a platform for POORT to address
land-sea connections as part of an ecosystem-based approach to
management. In 2009 POORT worked closely with the city of Port Orford
to amend the storm water ordinance that provides valuable protection to
the nearshore environment.
LOOKING TO THE FUTURE
To realize its vision of a sustainable fishery and healthy
nearshore ecosystem, POORT has established a Community Stewardship
Area. The Stewardship Area would encompass the community's fishing
grounds and associated watershed, and provide a framework for managing
local ocean resources at a finer scale and more integrated fashion. The
intent is to maintain public access to the resource for those who are
fishing selectively, while also conserving the marine biological
diversity of rocky reefs and surrounding waters.
Planning for the Stewardship Area has been conducted in a
transparent and inclusive manner within Port Orford, consistent with
POORT's community-based process. The project has also cemented longtime
partnerships between POORT and the Pacific Marine Conservation Council,
Surfrider Foundation and Ecotrust, who provide a variety of support
services for local planning efforts.
As a critical element of achieving designation of a Stewardship
Area, POORT is working to secure policy space for its community process
at the state and federal levels. While POORT's current efforts do
provide significant benefits to both the resource and community, the
full benefits of such a process cannot be fully realized without formal
recognition and authority sharing from government agencies. As such,
POORT is exploring alternatives for co-management of local ocean
resources with relevant agencies and management authorities.
Although the activities of POORT remain centered in the community
of Port Orford, an increasing number of managers, fishermen,
scientists, and elected officials throughout the state have expressed
interest and enthusiasm for this approach to ocean stewardship. While
still an evolving process, the Port Orford Community Stewardship Area
initiative holds significant potential as a model for how community and
ecosystem-based ocean management principles may be successfully
implemented.
Golden, J. 2005. On the need for spatial management in west coast
groundfish fisheries. Pacific Fishery Management Council,
Portland, Oregon.
______
Response to questions submitted for the record by Leesa Cobb,
Executive Director, Port Orford Ocean Resource Team
Questions from Chairwoman Madeleine Z. Bordallo (D-GU)
1. What advice would you give to other fishing communities who are
interested in community-based management?
I would advise fishing communities who are interested in community-
based management to:
a. Engage local leaders to launch the program. If local folks
need leadership training, make sure they get it.
b. Include everyone who wants to participate, and seek out
those who do not know they need to be at the table--bring them
in.
c. Always work with conservation and other interests even if
it's difficult. Build the relationships from the beginning.
d. This is a place-based program. Bringing people to ``the
table'' means bringing them to your place, your community.
Don't let folks use conference calls and email to replace
traveling to your place and working with your people.
e. This is a bottom-up program that ultimately has to be
endorsed by the folks who run the top-down process. Get those
folks on board early to provide political cover. If you do not,
your program will be a great idea that never gets implemented
because ultimately the power is at the top (until we can change
it!).
f. The program must work on the principles of the triple
bottom line: ecology, economics and equity. Each project must
consider all three, people, planet and profit to bring the best
results to the resource and the community.
2. In your testimony you mention quota as a property right and the
possibility of the government having to buy it back from the
second generation quota holders. What would be the situation
that would cause the government to take quota back?
The government of New Zealand had to buy back quota when they did
not include recreational fishermen in one of their quota programs. This
cost the government millions of dollars ``buying quota was the only way
to reissue it.
A very real example is the West Coast groundfish trawl IQ program.
Legal issues about allocation between user groups could be raised
because this is a trawl only program. Once the quota is out the door to
trawlers, issued to fishermen who begin to sell it, the only way to get
it back to fix a legal problem will be to buy it back.
3. Has the Pacific Fishery Management Council supported your community
in developing a Regional Fishery Association? What would this
Association look like?
We have been waiting for the Pacific Fishery Management Council to
provide guidance on Regional Fishing Associations (RFAs) so we can
begin work. Finally, with no action by the Council, several fishermen
asked the Council at the March, 2010, meeting to form a committee to
begin working on details. The Council declined to form a committee.
Council guidance for forming RFAs should have been running parallel
with developing the trawl IQ plan so communities can be prepared for
the negative impacts coming their way. Implementation of the trawl IQ
plan should be put on hold until RFAs are formed in the communities
that are ready to move forward.
In our case, a Port Orford RFA would be a business framework to
hold permits and quota to help stabilize our fishing community's
economy. Just as a marine reserve can provide resilience for fisheries,
a RFA can provide resilience to a fishing economy.
Ideally, the community RFA would inform the Council, with
documentation, the anticipated negative impacts of the trawl IQ program
and negotiate for initial allocation of quota to provide for
mitigation. This of course will not happen, because the Council has not
provided guidance for RFA's.
4. What is the most important thing NOAA could do to help your
community?
We would greatly benefit from formal recognition of the Port Orford
Stewardship Area by NOAA. We want to partner with NOAA on local
research and stewardship efforts. We have an amazing local program,
built from the bottom up. But we have to have recognition and support
from the folks at the top. We need this policy space, for example, so
we can talk to the Council about solutions to local problems. The PFMC
Groundfish Advisory Subpanel told me very clearly that they are not
considering place-based problems or solutions. We can't move forward
with science-based, sustainable solutions that we know will help our
local fisheries--we need NOAA's help with the policy space.
Port Orford Ocean Resource Team could be a NOAA pilot program for
community-based fisheries management. NOAA would use our successes and
challenges to inform other place-based fisheries programs in the
country. Most importantly, NOAA would work with the community to build
a local research field station to gather important data on local
fisheries and the broader California Current that will inform both
local area management, and coast-wide management.
If we could get NOAA's support for our program, including a local
research facility--it would be like we won the fishing lottery!
Questions from Republican Members
1. Are you opposed to all catch share programs or do you primarily not
like the Pacific Council's trawl catch share plan.
I am opposed to privatizing fisheries. I believe privatization of
fisheries offers up an immense benefit to corporate interests and I
have serious concerns about the negative impacts to fishing communities
and fishing families from Catch Share programs.
The EIS for the trawl IQ program provides extensive information
about anticipated negative impacts to communities and the fixed-gear
fleet. The analysis is done, and then nothing...no change in the plan
to address the negative impacts. That process, of asking the question
and ignoring the answer, shows me that a process to protect communities
and fishermen from negative impacts of the trawl program does not exist
and it will not exist for Catch Share programs.
2. You mention the North Pacific halibut plan and seem to think it has
many of the components that might be desirable in a catch share
plan. Many of those components came in stages as the North
Pacific Council amended the plan. Do you think it is possible
for a council to anticipate all of the needs of fishermen and
communities with the first draft of a catch share plan?
Yes, I believe the fundamental needs of fishing communities and
fishing families can be anticipated and addressed in the initial design
of a Catch Share program. Most importantly, how will the Councils
address negative impacts by changing the program? The fish has already
been given away, the quota allocated, the fishery opened up to non-
spatial management. You can't un-ring the bell.
If you're asking if I think Councils can fix the problems as they
go, no I do not believe that is even possible.
An example is the comment made by a member of the PFMC staff about
spatial management when I asked how we can protect fishing communities
from trawl IQ consolidation, and subsequent serial depletion of fish on
the fishing grounds near areas of consolidation. The staffer said, ``If
that happens, we can just go back and add some spatial management
lines''. Was he joking? The notion that a quota owner would blithely
accept new spatial lines and regulations on where he can fish his quota
is ridiculous? He bought the quota and paid the asking price with no
restrictions, and now he has to run 500 miles to fish it? That
adjustment to the trawl IQ plan will not happen without compensation to
the quota owner.
3. You are concerned about ``absentee ownership''. Should councils
require owner-on board provisions?
Yes, Councils should require owner-on-board provisions for
fisheries that have traditionally been fished by boat owners.
For fisheries that do not have a historic operating structure of
owner-on-board, Councils should consider as part of the EIS analysis
how owner-on-board provisions might help the fishery, fishing
communities, and fishing families. In the case of traditional corporate
ownership it may, or may not be appropriate.
4. Your members fish in a limited access fishery. This type of system
requires new entrants to purchase an existing permit. How is
this different from a catch share fishery where a new entrant
must purchase quota to enter the fishery?
The difference is the design of the programs. A Catch Share fishery
is designed for consolidation, quota can be broken down to small
pieces, and ownership has few limitations. The fixed-gear limited entry
program can't be broken up into pieces, it is a permit, not pounds of
quota that can be split up and moved around.
In addition, Catch Share quota can be leased and mortgaged because
the resource is owned by the quota owner. The fixed-gear permits can
only by leased by first generation owner. Second generation have owner-
on-board requirements to keep the fishery in the hands of fishermen.
5. You mention that ``if not carefully regulated, the balance of power
between processors and fishers may change greatly.'' If a council
decides to transform a fishery into an ITQ fishery, how would that
balance be shift? Should councils take processor investments in the
fishery into account in developing a catch share fishery?
It seems pretty simple to the fishermen I work for; if the
processors own quota they can further control the market. When
processors control the market, they can lower the price to the
fishermen.
An example can be found in New Zealand, when Leigh fishermen told
us after quota was issued, and processors gained a solid holding, the
price was lowered to such a low level they could not afford to fish.
There was not profit to be made. The processors could wait them out.
The fishermen don't have lines of credit and operating capital to be
able to wait out the processor until the price goes back up and fishing
becomes profitable. On the reverse side, the processors do have lines
of credit and operating capital so they can wait until the fishermen
are out of business, buy their quota, and go back to selling the fish.
This can happen in just two or three years.
Interestingly, today in New Zealand processors own most of the
fisheries quota. We asked NZ fishermen what happened; why did they let
this happen? They said the initial quota programs had ownership caps
that should have protected fishermen from processors controlling the
fishery. As the processors bought quota, they began to lobby for
increasing the ownership caps. In a short time, processors owned enough
quota to be considered part of ``the industry'', and if industry wanted
to increase ownership caps in their fishery--why not, the caps were
increased.
I do not support PQ or initial allocation to processors.
Unfortunately, having to deal with processor quota is just one of the
really tough downsides of going down this path of Catch Shares. The
reality is that it would completely disrupt the market forces in the
fishery to give out quota to processors.
______
Ms. Bordallo. Thank you very much, Ms. Cobb, for your
useful input. I will now recognize the members of the Committee
for any questions that they may ask, beginning with myself.
I have a few questions for Mr. Schwaab, the Assistant
Administrator for Fisheries, National Oceanic and Atmospheric
Administration. I think what I really want here is just a no or
a yes for the record, Mr. Schwaab.
Do you agree that good science is fundamental to good
fisheries management? Do you agree that many in the fishing
industry have concerns about the science being used to make
management decisions?
Mr. Schwaab. Yes, and yes.
Ms. Bordallo. Good, excellent. Number two. Do you think
NOAA has prioritized catch shares over science, by asking for a
big increase in the catch share budget, but not in data
collection programs?
Mr. Schwaab. Madame Chairwoman, no. We obviously have
placed some significant investment in catch shares as a means
to address some of the management challenges that we face in
new ways. But as I indicated in my testimony and provided in
more detail in my written testimony, we have also continued to
invest heavily in other aspects of our fisheries management
challenges, including significantly in data related to both
recreational and commercial activities, as well as in other
science and stock assessment work.
The last point I would make is that a significant amount of
the investment in catch share dollars will, in fact, yield
important new monitoring and observer data, which will
contribute to our overall science picture.
Ms. Bordallo. Good. Now, this one you may have to explain
here. How will NMFS prevent the consolidation and the migration
of catch shares away from coastal communities to ensure the
protection of fishing communities?
Mr. Schwaab. There is significant latitude in program
design and implementation, and I think we have already seen a
number of tools that have been developed and built into some of
these program designs, both as it relates to the limits in the
amount and type of ownership that might occur, as well as some
limits on transferability.
So we see things like community shares, small boat and
processor provisions. We also see innovative approaches like
permit banking to protect the interests of small, remote
communities and others who we are concerned about through a
socioeconomic process.
But I would just conclude by saying we depend very heavily
on the Councils, sort of from the ground up, to build the
specific design elements that are required to meet local,
social, and economic desires.
Ms. Bordallo. Thank you very much. Now I will go to Dr.
Fina, Mark Fina. What are the top three things you would change
in the Alaska Crab Catch Share program, if you could, to
protect fishing communities?
Mr. Fina. Madame Chair, I think one thing that we probably
would have done at the onset of the program that we didn't do
at the time, but I don't know how much we can go back to it, is
I think vessel caps were one issue.
The consolidation in that program was very fast. I think
there were a number of jobs lost by crew. The nature of crew
jobs changed, and I think there are some merits to the way crew
jobs changed, as well as some problems with respect to it. But
I think that's one aspect that I think we would have had a
graduated cap, where the caps maybe start at a more restrictive
level, and then become looser over time, to ease that
transition.
A couple other aspects that I think that right now the
Councils are already working on that are important to the
fishery, we are looking at changes in the community rights of
first refusal on processing shares, that communities currently
have a right of first refusal on transfers of certain
processing shares where the community can acquire those shares.
We are working to try to make that a more effective program.
Communities, at times they don't have the resources to
acquire those shares. Also, the way the right is structured
right now, it requires communities to make, at times,
substantial investments to exercise. So that is another area
that we are looking at, and that we may be able to make some
improvements that will benefit some of the small communities
that derive a significant benefit from processing.
Ms. Bordallo. Thank you. I asked you for three, you gave me
how many?
Mr. Fina. I gave you two so far.
Ms. Bordallo. Two. A third.
Mr. Fina. A third one that I would look at is another one
that I think the Council is trying to work with. It is as much
a community issue as a fishery issue. We are looking at changes
in the way the regionalization program works, to allow certain
exemptions to regionalization.
In some cases there are safety issues that can arise,
particularly in the North region, in the Pribilof Islands, with
ice. What we are trying to do is achieve a balance that will
allow fishermen the flexibility to redirect deliveries to other
locations when icing is a problem, but yet maintain the
integrity of the regionalization program for the communities,
particularly in the Pribilofs.
Ms. Bordallo. Thank you. I have one quick question, and
then I will turn to the Ranking Member for his questions.
Dr. Rosenberg, what are some examples of what decision
makers can do to provide neutral forums to discuss catch share
program design and improve trust and communication among the
fishermen, the managers, and the scientists?
Dr. Rosenberg. Thank you for the question, Madame
Chairwoman. I think that is a really critical issue for design
of programs. One of the opportunities would be to have some of
those design discussions outside of a strict regulatory
framework.
Once you are into the council process and the process on
the regulations with the Fisheries Service, you are into a
rather stilted regulatory discussion, in my view. If there is
the possibility to have open fora that are not decision-making,
and may or may not impact on the regulations, where people
don't have to take any final positions, then you might have a
more open dialogue. And then some of the design questions could
be put on the table.
That is really a more speculative process. It is difficult
to get people to engage, because fishermen and everyone else
are very busy. But it would provide an opportunity for a
discussion that isn't on an immediate regulation that is
sitting in front of you, where you have to take a position in
favor or against.
Ms. Bordallo. Thank you, Doctor. And we will have a second
round for the Members here.
I would like to recognize the Ranking Member, Mr. Brown.
Mr. Brown. Thank you, Madame Chair. Mr. Schwaab, if I might
ask you the first question.
When will the Atlantic red snapper stock assessment be
completed? And will this give the Council time to approve
fishing measures for the summer? Or do you expect the closure
to be extended?
Mr. Schwaab. Thank you, Mr. Brown. The current schedule
will provide the information for the Council by the end of
2010. So we expect that we will be dealing with the current
directed fishery closure, and the potential of a broader area
closure, through 2010.
Mr. Brown. I know they were talking about moving the lines
along the coast, the Eastern Seaboard. Is there any movement
there to establish some firm lines?
Mr. Schwaab. Yes, sir. The current council proposal, as I
understand it, is focused on a slightly, a somewhat reduced
area closure over the one that was initially proposed. That is
under council deliberation now, as we speak.
Mr. Brown. Do you have an idea when they might make that
choice?
Mr. Schwaab. My understanding is it will be at the next, at
the next council meeting later on this spring. But I don't have
an exact date for you, sir.
Mr. Brown. OK. When will that take effect, do you think?
Mr. Schwaab. You know, rather than try to get into the sort
of the nuances of the current emergency action versus the
timing of the proposed closure, would you mind if I got back to
you with specifics on that?
Mr. Brown. OK.
Mr. Schwaab. Thank you.
Mr. Brown. Because we have a lot of people in the
Charleston area, which I represent, whose livelihoods depend
upon it, and it is very critical for them.
Before you established the catch share program, what method
did you have to determine how many fish were being taken, say
on a daily basis, out of a certain area?
Mr. Schwaab. Well, in general for the commercial fisheries,
those include a variety of direct harvester reporting, as well
as dealer reporting. In the recreational sector that is based
largely on sampling, previous MRFSS data is now migrating into
the new MRIP system.
Mr. Brown. Under the catch share program, I know we heard
testimony from some of the other people, too, that you are
going to set quotas for the commercial fishermen. How would you
address just the recreational fishermen? Will they have quotas,
too? Or how does that, how do you plan to implement it?
Mr. Schwaab. Sir, the basic framework of setting annual
catch limits is essentially the same, regardless of the
management system, on a gross sense. From the perspective of
most fisheries, there is some established allocation of that
total annual catch between the commercial sector and the
recreational sector.
If you move into a catch share system for the commercial
sector, what you see, then, is that that annual catch limit
then gets assigned down to individual harvesters or other
parties in the process. On the recreational side, generally you
would see continued management under sort of a broad share of
the annual catch that is assigned to the recreational sector
and managed through traditional seasons and size limits and bag
limits and the like.
Mr. Brown. So you would restrict so many takes per day, or
so many takes per season per recreational fisherman? Or how
would you allocate those resources?
Mr. Schwaab. Yes, so basically it would be similar to the
system that is already in use for most recreational fisheries,
where there is one broad share of an annual catch limit that is
assigned to the recreational sector. And then that is managed
across the recreational fishery through seasons, size limits,
and the like.
And then we use the recreational catch and effort data
essentially after the fact to monitor compliance with that
total catch limit that has been established.
Mr. Brown. Is it true, on the commercial fishermen's side,
that you can barter with the quotas?
Mr. Schwaab. Well, under catch share systems there are
provisions for assignment leasing, trading of quota, in a
number of the systems that are in place.
Mr. Brown. So they can trade them, you can buy and sell
them based on something?
Mr. Schwaab. Which provides one of the real advantages as
you try to manage, particularly in mid-stock fisheries, bycatch
issues, and move quota back and forth to take advantage of what
is brought on board within the limits of quotas that have been
established.
Mr. Brown. What would denote value?
Mr. Schwaab. I am sorry, sir?
Mr. Brown. What would denote value in the trade? If you
want to buy some of this other guy's quota, how would you
establish the value?
Mr. Schwaab. Under most circumstances, those would be
market transactions.
Mr. Brown. OK. Thank you, Madame Chair. Thank you very
much.
Mr. Schwaab. Thank you, sir.
Ms. Bordallo. I thank the Ranking Member. Now I would like
to recognize the gentlelady from California, Mrs. Capps.
Mrs. Capps. Thank you, Madame Chair. Thank you for holding
this hearing on this important topic. I appreciate the
testimony of all of our witnesses today.
I think this is an important topic that we all are involved
in. Catch shares, when properly designed, I believe can have
strong economic and ecological benefits. I say this as someone
who represents several fishing communities on California's
central coast, struggling to keep their industry going.
Prices for fuel and gear are going up. There are severe
restrictions on groundfish fisheries. Many fishermen are
finding that the cost of navigating regulations is just too
high to stay in business.
Now, I think we all know there is no silver bullet for
managing our fisheries. But I believe today's hearing is very
important, for no other reason than to begin a discussion on
ways to help our struggling fishing communities, and how catch
shares might play a role in this.
So Mr. Schwaab, again, you may be aware of the innovative
partnership in Morro Bay in my district, on the Pacific coast,
between fishermen, the harbor district, and conservation
groups. This community fishing association, which the local
fishers feel very strongly about, was established by them to
preserve the heritage of the local fishing industry, as well as
to create stable, economically viable fishing opportunities,
for them, and perhaps even for their children.
So my question to you. By providing a catch share quota to
entities like community fishing associations, giving them the
quota, or cooperatives, however it is designed, what types of
benefits would you hope to see? That they could envision. Mr.
Schwaab.
Mr. Schwaab. Congresswoman Capps, thank you. Good question.
I am somewhat familiar with the example you describe.
I think there are a variety of benefits that can be derived
from catch share systems, some of which we have already
mentioned, providing greater latitude to individual fishermen
in making decisions about when they fish, when they bring the
product to the market, the opportunity to maximize value, to
take advantage in mixed-stock fisheries, some of the bycatch
issues that we deal with more directly, and manage them more
effectively.
Certainly in some catch share systems, design allows for
meeting certain local socioeconomic goals, like retaining quota
share in a particular community, or within a particular segment
of the fishery. There certainly are also opportunities to
accommodate new entrance into the fishery from a particular
community.
I also think, and I think one of the things, as I
understand what is happening in Morro Bay, there is an
opportunity to experiment with different fishing techniques,
and take more of an adaptive approach to going out and fishing
to target most effectively the most desirable product over
time. Thank you.
Mrs. Capps. Thank you very much. Dr. Rosenberg, I have a
couple of questions for you.
We have seen that a carefully designed catch share system
can contribute to the sustainability of the resource, the value
of the fishery, and the economy of fishing communities. At
least, that is the witness that I have.
We also heard that scientific research brings significant
improvement, when that is the basis for deciding the quota and
all the rest, to catch shares. I think you would agree that
rigorous science is the best way to understand the health of
our fishery resources.
So my question is, how can we ensure that the best
scientific research goes into the design--I mean, really up
front--of catch share programs, while taking into account
different fisheries and different fishing communities, the
science to then be reflected in that way.
Dr. Rosenberg. Thank you, Congresswoman, for the question.
I think this is an important issue. Of course, when we think
about fishery science, we often mostly focus on the biological
sciences. And we want to know how many fish are in the sea, and
their production rates, so that you can estimate sustainable
yields. That is necessary for catch share systems, but it is
necessary for any fishery management system.
I think for the design of catch share systems, we need a
much greater emphasis on the social and economic analyses,
particularly the economics, because it is easy for different
groups, from any particular perspective, to maintain a
particular set of impacts will occur. But that is different
from actually going through the analysis to try to put
information in front of all stakeholders.
Mrs. Capps. Can I just push this one question? Because I
appreciate where you are going with that answer.
In other words, how do you feel that should catch shares be
allocated, what steps can be taken to limit consolidation,
then? As one aspect of the local economic factors.
Dr. Rosenberg. Well, again, I think there is an economic
analysis and a financial analysis that needs to occur on the
potential for consolidation, as well as what would be
appropriate ways to mitigate that tendency for consolidation.
Mr. Backus suggested community associations as holders of
quota. That may work in certain situations, but not in others.
Certainly there are other kinds of structures that have been
used in the North Pacific to try to limit consolidation.
I think it depends upon an actual analysis of what the
financial conditions are for many of the businesses within the
fishery, and probably multiple communities. I think Ms. Cobb
referred to the need for people to be engaged in that
discussion directly.
Now, that can happen through the usual Magnuson-Stevens and
NEPA process, but it doesn't always happen in a very helpful
way. Because many times the social and economic analysis sort
of follows on the design of the regulations, as opposed to
preceding the design of the management system in the
regulations.
And so turning that around such that there is more analysis
up front would be very beneficial.
Mrs. Capps. Thank you. I apologize. I just really believe
this hearing begs the need for more hearings on this topic.
Many, many unresolved questions and concerns.
Ms. Bordallo. I agree.
Mrs. Capps. Thank you very much.
Ms. Bordallo. Thank the gentlelady from California. Now I
recognize the gentleman from Louisiana, Mr. Cassidy.
Mr. Cassidy. Thank you, gentlemen and lady. So, Mr.
Schwaab, best as I can figure out from what you guys are
telling us is that in a sense, we have put in stone how much
fishery is going to commercial, how much is going to
recreational, to an extent. A little bit of tweaking back and
forth.
It seems you have, but it seems like the two systems don't
work well. It would seem like we are applying the same system
to two different entities.
If more people buy boats, in a sense you have more new
entrants into the recreational field, but you are not really
allowing those new entrants. They are buying boats, they are
buying rods, reels, a growing population on the coast, et
cetera. But they hit their allocation sooner, so therefore you
squeeze down their allocation. Their season, if you will. Their
allocation remains constant, but you squeeze their season.
Now, the commercial guys consolidate--your testimony was
very good--the consolidation of the commercials is expected.
But in the recreational, there is consolidation, but it is by
season, not by market. Do you follow the distinction I am
making? It actually seems discriminatory against new fishermen,
if you will.
Mr. Schwaab. Thank you, Mr. Cassidy. I think the
circumstance you describe is not a function of the catch share
system, it is a function of many of the management systems that
have been in place for a long time, that have established
longstanding allocations between recreational and commercial
sectors.
Mr. Cassidy. So is there an ability to move the line back
and forth between recreational and commercial?
Mr. Schwaab. There is certainly that ability within the
council process now, independent of catch share systems. I
think one of the things, as we develop this catch share policy,
that we are focusing significant attention on, is the way in
which catch share systems might actually provide an additional
mechanism for, for quota or share of the catch to move back and
forth between sectors.
Mr. Cassidy. Now, that seems counter-intuitive to me,
because I have heard here that there is this corporatization of
the commercial market. And life has taught me that once you
have investors investing in a commercial commodity, property,
as I think one of the fellows said you can split it up in
Divorce Court, that it becomes more and more written and
concrete. It takes a Divorce Court to split it.
It actually seems no, it is going to be increasingly
difficult to allocate a greater percentage to the recreational
people. Is that not true?
Mr. Schwaab. I am not sure there are a lot of examples of
allocation under current management systems moving
significantly in one direction or another to accommodate the
kind of concerns you describe.
What I would submit is that properly designed catch share
systems may allow, through a market mechanism, the recreational
sector to purchase and move shares over into that common pool
that is available to meet the kind of growing demands that you
describe, and we all witness, in the recreational sector.
I am not saying it is the only way, but I think it is an
additional way.
Mr. Cassidy. So theoretically, just to pursue that,
theoretically, OK, you have 75 percent going to the commercial,
25 percent to recreational. That some entity, the State of
Louisiana, for example, could buy 15 percent of the 75 percent,
move it over to recreational, and you would lengthen the
season? Is that possible?
Mr. Schwaab. Theoretically, yes. The means by which to
manage and control that is something that we are focusing
attention on----
Mr. Cassidy. Now, again it seems a little counter-
intuitive, because again, I think I learned from the gentleman
from Ecotrust that as the fisheries return, that as opposed to
eliminating the catch share system, if you will, actually the
property becomes more valuable. If you get 10 percent of the
catch and there is more catch, then you actually have a more
valuable product, which increasingly prices it out of the range
of anybody but investors.
It almost seems we are on this inevitability of a
corporatization. Is that not true?
Mr. Schwaab. It is true that, under most commonly designed
systems, the share becomes more valuable as the annual quota
grows in size. So if the percentage remains the same, actual
numbers or amount of fish increase.
Mr. Cassidy. It almost seems it would be better, if you
will--and tell me if this has been done--that you have a catch
share that is based upon an absolute amount, not upon a
percentage. So, the absolute amount of the fishery grows, hits
a ceiling. You have this amount, but whatever comes on top is
then shared with the broader society.
Now, is that done in any of these?
Mr. Schwaab. To my knowledge, Dr. Rosenberg says yes, I
mean, it certainly could happen.
Mr. Rosenberg, do you mind? Dr. Rosenberg. I am sorry.
Dr. Rosenberg. That is fine. The New Zealand system tried
it that way, and it was really problematic. Then they have to
buy it back into a percentage-share system. Because the
difficulty is that stocks can go down, as well, due to natural
variability, as well as due to overfishing.
Mr. Cassidy. So in New Zealand, did they actually create
more shares? Or did they just allocate that to the recreational
guys, since the recreational guys are the ones that get
squished, it seems, if there is any shortcoming?
Dr. Rosenberg. That was in the specific case I am thinking
of, it was a commercial-only fishery, so there wasn't the
recreational problem. It may or may not be the case that
recreational gets squished, as you described it. As stocks
improve, that is not necessarily the case.
Mr. Cassidy. I just know that our red snapper season is
getting squished.
Dr. Rosenberg. Well, it is the status of the stock, not the
catch share system, though.
Mr. Cassidy. Yes, thank you.
Ms. Bordallo. I thank the gentleman, and would now like to
ask for unanimous consent that the gentleman from Washington, a
member of the full Committee, Congressman Jay Inslee, be
allowed to join us on the dais for this hearing.
Hearing no objection, so ordered.
Our next Member to be recognized is the gentlelady from the
Virgin Islands, Ms. Christensen.
Mrs. Christensen. Thank you, Madame Chair. I am between two
hearings, so I am sorry, I may have missed some of the
questions.
But Administrator Schwaab, I hope this hasn't been asked;
it probably has in one way or another. But given all of the
differing reports on the successes and failures of catch shares
and the many possible pitfalls, why is NOAA so committed to
them? Why not use more of that $54 million to provide better
data collection, expand monitoring, so that we can have
reliable annual catch limits? Since everybody agrees that that
is really what reduces overfishing.
Mr. Schwaab. Thank you, Ms. Christensen. I would submit
that we have to do both, and that we are doing both. On the one
hand, we have to increase our understanding of the status of
stocks and the timeliness of that understanding. And we are
continuing to invest there.
At the same time, we have to seek new management approaches
that allow us an opportunity to move beyond some of the
traditional management approaches that have, in too many cases,
failed us over time. By investing fishermen in the growth of
stocks, by providing to fishermen more latitude to manage
individual quotas, with more freedom to time markets to take
advantage of availability of fish--with one eye on the present
and one eye on the future--will, on the management side, help
to move us forward in the same way that we move forward on the
science side.
Mrs. Christensen. I see. These two are probably not, don't
have to be mutually exclusive of each other, but I have been
interested in the fish habitat partnership-type program as a
way to address our fishing challenges. Because it brings
everyone in the community together, every stakeholder together,
and develops a more comprehensive approach to managing our
fisheries, and hopefully gets some, builds consensus, which is
very difficult to reach.
Does NOAA support these habitat partnerships? Is there
funding in the budget to support the development of them?
Mr. Schwaab. Yes, a big focus of our attention continues to
be devoted to habitat. In a prior life, I actually helped to
develop the National Fish Habitat Action Plan, which became the
basis for these fish habitat partnerships and legislation that
is before Congress now.
Let me make one quick observation, and that is that I think
the opportunity of improving fish habitat addresses systemic
failures on the ecosystem side, in the same way that the
opportunities associated with catch shares provide us an
opportunity to address systemic failures on the economic side
of the equation.
Mrs. Christensen. OK, so they could work collaboratively.
Mr. Schwaab. Absolutely.
Mrs. Christensen. Ms. Cobb, what, to you, are the main
differences between Port Orford's community-based management
efforts and catch share? What are the main important
differences?
Ms. Cobb. Sure. Well, I can use, for example, the trawl
catch share program on the West Coast that is being developed
right now, versus our community-based program.
The difference is that in a catch share program, quite
often the Councils are looking at quota that goes to
individuals. In our community-based program, we are looking at
what are solutions for our entire community. It is very place-
based, so that our community can continue to fish sustainably.
But also so that our economy will be sustainable, as well.
So really, our project in Port Orford is about the triple
bottom line; it is about the economy and ecology or
conservation, and it is about equity and access. Catch share
programs, while they have the potential to address those, don't
emphasize those at all.
Mrs. Christensen. It sounds like something more akin to
what my community might be interested in putting together.
Dr. Fina, like many in this room today, you ascribe to the
belief that there is not one approach that can be tailored to
every fishery. We have, I mean, the Virgin Islands only has
120,000 people total on all three islands. Our fishery is
small.
What type of fishery do you think catch shares would be
best suited for? And are they suited to small communities like
mine?
Mr. Fina. Madame Chair, that is a difficult question.
Usually, we look at them in the North Pacific as generally
local questions, as to whether, whether the fishery itself and
the participants and the stakeholders are ready to make that
type of a transition into a catch share program. We do it
typically through a pretty long process in front of the
Council.
But I think that a lot of it depends on whether the
participants in the fishery are ready for that kind of
transition.
Ms. Bordallo. I thank the gentlelady from the Virgin
Islands. Now I recognize the acting Ranking Member, Mr. Wittman
from Virginia.
Mr. Wittman. Thank you, Madame Chairwoman. Members of the
panel, thank you so much for joining us today; we appreciate
you taking your time out of your busy schedules.
Mr. Schwaab, I will begin with you. I sense a growing level
of frustration by both recreational and commercial fishermen
with the various tracks on management of our fish stocks. I
know a month ago there were a number of folks here in
Washington, and just last week a number of recreational
fishermen, again expressing their frustration, and I guess a
feeling of disenfranchisement in this process.
So what I wanted to ask is, is there a way that we could do
a better job of recognizing the important role that fishermen
and communities have in our overall management strategies, and
how they affect our local communities? I know you spoke a
little bit, or have spoken here a little bit about how the
Councils can keep in mind the social and economic impacts of
their decisions.
But it seems like to me there is potentially a growing
divergence in the agency's track on managing fisheries and
fishermen and communities. I would like your thoughts about how
we can maybe bring that back on track. Because we all know that
the association between communities and sustainable fisheries
is extraordinarily important.
We have seen a lot of changes in that through the years. I
want to get your thoughts about how you think we can, through
this process, sort of bring those elements back together.
Mr. Schwaab. Yes, sir, Mr. Wittman, thank you. Well, that
is a big question.
I would offer a couple of observations. First of all, as
you know, to a large degree the Councils do include that kind
of representation. We have worked hard within the agency over
the years to enhance that balanced representation across the
Councils, as well as within the Councils--and to provide to the
Councils the kinds of support that they need to reach out
farther into the community but, at the same time, engage on
some fairly high-level and important decision-making processes.
I think another way to address your question that I would
submit is that one of the things that we have to do is be
careful to separate the questions, so that we have some clarity
in the discussions.
You know, there are debates around the status of fish
stocks. We need to continue to not only do a better job in
improving the accuracy and timeliness of our science, but also
having, developing a more shared appreciation, an agreement
around that current reality. One subcomponent of that, of
course, is the catch and effort data on the recreational side,
which we are working on.
Then those questions, at some level, have to be
distinguished from the questions that are partly the focus of
today's hearing, which are the management options. And catch
shares represent just one management option.
Largely before you get to catch shares, as we already
discussed with Mr. Cassidy, you have these allocation decisions
between sectors that have, in some cases, existed unchanged for
decades. Catch share systems represent one mechanism to
continue that dialogue, specifically as it relates to
management approaches and allocations.
Clearly, I think one of the things that almost unanimously
has resonated here so far this morning is an expectation, an
understanding that the best management systems, including catch
share systems, are those that take into account the local
social and economic goals of the communities and the fisheries,
in addition to the realities of the science and the status of
the stocks. We have to do a better job of having those
conversations very clearly and as locally as possible.
Mr. Wittman. You spoke a little bit about the impact on the
recreational side. As I have said, I think the recreational
fishermen are feeling a little more challenged, let us call it,
in this scheme of management.
What do you think we can do to restore the confidence and
access for recreational fishermen? As you know, they are
obviously one of the constituent groups out there that like to
utilize the resource. I think there is a growing element of
dissatisfaction with them.
So if you can talk a little bit about that, maybe how you
could restore confidence and access for the recreational
portion of our folks that utilize the resource.
Mr. Schwaab. Well, confidence in the data I spoke about a
moment ago. I think the access question goes back again to what
Mr. Cassidy was raising. They are really largely questions of
scarcity, in comparison to, in many cases, growing demand.
As I said earlier, one of the things that I think we should
continue to look to catch share systems to do is to provide for
us an additional mechanism to provide for some market-based
transfer of quota based on that increasing demand on the
recreational side.
Now design and implementation to that is tricky. It is
something we are spending some time on in this catch share
policy. But I think it is something that we should be very
attentive to.
Mr. Wittman. Thank you.
Ms. Bordallo. I thank the gentleman. Now I would like to
recognize Mr. DeFazio, the gentleman from Oregon.
Mr. DeFazio. I thank the Chair, I thank the Chair for
holding this important hearing. Mike Thompson from California
and I asked quite some time ago, and we are pleased to see this
going forward before we make some irrevocable or difficult-to-
change decisions
Dr. Rosenberg, in your testimony it says, ``In order to
meet social and economic goals, important considerations of
program design include rules, fees, eligibility requirements
based on transferability of quota shares at varied points
during catch share programs. These issues can be dealt with,
but it is very much harder to do so after the implementation of
the system, than as part of the initial implementation.''
Of course, as Ms. Cobb said, there is potential for catch
share to address some of these varied issues.
Then finally, Mr. Schwaab, you said the local, social,
economic goals, you could do a better job, more clearly
communicate and get as local as possible.
So I guess in context of that, are we ready to move
forward, particularly with the rule in the Pacific Northwest?
Have we adequately addressed all those issues on the timeline
that your agency has set? Or perhaps we should take a little
longer to discuss this? Particularly, as Dr. Rosenberg says, if
you mess it up at the outset, it is really hard because, then,
of the ownership issues and everything else, to go back in and
change it later.
I mean, April 10 EIS, and then implement for the next
fishing season. Can we resolve, have they already resolved
those issues? Do you think they resolved those issues in the
proposal and the PFMC?
Mr. Schwaab. Thank you, Mr. DeFazio. My understanding is--
well, in fact, I know at the last council meeting there was
significant attention devoted to discussion about the schedule.
The relative preparedness that the Council has, as well as the
affected communities have for moving forward. And based on that
discussion, there are a number of elements that process, moving
forward, that have to be addressed.
Mr. DeFazio. Well, very careful and very bureaucratic, but
would you support taking longer to do this at the outset? You
know, i.e., is there pressure coming from the national office
to PFMC, we want this for 2011? Or could you say well, gee, if
you can't really address these issues before 2011, let us put
it off and spend more time getting it right. Yes or no?
Mr. Schwaab. If you don't mind, I will preface by saying my
understanding is that there are significant elements of the
fishing community out there that are as anxious to move forward
as anybody else.
If circumstances suggested that we could not move forward
on the current timeline in an effective way, we would certainly
be receptive to delay. We may find ultimately that we are not
able to meet that January 1, 2011 date.
Mr. DeFazio. Do you agree with what Dr. Rosenberg said,
which is once you put this in place, it is a hell of a lot
harder to change it than if you take a little more time to
settle some of these questions about community impacts; you
know, about actually how you set the shares, what years you
choose, how those shares are going to be set, who is going to
be allowed, what you are going to be able to do with those
shares in the future, how you are going to have new entrants.
Don't you think it would be better to get all that stuff
done and arranged beforehand?
Mr. Schwaab. Yes. Theoretically, yes.
Mr. DeFazio. No, not theoretically. I think practically.
Yes or no?
Mr. Schwaab. Yes.
Mr. DeFazio. OK, good. OK.
Mr. Schwaab. Well, my point----
Mr. DeFazio. OK, that is good. I was going to say I am
disturbed at the continuing obsession and fascination with
market-based solutions around here. We had a market-based
solution on Wall Street not too long ago; worked out real well.
We had a market-based solution on deregulation of energy; that
worked out real well. We are paying $4,000 a megawatt-hour to
Enron, a corrupt company that went bankrupt.
Now I am very concerned here. I have had this experience in
aviation. You are going to apportion this valuable resource at
the outset. You are going to establish a property right.
You know, we can't deal with National Airport rationally,
or LaGuardia Airport, because all those airlines, who just
happen to have been there, or their predecessor airlines who
were there at the outset, they have a property right, by God,
and they own the gates. And no one else can land and come in
there, unless they want to pay them $10 million for a gate.
I don't understand how the successor clauses are going to
work. I don't understand how we are going to deal with the
leasing issue. The last thing I want is Goldman-Sachs buying up
all the shares in a fishery in three years, after the
restriction in the third year we can lease it to anybody,
including financial speculators.
Then we have derivatives of fisheries shares being sold on
Wall Street. I mean, the craziness that can come out of this is
extraordinary.
You have to get it right at the beginning. I don't think
you really have a clue and have thought through the
implications.
And even those who are advocating this, because they are
desperate to fish, you know, if you raise these issues with
them, well, it might mean that all the fish are going to go to
one community and one processor. In the not-too-distant future
they would say oh, no, that can't happen. Well, yes it can,
because of how you deal with the leasing of these shares in the
future, and how you deal with the accumulation of the lease
shares. Not the ownership, but the leasing of the ownership,
and the actual fishing that takes place, and where those fish
get directed, and who actually controls that, whether it is
some processor or some Wall Street broker or somebody else.
I don't think you have thought this stuff through. I think
we could have a disaster like they had in New Zealand at the
outset.
So I would hope that you will take your time, get it right,
and not just rush off to oh, well, we can just, market-based
system, here we go, and the local councils will solve it. I
just don't want to see that pressure from the national office.
I don't have tremendous trust in PFMC not to rush ahead,
either, but we will try and deal with that by region.
Would anybody else--Ms. Cobb or the gentleman, Mr. Backus
from Ecotrust--care to comment? Do you share some of the
concerns I just expressed, Ms. Cobb?
Ms. Cobb. Yes. Thank you, Congressman DeFazio. At the last
council meeting, which was last week in Sacramento, several of
us approached the Council, the Pacific Fishery Management
Council, and asked them to set up a committee on community
fishing association so that we could prepare these communities
for impacts from this trial IQ plan. The Council declined to do
that, because they are literally so rushed to get this IQ
program through.
Mr. DeFazio. Rushed by whom?
Ms. Cobb. I don't know what--I mean, there are certain
elements in the fishing industry that are pushing this to move
it forward. But the Council repeatedly says we have spent six,
seven years on this; we have to get it done, we have to start
this program in 2011. I don't see any reason----
Mr. DeFazio. Really? Have they answered all those issues
and concerns and questions I just raised?
Ms. Cobb. I don't think so, no. I think that that program
could be slowed down. I really think that there needs to be a
meeting held with the people who are very concerned about that
program and with NMFS to be able to express that, so we can
find out how----
Mr. DeFazio. Well, then, maybe what we need is some
direction from the national office to the PFMC, looking at
saying well, we don't think you have answered this range of
questions. And if we look at testimony from Dr. Rosenberg and
others, it is going to be a lot harder to change this after you
implement it, because of the property rights. Thank you. OK, I
appreciate that.
So maybe we need some intervention. But not to rush it, but
to get it right and take your time. It sounds like--yes, sir.
Mr. Backus. If I may, Mr. DeFazio, thank you. Yes, I think
in my oral statement earlier this morning I pointed out that
ownership structures are very much key to the future. And the
way that the Pacific Trawl IQ program is structured now in
terms of its eligibility to own rules, it essentially allows
perpetual leasing to happen.
I am all for----
Mr. DeFazio. Sort of like California water rights, right?
Mr. Backus. I am all for family businesses in fishing,
working their way through the generations. But if we are going
to have--one of the presumed benefits of having a quota market
if it is properly structured is, is liquid trade. When people
retire, it is a public-trust asset. It should go back into the
system.
If you have perpetual leasing the way that ownership
structures are set up now, that will never happen. As Ms. Cobb
said, we have been discussing with the Council the
implementation of these community provisions that are already
in Magnuson, regional fishery associations, fishing community
structures, which are clearly defined in Magnuson. We have been
pressing for community fishing association criteria and rules
of engagement for communities to be defined, so the communities
that are ready to develop CFAs, community fishing associations,
can go forward and feel that what they are doing is valid.
It is not an integral part of the trawl IQ program. Given
National Standard 8 about social and economic consequences, a
lot of us don't understand why these provisions are not a key
part of the design, the market design of this program, from the
get-go.
The adaptive management program, which sets aside 10
percent of the trawl groundfish allocation, is going to be a
trailing action that is going to be played out for two years,
after the initial start date of the program.
I don't understand why that would be the case. There are a
lot of unanswered questions about unintended consequences, but
we firmly believe, at a community level, like in Alaska,
allocate 10 percent to the community development quota
corporations. It has worked out very well. Ten percent for this
adaptive management program.
But let us make some solid decisions about where it should
be placed. And that I think should be at the community level,
and these community structures that are already described in
the Magnuson-Stevens fisheries law.
Thank you.
Mr. DeFazio. OK, thank you. Thank you, Madame Chair, you
have been very generous with the time. Thank you.
Ms. Bordallo. I thank the gentleman. Now I would like to
recognize Ms. Shea-Porter from New Hampshire.
Ms. Shea-Porter. Thank you, and thank you for being here.
I, too, was concerned when I heard the words ``market
transaction.'' And I thought, what are we really talking about
here?
I have been very concerned about the impact this is going
to have on the small fishermen. I am concerned about the extra
cost of monitoring on board, monitoring at the dock, increased
management costs.
But when we start talking market transaction, I worry that
what will happen is that we will be crowding out the small
fishermen, and that we will indeed wind up with some major
corporations that will be taking over. I think that would be
tragic for a number of reasons.
I just heard from a local fisherman in New England. And he
said, ``I am becoming increasingly concerned that the amount of
money being spent to implement a program that no one in New
England wants is approaching the gross value of the fishery.''
Mr. Schwaab, I listened to you talk about how things should
be settled as much as possible on a local level, and at least
include them. I do understand the tension that we have here,
because we have to take care of our fish, and we have to make
sure that the system doesn't collapse.
But what about his comment, that the costs now are going to
exceed or come in close to the gross value of the fishery?
Mr. Schwaab. Congresswoman, I don't have either of those
sets of figures in front of me. I would only suggest that costs
associated with the management decision-making process, as well
as catch monitoring and all the associated science that
underpins that exists to a large degree, regardless of the
particular type of management system that is employed.
And so there are costs and benefits in each case. I think
as you look down the road, one of the expectations that we have
is that by conveying more of the day-to-day management
decision-making of the fishery to the fishermen certainly
within limits established by the programs that each council
constructs, that we will have the opportunity to focus more and
more of our attention on the broader issues relating to
underlying stock science, as well as focused attention on
monitoring appropriately the total annual catches.
But I would be happy to get you a little more detail with
respect to cost of implementation of the sector program versus
the value of the fishery.
Ms. Shea-Porter. OK. Because I have seen some numbers that
are surprising. But in the--I am glad you brought up the
science, because I was obviously leading you to the next one.
In the 2011 budget, NOAA proposed a $10.5 million cut to
cooperative research, a $2.3 million cut to observers, and
inadequate funding for stock assessment.
Is this a question of we are creating a cart-before-the-
horse scenario? We have a lot of fishermen at this point who
are suspicious of the science. I appreciate your comments about
trying to work things out at a local level and getting the
local buy-in, but I don't think we are anywhere near close,
based on the comments that I am hearing, and the fact that
while they are still not confident about the science, you are
actually cutting back the science.
Mr. Schwaab. From a national budgetary perspective, we are
maintaining the increase in investment in the stock assessment
that, that we saw last year. About a $10 million increase, as I
recall.
There is a specific reduction in cooperative research, a $4
million reduction in cooperative research from the national
program. There is an additional $6 million shift from the
cooperative research general-line budget to cooperative
research under this new catch shares line.
So that money is predominantly Northeast money. So that
cooperative research will continue to occur. It will occur
under the auspices of the catch share program, as opposed to
under the auspices of the general cooperative research budget.
The last thing I would mention is something that I said
earlier, which is a significant amount of the new money
dedicated to catch share program implementation will go
directly to pay for observers and monitoring. So there will be
a net increase, particularly in those places where catch share
systems are being implemented this year, including the sector
system, in monitoring and observer data.
Ms. Shea-Porter. So what would you say to the man or the
woman who is fishing in New Hampshire, who is looking at all
this, looking at the plan, and says I don't think this is a
good deal for me? What would you say?
Mr. Schwaab. Well, I think there are two things at play
here. One is sort of the gross allocations. I think one of the
big challenges that we have run up against are reductions in
allocations that are based on assessment of stocks.
So in some cases, it is less the catch share or sector
program, and it is more the reality of the reduction in annual
catch that would have existed whether we were in a days-at-sea
program, or in a sector program. You know, that is a certain
reality.
Are there potentially winners and losers in this system?
Yes. And you know, one of the things that we continue to try to
do in New England is invest in ways, particularly to minimize
the impacts to some of the small fishery-dependent communities
that exist out there. And you are aware of some of those
investments. We continue to work very closely to protect those
interests.
Ms. Shea-Porter. But when you start using the words market
transaction, how are they supposed to understand that? It
doesn't sound very promising for the individual fishermen.
Mr. Schwaab. Yes. I mean, market transactions within the
confines of the rules established for the program.
My use of the term ``market transaction'' was specific to a
price question. It was not intended to imply that that would be
the only control on movement of shares.
Clearly, there are significant controls on movement of
shares, allocation and movement of shares in the system
designed to ensure a variety of localized social and economic
goals are met.
Ms. Shea-Porter. But do you think they are right to worry
that they could be driven out?
Mr. Schwaab. I am not sure that they should be worried
about being driven out of a catch share system or the sector
system in New England, any more so than they should have been
worried about being driven out under the prior days-at-sea
program, which had with it its own economic pressures and
costs.
Ms. Shea-Porter. Thank you, I have run out of time.
Mr. Schwaab. Thank you.
Ms. Shea-Porter. Thank you.
Ms. Bordallo. I thank the gentlelady, and now I would like
to recognize the gentleman from the State of Washington, Mr.
Inslee.
Mr. Inslee. Thank you. I really appreciate NOAA's interest
in catch shares and trying to advance this cause, for many
reasons. One of which is we have seen a continual decline in
fisheries where we have not had catch shares, and this is one
tool in the toolbox to help make sure we have a fishery for the
grandchildren of our current fishers.
I want to put into the record, if I may, a statement by the
President of United Catcher Boats in support of this effort,
dated March 16, 2010. If I may, Madame Chair, if I may put this
into the record.
Ms. Bordallo. No objection. So ordered.
[The statement submitted for the record by United Catcher
Boats follows:]
Statement submitted for the record by Robert E. Dooley,
President, United Catcher Boats
Dear Honorable Madeleine Bordallo and Members of the House Natural
Resources Committee, Subcommittee on Insular Affairs, Oceans and
Wildlife,
Thank you for the opportunity to present the following comments to
your oversight hearing on commercial fishery Catch Shares management.
My name is Bob Dooley and I am the President of United Catcher Boats
(UCB), a vessel owner's trade association that represents the interests
of the owners of 70 trawl vessels that participate in the Bering Sea,
Aleutian Islands, Gulf of Alaska and West Coast federal trawl
fisheries. My brother and I own and operate two trawl vessels and
together have participated in the West Coast and Alaska groundfish and
crab fisheries for over 40 years. We live in Half Moon Bay, California
and the UCB office is located in Seattle Washington. The members of UCB
reside in Alaska, Washington, Oregon and California.
Our primary concern is the timely approval and enactment of the
Pacific Fishery Management Council's recommendation on the West Coast
Trawl Rationalization program (FMP Amendments 20 & 21) and the
appropriation of adequate federal funding to ensure that this new
program becomes a success in 2011. To this end, we ask that the
Subcommittee convey its support for the West Coast Trawl
Rationalization program to NOAA/NMFS leadership and support funding
requests for this program through the congressional budget
appropriations process this year to help the West Coast Region of NMFS
and the Pacific Fishery Management Council get this new program up and
running as soon as possible.
The members of UCB are very strong supporters of Catch Shares
programs, or more commonly known as `rationalized' fishery programs. We
believe that our comments can be quite beneficial to the Committee
members because we participate in both a major rationalized fishery,
the Bering Sea Pollock fishery, and a fishery that is still an `open
access' fishery, the Pacific Whiting fishery. Through our experience of
both management styles we are able to provide you with an understanding
of the benefits associated with rational fisheries management programs.
The stated benefits of a catch shares program include reducing
overcapitalization, minimizing bycatch, ending the `race for fish',
maximizing vessel safety, maximizing the value of the harvest and
allowing for sustainable fishery management practices. Under the
provisions of The American Fisheries Act (MA) that passed Congress in
1998, the Bering Sea Pollock catcher vessel fleet has been operating
under a cooperative style (co-op) of management since 2000. With over a
decade of experience in fishing in a rationalized fishery, we can
unequivocally state that the stated benefits of rationalization are
very real and far outweigh any costs associated from shifting from an
open access style of management. All of these benefits, without a
doubt, have been realized and experienced.
One recent example is our ability to use our co-op style management
to address the problem of Chinook salmon bycatch taken incidentally in
the Pollock fishery. We are able to voluntarily enact co-op provisions
that provide strong incentives to minimize the encounter of salmon
while fishing for Pollock in the Bering Sea. Through the Co-op program
the Pollock fleet is able to enact a real-time reporting system to keep
vessels away from discrete areas of high rates of salmon bycatch. We
call this program the Rolling Hotspot Avoidance Program. In addition to
this avoidance program, we are able to use the co-op program to embark
on experimental fishing to develop a salmon excluder in the trawl net
that is now used by almost all of the Bering Sea Pollock fleet and some
of the Pacific Whiting fleet off the West Coast that allows salmon to
escape our trawl nets while catching Pollock These programs were
initiated by the Pollock industry to solve real-time problems and not
generated through government regulations or actions.
Compare this to the current open access style management of the
West Coast Pacific Whiting fishery. Similar to salmon bycatch in the
Pollock fishery, the incidentally caught rockfish species taken in the
Whiting fishery is the largest problem for the fishermen. In an open
access fishery, the government places hard caps of incidentally caught
bycatch species on the fishery that can close the fishery when these
caps are reached. This encourages a 'race for bycatch' by the fleet and
has resulted in closing the fishery down prematurely with harvest left
in the water. If the fleet had a co-op program in place, the owners can
pool the allocations of bycatch species and enact rules within the co-
op that result in avoidance of bycaught species. For example, the fleet
can choose to fish during times of the year, and in areas known for low
encounter rates of bycatch if they don't have to race for the fish when
the start of the fishery occurs. Without a co-op structure in place,
these kinds of avoidance incentive programs cannot exist.
The Pollock-Whiting comparison is very useful when analyzing the
problem of overcapitalization of the fleet. The present Whiting fishery
is exactly where the Pollock fishery was at the end of 1999. In that
year, the Pollock fishery fished for less than three months and the
value of the fishery was about 1/3 of the present value. Utilization
rates of the harvest was about half of what it is today and a number of
Pollock fishing companies were either just trading dollars or the cost
of fishing exceeded the gross revenues generated. This past year, the
Pollock fishery lasted for over six months, the fleet was able to avoid
bad weather, target on high value fish, spread the fishery out over the
entire year, match the size of the fleet to the level of harvest and
the products produced were matched to market demand. This past year's
Whiting fishery lasted less than one month, occurred during the time of
year when encounter rates of rockfish bycatch species were high and the
catch rates and product recovery rates of the fish were poor or sub-
optimal.
There is a feeling of stability and security, including the ability
to act and plan for the future in the Pollock fishery which was created
by the co-op rationalization element of the AFA. This sense of
stability is not present in the West Coast Pacific Whiting fishery.
Participants have continued to `capital stack' or put more investment
into catch capacity of the vessels and processing capacity in the
processing plants and the result has been shorter and shorter seasons.
This past year's Mothership catcher vessel fishery lasted about three
weeks and the Shore-side catcher vessel fishery lasted about one month.
In conclusion, I hope this comparison of two fisheries helps you
understand that a properly structured catch share program can solve
many of the problems fishermen face in an open access, race-for-fish
management style fishery. A co-op style management program allows for
fishermen to reduce their fishing capacity thereby lengthening seasons
and the ability to choose when and where to fish and gives fishermen
tools to voluntarily minimize bycatch of unwanted species without
government regulations. It allows us to better plan our businesses and
we are able to minimize costs while striving to maximize revenues from
a set amount of fish that get allocated to the individual members of
the co-op.
______
Mr. Inslee. Thank you. But I think about small fishers,
fishermen and women when I do this, I think of one of my
heroes, a fisherman named Rudy Neuser, who is my dad's best
friend from sixth grade, who fished the Shirley Ann for many
years. It was a beautiful wood boat, and he had many
adventures. He was an idol growing up, and still is. I want to
make sure that this program is designed in a way that everyone
feels they have a fair shake.
So I want to ask Dr. Fina to start with. This program has
been approved by the representatives of the Council from all
the states, as I understand it. What has been done to design
the catch share program so that the small fisherman who has got
that little, old wood boat out there is protected, and at least
has a fair shot at this?
Mr. Fina. Madame Chair, Mr. Congressman, in Alaska we have
done a few things in some of our programs, most particularly
the halibut and sablefish IFQ program, where there are vessel
classes and there are limitations on the movement of share
among vessel sizes. So that you can create classes that are
restricted to, for use on small vessels. You can also create
owner-on-board requirements that require the shareholder to be
on the vessel. You can limit leasing or limit the use of hired
skippers on vessels. Those types of, those types of elements
are included in the IFQ program in particular.
You can limit who can acquire shares, too. You can limit
the acquisition to people who meet certain fishing time
requirements prior to their purchase.
Mr. Inslee. Mr. DeFazio has risen issues about a concern
that you don't want to rush into an ill-considered decision. I
will just tell you my perspective. It is my understanding this
has been a multi-year process. Is it five or six years now? It
sounds like there is consensus from council members from the
Northwest, in any regard.
Is there any issue that has not been considered already,
that is sort of a new issue that no one has thought of, that
should delay this? Can anyone posit any that hasn't been
considered during this multi-year process?
Ms. Cobb, did you have a comment?
Ms. Cobb. Yes, thank you, Congressman. As I mentioned to
Congressman DeFazio, we asked the Pacific Fishery Management
Council to look at community fishing associations. Frankly,
those should have been running parallel with the design of this
IQ program.
Mr. Inslee. When did you propose that?
Ms. Cobb. We wrote letters to the Council, and were at the
Council meeting last week in Sacramento. The Council had every
opportunity to set up a CFA committee.
And again, these committees, community fishing
associations, could be very place-based, would need to respond
to these impacts from this trawl IQ program. And you know, we
couldn't even get them to set a committee date.
Frankly, as I said to Congressman DeFazio, this council,
the Fishery Management Council, is extremely rushed in trying
to get this through by 2011. I spoke with a council member in
the hall who said we may have to set all other issues aside for
this council, and just work on the Trawl IQ plan.
I kind of pushed back, because we have a halibut proposal
before the Council. And he said we don't want this thing to go
out the door a mess. We have to work on this, right, by 2011.
Mr. Inslee. So that makes, just briefly, because I have
limited time. So this has been going on for several years. Was
this the first time you had proposed the community council
approach, in this letter? Is this the first time this issue
came up?
Ms. Cobb. Do you want to respond to that? You have been
working on it, too.
Mr. Backus. Actually, the issue had come up several years
back, and the Council began to take action on it, I believe in
March of 2009, for the first time, when the Congresswoman from
California, Mrs. Capps, mentioned a project in her district in
Morro Bay which is large enough in terms of one of the
organizations involved, owns a significant amount of trawl
permits now in that project. I think that got the attention of
the Council to begin to address these social and economic
issues.
I would argue that these community provisions are already
clearly stated in the Magnuson-Stevens Act, in Section 303[a],
the Limited Access Privilege Program section. It clearly
defines that councils should define criteria for the
development of, in two sections: fishing communities in one
section, and regional fishery associations and other related
entities in the next section of the Act.
And a lot of us firmly believe that if you are going to
have a fully integrated approach in catch share design related
to communities, fishing businesses, and individual fishermen as
an integral part of the fisheries to start with, before you
start catch shares, that it is council responsibility to take
an integrated approach to the design of those programs from the
get-go. Not having us on the outside saying hey, what about
these provisions.
Mr. Inslee. Well, I hope that they are a success. This has
been several years. I think there are great opportunities for
improvement with a catch share program. I hope there is success
getting this going, taking in everyone's consideration,
particularly in light of the vote of the Council to move
forward.
Thank you. My time has expired.
Ms. Bordallo. I thank the gentleman. I have a couple of
questions, and I think Mr. Wittman also has a few questions.
This is for Mr. Backus. When is quota leasing necessary and
constructive, and when does it become exploitive?
Mr. Backus. Thank you for the question, Madame Chair. In a
single season, in a particular season of fishing that is going
on, there is often quota that is assigned around bycatch
species. And that can be practically and valuably traded
between vessels who might have gone over on some other bycatch
quota, and some other person who has not had that experience,
they can trade or lease intra-annual leasing of quota, to make
the system work.
Cooperative approaches to that issue are commonly exercised
in the North Pacific, and beginning to emerge here on the West
Coast.
So intra-annual leasing I think serves a very useful
function for fleets to operate under a catch share program. I
think when it gets abusive is when, as you see in British
Columbia, a majority portion of the quota is owned by non-
fishing entities or individuals, and it is leased so that 70
percent to 80 percent of the catch value goes off the top to
pay the lease fees that are demanded by the lessor. The lessees
feel like they are really becoming sharecroppers.
Leasing, for example, in Alaska is limited to the first
generation of initial issues of halibut quota. It is going to
sunset. That is a very good thing. That is a compromise I
believe in the design, but it is recognizing that leasing going
forward can be highly negative.
In the Pacific trawl program, as I mentioned, the way that
ownership structures are set up, even Ecotrust or the North
Pacific Fisheries Trust could buy trawl quota and lease it. We
would probably do very positive things with it, but again, I
think permanent perpetual leasing entities and trusts should
not be allowed. That is where it becomes abusive. Thank you.
Ms. Bordallo. I have another question for you. Has Ecotrust
been able to distinguish between the improvements of fish
stocks from setting a total allowable catch, versus
establishing a catch share program? And what does this
indicate, given the fact that the President's Fiscal Year 2011
budget request shifts funding for basic science over to catch
shares?
Mr. Backus. Thank you. As you have heard in this
discussion, it is very essential to address harvest levels
through total allowable catch or annual catch limits. It is
essential to allocate the proper proportion of budgets to the
science and the surveys and the analysis to establish those,
those levels, the TAC or the ACL.
I think the challenge, of course, for a manager is how do
you know when a fleet is getting up toward that annual limit,
and how do you prevent going over it.
Catch shares, for their good and bad, on the good side, as
I said in my earlier testimony, they do get down to the
accountability of individual vessels. That is a key positive
aspect of catch shares, properly designed, as I have said.
So I think it is important to recognize that TACs and ACLs
in and of themselves are the first benchmark that you want to
establish for control of the fishing. There are some distinct
advantages in being able to hold individual vessels accountable
for how they operate, and that is a positive aspect.
Ms. Bordallo. Thank you very much. Now I would like to
recognize the acting Ranking Member, Mr. Wittman from Virginia.
Mr. Wittman. Thank you, Madame Chairwoman. Dr. Fina, I
wanted to sort of get your perspective on the economics of this
whole realm of catch share. I am going to relate a story that I
experienced in Virginia. Back, I believe it was 1990, the Surf
Clam and Ocean Quahog Fishery underwent essentially an
individual fishery program. I watched that through the years
develop. I watched surf clam plants in Virginia, in Maryland,
and in Delaware close down.
I watched permits consolidate. I watched many boats go down
to a few boats, all controlled by one company, about 80 percent
of the catch controlled by one company. Then eventually that
one large facility that was there in Virginia being bought out
by a larger entity.
So the whole idea of making sure that we have healthy
communities, working waterfronts, a diverse fishing economy in
these areas, under that scenario, escapes me.
So I want to get your thoughts. How do you think we best,
in the scheme of fisheries management, how do you think we best
assure that we have healthy diverse fisheries, sustainable
fisheries, but also sustainable coastal economies that are,
again, diverse from top to bottom, not just for large
producers, but with small producers.
So how do we do that in that context, using the backdrop of
the individual fishery quota scenario we had with surf clams
and ocean quahogs.
Mr. Fina. Madame Chair, Mr. Congressman, in the North
Pacific we have done a few things. Like I mentioned before, we
have put in vessel caps, and you can use those to try and
maintain the size of your fleet, or make sure that nobody gets
bigger than a certain size. Also shareholding caps. We have,
where we have co-ops we have caps on how big a co-op can get.
That is a group of fishermen that join together and are managed
as a group, and their catch is managed as a group.
Also, in at least one of our programs and a few of our
programs where we have processors recognized as processors in
the program, we have processing caps, as well, that prevent any
processor from getting above a certain size.
I know that there is a lot of controversy around the
processing aspects of programs, but they are directed at two
things. Part of is that shore-based industry that you referred
to, as well as some of the community interests that you might
be able to protect with those.
So, and you can keep the distributions, you can affect the
distributions by some of those caps and some of those
provisions.
Mr. Wittman. Sir, do you believe then, as the fishery or
fisheries grow, under the scenario you have painted, that we
would actually be able to grow jobs? Have more people been
involved, both on the fishing side and on the processing side,
by making sure you have diversity both on the catch side and on
the processing side?
Mr. Fina. Madame Chair, Mr. Congressman, I think there is
potential for that. Other things that you can use are port
landing requirements that are now provided for in regional
landing requirements. Those may be appropriate for certain
circumstances. We have them in one fishery, and we are
considering them in another. So you can use a different tool,
which doesn't necessarily get down to the processor level in
that regard.
But I think with respect to your question about the
economy, I think you can use these types of measures to
redirect landings in ways that can provide for that basis.
Mr. Wittman. Thank you, Dr. Fina. It is great to have a
fellow Hokie here on the Hill. Thank you.
Ms. Bordallo. I thank the gentleman. I want to thank all of
the witnesses for their participation in the hearing today.
Members of the Subcommittee may have some additional questions
for you, and we will ask you to respond to these in writing.
In addition, the hearing record will be held open for 10
days for anyone who would like to submit additional information
for the record.
Again, as Chair of the Subcommittee, I would like to thank
the members of the Subcommittee and our witnesses. If there is
no further business before the Subcommittee, the Subcommittee
now stands adjourned.
[Whereupon, at 2:00 p.m., the Subcommittee was adjourned.]
[Additional material submitted for the record follows:]
[A letter submitted for the record by Lee Anderson,
University of Delaware; Trevor A. Branch, University of
Washington; Mark Carr, University of California, Santa Cruz;
Christopher Costello, University of California, Santa Barbara;
David B. Eggleston, North Carolina State University; Steven D.
Gaines, University of California, Santa Barbara; John C. Ogden,
University of South Florida; Michael K. Orbach, Nicholas School
of the Environment, Duke University; Stephen Palumbi, Stanford
University; Charles H. Peterson, University of North Carolina
at Chapel Hill; Pete Raimondi, University of California, Santa
Cruz; James N. Sanchirico, University of California, Davis;
Wolfram Schlenker, Columbia University; and Bob Steneck,
University of Maine, follows:]
March 30, 2010
The Honorable Nick J. Rahall, II
Chairman
Committee on Natural Resources
1324 Longworth H.O.B.
Washington, D.C. 20515
The Honorable Madeleine Z. Bordallo
Chairwoman
Subcommittee on Insular Affairs, Oceans & Wildlife
Committee on Natural Resources
1324 Longworth H.O.B.
Washington, D.C. 20515
The Honorable Doc Hastings
Ranking Member
Committee on Natural Resources
1329 Longworth H.O.B.
Washington, DC 20515
The Honorable Henry Brown, Jr.
Ranking Member
Subcommittee on Insular Affairs, Oceans & Wildlife
Committee on Natural Resources
1329 Longworth H.O.B.
Washington, DC 20515
Dear Chairman Rahall, Chairwoman Bordallo, and Ranking Members Hastings
and Brown:
We, the undersigned scientists, are writing to ask you to support
key investments in natural and social science needed to build a strong
and sustainable fishery management system in the United States by
supporting the President's proposed FY11 funding for the National
Oceanic and Atmospheric Administration's (NOAA) National Catch Share
Program. This key program will help improve science, restore fish
populations, and improve fishermen's livelihoods.
Good science is essential for good decision-making in fisheries
management. Good science involves strong fishery-dependent information
(including effective accounting of catches, and related social and
economic effects) and robust fishery-independent information (including
stock assessments). Many essential scientific elements remain woefully
underfunded in the United States, to the detriment of fishermen,
fishing communities, and ocean ecosystems.
Well-designed catch share systems provide an excellent tool to
build stronger fishery science and management at the same time. Core
elements of well-designed catch share systems include robust catch
accounting, monitoring and compliance systems, as well as improved
tracking systems for social and economic outcomes. Catch shares can
actually improve science, because they result in rapidly improving
fishery-dependent information--reducing uncertainty, allowing greater
yields for every stock condition, and getting fishermen back on the
water faster--and because stocks rebuild faster and more profitably
1 when compliance with appropriate catch targets is assured.
---------------------------------------------------------------------------
\1\ Newell, R., J. N. Sanchirico, and S. Kerr. 2005. Fishing Quota
Markets. Journal of Environmental Economics and Management 49(3): 437-
62.
---------------------------------------------------------------------------
The President's budget request for catch shares includes
significant funding (over $19 million--or 35% of the total for the
National Catch Share Program) for getting better data through dock-side
and at-sea monitoring, as well as helping to set up the infrastructure
for fisheries around the country to move forward with improved
electronic reporting systems.
Strong and compelling scientific evidence concludes that catch
shares are effective. Six recent studies have documented that catch
shares help prevent the collapse of target stocks and rebuild
fisheries:
``Can catch shares prevent fisheries collapse?'' looked
at 11,000 fisheries worldwide and concluded that catch shares prevent--
and even reverse--fisheries collapse. 2
---------------------------------------------------------------------------
\2\ Costello, C., S. Gaines and J Lynham. 2008. Can catch shares
prevent fisheries collapse? Science 321: 1678-81.
---------------------------------------------------------------------------
``Sustainable Fisheries'' demonstrated that fishery
production, on average, increases significantly after catch share
management is implemented--in some cases, dramatically so. 3
---------------------------------------------------------------------------
\3\ Heal, G. and W. Schlenker. 2008. Sustainable Fisheries. Nature
455: 1044-5.
---------------------------------------------------------------------------
``Rebuilding Global Fisheries'' presented a strong
consensus from scientists around the world--built around a brand-new,
sophisticated fisheries database--that catch shares is one of, and
perhaps the, most effective fishery management tool. Catch shares were
credited by experts as ``an essential tool'' in four of the six
ecosystems where reductions in total allowable catch were essential.
Conventional management was deemed ``essential'' in just two other
ecosystems, and one of those is now also finalizing catch shares.
4
---------------------------------------------------------------------------
\4\ Worm, B., R. Hilborn, J. Baum, T. Branch, J. Collie, C.
Costello, et al. 2009. Rebuilding Global Fisheries. Science 325: 578-
85.
---------------------------------------------------------------------------
``Ecological indicators display reduced variation in
North American catch share fisheries'' examined the ecological
performance of 15 North American catch share fisheries and reaffirmed
two critical benefits. First, catch shares drastically reduced catch-
to-quota ratios--i.e. fisheries complied with management targets and
avoided quota overages. Second, bycatch rates significantly declined
under catch shares--by an average of 30%. 5
---------------------------------------------------------------------------
\5\ Essington, T.E. 2010. Ecological indicators display reduced
variation in North American catch share fisheries. Proceedings of the
National Academy of Sciences 107(2): 754-9.
---------------------------------------------------------------------------
``How do individual transferable quotas affect marine
ecosystems?'' demonstrated that catch shares lowered fishing mortality,
and raised fish abundances, but also led to requests from fishermen for
more conservative catch limits, stronger monitoring programs, better
research, and improving data collection and stock assessments. Fighting
about the science was replaced by cooperating for improved science.
6
---------------------------------------------------------------------------
\6\ Branch, T.A. 2008. How do individual quotas affect marine
ecosystems? Fish and Fisheries 10(1): 39-57.
---------------------------------------------------------------------------
``Thirty years later: the global growth of ITQs
[Individual Transferable Quotas] and their influence on stock status in
marine fisheries'' chronicled improvements in most stocks managed under
ITQs, and documented the need for concomitant improvements in science,
including better total allowable catch specification, improved
monitoring, and accounting for related aspects of ecosystem-based
fisheries management. 7
---------------------------------------------------------------------------
\7\ Chu, C. 2009. Thirty years later: the global growth of ITQs and
their influence on stock status in marine fisheries. Fish and Fisheries
10(2): 1-14.
---------------------------------------------------------------------------
An investment in catch share systems in fisheries for which they
are appropriate is an investment in better science and better fisheries
management. We respectfully request that you support the President's
$54 million budget request for the National Catch Share Program in
FY11.
Sincerely,
Lee Anderson
University of Delaware
Trevor A. Branch
University of Washington
Mark Carr
University of California, Santa Cruz
Christopher Costello
University of California, Santa Barbara
David B. Eggleston
North Carolina State University
Steven D. Gaines
University of California, Santa Barbara
John C. Ogden
University of South Florida
Michael K. Orbach
Nicholas School of the Environment, Duke University
Stephen Palumbi
Stanford University
Charles H. Peterson
University of North Carolina at Chapel Hill
Pete Raimondi
University of California, Santa Cruz
James N. Sanchirico
University of California, Davis
Wolfram Schlenker
Columbia University
Bob Steneck
University of Maine
______
[A statement submitted for the record by Stephen A. Arnold,
Kingston Trawlers, Inc., West Kingston, Rhode Island, follows:]
Statement submitted for the record by Stephen A. Arnold,
Kingston Trawlers, Inc., West Kingston, Rhode Island
Thank you for the opportunity to provide my personal perspective on
catch share management.
I am an owner/operator of an inshore/offshore 55 foot commercial
fishing trawler from Pt. Judith, Rhode Island. I have been fishing for
more than 25 years and participate in several different fisheries:
large and small mesh multispecies, squid, mackerel and butterfish. For
this last year, I participated in the Rhode Island Summer Flounder
Sector Allocation Pilot Program, a type of catch share program.
I support catch shares and support the fluke sector being renewed,
modified, and expanded for fishing year 2010. Over this last year, the
fluke sector has accomplished a drastic reduction in fishing mortality
because of the catch share program. Going forward with the new
requirements of annual catch limits (ACLs) and accountability measures
(AMs), it will be increasingly important to take control over managing
discarded fish. Working under input controls makes it difficult and
even impossible to achieve this. By having control over how individuals
harvest the fish to suit their needs, we can manage the fluke mortality
while adding value to the days fished throughout the year. The fluke
sector enabled fishermen to extend the summer period to get fish into
August, September, and October, when in past years the fishery was
closed and became a pure discard fishery. By moving forward and
continuing with the fluke sector as a pure catch share program, we will
be better able to understand how this program can be better integrated
with the new groundfish sectors coming into effect May 1, 2010. I
believe catch shares can work with a well funded with fish catch share
management system.
I consider this fluke sector program a management proof of concept
study. We should not stop with only one year's worth of data, but
continue and expand it so we can see how it can develop with a larger
diversified fleet of boats that are interested in participating. Until
we have some new ideas put on the table, this is the only alternative
to access more of the resource.
______
[A letter and attachment submitted for the record by Ben
Bowman, Policy Analyst, Food & Water Watch, Washington, D.C.,
follows:]
March 29, 2010
U.S. House of Representatives
Subcommittee on Fisheries, Wildlife and Oceans
187 Ford House Office Building
RE: House Subcommittee on Insular Affairs, Oceans and Wildlife--
Oversight Hearing on ``Catch Shares as a Management Option: Criteria
for Ensuring Success''
Honorable Committee members,
Food & Water Watch (FWW) is a nonprofit consumer action
organization headquartered in Washington, D.C. that runs cutting-edge
campaigns to help ensure clean water and safe food. We work with
various community outreach groups around the world to create an
economically and environmentally viable future. We advocate for safe,
wholesome food produced in a humane and sustainable manner; and public
rather than private control of water resources, including oceans,
rivers and groundwater.
On February 25, 2009, FWW and the Pacific Coast Federation of
Fisherman's Associations wrote jointly to members of congress to
request oversight hearings on the fair allocation of fishing access
privileges. FWW would like to thank the House Subcommittee on Insular
Affairs, Oceans and Wildlife for holding the hearing. We hope for more
oversight hearings on this issue and hope testimony from small-scale
fishermen and consumer representatives will be included.
Limited Access Privilege Programs (LAPPs), now commonly known by
the euphemism ``catch share'' programs, allocate access to public trust
fish stocks by apportioning the Annual Catch Limit to identified
entities. FWW is not opposed to LAPPs and has undertaken international
research to identify a catch share approach (titled Cap-Rent-Recycle)
that we believe will best serve the U.S. people. Unfortunately, to date
LAPPs have been used to privatize access to public fish stocks and
develop a market-based cap-and-trade system that benefits speculators
while putting hard working primary producers out of work.
As the Oversight Hearing was focused principally on the development
of LAPPs for the Pacific Coast Groundfish Fishery, we would like to
place our comments regarding this proposal on the record. FWW has
provided comment to the Pacific Fishery Management Council on numerous
occasions. Through both public testimony and written comments we have
made it clear that we, and those we represent, do not support the
proposed changes (Amendment 20 and 21 to the Pacific Coast Groundfish
Fishery Management Plan). FWW asserts that the PFMC is deeply confused
about its fishery management role, and needs to be re-oriented, and
provided with contemporary policy development tools. FWW appreciates
the opportunity to provide comments on this matter.
Sincerely,
Ben Bowman
Food & Water Watch, Policy Analyst
[email protected]
______
Food & Water Watch
1616 P Street, N.W., Suite 300
Washington, DC 20036
www.foodandwaterwatch.org
March 15, 2010
Barry A. Thom
Acting Regional Administrator
Northwest Region, National Marine Fisheries Service
National Oceanic and Atmospheric Administration
7600 Sand Point Way NE
Seattle, WA 98115
Food & Water Watch re: Draft Environmental Impact Statement for
Allocation of Harvest Opportunity Between Sectors of the Pacific Coast
Groundfish Fishery: Pacific Coast Groundfish Fishery Management Plan
Amendment (A21)
Dear Mr. Thom,
Food & Water Watch (FWW) is a nonprofit consumer action
organization headquartered in Washington, D.C. that runs cutting-edge
campaigns to help ensure clean water and safe food. We work with
various community outreach groups around the world to create an
economically and environmentally viable future. We advocate for safe,
wholesome food produced in a humane and sustainable manner; and public
rather than private control of wild capture fisheries and water
resources, including oceans, rivers and groundwater. Importantly, FWW
supports some Limited Access Privilege Program (LAPPs) designs that
affirm the public trust on fish.
FWW has taken a strong interest in the Pacific Coast Groundfish
Fishery Management Plan (PCGFMP) Amendment 21 (A21), and related
amendments. We view the allocation of access privileges to harvest the
Pacific coast groundfish resource as strategically important. Without
access to this keystone resource it will be difficult for many Pacific
coast communities to continue to participate in commercial fishing in a
meaningful way. They may lose their jobs, as well as the opportunity to
respond to the growing consumer demand for local, sustainably caught
seafood. Local food requires local primary producers.
FWW has provided comment to the Pacific Fishery Management Council
(PFMC) on numerous occasions. Through both public testimony and written
comments we have made it clear that we, and those we represent, do not
support A21 as the enabler of fishery privatization through
Rationalization of the Pacific Coast Limited Entry Trawl Fishery:
Pacific Coast Groundfish Fishery Management Plan Amendment 20 (A20).
FWW asserts that A21 is one segment of a major federal action to
establish private control over access to, and use of, the public's
Pacific coast groundfish resource. These ``major Federal actions
significantly affecting the quality of the human environment''--A20 and
A21--should be a single amendment presented for National Environmental
Protection Act (NEPA) review (42 USC Sec. 4332(C). Presently, it is not
possible to review the environmental impacts of A21 as the Draft
Environmental Impact Statement does not include sufficient
environmental analysis. Rather, it serves to justify a predetermined
course of action. FWW appeals to Secretary of Commerce to disapprove
A21 on this basis.
In the following comments we will provide additional specific
comments and a number of attachments. Please feel free to contact me
with any questions or for further information.
Sincerely,
Ben Bowman
Policy Analyst, Food & Water Watch
______
Specific Comments on the A21 DEIS
NEPA and Segmentation
The Pacific Coast Groundfish Fishery Management Plan (PCGFMP) is
the single document outlining the management of the entire Pacific
coast groundfish fishery. Recent proposed amendments to the PCGFMP have
not been presented in a coherent and logical way. Instead, reforms have
been unnecessarily segmented into a number of different management plan
amendments. These amendments have then been pushed through in a
confusing manner, resulting in decreased public comprehension and
participation, and an inadequate NEPA review.
The plan, if presented logically as one major federal action, would
likely be very unappealing to a public weary of both industrial-scale
trawl fishing and corporate welfare. In brief:
Allocate to the trawl sector 90%+ of the total Pacific coast
groundfish quota, essentially in perpetuity (A21); restrict
entry to this fishery to suppress competition (A15/A20
Alternative 4b); privatize quota share; then introduce measures
to promote concentration of market share in the restricted
entry fishery through vertical and horizontal integration (A20
Alternative 4b).
Segmentation of this major federal action into component parts has
led to a piecemeal and fragmented analysis of environmental effects
relative to Environmental Impact Statement (EIS) analysis. The NEPA
rule against segmentation was developed to guard against such efforts.
The PFMC Groundfish Allocation Committee (GAC) recognized the need
for the two amendments to be studied together:
``The GAC acknowledged that it is difficult to discuss
Intersector Allocation (IA) without also thinking about trawl
rationalization. The IA and trawl rationalization processes
would have to be reconciled.''
FWW concurs with the assessment of the PFMC Groundfish
Allocation Committee, and asserts that improper segmentation of this
major federal action is reason alone for the Department of Commerce to
disapprove A21. The major federal action (A20 and A21) should be
reconsidered as a single amendment. FWW requests that the Department of
Commerce disapprove A21--select the status quo alternative--and send
the PFMC back to the drawing board with respect to groundfish
allocation.
Proposed Actions and Purpose and Need?
The proposed actions presented in A21 all relate to how to
undertake a course of action that has (seemingly) already been decided:
to make long-term formal allocations of groundfish species to the
combined limited entry trawl sectors. This is putting the cart before
the horse.
There is no statement of a policy problem, and thus no presentation
of policy alternatives. What is presented for review is a predetermined
course of action to lock in the lion share of groundfish quota to the
trawl fishery. The alternatives presented are not alternatives but
simply tweaks to the same plan. Of note, this lock in of access is
described in A21 as a move required in the interests of ``better
business planning'' rather than as a precursor to fishery access
privatization.
``In support of the Trawl Rationalization Program, the main
socioeconomic impact of Amendment 21 allocations is longer term
stability for the trawl industry. While the preferred Amendment
21 allocations do not differ significantly from status quo ad
hoc allocations made biennially, there is more certainty in
future trawl harvest opportunities, which enables better
business planning for participants in the rationalized fishery.
This is the main purpose for the Amendment 21 actions.''
1
---------------------------------------------------------------------------
\1\ Ibid, at 201
---------------------------------------------------------------------------
This amendment has no public interest basis and is simply an
egregious attempt to lock in special privileges for vested interests
without any analysis of allocation alternatives.
The regulatory principles in EO 12866 (Regulatory Impact
Review) emphasize careful identification of the problem to be addressed
and make it clear that the Department of Commerce should choose policy
approaches that maximize net benefits to society. A21 does not identify
a problem to be addressed nor does it provide alternatives that allow
the choice of an approach that would maximize societal benefits. Yet
the proposed action will undoubtedly have an impact on the economy of
$100 million or more, and will affect jobs, competition, and local
communities. FWW requests that the Department of Commerce disapprove
A21.
Catch History: A Problematic Allocation Device
This proposed amendment illustrates the problems of using catch
history as the means of undertaking intersector allocation; and by
extension fishery privatization through the awarding of exclusive,
transferable, and essentially perpetual limited access privileges in
A20.
Catch history is influenced by past management decisions and
neither reflects a past optimal intersector allocation, nor the basis
for a future optimal allocation. Problematic practices may simply be
locked in place--blocking innovation and continual improvement. The
Groundfish Allocation Committee recognized this:
``The alternatives in the ISA analysis are based on historical
catch percentages by sector. However, it was suggested by the
NMFS representative to the GAC that there could be other ways
to approach sector allocations. The current fishery is the
result of years of declining catches, including declaration of
a fishery disaster in 2001. In addition, the presence of
overfished species has forced restructuring of the fishery to
avoid harvesting these species, resulting in further changes to
fishing patterns. The Amendment 21 ISA action is an attempt to
allocate the groundfish stocks among the various sectors to
reduce the risk that the activities of one sector will affect
or be affected by the others. The initial strategy under
discussion by the Council has been to look at recent harvest
splits among the sectors and then lock in these harvest
percentages, with some alteration of strict historical patterns
on a case-by-case basis. However, the current harvest
percentages are the result of several years of perturbations
and, if the ISA were to have been done in the 1980s, an
allocation based strictly on historical catches would likely
have been different. If we were to do nothing, the fishery
would be free to rearrange itself among the sectors as
overfished species rebuild themselves and communities recover.
In addition, the Council has received public testimony stating
that an allocation directed more toward fixed gear could be
more ``environmentally friendly'' and could help support more
fishing communities. However, the impact of allocating quota to
sectors based on other than historical methods has not been
fully analyzed. In particular, an analysis could explore the
impacts of allocating more than a historical proportion of
quota to a sector on habitat, bycatch, overfished species,
fishing communities, and endangered species.'' 2
---------------------------------------------------------------------------
\2\ Ibid, at 254
---------------------------------------------------------------------------
The PMFC should have analyzed ways to allocate other than
through catch history. The GAC understood the merit of the concept of
allocating access in such a way as to favor gear types that are more
selective, have less environmental impact, and also happen to employ
more people and provide potential for a higher quality product that is
worth more at market. However, this analysis was not undertaken. FWW
asserts that A21 does not identify a problem to be addressed, nor does
it provide alternatives that allow the choice of an approach that would
maximize societal benefit--including environmental outcomes. FWW
requests that the Department of Commerce disapprove A21.
Alternatives?
According to the Council on Environmental Quality (CEQ) Regulations
for implementing NEPA, the analysis and comparison of alternatives is
considered the ``heart'' of the NEPA process.
Careful allocation can integrate social, economic and environmental
factors, assert public ownership of our ocean resources, and achieve
the nation's goals for fishery management. As an indication of fair
alternatives, FWW advocates the cap-rent-recycle model of LAPP
management. This model supports public control of wild fish stocks,
provides flexibility for management improvement over time, and creates
an even-handed business setting. International support for the
environmental fiscal reform tenets of the cap-rent-recycle catch share
model is coming together--from the Pacific Coast to Washington D.C.,
from Namibia to Iceland, and from the United Nations to the World Bank.
In this context, environmental fiscal reform is about capturing
resource rent. Resource rent capture will allow the government--the
steward entrusted with management of the public's valuable resource--
with revenue to invest in protecting the resource base, and ensure that
extractors face the full social cost of their activities, which should
lead to more efficient and sustainable use. 3 In the A21
DEIS this resource rental approach has not been explored as a robust
alternative.
---------------------------------------------------------------------------
\3\ The World Bank, Environmental Fiscal Reform, What Should Be
Done and How to Achieve It. 2005, at 69
---------------------------------------------------------------------------
FWW asserts that within this resource rental system, agreements
could be structured to support eco-friendly community-based cooperative
catching and marketing business models that could be linked to an area-
based management regime. Furthermore, the investment of rental revenues
into ocean policy and programs is urgently required and consistent with
the priorities of the Obama Administration and Congress to support
economic development initiatives--including green jobs--and to enhance
natural resource management.
Consistent with this position, the Joint Ocean Commission
Initiative, when discussing the urgent need for an Ocean Trust Fund in
the U.S. Treasury to supply greater funding for ocean policy and
programs states as one of three central principles:
``Require Payment for the Use of a Public Resource: The use of
a publicly-owned resource by the private sector in federal
waters should be contingent on a reasonable return of some
portion of the revenues to taxpayers in order to support
programs that will help sustain the health and vitality of our
nation's oceans and coasts.'' 4
---------------------------------------------------------------------------
\4\ Joint Ocean Commission Initiative, Ocean Policy Fact Sheet. New
Funding for Ocean Policy and Programs. http://
www.jointoceancommission.org/rc-fact-sheets.html, accessed June 2009.
---------------------------------------------------------------------------
With respect to the effect of a resource rental approach upon
efficiency, Bromley (2009) states:
``The single policy innovation that will induce efficiency in
the fishery is to require fishing firms to pay for the fish
they catch. A market economy requires that all owners of
factors of production--and fish in the EEZ are a factor of
production to fishing firms--must receive a payment for their
relative contribution to the value of the total product of the
firm using those factors. In this case fish are the raw
material (similar to gold, silver, timber, and oil) gathered up
by the private sector and delivered to the market ready for
further processing. Payment for this raw material is correctly
understood to be resource rent.'' 5
---------------------------------------------------------------------------
\5\ Bromley, Daniel W. Abdicating Responsibility: The Deceits of
Fisheries Policy. Fisheries Vol. 34 (4). June 2009, at 287.
---------------------------------------------------------------------------
FWW fact sheets explaining this concept are attached.
Conclusion
FWW asserts that A21 is one part (A20 and A21) of a major federal
action that should be combined for review. The regulatory principles in
EO 12866 (Regulatory Impact Review) emphasize careful identification of
the problem to be addressed and make it clear that the Department of
Commerce should choose policy approaches that maximize net benefits to
society. A21 does not identify a problem to be addressed, nor does it
provide alternatives that allow the choice of an approach that would
maximize societal benefits. As presented, A21 is inconsistent with the
Magnuson-Stevens Fishery Conservation and Management Act in respect to
National Standards 4, 5, 6, 8 and 9. The proposed amendment is not
reasonably calculated to promote conservation (and does not even
promote a reduction in bycatch); instead, economic allocation is its
sole purpose. Finally, A21 does not provide scope for changing
contingencies, nor does it take into account the importance of the
resource to different communities. FWW requests that the Department of
Commerce disapprove A21.
The PFMC should be sent back to the drawing board with respect to
the major federal action (A20 and A21) to develop a long-term strategic
assessment of the challenges and opportunities likely to affect the
ecological and social systems of the Pacific Coast. This analysis
should inform the development of a subordinate analysis of alternative
designs for allocation of the groundfish resource, including community
based fishery management models and market based approaches that assert
the public trust (see FWW comments on alternatives). FWW respectfully
requests that the Department of Commerce disapprove A21.
Attachments
[NOTE: Attachments have been retained in the Committee's official
files.]
______
[A letter submitted for the record by Glen Brooks,
President,
Gulf Fishermen's Association, follows:]
The Honorable Madeleine Bordallo
Chairwoman
Insular Affairs, Oceans, & Wildlife Subcommittee
1324 Longworth House Office Building
Washington, DC 20515
The Honorable Henry Brown
Ranking Member
Insular Affairs, Oceans, & Wildlife Subcommittee
House Natural Resources Committee
1329 Longworth House Office Building
Washington, DC 20515
Dear Chairwoman Bordallo and Ranking Member Brown:
On behalf of the Gulf Fishermen's Association, thank you for the
opportunity to provide information on Individual Fishing Quotas
(``IFQs'') for the subcommittee's hearing on fishery catch share
programs. Commercial fishermen living in the Gulf region of the United
States have greatly benefited from the implementation of IFQs, which
have helped end overfishing, while preventing and even reversing the
collapse of fisheries.
The Gulf Fishermen's Association is dedicated to ensuring the
fishing future for all fishermen and is comprised primarily of
commercial fishermen who are concerned about the fishing industry and
its future. These organizations have been strong proponents of IFQs and
support the development and implementation of similar programs, like
catch shares, in other fisheries.
Until recently, red snapper fishermen in the Gulf of Mexico were
faced with depleted stocks and an uncertain future. The Gulf's red
snapper fishery has a long history in America, dating back to the 19th
century. This fishery was rather stable until the 1970s and 1980s, when
demand for fish began increasing as the technology to catch fish was
improving. During that time, fishermen were able to catch fish easily
and deplete abundant stocks; due to the decline, fishermen had to
travel farther offshore to catch smaller fish. When regulators stepped
in to establish catch limits, fishermen began racing against one
another to catch as much fish as possible before the limit was hit and
fishing shut down for the year. This ``derby'' style system resulted in
large discards of dead red snapper, a decrease in fish prices, higher
operating costs and dangerous fishing conditions, as fishermen risked
their lives and boats in dangerous weather.
Fortunately, in 2007, the Gulf of Mexico red snapper fishermen
began fishing under an IFQ program. Under IFQs, each fisherman is
allotted a share of the total catch and is held individually
accountable for adhering to that limit. Fishermen are able to fish
throughout the year when it is good for business, as seasonal closures
are not needed. Further, as commercial fishermen, we are able to
deliver high-quality fish to market when consumer demand increases and
the weather is suitable for fishing. Under an IFQ program, fishermen
can lease or sell shares if they are unable to fish for any reason.
Best of all, with an IFQ program, fish are not wasted but retained and
counted against the individual quotas. Under previous rules, fishermen
were forced to throw fish overboard to comply with management
directives.
The red snapper IFQ has engaged commercial fishermen in the Gulf,
empowering them to be stewards of the resource, to run efficient
operations and minimize the waste of fish. Further we have the ability
to carefully target and market red snapper to earn more money with less
fish. Catch share programs provide fishermen with an economic stake in
the fishery, while holding them accountable to their allocation and
health of the stock.
Recently, scientists said that the red snapper population is
finally improving after decades of decline. The IFQ program has helped
stop overfishing and will increase allotments of fish in the coming
years. The commitment of commercial fishermen to the red snapper IFQ
has helped the program succeed since its implementation.
An August 2009 report from the National Marine Fisheries Service's
(``NMFS'') Southeast Region stated that ``two years after initial
implementation of the red snapper IFQ program, progress has been made
toward achieving [the] program's objectives--[which] include mitigating
derby fishing conditions and reducing overcapacity.'' 1 The
NMFS report also states that the IFQ's benefits are ``numerous'' and
``include increasing flexibility for fishing operations; providing
cost-effective and enforceable management of the fishery; reducing
bycatch; eliminating quota overages; improving safety at sea; and
optimizing net social, economic, and biological benefits from the
fishery.''
---------------------------------------------------------------------------
\1\ 2008 Gulf of Mexico Red Snapper Individual Fishing Quota Annual
Report, August 17, 2009. Southeast Region, National Marine Fisheries
Service.
---------------------------------------------------------------------------
Many of these goals and objectives are already being achieved. For
example, since 2006, the average ex-vessel value of red snapper has
increased 10 percent when adjusted for inflation (17 percent when not
adjusted). At the same time, the number of fishermen holding IFQ shares
has decreased nearly 15 percent, demonstrating that fishing capacity is
becoming aligned with the available catch.
The NMFS report also states that fishermen have benefited from the
IFQ program through increased flexibility as to when and whether they
fish, as well as how much they may catch. For example, in the 15 years
prior to the implementation of the IFQ program, the commercial red
snapper fishery was open for an average of 88 days. During this period,
fishermen were limited to either 200-pound or 2,000-pound trip limits
and 10-day fishery openings per month. Under the IFQ, fishermen are not
constrained by fishery closures or trip limits; a fisherman is limited
instead to his annual allocation or red snapper that he can catch
throughout the year. Subsequently, the NMFS report states that ``the
IFQ program has lead to greater efficiency for many red snapper IFQ
program participants.''
NMFS also cites the biological benefits resulting from the IFQ
program, saying that during the 17 years of management prior to
implementation of the IFQ, the commercial quota was exceeded nine
times. Conversely, in the first two years of the IFQ program,
``reported [commercial] landings have been below quotas.'' Similarly,
NMFS found that the ratio of landed to discarded fish has increased
three to four times since the implementation of the 13-inch minimum
size limit. The report acknowledges that while ``the IFQ program is not
directly responsible for large reductions in red snapper bycatch, it
has indirectly allowed managers to implement a lower minimum size limit
to achieve reductions in bycatch.''
Commercial catch share programs such as IFQs also support good jobs
in the seafood industry and throughout the broader economy. When catch
share management is used, seasonal harvesting restrictions are often
reduced or eliminated as unnecessary. The result is more stable
employment for fishermen, as well as their suppliers and buyers,
lasting for longer periods of time and helping to prevent economic harm
to fishing communities that depend on the fishing industry to sustain
their livelihoods.
The IFQ program currently in place for commercially-caught red
snapper in the Gulf of Mexico has been extremely successful, as it
allows fishermen to lower operating expenses, increases the price paid
at the dock, and meets high conservation standards, which has improved
both economic performance and safety at sea. A recovering fishery is
good for commercial, recreation and other fishing interests.
We respectfully urge you to consider supporting the development and
implementation of catch share programs in other fisheries throughout
the nation. The future health of fishery stocks depends on the
elimination of overfishing. Catch share programs can help meet this
goal while providing fishermen with an economically sound and healthy
resource to fish in the future.
Sincerely,
Glen Brooks
President, Gulf Fishermen's Association
941-920-7302
[email protected]
______
[A statement submitted for the record by Richard Carroll,
Ocean Gold Seafoods Inc., Westport, Washington, follows:]
Statement submitted for the record by Richard Carroll,
Ocean Gold Seafoods Inc.
Written testimony on Amendment 20 to the pacific Groundfish Trawl IFQ
program
I would like to submit on behalf of myself and Ocean Gold Seafoods
and the groundfish trawl vessel F/V Sea Clipper, the following comments
regarding amendment 20 to the pacific ground fish management plan.
Amendment 20 was approved by the Pacific Fisheries Management
Council at the November 2008 meeting, however it fails, in our belief,
to meet the objectives and provide the benefits sought by the
commercial fishing industry in a trawl rationalization program.
The goal of this process was to produce a comprehensive trawl
rationalization program that would stabilize the west coast groundfish
trawl fishery. We were initially hopeful this might occur, and still
believe in the merits of trawl rationalization in some form, but as the
details of this plan have come to light, we are left with a program we
cannot support.
This plan like many before it, serves the interests of a few,
against the greater interests of the many. Those currently attempting
to derive their livelihood from commercial fishing on the pacific coast
are shortchanged by this plan. This plan provides no compensation to
the American public, to who this resource truly belongs. This plan by
extending exclusive access privileges to federal groundfish permit
holders attempts to achieve a conservation benefit that may or may not
exist.
We have seen examples under catch share management where stocks
were subjected to overfishing just as they were under other management
schemes. The orange roughy fishery in New Zealand is just one such
example.
The Pew commission analysis show the conservation benefits
attributed to catch share programs have been overstated and oversold,
and can be achieved with far less radical management alternatives. The
environmental defense fund which has been one of the driving forces
behind pacific groundfish trawl rationalization recognizes the problems
associated with using catch history as a means of determining initial
allocation.
Throughout this process, most of the problems in this plan were not
addressed due to their structural nature. This amendment's primary
flaws were built in at the outset, by those less interested in building
a fisheries management plan then creating a retirement plan in which
they were heavily vested. Approximately 40% of the non whiting ground
fish allocated under this plan go to permits that are not active
participants in the fishery. Active fisherman will be required to buy
or lease quota upon implementation of this program just to achieve
their status quo fishing levels prior to its implementation.
This plan considers historical participation that will be 17 years
old at the time of implementation but not 7-year-old history, and this
assumes the program will be ready for implementation in 2011. There has
never been a successful rationalization plan implemented anywhere in
the world with a qualifying period for allocation that contrasts so
sharply from the current state of the fishery.
The National Marine Fisheries Service has publically expressed
reservations about the inclusion of the early years of the qualifying
year range, The inclusion rewards fisherman with quota during the same
time period when their fishing behavior created the groundfish disaster
this amendment is attempting to address. It includes years with
inaccurate species composition data, and discard data that skew our
picture of the true state of nature.
The problems with the year range in amendment 20 were recognized by
the PFMC in their vote when they chose a different year range, rather
than the 1994-03 for the purposes of allocation of by catch species.
This was recognition that the qualifying period did not represent the
current state of the fishery
For this reason I and my colleagues believe that Amendment 20 as
currently conceived fails to meet the recentcy requirements outlined in
the Magnuson-Stevens Act, and we expect that this will be demonstrated
during the litigation this plan will likely encounter prior to its
implementation.
Since 2000 we have seen significant changes in the markets and
technology in ground fish processing. This has lead to a shift in
fishing behavior and increased values and market opportunities for the
ground fish fishers and processors. Investments have lead to improved
vessels that can fish deeper water, farther off the shelf and later in
the year with lower bycatch
The effect of amendment 20 would be to undo all that has been
accomplished in the last ten years. This plan rewards the
inefficiencies, inadequate infrastructure and lack of investment that
characterized the qualifying year window.
The overly historical and retrospective nature of this plan will
result in allocations that shift catch from the present participants to
the past, from the north to the south, from the new to the old, from
the efficient to the inefficient. This plan if implemented as proposed
would likely reverse some of the conservation benefits achieved in the
last few years in the groundfish fishery.
We need a forward looking management plan that provides a
transition to a rationalized fishery, without the burdens of
significant additional investment the average fisherman cannot afford
and will likely not make. This plan as currently configured will
increase the level of consolidation that is likely to occur leaving
many ports no longer viable. It will require the redirection of limited
capital, badly needed for infrastructure and vessel improvement to
acquisition of needed quota.
The best alternative to resolve the flaws and inequities in the
amendment 20 ground fish trawl IQ program would be to adjust the year
range to be consistent across sectors. 1997 is the point of creation of
the three sector split in the whiting trawl fishery and the year range
used by the offshore for their rationalization plans. In addition the
PFMC and NMFS need to recognize a new control date of January 1, 2007.
The year range 1997 through 2006 should be used for allocation of
target species and 2003 through 2008 for allocation of by-catch
species.
We believe Amendment 15 to the groundfish management plan created
a, new control date of January 1 2007. The council, by taking action to
create a moratorium to vessel entrants to the trawl whiting fishery and
by including these years for the allocation of bycatch species has
established the significance of this date for management purposes in
the groundfish trawl program. The NMFS and PFMC need to recognize
January 1 2007 as the correct control date for the purposes of
consideration of recent participation in the fishery.
Seven years have passed since the 2003 control date was issued; the
PFMC and the NMFS have an obligation to implement its proposed plan in
a timely manner. The current industry participants should not be
further penalized for the inability of the PFMC and the NMFS to do so.
We believe this would go a long way to address the many of the
concerns about recent participation and eliminate the basic inequities
in this program, making it more of a management plan and more
consistent with the current state of the fishery
I hope that these comments will be considered and with the efforts
of your agency there will be an opportunity to rectify the flaws in
this proposed program.
Our goal is to produce a plan that will benefit the marine resource
on which we rely for our livelihood, the fishing industry to which we
belong, and the coastal communities in which we reside. If you have any
questions, please contact me at 360-310-0664
______
[A statement submitted for the record by the Gulf of Alaska
Coastal Communities Coalition follows:]
Joint statement submitted for the record by Fred Christiansen,
Chairman, and Gale K. Vick, Executive Director, Gulf of Alaska Coastal
Communities Coalition (GOAC3)
Chair Bordallo and Members of the Subcommittee:
Thank you for this opportunity for the Gulf of Alaska Coastal
Communities Coalition (GOAC3) to provide a statement to the
Subcommittee on Insular Affairs, Oceans and Wildlife on issues
regarding fisheries catch shares.
We are submitting this statement on behalf of the GOAC3, a non-
profit coalition formed in 1998 to provide a voice for the small
coastal, fisheries-dependent communities of the Gulf of Alaska and to
help ensure that they retain current, and regain lost, fishing effort
in order to maintain sustainable economies to provide for the
survivability of those communities.
The Location and Economy of Gulf of Alaska (GOA) Communities
The Gulf of Alaska (GOA) spans east to west over 2400 miles from
its southeastern to its western most points, with the Aleutian chain
separating it from the Bering Sea/Aleutian Islands (BSAI) to the west.
The BSAI and GOA are two very different and distinct eco-systems. The
GOA is one of the most diverse large marine environments (LME) in the
world. The Bering Sea dominates fishery productivity with a total
fisheries biomass almost 10 times the biomass of the Gulf of Alaska.
The GOA encompasses a marine area of approximately 592,000 square
miles. Within this area are 80+ coastal communities, over half of which
are under 1,500 in population, not connected to each other and are
fisheries-dependent in the clearest sense of the phrase.
The GOAC3 was established to provide a collective voice for the
smaller coastal communities of the Gulf of Alaska that were that were
without adequate representation in fishery regulatory arenas and were
being severely impacted by regulatory decisions (42 of these are
eligible under federal law for CQE designation by the National Marine
Fisheries Service 1).
---------------------------------------------------------------------------
\1\ The 42 small coastal fisheries-dependent communities that the
GOAC3 was established to assist are located in three fisheries areas in
the Gulf of Alaska as follows:
Area 3A (Central Gulf): Chenega, Tatitlek, Seldovia, Nanwalek, Port
Graham, Tyonek, Halibut Cove, Old Harbor, Ouzinkie, Port Lions, Karluk,
Larson Bay, Yakutat;
Area 3B (Western Gulf): Sand Point, Perryville, Chignik Bay,
Chignik Lake, Chignik Lagoon, King Cove, Ivanoff Bay, Akhiok; and
Area 2C (Southeast): Angoon, Coffman Cove, Edna Bay, Elfin Cove,
Gustavus, Hoonah, Kake, Craig, Kasaan, Klawock, Thorne Bay, Hollis,
Hydaburg, Metlakatla, Meyers Chuck, Pelican, Point Baker, Port
Alexander, Port Protection, Tenakee Springs, and Whale Pass.
---------------------------------------------------------------------------
In 1998, the out-migration of fishing effort was already taking its
toll on local economies. By 2005, twenty-seven (27) of the smaller
fishing communities of the Gulf of Alaska were considered ``severely
distressed'' by the State of Alaska. In 2010, the situation has grown
worse.
The remote communities of the Gulf of Alaska operate in an
exclusively marine environment. No roads connect them to the mainland;
access is only by air or water. Weather dictates much of the travel to
and from the communities. As may be expected, fishing and marine-
related activities dominate the economies and the importance of the
fishing industry on the community fishing families and related
businesses is profound. In Southwest Alaska, for instance, the fishing
industry accounts for just over half of all private-sector employment.
``It's no exaggeration to say that many Southwest Alaska
communities would virtually disappear without fishing,'' reported Dan
Robinson and Michael Patton, co-authors of a 2006 State of Alaska
Department of Labor report on ``Employment in Alaska's Fisheries.'' The
authors expanded this observation to include Aleutians East, Kodiak
Island, Lake and Peninsula Borough, Central Gulf communities and
Southeast--basically, all of the unconnected communities of the Gulf of
Alaska.
A Contrast in Community Protections for North Pacific Fishing
Communities
Alaska leads the nation in both fisheries value and number of catch
share programs but it is still evolving in its understanding and
prudent application of catch shares, particularly in regard to
community protections.
On one end of the spectrum in terms of providing communities access
to fisheries is the enormously successful ``industrial model,'' i.e.,
the western Alaska Community Development Quota (CDQ) program, which was
granted rights to ten percent (10%) of Bering Sea and Aleutian Islands
(BSAI) rationalized species, received start-up capital through their
joint venture operations and has received federal loan access. This
program was originally implemented by the North Pacific Council in 1992
and subsequently authorized by the Magnuson-Stevens Fishery
Conservation and Management Act (MSA). The six CDQ corporations
(representing 65 communities) now own hundreds of millions of dollars
in assets and receive millions of dollars each year as rents for their
ownership rights. In general, others fish those rights through joint
venture arrangements providing income to the CDQ corporations and to
the communities.
On the other end of the spectrum are the 42 communities of the Gulf
of Alaska who were authorized by the 2004 Amendment 66 to the GOA
Groundfish Fisheries Management Plan, to form individual (or
collective) non-profits to purchase halibut and sablefish quota shares
and to subsequently lease those quota shares to local residents. This
resulted in the Community Quota Entity (CQE) program under the Halibut
and Sablefish IFQ program. It is strictly a small boat, local resident,
``owner on board'' program, with no initial fishing assets unlike the
CDQ communities. Because of the lack of quota shares and funding
access, the CQE program, though well intentioned, will have no value to
and cannot assist the small communities until they can secure a CQE
loan program that is workable and/or granted income for purchase of
quota share or granted quota share itself.
Both the CDQ and CQE programs were based on the need to help
coastal communities deal with extreme economic challenges, but for
different reasons. The CDQ communities had demonstrated that their lack
of infrastructure prevented them from participating in the lucrative--
and growing--industrial fishing in their ``back yards.'' In contrast,
the smaller fishing communities of the Gulf of Alaska were able to
demonstrate that fisheries regulatory practices had significantly
contributed to their increasing loss of traditional fishing access.
Neither the CDQ nor the CQE program is inclusive of all fishing
communities within their respective regions, but general similarities
end there. The contrasts between the two programs' financial and
political status could not provide a clearer lesson to fishing
communities everywhere: Unless a community owns rights to a percentage
of non-transferable quotas (as the CDQ communities do), it really has
nothing. Therefore, today, there is a huge disparity between the CDQ
communities of the Bering Sea and the CQE communities of the GOA.
The GOAC3 was the primary motivator for the CQE program concept but
openly opposed the purchase-only concession to the fully rationalized
Halibut and Sablefish IFQ program because, without initial issuance of
quota, it was going to be extraordinarily difficult to launch the CQEs;
there was simply nothing to leverage. In the end, the choice was to
accept purchase-only terms or not get a program at all. At the time, we
knew purchase was going to be a hard road. We just didn't know how
hard.
Since the Gulf of Alaska CQE program was authorized in 2004,
2 only 20 CQEs have been formed as of late 2009 and only two
have actually purchased quota share of any kind and those have not even
come close to purchasing quota share up to the caps authorized. Neither
of those purchases was able to use the State CQE loan program or
federal loan programs. Both of those CQEs are currently operating on
thin margins, having obtained private financing that is not likely to
be replicated in other areas nor expanded utilizing existing state loan
opportunities.
---------------------------------------------------------------------------
\2\ The CQE program was established as an amendment (#66) to the
Fishery Management Plan (FMP) for Groundfish of the Gulf of Alaska and
an amendment to the Pacific halibut commercial fishery regulations for
waters in and around Alaska by the North Pacific Fishery Management
Council. The CQE program was made into a Final Rule in the Federal
Register, Volume 69, No. 84, April 30, 2004, Rules and Regulations,
page 23681, June 1, 2004 and 50 CFR 679.2)
---------------------------------------------------------------------------
There are many substantive reasons for the lack of participation in
the CQE program (most recently outlined in the CQE Review Report by the
North Pacific Fishery Management Council), but the simple answer is a
lack of funding (loans and grants) with which to purchase quota share.
The CQEs did not receive gifted shares (like CDQs) nor was the CQE
program funded administratively. Given the absence of quota share,
percentage of catch or funding, it should not be surprising that the
CQE program has generally not worked.
The CQE program could work extremely well if funded. A key factor
in trying to craft a remedy for the CQE program is the fundamental
public policy distinction between a program for individual fishermen
and one for small fishing communities. Community goals, purposes, and
outlook are for the greater good of all of the people in that community
as opposed to what is best for one individual or one family. In other
words, the strategies for financial help that may work for an
individual fisherman are not necessarily applicable to a community-
based organization. This important distinction is the reason that the
current application of financial remedies for individuals most often
does not work for an organization in the community trust.
For a newly formed community non-profit CQE in a remote community
without assets to leverage and with an additional layer of
administrative burden, it is a seemingly impossible task to utilize
existing loan programs and/or attract grants that can help CQEs
purchase quota share and still be able to pay their debt service. To
address this conundrum, the GOAC3 working with many of the GOA
communities, economists, fishermen and fishing community
representatives have been working on the development of a loan program
that would work. This group has identified specific loan terms that
will ``pencil out'' but currently do not exist in the open market. Such
a program, although not as helpful as the granting of quota shares or
TAC to communities, would be of enormous benefit. This will require
lawmakers (and regulators) to act. Such a plan is being strongly
recommended to the State of Alaska by small communities of the GOA and
it would make sense to have something similar at the federal level to
help implement the federal CQE program in the GOA.
The Value of Combination (Diversified) Fishing
The economic viability of the fishing communities in the Gulf of
Alaska is based on small boat, ``combination,'' (i.e. ``diversified'')
fishing. As fish species fall into various rationalization (catch
share) programs, the ability to maintain a boat and gear that can fish
multiple species and be able to purchase permits or quota shares has
become increasingly problematic.
The following observations on this subject were made in connection
with a workshop in 2000 conducted by the H. John Heinz III Center
entitled ``Improving Federal Fisheries Management in the North
Pacific'' at which community participants discussed their experience in
the loss of diversified fishing as the backbone of small community
fisheries economies:
``Some participants said that small fishing communities will
not be able to last unless they can diversify over different
fisheries. But, others noted that the management trend is the
opposite--to push people into discrete fisheries. This happens
because when new programs are developed, people without a
fishing history during the qualifying period do not receive
licenses...Specialized programs have cumulative effects that
require cumulative assessments of their impacts. There was some
agreement that small coastal communities have their own culture
and have their own way of doing things, in contrast to the one-
size-fits-all style of the federal government...Some
participants noted that many small communities were at a
disadvantage when it came to individual fishing quota
allocations because their diversified fishing patterns left
them without substantial fishing histories during the window
period.''
Fisheries regulatory decisions very often continue to help out the
``haves'' vs. the ``have-nots.'' Fishing communities need the Congress
to ensure that federal policies and programs do not preordain the
dismemberment of their communities because the moneyed interests in the
fishing industry are able to be most effective in securing for
themselves ``public assets'' such as federal fisheries resources.
Catch Share Programs Create Dramatic Shifts
Most small coastal communities in Alaska are entirely fisheries-
dependent, with many of the Alaska Native villages having ``fishing
histories'' going back 8,000 years and more. Over-capacity of fishing
effort is not an issue in any of these communities; quite the opposite
is true. However, because catch shares are designed for a fishery and
not a community, the vulnerability of communities is acute. The
economies of scale can make even a single catch share action very
debilitating to a community if not crafted with the sustainability of
both fisheries and communities at the forefront.
Dr. Marie Lowe of the University of Alaska Institute of Social and
Economic Research (ISER) wrote in her paper ``Eastern Aleut Society
Under Three Decades of Limited Entry'' (for salmon): ``Aleuts who were
not given permits initially could not afford to purchase these.'' This
situation, Dr. Lowe notes, resulted in Aleut migration away from their
home communities to search for jobs. This simple statement illustrates
an increasingly common situation that prevails throughout all Alaskan
small fishing communities and has resulted in wholesale shifts in
population, gear and income.
At the time the North Pacific Council was considering the CQE
program (2001-2002), there had already been a significant out-migration
of quota share of halibut from small communities since the 1995 IFQ
program implementation. By 2009, the National Marine Fisheries Service
RAM Division reported that CQE communities had lost between 29-45% of
their initial IFQ holdings in halibut and up to 89% of their initial
sablefish holdings. This does not include pre-IFQ fishing effort, for
which there is no data, particularly for Alaska Natives who have
depended on the sea for their survival for centuries. That data would
be expected to indicate a much greater loss.
The qualifying years for the halibut and sablefish IFQ program has
often been criticized for its narrow window of time. In his 2004 report
on Alaska Residency in Alaska Fisheries, Neil Gilbertson, an economist
with the Alaska Department of Labor, wrote:
``When the IFQ program was finally adopted in 1995, only
fishermen who had landed halibut in 1988, 1989, or 1990 were
allowed quota shares. These shares were based on the
individual's production in the 1984-1990 period. Under these
terms, many new or one-time participants were excluded, and
this exclusion led to a dramatic decrease in resident
participation.''
Nor was there an accommodation for communities with a proven
historical dependency. The North Pacific Council did not, because it
was not required by law, consider the thousands of years of traditional
halibut fishing by Alaska Native communities. Archeological data
suggests that GOA coastal communities, when unimpeded by limited
access, maintained highly sustainable fishing cultures for millennia.
Dr. Steven Langdon, University of Alaska Department of
Anthropology, wrote in his 2009 paper 3 on the CQE program:
---------------------------------------------------------------------------
\3\ ``The Community Quota Program in the Gulf of Alaska: A Vehicle
for Alaska Native Village Sustainability,'' ``Enclosing the Fisheries:
People, Places and Power'', American Fisheries Society 2009, Dr. Steve
J. Langdon, Department of Anthropology, University of Alaska Anchorage.
---------------------------------------------------------------------------
``A series of distinct archeological traditions and adaptations
appeared in the central Gulf of Alaska region from the Kodiak
Archipelago to Prince William Sound approximately 8,000 years
ago. Continuity with contemporary peoples of this region, known
collectively at Sugpiaq or more recently Alutiiq, can be
identified at least for 1,000 years in certain locations and
for nearly 4,000 years in other locations. In all of these
regions, archeological evidence and oral tradition demonstrate
that these groups built complex societies with rich ceremonial
practices based on their relations with rich resources of the
Gulf of Alaska ecosystem.''
Cumulative Impacts of Catch Share Programs
Small fishing communities in the Gulf of Alaska are dying through
no fault of their own. Since the implementation of Limited Entry for
salmon in the mid 1970's, through the more recent Halibut and Sablefish
IFQ program and the fall-out to the Gulf of Alaska from the Bering Sea
Crab Rationalization Program, the fishing communities of the Gulf are
virtual shadows of their former selves. For example, one Southeast
Alaska community lost almost half its population since 2000. This IS a
crisis. And many of those, if they had jobs in fishing in the community
would return.
The pending LLP reductions and sector allocations of groundfish are
going to exacerbate the problem, even with community provisions. The
fishing communities of the GOA wonder what further has to happen in
terms of a wake-up call for lawmakers to understand that community
fisheries will disappear altogether without immediate remedial action.
The communities are not alone in their concerns. Dr. Seth Macinko,
Department of Marine Affairs, University of Rhode Island, a member of
the North Pacific Council Science and Statistical Committee, raised in
Kodiak, author of many fisheries papers, is a strong critic of
approaches to IFQ programs that don't consider the severity of
unintended consequences, unequivocally stating ``Coastal Alaska is
dying. I question how much longer permanent giveaways to selected
individuals will somehow make communities better off. This process is
killing us.''
Loss of fishing access means loss of boats, gear, jobs,
infrastructure and eventually schools. It is not just fishing families
who suffer, but all the families dependent on the support systems. When
the economic dominoes start to fall, social ills increase: alcoholism,
drug abuse, child and spousal abuse, teenage suicide and unemployment
rates become toxic, jeopardizing the viability of the community.
Families are forced to move to urban settings where the opportunities
for failure are much greater. Kids who learned from their parents how
to work hard and make a living from the sea are similarly displaced.
The skill sets that people took for granted for generations are lost.
Families are split up. Briefly stated, it is a human disaster that is
totally preventable.
A letter written just a few weeks ago by the Mayor of the City of
Pelican, once a very vibrant fishing community, expressed the
following:
``One look at the Pelican Boat Harbor and one can see that
employment opportunities are scarce. Many coastal communities
are on the brink of economic collapse. We need to generate
fishing jobs and opportunities for our residents...furthermore,
Pelican struggles to stay current with fishing regulations
because we have experienced first-hand the consequences of
government regulations that have eroded our ability to sustain
our economy through our traditional fisheries.''
It is the cumulative impact of catch share programs on the loss of
diversified fishing that is the most devastating. As species are
rationalized, all other species still in open access are marginalized.
Not only is the cumulative loss often unsustainable, but also the
combination fishing cycle can actually contribute to a loss of fishing
in qualifying years, thereby making a community fisherman ineligible
for initial quota. Regulators simply do not have the statutory
guidance, much less a tool set, that will guide them in sufficiently
addressing cumulative impacts on fishing communities.
The High Cost of Entry into a Catch Share Program
Catch shares can dramatically increase the cost of entry into a
particular fishery, especially over time. For people who qualify for
initial issuance, that is the point of creating a catch share program,
they simply want the value. The halibut IFQ program, for instance, more
than tripled the price of quota share in just the last six years alone.
At average current prices, a small amount of quota--12,000 pounds
as example--will cost up to $300,000. Larger amounts run into the
millions. Remote fishing community residents often cannot collateralize
their homes because of lack of valuation or no available fire
protection, and cannot meet minimum loan requirements. This compounds a
long list of complicated scenarios caused by rationalization, not the
least of which is loss of fishing access that residents had previously
depended on to live in their home community.
For a CQE to purchase quota there are additional costs and
complications. Even with community-held quota, the supreme irony of
community residents having to lease back fishing effort that they once
utilized for just the cost of gear and boats under an open access
fishery is never far from one's mind during discussions about the cost
of entry to a fishery. Tony Gregorio, long time Chignik multi-species
fisherman knows full well that most small community residents cannot
afford to buy. ``It's like taking away someone's job and then charging
them outrageous rates to get it back.'' This makes the CQE program the
only viable option...if it were working.
Feasible CQE Loan Program Could Make The CQE Program a Model Soon
Every region of the nation is different but fishing communities
around the country share many elements and concerns in common. Fishing
communities, regulators, NGOs, etc., are all looking for models that
illustrate their particular point of view.
The GOAC3 has been concerned that the CQE program has been held up
as a model to emulate. We hope it will soon become one to emulate, it
is just not there yet. One of this coalitions primary goals is to see
that loan programs are developed that will facilitate full
implementation over time of the CQE program as authorized by federal
law.
The Gulf of Alaska CQE program would be a good model except for the
serious flaw that there was no initial issuance of quota (or sufficient
seed funding) as was made to the CDQ communities in the Bering Sea and,
in the alternative, there is no loan program in place that ``pencils
out'' so that community CQEs can actually purchase the quota share
allotted to them under the law.
In the Gulf of Alaska, people want to work and specifically want to
work in the fishing industry. It is where their roots are. It is
integral to their history and culture. Many communities have people who
have moved away who would move back in an instant if the CQE program
were functional. The exodus must be reversed and reversed soon if there
is to be a rural coastal Alaska with real viable communities intact.
If the CQE communities are able to capitalize on the CQE program in
the immediate future, many of them might have a chance to revitalize
their community economies. CQE communities are desperately searching
for solutions that can help them make the margins work. They are
running out of time. This is a human crisis of historic proportions,
one that has been triggered by past regulatory actions and one that can
be fixed at the will of lawmakers and regulators with an understanding
of how catch share programs affect fisheries-dependent communities.
The High Cost of Participation in Regulatory Arenas:
A comment frequently heard at the community level: ``When the
voices go away because they have been driven away, they are no longer
able to communicate their story.''
But seeking a voice in regulatory arenas is an arduous and
expensive process. The GOAC3 has played a significant role in
representing the smaller fishing communities of the Gulf of Alaska
simply because those communities cannot afford, on their own, to attend
the years of regulatory meetings necessary and to garner even minimal
political support. The issues are so diverse and complex that fishery
meetings go on year round. Even veterans find themselves mired.
Meetings are ``open and transparent'' but not without significant cost.
The Council, for example, meets five times a year for nine days at a
time, four meetings in Alaska, one in Seattle or Portland. The annual
cost (air fare, housing, meals, etc.) for a single individual from a
remote Alaskan community to attend Council, related committees and
Alaska Board of Fisheries meetings can run as high as the equivalent of
a year at Harvard (over $50,000.) Yet the Council's and Board of Fish
decisions have enormous impacts on Alaska's coastal communities.'' It
is therefore an absolute necessity to have an advocacy and information
sharing and coordinating organization that can help the smaller
communities, especially, have any voice at all in such forums.
What will it take to Revitalize and Sustain Small Fishing Communities?
Any catch share program will have ``winners and losers,'' but
fishing communities have unique situations that should encourage
lawmakers and regulators to take extra precautions to avoid creating
unnecessary economic devastation across a broad swath of coastal
America. Here are some essential requirements we believe necessary for
a community quota program to fulfill the intent of anchoring fishing
effort in a fisheries-dependent community in perpetuity:
Either:
1. Gifted Quota Shares or gifted set percentage of TAC (total
allowable catch)
2. Ability to purchase Quota Shares
3. Non-transferable quota
4. Eligibility for loans
5. Consistent ``Code of Conduct'' (operational criteria) and good
management
6. Single umbrella organization identified for technical
assistance and advocacy
Or:
1. Ability to purchase Quota Shares and sufficient seed funding to
both purchase Quota Shares and administer a program until there is an
adequate revenue stream
2. Eligibility for loans that are specifically designed for
community quota purchase
3. Non-transferable Quota Shares
4. ``Owner on board'' requirement (i.e., the individual community
resident who leases the Quota Shares form the CQE must actually fish
the quota themselves)
5. Consistent ``Code of Conduct'' (operational criteria) and good
management
6. Single umbrella organization identified for technical
assistance and advocacy
A 2004 General Accounting Office (GAO) report regarding methods for
community protections under an IFQ program stated:
``Several methods are available for protecting the economic
viability of fishing communities and facilitating new entry
into IFQ fisheries. The easiest and most direct way to help
protect communities under an IFQ program is to allow the
communities themselves to hold quota.'' (Emphasis added).
This recommendation has been reinforced by the last two
reauthorizations of the federal fisheries management act that governs
actions of all the fishery management councils.
Federal Law Supports and Encourages Fishing Community Protections
The 2006 Magnuson-Stevens Fishery Conservation and Management
Reauthorization Act (MSRA) reiterated the national standards of the
1996 reauthorization, specifically the National Standard No.8 relating
to fishing communities:
``Conservation and management measures shall, consistent with
the conservation requirements of this Act (including the
prevention of overfishing and rebuilding of overfished stocks),
take into account the importance of fishery resources to
fishing communities by utilizing economic and social data that
meet the requirements of paragraph (2), in order to (A) provide
for the sustained participation of such communities, and (B) to
the extent practicable, minimize adverse economic impacts of
such communities.''
The April 4, 2006 Report of the Committee on Commerce, Science and
Transportation on S. 2012 stated:
``Coastal communities dependent on fishery resources crossing
their docks and the associated taxes and jobs from related
shoreside businesses have raised concerns that quota programs
reward the ``actual participants'' but ignore the community and
next-generation fishermen who were not part of the initial
allocation and could be forever priced out of the fishery.''
Further, the report defined the fishing community section of MSRA
relative to holding harvest privileges. 4 It is very clear
that the Senate intended MSRA to provide additional and specific
protections to those small, remote fishing communities that were most
likely to be disadvantaged by catch share programs. 5
---------------------------------------------------------------------------
\4\ ``Fishing Communities,--New section (303A(c)(3) would establish
that fishing communities may be deemed eligible to receive and hold
harvest privileges if they meet criteria developed by the relevant
Council. According to new section (303A(c)(3)(A)(i), the community
would have to (1) be located within the management area of the relevant
Council, (2) meet criteria developed by the relevant Council, approved
by the Secretary, and published in the Federal Register, (3) consist of
residents who conduct commercial or recreational fishing, processing,
or fishery-dependent support businesses with the relevant Council's
jurisdiction, and (4) develop and submit a community sustainability
plan to the Council and Secretary. This plan must address the social
and economic development needs of the community, including those who
have not historically had access to resources to participate in the
fishery. ``..Participation criteria for a Council to consider are: (1)
traditional fishing or processing practices in, and dependence on, the
fishery, (2) the cultural and social framework of the fishing
community, (3) economic barriers to access to the fishery, (4) the
existence and severity of projected socio-economic impacts associated
with a LAPP (limited access privilege program) on participants in the
fishery and related businesses, (5) the expected effectiveness,
transparency and equitability of the community sustainability plan, and
(6) the potential for improving economic conditions in remote coastal
communities that lack resources to participate in fishery related
activities. The Committee intends the Councils to consider as
``traditional'' those uses that pre-date contemporary commercial
fishing in smaller, isolated communities that can demonstrate historic
dependence on combination fisheries or participation in the fishery
during years that may not fall within the qualifying period for
individual LAPPS.''
\5\ Senate Committee Report No. 109-229, April 4, 2006, to
accompany S. 2012 to reauthorize the Magnuson-Stevens Fishery and
Conservation Management Act (16 U.S.C. 1801 et.seq.)
---------------------------------------------------------------------------
Conclusions and Recommendations
Catch Share programs around the country (including Alaska) remain
highly controversial. They have some benefits to safety, product
quality and markets, as well as conservation (in some cases) but they
have consistently been detrimental to fishing communities by virtue of
how they were implemented and by whom. Catch share programs can have
the effect to consolidate fleets, reduce crew, and automatically raise
the price of entry via increased quota share prices.
Designers of catch share plans need to both recognize and admit
that fishing communities are likely to take the biggest hit as the cost
of participation will most often result in fishing effort leaving the
community, perhaps to the final demise of that community. After the
initial shifts of quota, the real costs may not be known for years. By
then, it will likely be too late to salvage or resurrect what may be
the only way for a community to survive. And this loss becomes a loss
to the larger hub communities as well as they experience loss of buying
power for goods and services, fish landings, taxes and increased
burdens to social services organizations.
The best ways to help fishing communities become self-sustaining is
to grant them a certain amount of initial issuance of the public
resource quota share either individually or through a collective
arrangement, or, to grant them a percentage of the annual catch limit
on a particular species for lease to community residents or a
combination of both. In a fully rationalized fishery--one already under
a quota share program--the best option is to provide a combination of
grant funding and loan funding with loan terms that are realistic and
feasible for such communities.
If the small fishing communities of the Gulf of Alaska, for
instance, cannot have access to a specifically designed loan program
they will need a significant amount of seed capital and/or a percentage
of the annual catch limit in some form in order for the CQE program to
be feasible for them to utilize and to help such communities obtain
over time the quota shares authorized by law.
Once CQEs are able to access such opportunities, and can obtain by
gifting or purchase, over time, their allocation of quota shares
established by federal law--they will be able to sustain themselves
using fishing and related means of economic diversification to make
their communities viable into the future.
In closing, we wish to make the following recommendations to the
Subcommittee on Insular Affairs, Oceans and Wildlife for its
consideration and potential action:
1. Ensure that catch share programs recognize the unique
circumstances and needs of small fishing communities: Include in the
design of any catch share programs recognition of the economic needs
and history of fisheries-dependent fishing communities looking far
beyond just the catch histories of individuals, of the importance of
aiding opportunities for combination (or diversified) fishing, and of
the cumulative adverse impacts of many catch share programs.
2. Authorize and Direct the Development of a CQE Loan Program:
Authorize and direct the development of a CQE loan program with terms
and conditions that are feasible and equitable for CQEs in small
coastal communities of the Gulf of Alaska.
3. Require Fishery Management Councils to Report to Congress
Annually on their Achievements on Behalf of Small Communities in their
Regions: Require that each Fishery Management Council report annually
to Congress on its work in the past year that genuinely and
specifically involved and accommodated in its decisions the needs and
concerns, including particularly access to fisheries, of the small
fisheries-dependent communities in their regions.
The people of the Gulf of Alaska whom this coalition was
established to assist will be deeply indebted to the Members of this
Subcommittee, as well as to House Natural Resources Committee, for your
respective efforts to achieve workable solutions to help make sure the
CQE program actually works for the small CQE communities of the GOA.
Thank you for the opportunity to submit this statement for the
record of this Subcommittee's hearing on catch shares.
______
[A statement submitted for the record by Mary Beth de
Poutiloff, Fisherwoman, F/V Blue Ocean, F/V Patience Too,
Provincetown, Massachusetts, and Harrington, Maine, follows:]
Statement submitted for the record by Mary Beth de Poutiloff,
Fisherwoman, F/V Blue Ocean, F/V Patience Too, Provincetown,
Massachusetts, and Harrington, Maine
RE: Block NOAA's Catch Share Funding & Impose a Catch Share Moratorium
Vote NO on NOAA's budget for Catch Shares and help save the
fishermen and their communities.
NOAA's budget request is indicative of lack of commonsense,
communication and cooperation with the fishing industry. Their
objective seems to be about destroying fishermen and our communities.
Stock assessments, science, Magnuson-Stevens Act and real data, is
unnecessary in their quest. This is why the fishery management plans
are designed to fail?
My family has been fishing for scallops for over 20 years. Scallops
are not over fished now or recently. In fact, the resource is at the
second highest level since keeping records. Some closed area scallops
are dying of old age.
With the Catch Share management tool my family can fish only 4 days
this year. Scallop Amendment #11 took over 2900 permits and qualified
only 329 small boats. Of these 329, very few boats are viable under
ITQs/Catch Shares. I only know of one boat that can make a living. The
rest are like my family-1 day, 2 days, 4 days, or 9 days.
Catch Shares is an economic tool not a conservation one. It is a
redistribution of wealth. The majority of the fishing industry is
against this unfair consolidation of fishermen. We have abided by the
strict regulations, made sacrifices, and we were led to believe when
the stocks rebounded we would be able to share the bounty. What
happened to those promises? Why are current stock assessments being
ignored?
NOAA is on a train wreck with the Catch Share scheme. A public
resource is about to be lost to a wealthy few. This is discriminatory
and in 2007, the United Nations agreed. No one has the right to
ownership through transferability. The rich should not be able to buy
something that should not be for sale.
For every fishing job it supports 6.6 jobs on land (Univ. of
Maine). We need more jobs not less. Why spend taxpayer's money to put
us out of work unnecessarily? This makes no sense. What are all these
displaced fishermen and related businesses to do?
The small boat family fleet does less harm to the resources, the
environment and our money supports coastal communities. Why is NOAA
favoring huge, corporate fleets while the small boats are practicing
sustainable fishing? We need diversity in our fleet to sustain our
resources.
NOAA is requesting to spend $54 million dollars on Catch Shares
that the fishing industry does NOT need or want. This should be raising
red flags! All fisheries management plans need to rely on timely,
accurate science. Yet, Dr. Jane Lubchenco wants to siphon money from
our cooperative research to force Catch Shares.
We need a 2-year Catch Share moratorium and Congressional oversight
hearings for the Council, NMFS/NOAA-mismanagement, corruption, conflict
of interest and breaking the Magnuson-Stevens Act (MSA). No one should
be exempt from laws. The flexibility in rebuilding our resources is
also needed immediately.
My kudos to our elected officials, who all ready have joined our
efforts to insure the continuance of the fish AND the coastal
communities. A 400-year old tradition does not deserve to die because
of mismanagement.
Senators--Bruce Tarr, Scott Brown, Charles Schumer, George LeMieux,
Richard Burr, Kirsten Gillibrand, Kay Hagan.
Congressmen & women--John Tierney, Barney Frank, Henry Brown,
Walter Jones, Carol Shea-Porter, Frank Pallone, John Mica, Cliff
Stearns, Ileana Ros-Lehtinen, Adam Putnam, Bill Posey, Ron Paul,
Solomon Ortiz, Michael Michaud, Mike McIntyre, Larry Kissell, Peter
King, Patrick Kennedy, Alan Grayson, Ander Crenshaw, Joe Courtney,
Donna Christensen, Michael Capuano, Ginny Brown-Waite, Allen Boyd, Jo
Bonner, Tim Bishop, Gus Bilirakis, Bob Andrews, John Adler, Peter
DeFazio.
Governors--Deval Patrick, Rick Perry, Bobby Jindal, Haley Barbour,
Bob Riley.
Mayors--Scott Lang & Carolyn Kirk and Reps. Ann-Margaret Ferrante,
Tony Cabral, John Quinn, William Straus, James Cantwell, Stephen
Canessa, Robert Koczera.
______
[A statement and attachments submitted for the record by
Shawn C. Dochtermann, Executive Director, Crewman's
Association, follows:]
Statement submitted for the record by Shawn C. Dochtermann,
Executive Director, Crewman's Association, Kodiak, Alaska
Honorable Chairwoman Madeleine Z. Bordallo and Subcommittee
members:
I'm Shawn Dochtermann, a lifelong commercial fisherman from Kodiak,
Alaska with 31 years experience. Currently participating in salmon,
halibut, cod and the Bering Sea (BS) crab fisheries, I'm commenting
today as the executive director of the Crewman's Association.
Alaskan's Privatization programs (IFQs) are the examples of Catch
Share programs gone wrong that need to be modified before other Fishery
Management Plans (FMP) are sabotaged. Otherwise, new Catch Shares
systems will absolutely be detrimental to United States coastal
fishermen and their communities, in Alaska and elsewhere.
We're seeking a 2 to 3 year moratorium on Catch Shares, so
that they will be properly designed to promote conservation and
protections of fish stocks, as well as preserve local jobs and fishery-
dependent coastal economies. This would include the Gulf of Alaska
rockfish FMP.
A Kodiak-based group, the Crewman's Association represents crewmen
and captains, and as vessel owners in Alaska and on the West Coast. Our
major goal is to gain fair and equitable access and compensation to all
stakeholders. We have made multiple proposals to the North Pacific
Fishery Management Council (NPFMC) since April of 2007 (Attachment 1),
primarily regarding the Bering Sea Aleutian Island Crab Rationalization
(BSAI/CR) program.
Our message today is that Catch Shares are not pretty, as
the highly flawed BSAI/CR program demonstrates. Our bad experience
offers you a key example of what can go wrong.
In the Bering Sea (BS) crab fisheries, the Total Allowable Catches
have dropped, ex-vessel prices have fallen considerably, fleet
consolidation has been dramatic, and we've seen a staggering job loss
of over 1,000 jobs (while 450 remain). The crew-level economic losses
were two-fold.
First, the crewmen lost approximately $400 million in harvest quota
shares (HQS) due to the unjust taking by the License Limitation Permit
(LLP) holders while capturing over $1 Billion dollars in initial HQS
giveaways for themselves. Thousands were disenfranchised with no job
relocation or retraining benefits. Second, remaining crewmen lose
millions more in reduced annual compensation.
NOAA has never utilized Lay Share laws to protect crewmen
from being forced into sharecropper status, or asked for confirmation
that vessels pay crewmen with settlements that can be reconciled, as
the trip recaps are usually incomplete accountings.
We have settlement sheets from crewmen that prove
that crab harvest quota shareholders are siphoning off most of
the profits from the BSAI crab fisheries.
Exorbitant lease rates upward of 70-80% are being
extracted off-the-top before trip settlements, and crewmen are
receiving unfair and inequitable compensation ratios.
The CR program needs to be modified to follow MSA law
and National Standards in order to protect fishermen and their
communities, and to ensure a fair ex-vessel value is being
received at the dock for product deliveries.
Congress needs to step in and modify all Dedicated Access
Privilege (DAP) or ``catch share'' programs so that they utilize
``owner on board'' requirements, before any other Catch Shares program
should be implemented.
We want a 2 to 3 year moratorium on Catch Shares.
Other DAPs must be brought up to snuff, so that they abide
by the National Standards, can be completed by new Congressional
legislation and undergo more complete review by the SOC's office.
We need to put strong provisions on Catch Shares to ensure
that large fish corporations and processors cannot become the absentee
owners of most U.S. fisheries.
I'm not saying we're advocating for IFQs/Catch Shares, but we
understand that just saying ``NO'' has done nothing for us in the past.
We'd rather hear that Congress would like to find commons-based
solutions while retaining public ownership and providing future
generations with opportunities, rather than privatize the rights only
for a few large economic players.
These provisions should be installed and stringently adhered to if
Catch Shares are used as a tool in the future.
1. Owner on Board & assurances HQS can't be purchased by non-
participants
2. Crews' historical ratios of compensation must be protected
3. Vessel caps need to be kept smaller to protect the small vessel
fisheries
4. No processor affiliations (i.e. no fleet linkages to specific
processors)
5. Limited duration--with a possible guild system built in
6. Limited leases, only allow for verified crew to buy in (if a
guild or point system was not used).
We attended the Oceans Policy Task Force Hearing in Anchorage, AK
on August 21, 2009 and read into the record, ``Adjacent but Alienated
by Catch Shares'' (Attachment 2), which was a compilation of the
problems with the BSAI/CR privatization regime.
Dr. Jane Lubchenco was handed a copy (with my business card
attached) and asked to contact us if she had any questions. She has
never contacted us. Is that a sign NOAA administrators don't care how
flawed DAPs are--just like the North Pacific Fishery Management Council
(NPFMC)?
The Problems of BSAI CRAB RATIONALIZATION:
We've spent the better part of 6 years at the NPFMC asking that the
CR program be modified to include ``fair and equitable'' historical
compensation for crewmen, captains, and vessel owners.
Due to jurisdictional violations by former Senator Ted
Stevens Due Process was never served, as the CR was initiated as an
appropriation's Rider on a must pass Appropriations bill (Attachment 3)
in November of 2003.
National Standards (NS) of the MSA that were enacted by
the Sustainable Fisheries Act of 1996 (SFA) were not adhered to--
especially NS#4, 5, & 8, as a result of misguided legislation.
The CR ``Purpose and Needs Statement'' outlined the primary reasons
for making a change to management plan (Attachment 4). It says
biological need, safety & overcapitalization--and promised a loan
program for crew--alleged needs and goals that were not met:
Biological Need: TACs (or ACLs) are now declining, and
localized depletion is a great possibility.
Safety: BS crab fishermen still fish in the same storms
and for longer periods of time.
Overcapitalization: Last year my banker (Alaska's biggest
statewide bank) told me that the Bering Sea crab fishery was not
overcapitalized when they initiated the CR program. Now
overcapitalization is actually the result of the free quota giveaway,
since the total value of the BSAI Harvest Quota Shares (HQS) is worth
approximately $1 billion. Meanwhile, the vessels and gear are worth
almost nothing without the privileges of Catch Shares.
A Crew Loan Program was the option chosen by the NPFMC--to excuse
the robbery from crewmen. Here are some of the problems with that yet
to be funded option:
While the HQS was distributed 5 years ago, the $3.5
million dollar crew loan program has been delayed since 2005. Also, for
crew to buy into a Billion dollar industry, that measly loan program is
a promissory joke, one we call ``buyback my back''--since those crew
quota would have to be procured (mostly under bank financed or vessel
owner backed mortgages) from ITQ holders who were already gifted the
crew's historical shares.
There were 2 other crewmember options in the May 2002
Public Review Draft that better adhered to the National Standards
(Attachment 5).
Likewise, the NPFMC was very crafty in changing parts of
the original documents so that it read differently than what was in the
SFA.
Please keep in mind these points made in early (and current)
testimonies to the Council and Secretary of Commerce (SOC) by crab
crewmembers and communities:
The quotas are selling as if property rights, yet these
resources are public commons, and international treaties surely
disallow grants of dominance to specified corporations in global trade
within resource industries by any nation.
The exorbitant crab quota lease rates offer room for
readjustment; and high rents in the realm of 60% to 70% demonstrate the
de facto property taking;
The council's 2002-03 economic analysis was not released
in a timely fashion; as the final EIS was released in August 2004--
after Congress passed Sen. Stevens' Appropriations rider.
Analysis of whether or not to do crab and other
``rationalizations'' was not prepared and sent to the Congress in a
timely manner, as required by law;
The Senate Appropriations Committee usurped
jurisdictional authority from the Commerce Committee and violated other
proper legislative due process (leading to John McCain's hearings);
The June 2002 AP minority report predicted most of the
negative consequences (e.g. unnecessarily complex regulations; not
addressing resource conservation goals; artificially allocating market
shares; constituting economic protection of competitors not competition
itself; accelerating unstoppable consolidation, and granting excessive
power to foreign entities over public resources);
A five-year price decline has occurred in king crab and
opilio crab prices; and no subsequent analysis nor Justice Department
antitrust review has been undertaken;
With no definition of fishermen or harvesters in the MSA
to guide allocations, the rights of vessel operators as participants,
and their historical investments of human capital, were arbitrarily and
capriciously dismissed;
The 1-2-3 pie concepts are imperfect economic theory
without practicable substantiation in the real world, especially since
foreign-controlled economic structures and concomitant cross-border
profit laundering strategies (transfer pricing abuses) were wholly
ignored; and clear legal solutions such as FCMA seller rights and other
alternatives were not analyzed;
Lengthier seasons weaken sellers and have caused
increased inefficiencies in plant worker revenues and imposed costs on
the fleets for standby time and other factors;
There has been a lack of promised value-added production
in crab, which is also a flaw being demonstrated during the first year
of the Rockfish Pilot Program.
Crews, plant workers and communities have no official say
in arbitration, yet suffer losses and costs, whereas the Council's
chosen standard of focus on preserving the division of revenues (not
rents) between only processors and vessel owners forms a basis for
rights to negotiation should, for example, efficiency gains not accrue
to the sector creating those productivity/cost gains.
NPFMC & Senator Stevens' Actions Disenfranchise the Crab Crewmen:
In 2002, during the BSAI/CR program development and related motions
to identify the ``preferred alternative,'' the Council took certain
wrongful steps:
1. The Minutes from the Council's prior meeting in April 2002 were
not presented and not approved at the Council level in June.
2. The June Minority Report of the Advisory Panel, outlining the
shortcomings of the preferred alternative, was not entered on the
Council record, and no copies were made for distribution to the public,
before the Council rushed into place its preferred alternative, and
ended up leaving the crews rights stranded.
3. The Crab EIS was deliberately withheld, and its release was
delayed until 2004, long after the CR preferred alternative was
identified, and Senator Stevens pushed CR into law via a Consolidated
Appropriations rider. It was too late for the crewmen to review,
criticize and change it to reflect historical rights that would have
equitably allocated IFQs to all past participants.
4. Changes were made to Ted Stevens' legislative language on the
BSAI/CR program to ensure that the preferred alternative leaving crews
out became the unique and guiding statute for the MSA. Stevens used a
flawed decision making process of industry ``regulation negotiation''--
and by ``industry'' he did not mean the communities and crewmen, but
rather just the corporations and vessel owners. (See again: Attachment
3)
a. A small concession of 3% of the IFQs was made to skippers
as vessel operators, under quotas with a separate class of
delivery rights.
b. Not one pound of the IFQs could have been allocated to the
LLP holders had the fish ticket recipients not signed their
rights over for NOAA to allocate them to the vessel owners.
5. The ``end notes'' (see below) show an example of the means by
which the Council also reframes and weakens the crew rights argument,
by manipulating the wording of the National Resource Council, statutes
and National Standards. In short, they said anything to build a record
leaving out the crew, while all along making false promises to the crew
that in the end we'd be taken care of.
In 2002 and since, whenever crewmembers made efforts to stand up to
vessel owners, the owners and their hired-skippers used coercion
against crewmembers trying to secure their fair portion of historical
shares.
Coercion was used to Disenfranchise the Crab Crewmen:
Coercion of crewmembers is a serious crime, and we hope the
Congress would undertake asking law enforcement to investigate this
ongoing criminal activity, to prevent stakeholders from being denied a
fair process. If effective coercion can happen to the daring crews of
``The Deadliest Catch'' sector, it can certainly happen to the smaller
boats and day-fishermen in other species across the Nation.
This is not a joke, and we've been coerced since the June
2002 NPFMC meeting in Dutch Harbor, when crab crewmen were actually
physically held up to the wall and told by skippers and vessel owners
not to testify or they'd lose their crew jobs.
The public coercion re-started in April 2007 (182nd
Plenary Session--NPFMC) when we put our first reallocation proposal on
the table for the crewmen. We advised federal law enforcement and NOAA
authorities about these strong-arm tactics, after several crew already
signed up (December 2007) to give testimony and were intimidated into
not speaking on the official record (or at all). To date, we've seen no
legal action taken to stop the coercion.
Fishermen work long hard days in raging storms and in unforgiving
conditions to bring the sea's bounty to our shores. Yet, due to
deliberate Council scheduling tricks, it is during the time we are
fishing out at sea when most fisheries policy is drawn up and pushed
through federal and state agencies. Again this year, the NPFMC has
essential crab items agenda-timed for October, the session we have
repeatedly told them is the worst for crab fishermen who are at-sea
that month.
The failure to include crew as stakeholders in due
process should be a crime, since we risk our lives every day to provide
the first dollar from the products we catch. Just as our labor first
creates all capital.
Concluding Remarks:
Again, please institute a 2-3 year moratorium on any further Catch
Share programs, and go back and fix Crab Rationalization and similar
privatization mistakes.
We ask the U.S. Congress, the Secretary and the Inspector General
of Commerce to help address the problems of present Catch Shares
programs before one bad fish spoils the whole boat load of American
fisheries.
Before the concept that financial investments--which
government has supported by depreciation allowances (recoveries),
subsidized loan guarantees and low interest rate programs, and capital
construction fund tax breaks--allow for more reframing of the arguments
that vessel owners alone should get private rights, active fishermen
(who are real participants) should have their real and ongoing
investments recognized foremost. And that of their fishery-dependent
communities.
The BSAI crab crewmen needed to be established as the ``stranded
labor'' portion of the CR program (i.e. as stakeholders that were not
included).
Remember:
``Labor is prior to, and independent of capital. Capital is
only the fruit of labor, and could never have existed if labor
had not first existed. Labor is superior to capital, and
deserves the much higher consideration.''--Abraham Lincoln
Thank you for the opportunity to present our problems with a
cumbersome and unfair program that did not fulfill its assurances, as
the chairman of the NPFMC falsely promised in his letter to Congress on
August 5, 2002:
``Rationalization will improve economic conditions
substantially, for all sectors of the industry. Community
concerns and the need to provide for economic protections for
hired crew will be addressed.''--David Benton, NPFMC Chair
(2002)
End Notes:
Example of NPFMC Manipulating Language to Disenfranchise Crab Crewmen:
Below is an example (from the June 2002 NPFMC meeting in Dutch
Harbor) of the changes that were made in order to diminish the role of
crewmen's historical participation rights, which was deliberately
designed to award ``catch share'' quotas to the vessel owner entities
rather than to participating skippers and crew, in a fair and equitable
split.
National Research Council (NRC) Report Recommendations:
The NRC report ``Sharing the Fish'' recommends that regional
councils ``consider including hired skippers and crew in the
initial allocation of IFQs where appropriate to the fishery and
goals of the specific IFQ program.'' The report concludes that
even though crew may invest minor amounts of capital in
comparison to vessel owners, crew may have undertaken
significant financial and physical risks to participate in a
fishery. Crew assume financial risks in fisheries where
skippers and crew are paid with crew shares. In addition, crew
may assume substantial physical risks in certain fisheries.
These risks justify the consideration of crew interests in
designing an IFQ program and could justify an initial
allocation of shares to skippers and crew.
Alternatively, the report recommends that councils consider
developing programs that ensure the availability of QS for crew
purchase, such as the block program in the halibut IFQ program, and
loan programs that assist skippers and crew in purchasing QS.
Then, in the original document from the SFA 1996, Public Review
document of the Bering Sea/Aleutian Islands Crab Rationalization
Program from May of 2002, it reads (in highlight) plus other important
text below:
1.1.2.5 Sustainable Fisheries Act of 1996
Requirement for the New IFQ Programs (page 8) ``
(A) establish procedures and requirements for review and
revision of the terms of any such program (including any
revisions that may be necessary once a national policy with
respect to individual fishing quota programs is implemented),
and, if appropriate, for the renewal, Reallocation, or re-
issuance of individual fishing quotas;
(C) provides for a fair and equitable_initial allocation of
individual fishing quotas, prevents any person from acquiring
an excess share of the individual fishing quotas issued, and
consider the allocation of a portion of the annual harvest in
the fishery for entry-level fisherman, small vessel owners, and
crewmembers who do not qualify for individual fishing quotas.
3.2.6.2. Stewardship (page 164)
The National Research Council (NRC) report discusses ``.Another
component of stewardship is who owns the quota. Due to the ownership
structure of the BSAI crab fisheries, the majority of the quota will be
issued to vessel owners who do not fish. Proponents of the initial
allocation of skipper/crew shares and owner-on-board provisions
advocate that these options would improve stewardship because fishers
will have ownership in the resource.
3.3.2 Initial Allocation of QS (or Cooperative Shares) (page 193)
Paragraphs 1.2 and 1.4 of the list of elements and options define
options for the initial allocation of harvesting QS (or cooperative
shares). The initial allocation is of critical importance to a
rationalization program since it is the foundation for the distribution
of interests in the resource in the new management regime.
Here's the NPFMC's version of the NRC report:
National Research Council Report Recommendations.
The NRC report on IFQs, ``Sharing the Fish'' advises that an
initial allocation should widely distribute shares to avoid granting
excessive windfalls to a few participants in the fishery. Broader
initial allocations might be favored because they will distribute
benefits more equitably and compensate more individuals as shares
become concentrated. In addition, payment for initial allocations
(thorough either windfall taxes or auctions) should be considered as a
method of distributing the benefits of the resource to the public.
Share distributions should consider investments of time and capital in
the development of the fishery. Crew exposed to safety risks might also
be considered to have invested in a fishery. A broad distribution might
consider the distribution of shares to skippers, crews, and processors.
Catch history is frequently relied on for determining the
distribution of shares because it is perceived to be a fair measure of
participation. Allocation based on catch history, however, can have
unintended or onerous consequences. 3Reliance on participation in a
single fishery can be detrimental to fishers that move between
fisheries. These transient fishers might be deprived of an interest in
a fishery even though their movement between fisheries may have
resulted in a better distribution of effort across fisheries. Catch
history can also reward speculative behavior of fishers that enter a
fishery in hopes of obtaining an interest in the fishery under a future
rationalization program and fishers that overexploit stocks to obtain
larger initial allocations of shares. Alternatively, a portion of the
initial allocation could be distributed equally to all participants or
could be based on vessel size.
In addition to the issues raised in the NRC report, NOAA GC has
emphasized that the failure of the halibut and sablefish IFQ program to
give sufficient consideration to recent participation was an important
issue in the lawsuit filed against that program.
As required by NS #4 paragraph (c) (3) (i):
Definition. An ``allocation'' or ``assignment'' of fishing
privileges is a direct and deliberate distribution of the opportunity
to participate in a fishery among identifiable, discrete user groups,
or individuals. Any management measure (or lack of measurement) has
incidental allocative effects, but only those measures that result in
direct distributions of fishing privileges will be judged against the
allocation requirements of Standard 4.
Excessive HQS was distributed to LLP holders in the initial
allocation of the CR program, depriving the BSAI crab crewmen of their
rights to HQS and to fair negotiation for lay share contracts.
Review NS#4 (c ) (3) (iii), avoidance of excessive shares.
An allocation scheme must be designed to deter any person or other
entity from acquiring an excessive share of fishing privileges, and to
avoid creating conditions fostering inordinate control, by buyers or
sellers, that would not otherwise exist.
Due to excessive HQS being allocated to LLP holders, exorbitant
lease fees have been extracted off the top of gross revenues and have
deprived the vessel operators (crewmen) from receiving fair and
equitable compensation from the HQS holders.
Lay Share contracts have never been included as part of the CR
program for EDR data or for legal liability of the HQS holders and the
vessel owners. NOAA/NMFS may not be responsible for enforcing 46 U.S.C.
section 10601 (and Sec. 11107), but it is their job to follow such
highly applicable federal code, which was not done in creating the CR
program.
Otherwise, it will be the responsibility of the FBI or the courts
to sort out this problem.
As stakeholders that were left out of Due Process we ask the U.S.
Congress to examine the CR program with a microscope to provide relief
for the labor portion of the industry that was damaged not only
monetarily, but by long-term losses of jobs, and to the livelihood of
being an independent contracted fisherman.
The crewmen that are participating in the crab fisheries presently
are facing coercion, due to the threat of losing their jobs if they
come forward and voice their written or oral presentation to the
Council. This type of action took place at the December 2007 meeting,
as crewmen were ready to testify and received phone calls from vessel
owners while at the meeting, and chose not to go on the record, or
otherwise they would become jobless. Many are furious about their crew
compensation being diminished due to high lease fees on QS. This has
been put on the record more than once, so why is nothing being done to
stop these actions?
We've been talking with a few individuals in the industry (for the
last two years) that have advised us that the crew is at fault for not
joining the vessel owners to fight against PQ and helping 90/10 being
removed or being diminished. After listening to the 154th Plenary
Session tapes it's clear the vessel owners were offered only two
options at that meeting, either status quo and no quota grab or the
three cow-pie system that has so overcomplicated the crab fishery and
led to restraint of trade.
The present vessel owners that bought into the industry since CR
are almost as bad off as the crewmen. They are at the mercy of the QS
holders that are charging huge rents for use of their quotas. How can
the Council expect the vessel owners and crews to survive on 30-50% of
the net revenues after lease fees (high quota rents), all taxes and all
expenses? These vessel owners dare not speak up about almost anything
but safety, as they are being threatened (coercion again) by the QS
holders or otherwise will have their lease quotas removed. The post-
rationalization vessel owners (those who bought in) would promote the
idea of lease fees being reduced to past historical levels of between
30-35% of the net revenues after taxes and trip expenses, if they were
able to speak freely.
The QS holders are being threatened by the fisheries processors
that if they try to change PQs from 90/10 to a lower rate, the
processors will help the crewmen get a reallocation. The QS holders are
not willing to allow a reallocation, as they think they would lose
quota. They would only be allowed to receive their historical ratio of
compensation (as above, 30-35% net) if the skippers, crewmen and vessel
owners received their pre-rationalization compensation levels.
The processors are not willing to allow open markets because they
would have to pay a fair price or else other processors--competitors
paying higher ex-vessel prices--would move into the industry.
______
Attachment 1
BS/AI CRAB RATIONALIZATION IFQ/ITQ REALLOCATION
AMENDMENT PROPOSAL--FOR SKIPPER/CREWMEN COOPERATIVE
North Pacific Fishery Management Council
189th Plenary Session--October 2008
RE: C-2 BSAI CRAB MANAGEMENT
Name of sponsor: Shawn C. Dochtermann
Originally Introduced at the 181st Plenary Session, April 1, 2007
Address: PO Box 3886
Kodiak, AK 99615
Date: September 15, 2008
Telephone:907-486-8777
Email:[email protected]
Brief Statement of Proposal: (preferably under a separate agenda
placeholder)
1. Reallocation of a percentage of Individual Transferable Quota
(ITQs) harvest privilege shares of ``CR Crab''--Bering Sea/Aleutian
Islands red king crab, opilio, and tanner crab fisheries--to active
crab crewmembers; by
2. Provision for a single Crewmember's Cooperative for ``CR
Crab''; with options of multiple Crew coops &/or combined with Regional
Fisheries Associations (guidelines needed);
3. Retain Open Market for All Crewmember Pooled Quota Shares;
4. Require Active Participation & Provide for Crew Contracts.
Objectives of the Proposal (What is the Problem?):
The problem is an inequitable distribution of CR Crab fishing
privileges that resulted in excessive shares being assigned to vessel
owners, which granted them inordinate control over fishermen on decks
and in the wheelhouses, who are engaged in active fish harvesting.
This was an unbalanced, direct and deliberate distribution of the
opportunity to fish to a discrete user group or set of individuals that
excluded long-term participants (boots-on-deck fishermen) without any
justification in terms of the objectives of the Crab Rationalization
FMP.
This failed to preserve the status quo of economic distributions in
the crab fisheries, ignored the dependence of present participants
(crew) and coastal communities, and failed to fully consider the social
and economic consequences (harms) of the scheme (rationalization).
1. Correct Inequitable Distribution of Harvester Shares under CR
Crab FMP; and Restore Historical Crewmembers Compensation Levels.
Complete failure to recognize deckhands as vessel operators
(allocating them 0%), combined with Skipper shares of 3%, falls
drastically short of the historical earnings of crewmembers who
actually harvest crab. A germane legal argument is that an inequitable
``takings'' occurred as vessel owners or mere investors confiscated
those rights, and upwards of 70% of ex-vessel fish ticket earnings as
high quota rents consequential to implementation of the CR Crab FMP,
which occurred without prior public production of Economic Data Report
reports and proper analysis.
Reallocation of crab quotas would provide crewmen ``fair and
equitable'' quotas recognizing that their small businesses were
needlessly harmed (even foreclosed) by inequitable allocations under
Crab Rationalization, and allow for future career opportunities in
these crab fisheries.
2. Crewmember Representation in Binding Arbitration & Price
Negotiation.
Add crewmember representatives to the binding arbitration tables to
protect the financial interests of the skippers and crewmembers.
3. Assure Experienced Crews are Available and Rewarded in CR Crab
Fisheries.
Assure crewmember jobs in the future have earnings that are
commensurate to their personal investments and recognize the dangers of
active participation in CR Crab fisheries.
Needs and Justifications for Council Action:
The drastic reduction of jobs and compensation, especially with the
massive consolidation of the rationalized crab fisheries, demands this
issue to be dealt with, without further delay: at best, through a
separate placeholder (e.g. FMP amendment). No provision was made for
crewmen to initially receive allocated quota for BS/AI crab,
representing their historical ratio of compensation, which violates:
Section 600.325 National Standard #4 Allocations [applicable
excerpts; plus c(3)(i) ``(iii) etc.]
If it becomes necessary to allocate or assign fishing privileges
among various U.S. fishermen, such allocations shall be:
[1]. Fair and equitable to all such fishermen; [and]
[3]. Carried out in such a manner that no particular individual,
corporation, or other entity acquires an excessive share of such
privileges.
Discussion: Regarding capitalism, Adam Smith first said that labor
alone is the real standard by which the value of all commodities can be
compared; but modified it for the claims of ``the landlord and the
capitalist''. Similarly, Abraham Lincoln noted, ``Labor is prior to,
and independent of capital. Capital is only the fruit of labor, and
could never have existed if labor had not first existed. Labor is
superior to capital, and deserves the much higher consideration.''
In determining the allocations under CR Crab regime(s):
ITQ/IFQ privileges were not rationally connected to
achievement of Optimum Yield--especially considering that it is through
the crewmembers earnings that maximum net economic benefits flow widely
to communities.
The motives for making particular allocations were not
justified in terms of objectives--i.e. to increase safety and provide
for value-added benefits.
The FMP did not restrain income shifts from crewmembers
to rent-seeking owners, nor deter acquisition of excessive shares.
The FMP did not prevent exorbitant rents--up to 70% quota
lease fees.
The historical ratio of compensation for crewmembers as active
participants (while oddly recognizing a small ratio of rights for other
vessel operators, in the 3% skipper shares) was abandoned as the value
of the ``human capital'' was taken--without permission or negotiation
by past stakeholders. In legal and economic terms, ``lay share'' rights
were taken and the crew now has to produce a ``surplus value'' for
others that represents the degree of private exploitation (of crew
labor) by a ``high rent seeking'' distant, non-participating
capitalist: i.e. by a ``sealord''--often investing in quota on a loan-
financed basis only.
Likewise, there's a new post-rationalization class of vessel owners
(some of whom may also hold a small portion of ITQs by way of the
vessel's history) that are paying high rent rates to such
``sealords''--greatly depressing the crewmembers' net earnings,
relative to historical ratios of compensation. This is especially true
because such ``sealord'' rents come off the top of gross vessel
earnings--prior to direct costs (fuel, bait, groceries, fish taxes and
related settlement expenses of harvesting crab) and indirect vessel
operating costs (hull insurance, repairs and maintenance, etc.).
All of these changes have exacerbated the degree to which
allocations were neither ``fair and equitable'' nor preventative of
``excessive shares.''
Foreseeable Impacts of the Proposal (Who wins, who losses?):
Who Wins: By having quota rights Crewmembers (deckhands, engineers
and skippers) gain ability for substantial employment opportunities and
are more likely to achieve fair earnings. This enhances the interests
of new entrants, as well. Crew will benefit from increased bargaining
power for ex vessel compensation with both cooperatives and processors.
Fishery dependent communities will benefit from increased (restored)
crew incomes. Federal and state taxes will be higher, in total, as
crewmembers invariably pay taxes whereas corporations often shelter
them.
Are there alternative solutions?
Revoke crab rationalization and return to Open Access
with a 100 pot limit for king crab and 250 for opilio. This is the
option that would best have modified Status Quo, which when coupled
with buyback would have helped maintain crew jobs and avoid excessive
consolidation onto fewer boats.
Cap rents for vessel owners to a much reduced percentage,
more like 35%, rather than the current exorbitant rates of between 70%-
50% being taken by boat owners/IFQ holders. This would be coupled with
giving the crewmembers their historical 35%-to-40% of total fish value.
An option is to add ``Vessel Caps'' regarding
consolidation of ITQs per vessel.
Supportive Data and Other Information:
NOAA is remiss in providing Crewmembers with useful information
from the EDRs. The open, public provision of EDR data is not only
overdue (it is now one-year late), but essential and legally warranted
prior to the Council making any further decisions on ITQ shares.
For this data to now be regularly characterized as either
inadequate or non-useful to the decision-making process seriously calls
into question the initial allocation of shares for all BSAI crab.
The EDR data apparently does not reflect the federal legal
requirement of crew contracts, and cross-verification with crew shares
submitted in EDRs. NOAA must strengthen compliance with the requirement
in 46 U.S.C. Sec. 10601 that seamen be given pre-trip written
agreements. The lack of such required data, ensuring appropriate
analysis and reports for crewmembers seeking restoration of historical
rights, is an additional deficiency in the decision-making process to
date.
Altogether, these are serious deficiencies of the regional council
in meeting the recommendations of GAO 06-289: Core Principles and a
Strategic Approach on Stakeholder Participation.
Discussion: Previous to IFQ shares being allocated to all entities,
vessel owners, or corporations, they were each required to submit 3
years (2002-04) of crab data to NMFS in order to receive initial crab
quota shares. NMFS and/or related agencies could release this data in
summary to substantiate the overall participation levels (i.e. to
establish the estimated 35% to 40% historical crew rights).
The present BS/AI crab rationalization requires that all quota
shares holders furnish NMFS with extensive crew and other data. Gunnar
Knapp of ISER conducted a study for the City of Kodiak and it contained
preliminary analysis that puts job losses in the BSAI crab industry at
892 persons who held jobs prior to rationalization. (An estimated 1,500
persons previously held crab jobs before rationalization.) And a draft
of an upcoming NOAA crew report indicates a range of lost crew jobs of
between 1,026 and 1,674.
Final Note in Protest: Critical discussions affecting crab
crewmembers were placed in an inappropriate committee, and the
Council's relevant matters have been knowingly scheduled during the
crab fishing season when crewmembers cannot be present to represent
their stakeholder interests. The weight of these concerns and
deficiencies necessitates a separate placeholder for a Crab Crewmembers
FMP Amendment.
Shawn C. Dochtermann
______
Attachment 2
Oceans Policy Task Force Hearing August 21, 2009
Anchorage, Alaska
RE: Adjacent but Alienated by Catch Shares
Public Comment: Crewman's Association
Madam Chair, Dr. Jane Lubchenco, Interior Deputy Secretary Hayes, USCG
Admiral Allen, & Deputy Assistant Zichal.
My name is Shawn Dochtermann from Kodiak, Alaska. I have commercial
fished in Alaskan waters for 31 years and I am here today representing
the Crewman's Association. Alaska's Bering Sea crab fisheries are an
example of the failure of a Catch Share program. Over 1,000 crewmen
lost their jobs due to privatization, while many of them had 20 to 25
years experience in the industry. Consolidation continues and hundreds
more are losing their crab incomes.
Crewmembers are also losing jobs as other management programs, such
as the Rockfish Pilot Program, get politically privatized without
adequate scientific justification. Total allowable catches are already
in place. This public larceny hides under ``the theoretical joys of
privatization'' to benefit non-participating investors. A recent study
by the University of British Columbia indicates that small-scale
fisheries are more efficient and better at meeting socio-economic needs
than large scale fisheries, as the residents of local communities are
provided with fishing related jobs.
When the Bering Sea crab catch share system was implemented,
crewmembers were denied a historical participation share of $400
million of IFQs--while roughly $1 billion of catcher rights (IFQs) were
given to vessel owners. Many of these vessel owners are large
corporations. Now high lease fees paid to quota-holding 'Sealords' come
right off the top of our vessel trip settlements--costing independent
contracting crewmen another $35-40 million per year compared to before
privatization.
It does not take much effort to realize our fisheries suffer under
a Resource Curse condition, and that the North Pacific Fishery
Management Council is a perfect example of Regulatory Capture in
action. Once again, it is the Labor component who is disenfranchised
and alienated, and driven into indentured servitude under what are in
fact sharecropping programs. NOAA is letting this happen in America!
Vessel owner group representatives have committed perjuries on the
federal council record and crewmembers have been coerced into not
giving public testimonies for fear of losing their fishing jobs. NOAA
has failed to prosecute these criminally false testimonies and
coercions. When will these perjuries be investigated?
The NPFMC and NOAA have also ignored 46 U.S.C. section 10601 and
other federal law requiring fairly contracted ``lay shares'' for crew.
Individual crewmen who used to net 5% to 6% are now lucky to net 1% to
2% of the adjusted gross revenues from crab fishing trips. Some quota
holders presently scalp off upwards of 75% of gross revenues while an
entire crab crew and skipper collectively receive only 12-15%. Crews
and skippers historically received 35-40% of the gross revenues.
Without required active participation, without caps on ownership,
without limits on consolidation, and without adherence to the national
standards of a ``fair and equitable'' distribution of rights, Catch
Shares will clearly lead to more socio-economic harms.
Contrary to what others may tell you, when examined from the point
of view of fishermen, communities and regional economics, Alaska's
rationalization schemes do not serve as good examples of fisheries
management and national policy. An independent review by the U.S.
Department of Justice Antitrust Division and the Government
Accountability Office of the restraints of trade and ownership
structures is overdue.
We have grave concern about OCS Gas and Oil Exploration and the
proposed Pebble Mine, as both of these resource extractions could
easily damage the renewable resources of the Bering Sea and Bristol Bay
with only one disaster. Therefore, we urge this panel to do the right
thing and never let nonrenewable resource extraction take a front seat
to the precious renewable seafood of Alaska.
Respectfully,
Shawn C. Dochtermann
Crewman's Association--Secretary/Executive Director
PO Box 866; Kodiak, AK 99615
______
[GRAPHIC] [TIFF OMITTED] 55542.005
.eps[GRAPHIC] [TIFF OMITTED] 55542.006
.eps[A letter submitted for the record by Kathy Hansen,
Executive Director, Southeast Alaska Fishermen's Alliance,
Juneau, Alaska, follows:]
Southeast Alaska Fishermen's Alliance
9369 North Douglas Highway
Juneau, AK 99801
Phone 907-586-6652
Fax 907-523-1168
Website: http://www.seafa.org
E-mail: [email protected]
March 15, 2010
House Committee on Natural Resources
Subcommittee on Insular Affairs, Oceans and Wildlife
Representative Madeleine Z. Bordallo, Chairwoman
1324 Longworth Building
Washington, DC 20515
RE: Hearing on ``Catch Shares as a Management Option: Criteria for
Ensuring Success''
Dear Honorable Madeleine Bordallo and Committee Members,
Today, March 16th you are holding a hearing on catch shares as a
management option for fisheries and the criteria for ensuring success.
Catch Shares have been a positive and successful management tool for
fisheries in Alaska and in other places around the world. For example,
since catch shares have been implemented in the Alaska halibut and
sablefish fisheries, these fisheries have not gone over the commercial
allowable catch. The Canadian groundfish catch share program has
significantly reduced their by-catch issues in the fishery. Catch share
programs when designed correctly with good stock assessment and catch
accounting systems protect the resource from overexploitation and
ensure the long-term sustainability of the resource. There are lessons
to be learned from every catch share program that has been implemented.
You have asked for advice on criteria for ensuring the success of a
catch share program. First and foremost for the long term success of
the program you must have good, viable and on-going stock assessment
program in place and you must have good catch accounting that accurate
reflects all removals of that resource whether it is the target
species, bycatch, or a recreational sport harvest.
In the development phase of the program, there are issues that need
to be looked at and considered, these include whether you wish to
maintain an owner-operator on board clauses, excessive consolidation,
community protections, consideration of crew, and consideration of
other users of the resource whether you provide an allocation or decide
to allow another sector to grow which might undermine the catch shares
in the future (i.e. Alaska Halibut and the guided sport sector).
With catch share programs, there will be some consolidation over
time but that is partly because by the time a catch share program is
considered the industry has overcapitalized and become uneconomical for
all industry players to continue.
When Alaska's catch share programs have been developed there has
been large segments of the industry against the idea but after time
even those that didn't get an initial allocation mostly agree that the
program has stabilized the industry, increased price per pound due to
market changes--processing smaller high quality quantities at a time
compared to derby style all the fish at once poor quality product,
better safety record since you don't have to fish in bad weather and
many other advantages.
Southeast Alaska Fishermen's Alliance is a multi-gear/multi-species
membership based commercial fishing organization representing our
members involved in the salmon, crab, shrimp and longline fisheries of
Southeast Alaska and federal halibut and sablefish quota share
programs.
Please feel free to contact our office for more information about
catch share programs.
Sincerely,
Kathy Hansen
Executive Director
______
[A statement submitted for the record by The Honorable
Walter B. Jones, a Representative in Congress from the State of
North Carolina, follows:]
Statement of The Honorable Walter B. Jones, a Representative in
Congress from the State of North Carolina
Madame Chair, I want to thank you and the Ranking Member for
holding this hearing on what is a very important topic of concern for
not only the fishermen that I have the privilege to represent, but for
watermen around the country as well.
The use of catch shares as a management tool is very controversial.
As you know, catch share programs give shares of the total allowable
catch in a given fishery to particular fishermen or groups. I can tell
you that North Carolina fishermen vehemently oppose catch share
programs as nothing more than thinly veiled attempts to get fishermen
to leave the business and to destroy fishing communities. These
sentiments were validated by a 2009 assessment of catch share programs
and the resulting industry consolidation performed by Dr. Julia Olson
of the National Oceanic and Atmospheric Administration's (NOAA)
Northeast Fisheries Science Center. Dr. Olson's report found:
``The primary social impacts that have been documented in empirical
cases involving consolidation range from employment loss, decreased
income, decreased quality of life, changing relations of production,
structural disadvantages to smaller vessels and firms, dependency and
debt patronage, concentration of capital and market power, inequitable
gains, regulatory stickiness, reduced stewardship, decreased community
stability, loss of cultural values, and so on.''
Given these problems, I was very troubled that the Administration's
Fiscal Year 2011 Budget Request for NOAA included proposals to cut
funding for fisheries science--which we all acknowledge is necessary
for adequate management of our fisheries--in order to add $36.6 million
to expand implementation of catch share programs into new fisheries
across the country. The last thing the federal government should be
doing in these economic times is spending millions of taxpayer dollars
to expand catch share programs that will put even more Americans out of
work.
To the extent that solid science demonstrates that catch reductions
in any given fishery are necessary, there are far better options than
catch shares for achieving those reductions. In my opinion, expanding
catch shares is the wrong policy for the United States and I would urge
the Subcommittee to move legislation that would suspend expansion of
these programs.
Thank you for again for holding this hearing and for the
opportunity to offer my thoughts on this matter.
______
[A statement submitted for the record by Linda Kozak,
Consultant, Crab Group of Independent Harvesters, Kodiak,
Alaska, follows:]
Statement submitted for the record by Linda Kozak, Consultant,
Crab Group of Independent Harvesters, Kodiak, Alaska
Madam Chair and members of the subcommittee, I would like to thank
you for the opportunity to submit written testimony on the policy of
catch shares. My name is Linda Kozak and I serve as a consultant for
the Crab Group of Independent Harvesters, whose membership includes
Bering Sea and Aleutian Islands crab fishermen who hold crab quota
share. I also work closely with fishermen who are quota share holders
in the halibut and sablefish IFQ catch share program. My past
experience on catch shares includes representing fishermen during the
creation and implementation of both the halibut/sablefish IFQ and crab
rationalization programs. I was a charter member of the IFQ
Implementation Team for halibut/sablefish, as well as serving on North
Pacific Fishery Management Council and Alaska Board of Fisheries
committees for crab rationalization. I was a member of the West Coast
panel for the National Academy of Sciences study on individual fishing
quotas, which resulted in the publication in 1999 of ``Sharing the
Fish''. Additionally, I participated in several workshops and panels
including the 2002 National Marine Fisheries Service ``Individual
Fishing Quota and Community Programs''. My background also includes
past ownership in a halibut and sablefish quota brokerage with offices
in Alaska and Washington where for three years the majority of all
quota share sales occurred.
My comments will reflect primarily on the Bering Sea and Aleutian
Islands (BSAI) crab rationalization program, which is acknowledged to
be the most complex catch share program in the nation. With allocations
of harvesting and processing quota providing for fishing cooperatives
and binding arbitration, as well as regional landing requirements, the
adaptation into the program has been at times difficult. As the program
is nearing its fifth year since implementation, it is good to take a
look back and review the crab catch share program.
The Bering Sea and Aleutian Islands crab catch share program did
not evolve overnight. The process began in 1992 when at the request of
industry, the North Pacific Fishery Management Council approved a
moratorium on new vessel entry into the fishery, and it became
effective in 1995. The Council took further action in 1995 to approve a
license limitation system and this was put into place in 2000.
Both the moratorium and LLP system were necessary due to the
excessive number of vessels racing to catch crab in the fisheries of
the Bering Sea and Aleutian Islands. During this time, there was a
downturn in crab stocks for the major fisheries and with the crab
fisheries operating under strict catch limits, there was little
flexibility for the vessel owners other than to race even harder. This
race for crab contributed to several tragic accidents which resulted in
loss of life in this deadliest fishery.
It became clear to harvesters, processors and communities that a
different management structure was needed and in 1999, at the request
of industry, the North Pacific Council formed the first BSAI Crab
Rationalization Committee. As this committee began to meet, one of the
foremost concerns was that of over-capitalization in the crab fleet. As
a result of an industry initiative, the Consolidated Appropriations Act
of 2001 established a license and vessel buyback program for the Bering
Sea and Aleutian Islands crab fisheries in order to reduce fishing
capacity. This buyback program was implemented in 2004 and resulted in
the buyback of 25 crab licenses and vessels, which are prohibited from
ever participating in any commercial fishery in the United States.
The legislation providing for the Buyback Program also required the
North Pacific Fishery Management Council to begin analyzing options for
rationalizing the BSAI crab fisheries and to report back to Congress on
the results of that study. This was supported by a majority of the crab
harvesting sector because the Buyback Program only partially addressed
the over-capitalization problem. Many vessel owners were on the verge
of bankruptcy and a graceful exit was needed.
After many committee and Council meetings, at the June 2002
meeting, the North Pacific Council voted on a report to send to
Congress. This report recommended harvester catch quotas with the
ability to form cooperatives in order to become more efficient.
Additional elements included the controversial 90/10 processing share
component along with regional landing requirements as a form of
community protection.
In January of 2004, Congress amended the Magnuson-Stevens Act
through the Consolidated Appropriations Act of 2004 requiring the
Secretary of Commerce to approve the BSAI crab rationalization program
by January 1, 2005. Embedded in this law, was a requirement for the
North Pacific Council to conduct a three-year and five-year
comprehensive review of the crab program. Within a month of the
Congressional action, the North Pacific Council voted unanimously to
prepare an analysis specifically on the issue of the 90/10 processing
share component and deliver that analysis 18 months after the program
began. This began a series of Council discussions on the issue of 90/
10.
Crab rationalization has been an issue on the North Pacific Council
agenda at many Council meetings since February 2004. As with the
halibut/sablefish IFQ program, the complexities of the crab catch share
program have required a substantial amount of discussion and
consideration for modification. Issues dealing with processing shares,
emergency relief from regional landing requirements, cooperative
leasing, crew compensation, and binding arbitration have been addressed
and continue to be addressed by the Council.
The Congressionally mandated five-year review of the crab
rationalization program is scheduled for review by the North Pacific
Council in October 2010. This review will cover a wide range of topics
requested by the Council and is expected to be very detailed in scope.
It is expected that the Council will consider further changes to the
program at that time.
The crab rationalization program was not perfect when implemented.
There are still areas which will be addressed and we expect to continue
working in the foreseeable future to make this program better. However,
even with the concerns expressed by the Crab Group of Independent
Harvesters as well as other groups or communities, the catch share
program is a distinct improvement over the destructive practices of too
many vessels racing for too few crab. We are working to make the
program better, but strongly believe that BSAI crab catch shares have
achieved many of the goals addressed during the development of the crab
rationalization program.
The members of the Crab Group of Independent Harvesters agree with
several of those testifying at the hearing on March 16th that the
design of a catch share program is most important. By attempting to
create a program that will accomplish specific goals and have a clear
vision of where the program and participants should be in five, ten or
even 20 years, the catch share program will be better designed and able
to achieve those goals. However, regardless of how much attention or
effort is put into trying to make the program as perfect as possible,
you will find that some unexpected consequence will occur and
adjustments to the program need to be considered.
I would briefly like to address some of the positive elements of
the BSAI crab catch share program that we believe have occurred in the
last four seasons.
Conservation of the Resource and Habitat
The BSAI crab fisheries have operated under science-based
catch limits for 30 years. However, prior to the catch share program in
the race for crab, on some occasions, agency managers did not react
quickly enough to close the fishery before catch limits were exceeded.
Under the catch share program, those harvest limits have not been
exceeded even a single time.
Crab harvesters have utilized biodegradable cotton thread
in escape panels since the 1970's and this eliminated the possibility
of crab pots ``ghost fishing''. Since the race for crab ended with
catch shares, many vessels have added larger mesh to their pots, which
allow for female and sub-legal crab to escape long before the pot is
pulled for harvest. This reduction in handling is very beneficial for
the future of the resource.
Under the catch share program and a result of the
elimination in the race for crab, vessel owners have the ability to
allow their pots to soak longer to maximize catch rates of adult male
crab. The catch per pot rate has more than doubled in certain
fisheries.
While the BSAI onboard fisheries observer program has
been in place since 1988, all vessels began using a vessel monitoring
system (VMS) under the catch share program. This ensures that vessels
do not fish in areas that are closed.
Fewer pots are used in the crab fisheries under the catch
share program and the environmental footprint as been reduced by half,
while still prosecuting the fishery throughout the entire range of
adults. This eliminates concerns about localized depletion, while
experiencing a minimal impact on the marine habitat.
The carbon footprint has also been reduced by half since
the implementation of the catch share program. This has been possible
due to the cooperative fishing efforts by the fleet and less fuel being
burned.
Safety at Sea
Sadly, 26 BSAI crab vessels sank from 1991-2005,
resulting in 77 deaths--50 times the overall U.S. worker fatality
rate--earning the fleet the title, ``deadliest job in America''. Since
the crab catch share program was implemented in the fall of 2005, not a
single vessel has been lost to the sea.
One of the benefits under the cooperative fishing
provision in the catch share program is that those vessel owners with
less sea-worthy vessels have not been forced to send their boats out to
fish, while still having the ability to be part of a fishery that many
have participated in for decades.
Another safety benefit is that with the race for crab
something of the past, vessel owners no longer feel the need to stack
too much gear on deck, which led to instability, particularly in icing
conditions. The need to have as much gear in the water as possible in
order to maximize the catch has been eliminated. With every vessel
harvesting a pre-determined amount of the quota, the fishery is no
longer frenzied and reason prevails.
Reducing Fleet Over-Capacity
A major concern for fishery managers and the crab
industry when developing the crab catch share program was that of fleet
over-capitalization. For years many vessel owners were at the edge of
losing their business after the downturn of the crab stocks due to
ecosystem shifts. The Council's Problem Statement clearly identified
that crab catching capacity far exceeded available resources.
While the crab license and vessel Buyback Program helped
provide a graceful exit for 25 vessel owners, others who were not
selected to be part of that program were left to wait for
rationalization. Many of those vessel owners continued to operate in a
marginal manner.
The cooperatives, which were designed in the BSAI crab
rationalization program, provide for a buffer and allow for fewer
vessels to harvest the crab, especially in these years of lower harvest
limits. As harvest limits increase, the number of vessels in the
fishery will also increase. There are approximately 50 vessels, many of
whom are currently working on science and research charters, or acting
as fish tenders for processing companies in other fisheries, that plan
to re-enter the fishery as crab stocks continue to improve.
Many quota share holders who had marginal operations
prior to the crab catch share program being implemented are now able to
participate in the fishery through the vessel cooperative program, and
have been able to realize some benefit.
Skipper and Crew Compensation
The crab catch share program initially allocated 3% to
eligible crab crew members and many of those are continuing to expand
their quota holdings. The incremental investment in quota share allows
a crew member to enter the fishery in a cost-effective way over time.
Prior to catch shares, the investment of a boat and
license were cost prohibitive, but now that crew can buy into the
fishery over time, this benefits their progression into the fishery.
Recent appropriations by Congress provide for $8 million in loan funds
for crab crew members to acquire quota. We have encouraged National
Marine Fisheries Service to quickly implement the regulations allowing
them to begin utilizing that loan program.
The North Pacific Council's analysis found that prior to
the catch share program being implemented, most crew members were not
making enough money in the crab fisheries to provide for them and their
families throughout the year and they had to supplement their income
with other jobs. With catch shares, the average crew share has risen
dramatically and now there are more full time crab crew members than
before the catch share program was implemented.
While there are a few instances of vessel owners paying
poorly under the catch share program, the majority of the fleet is well
paid and the crew members are satisfied that they are receiving fair
and equitable compensation.
As the crab stocks increase and more vessels return to
the fishery, crew member jobs will be created and these jobs will be
stable and provide more certainty than in the years before
rationalization.
Community Development Program
A major element of the crab catch share program was to
provide a royalty of 10% of the annual allocation of each crab
fishery's catch limit to six regional community organizations
representing 65 Western Alaskan communities, as well as the Aleutian
Islands community of Adak. The purpose is to assist these communities
in long-term economic development.
Each CDQ organization has partnered with crab fishermen
for the harvest of the crab resource.
CDQ organizations have added to their crab investments by
purchasing additional crab catch shares at a value estimated to be over
$230 million.
Several CDQ communities have invested in processing
facilities and processing quota.
Crab Catch Shares and Alaskan Communities
Communities adjacent to the Bering Sea and Aleutian
Island waters are important to the success of the crab catch share
program, as well as communities in other areas of Alaska.
Crab catch shares are held by Alaskan residents in 16
communities from Nome to Petersburg.
Crab landings occur primarily in St. Paul, Adak, Dutch
Harbor/Unalaska, Akutan, King Cove, and Kodiak.
Dutch Harbor has the largest number of landings and most
of the Bristol Bay red king crab processing effort, while nearly 50% of
the Bering Sea snow crab is processed at St. Paul Island, one of the
most remote communities on earth.
In the Aleutian and Pribilof regions, where nearly all of
the crab is delivered to a shoreside facility, seafood processing jobs
account for 65% of all jobs.
Crab fishery taxes are an important source of local
revenues. These include fisheries business taxes, landing taxes,
property taxes, and sales taxes.
Community benefits include purchases of fuel and
groceries, vessel maintenance and repair, gear fabrication and repair,
and a variety of support services.
Some crab vessel owners who traditionally took their
vessels to Washington or Oregon during the off-season, now are keeping
their boats in Alaskan ports, contributing further to the Alaskan
coastal community economy.
The Bering Sea and Aleutian Islands crab catch share program is not
perfect, as stated earlier. However, the good things far outweigh the
negative and the members of the Crab Group of Independent Harvesters
are committed to keep working to make the program better for the
resource, catch share participants, coastal communities, and the owner
of the resource--the people of the United States.
______
[A statement submitted for the record by James A. Odlin,
Commercial Fisherman, Portland, Maine, follows:]
Statement submitted for the record by James A. Odlin,
Commercial Fisherman, Portland, Maine
Thank you for the opportunity to provide my personal perspective on
catch share management.
I have been a commercial fisherman vested in the New England
groundfish fishery for over 35 years and have served on the New England
Fishery Management Council for the last seven years. I have experienced
derby fishing under hard quotas, days at sea management, and will soon
experience catch share management as the New England groundfish fishery
transitions to catch share management in May 2010.
From 2001 to 2007 the number of active vessels in the New England
groundfish fishery has shrunk from nearly 1100 to 574, and in
Massachusetts, from which the largest percentage of vessels has
historically hailed, the number of active vessels declined from 629 to
300. In Maine, less than 75 boats remain in the fishery and groundfish
landings have plummeted from 30 million pounds annually to 6 million
pounds. The current system of day's at sea clearly has not protected
the community or the industry, it has promoted huge discards of dead
fish and left millions of dollars of fish in the ocean that could have
been sustainably caught providing jobs.
In the past I have been an opponent of catch shares, but I have now
come to the conclusion that, under the current mandates of the
Magnuson-Stevens Act, and facing the alternative of only 20 allowable
days to fish, that catch shares management must be tried in New England
groundfish.
However, if catch share management of New England groundfish is to
succeed, we need more frequent stock assessments and appropriate
monitoring of the fishery.
A buyout is crucial to lessening the negative impacts of Amendment
16 to the New England groundfish plan. A buyout would remove excess
capacity, give those who wish to leave the industry a dignified way to
exit, and allow those who remain to increase allocations at minimum
cost. Buyouts have preceded the implementation of catch shares in the
North Pacific crab fishery and the west coast groundfish fishery, and
have provided increased profitability for fishing businesses and
stability for fishing communities.
Congress must provide the funding necessary for a buyout, or
advance an industry-funded buyout proposal.
Congress must remove the referendum requirement for implementation
of Limited Access Privilege Programs (LAPPs) in New England. Without
the ability to move to LAPPs, the industry is burdened with high and
unnecessary management costs of ``sectors''.
Congress must amend the Magnuson-Stevens Act in a way that clearly
articulates the flexibility necessary for fisheries managers to restore
fisheries resources while preserving fishing communities. In
particular, Congress must rescind the ridged 10 year rebuilding
requirement.
______
[A statement submitted for the record by Mark Phillips, F/V
Illusion, Greenport, New York, follows:]
Statement submitted for the record by Mark S Phillips,
F/V illusion, Greenport, New York
To the House Subcommittee on Insular Affairs, Oceans and Wildlife,
I would like these comments added to the hearing on Catch Shares on
March 16, 2010.
The comments by new NMFS Eric Schwaab that most fishermen are in
favor of catch shares is a distortion of the facts. Nothing could be
farther from the truth, and I know of no fisherman in NY who is for
this. He is taking the fact that most fishermen joined a ``sector'' as
an indication that we wanted catch shares.
The fact is, NMFS gave us a choice between joining a ``sector'' or
staying in the common pool, but neither was any good. Shooting yourself
in the head or stabbing yourself in the heart are choices too, but the
outcome is still the same--you are dead.
The problems with catch shares are:
1) NMFS' data is not ready to implement catch shares and cannot be
fixed until 2011 or later. This is NMFS' own admission.
2) Catch shares have never been done on a multi-species format
before. This is an experiment with unprecedented consequences if it
fails.
3) NMFS touts science as the fix all for overfishing, yet they
want to gut cooperative research to fund catch shares. Cooperative
research's science has shown NMFS's science is less than accurate.
4) Calling the catch shares program ``sectors'' is NMFS' way to
try to get around calling them ITQs ( what they really are),which need
a 2/3 referendum by all affected participants if they are to be
implemented, as stated in Magnuson-Stevens Act.
5) We have one ITQ system on the east coast already it has not
been very good for anyone but the one man that owns 70 + percent of the
surf clam/ocean quahog resource. We also have a multi state catch share
system in fluke, and because of bad data NY recreational and commercial
fishermen have fared terribly. Even though NMFS admits the data was
faulty, it has never been corrected.
6) Catch shares are an economic tool not a conservation tool.
I am writing to request an East Coast hearing on catch shares by
both the House Subcommittee on Insular Affairs, Oceans and Wildlife,
and the Senate Commerce Committee. Also, that these hearings call for
at least a 1 year freeze on this program, as has happened on the West
Coast.
With the problems inside NMFS concerning Dale Jones' shredding of
documents while under investigation by Inspector General Todd Zinser,
fishermen feel that NMFS service should get its own house in order
before it rams an unwanted program down our throats that will put many
of us (50-70 percent) out of business, along with the infrastructure
that supports us.
Again, I know of no fisherman in NY that is for this catch shares
program.
Thank you.
______
[A statement submitted for the record by Edward Poulsen,
Executive Director, Inter-Cooperative Exchange Policy Advocacy
Committee, follows:]
Statement submitted for the record by Edward Poulsen, Executive
Director, Inter-Cooperative Exchange Policy Advocacy Committee,
Shoreline, Washington
Madam Chairwoman and Members of the Subcommittee, I appreciate the
opportunity to submit written testimony regarding catch share policy.
My name is Edward Poulsen and I am Executive Director of the Inter-
Cooperative Exchange Policy Advocacy Committee (ICEPAC), which
represents approximately 70% of the Bering Sea crab harvesters. All
members of ICEPAC hold quota share as part of the Bering Sea/Aleutian
Islands (BSAI) crab rationalization program in the North Pacific Ocean.
My comments will be limited to our experiences with this catch share
program.
It is widely acknowledged that the BSAI crab catch share program is
one of the most complicated catch share programs in the United States.
This is precisely because of the broad goals of the program as well as
issues and stakeholders that had to be balanced during the design and
implementation of the crab catch share program. An important point
about the crab catch share program is that it was a ``bottom up''
effort supported by industry including representatives from vessel
owners, crewmembers, processors and affected communities. We are also
fortunate to have strong leadership and staff from the North Pacific
Fishery Management Council, Alaska Region National Marine Fisheries
Service, and Alaska Department of Fish and Game which helped industry
move forward to address the goals and identify issues while providing
an open forum for all stakeholders.
The three main goals of the program were to improve safety, address
resource conservation issues, and improve the financial stability of
the industry. It has been successful on all three fronts.
First, the old derby fishery created tremendous stress in a
dangerous environment. Crab fishing was the most dangerous occupation
in the United States. The derby days are now gone and so is the
incentive to push the envelope. We are pleased there have been no
sinkings under the crab catch share program. The fatality rate has been
reduced to 0.2 per year under catch shares, from 5.1 fatalities per
year during derby fisheries (1991-2005).
Second, conservation of the resource has improved in many ways.
With more fishing time allowed, increased soak time allows the crab
pots to screen small crab out while on the ocean floor thereby reducing
bycatch. Additional fishing efficiencies include better sorting tables,
overboard chutes, and better gear that all have helped to reduce
bycatch mortality. We expect this trend to continue in the future. The
crab quota share holders, now direct stewards of the resource, have
formed a successful research association, along with crab processors
and crab dependent communities, funded collaboratively by the crab
industry and NMFS to better understand our resource.
Third, the financial footing of the fleet has also been stabilized
through the crab catch share program. 2005, the last year of crab
fishing prior to the crab catch share program, resulted in a grand
total of just 7 days of fishing time for the Bering Sea crab fleet to
catch opilio and red king crab combined. Nearly everyone was losing
money. Vessel owners couldn't pay their vendors let alone a mortgage.
Owners were forced to defer repair and maintenance simply because there
was not enough money to go around, further exacerbating the safety
situation. Crewmembers could not support themselves or their families
on crab incomes alone. With the crab catch shares program, the industry
has financially stabilized even though we continue to fish at very
conservative levels. On average, vessels are profitable and crew now
make more per day than prior to the catch share program. The bottom
line is that a financial crisis was afflicting the industry and
everyone knew the way out was massive bankruptcies, a government
bailout, or a catch share program. We chose a catch share program,
following a modest, industry-funded vessel retirement program.
Issues identified during the design and implementation process
included: consolidation, community protection, price negotiation,
stakeholder allocations and management fees. During the recent catch
share hearings, consolidation and community protection concerns were
brought up several times. During the design of the crab catch share
program, both of these topics received considerable discussion as well.
To prevent consolidation in ownership of quota share (QS), both
harvesters and processors have ownership caps to prevent excessive
consolidation. On the vessel level though, caps were intentionally not
implemented so that efficiency gains and consolidation could be
achieved. The crab harvesting sector was massively overcapitalized. In
addition, it was necessary to allow flexibility in the contraction and
expansion of capacity, in response to environmentally-induced changes
in the crab Total Allowable Catch (TAC) and the legal requirement to
achieve Optimum Yield on a continuing basis. We would expect that our
snow crab rebuilding plan, which includes very conservative management
measures, plus recent favorable environmental factors, will result in
higher crab TACs in the future and more crab vessels fishing. If this
does not happen though, the fleet has the flexibility to consolidate to
a level where profitability, conservation, and safety can be
maintained.
Community protection measures are also very important in the design
of the crab catch share program. Upon implementation of the crab catch
share program, the Community Development Quota Communities (CDQs) were
provided an additional 2.5% of the entire TAC resulting in a total of
10% directly allocated to them. In addition, a regional landing
requirement was put in place to ensure the historical dependence of the
communities of St. Paul and St. George was maintained. Processing quota
was tied to communities in a way that provided a ``Right of First
Refusal'' (ROFR) to allow the processing quota and the associated crab
landings to remain where they had been historically. So far, there has
been little disruption to the historical crab landings to each
community based on the years the Council set as the baseline for
determining historical participation.
Price negotiation became a very serious issue as part of the crab
catch share program mainly because processing quota (PQ) was part of
the design of the crab catch share program. The concern was that if
harvesting quota had to be delivered against processing quota, how
would there ever be fair market competition? Again, through a bottom up
approach, industry came up with an arbitration system that has proven
to work very well to maintain a historical distribution of revenue
between harvesters and processors.
As with any catch share program, stakeholder allocations are one of
the biggest issues to tackle. The crab catch share program created a
``3 pie allocation'' to harvesters and crew, processors, and
communities. The crab catch share program was the first catch share
program in the United States to initially allocate a portion of the
quota shares to qualified crew, in this case 3% to skippers who met
certain participation requirements. The remaining 97% of the quota
share was allocated to owners of harvesters based on specific
qualifying years. Approximately 90% of harvester quota share must be
delivered against processing quota which was awarded to processors
based on their historical participation during specified years, while
the remaining 10% could be delivered to any processor. Communities are
not granted quota per se, but the processing quota share is linked to
communities through ROFRs and therefore provides reasonable assurance
that historical dependence will be maintained. This 3-pie system has
allowed the protection of all three sectors' historic dependence on the
fisheries.
Finally, the crab catch share program resulted in some increased
management and enforcement costs for both the National Marine Fisheries
Service and the Alaska Department of Fish and Game. Industry agreed to
help defray these costs with an annual fee deducted on each delivery.
Both harvesters and processors are assessed a combined maximum of 3% of
the landed value of the crab fisheries.
In conclusion, I have presented goals and issues that the
stakeholders and relevant agencies wrestled with in devising and
implementing the BSAI crab catch share program. This discussion is not
meant to push our model on any other fishery; we know each fishery is a
unique situation necessitating a unique solution. This testimony is
simply meant to provide a background of where we have been and why we
are grateful for the catch share program that we have.
______
[A statement submitted for the record by David E. Preble,
Narragansett, Rhode Island; Rhode Island Representative, New
England Fishery Management Council, follows:]
Statement submitted for the record by David E. Preble, Narragansett,
Rhode Island; Rhode Island Representative, New England Fishery
Management Council (NEFMC), U.S. Commissioner to the Northwest Atlantic
Fisheries Organization (NAFO)
A prominent politician once told me that of all the issues he dealt
with, the most difficult and contentious was marine fisheries, and
nowhere is that more true than in New England. New England, more than
any other region, is steeped in its traditions and its myths. John
Kennedy recognized this when he said, ``The great enemy of the truth is
very often not the lie--deliberate, contrived and dishonest--but the
myth--persistent, persuasive and unrealistic.'' We must look past our
myths to find the truth, to ferret out the facts. For the truth is that
in fisheries management today's problems will only be solved by
adhering to the facts, not by misreading the past.
The facts are really rather straightforward. From early colonial
times, the ocean-based portion of New England's economy was mostly
based upon free harvest open to all. But a free and open-access fishery
could only work when human population was smaller and harvest
technology more primitive. By the second half of the 20th century
neither was still true, and open harvest had become over-harvest--the
``tragedy of the commons'' had come to pass for the fish. Commercially
important species had become the buffalo and passenger pigeon of a
century earlier, and local fishing economies began a steady decline. It
had, in the end, become necessary to manage these public resources
through the agencies of government. As modern fishery management began,
New Englanders clung to the ``free and open'' myth, long after all
other natural resource industries had abandoned such thinking. To keep
management as free and open as possible they tried to control fishing
effort, step by unsuccessful step, finally by limiting the number of
days a boat could fish and the amount that could be caught per day. The
approach originally seemed fair to all, but ``days at sea'' (DAS) with
``daily trip limits'' multiplied average daily operating costs,
required the discarding of fish caught above the daily limit, closed
recovered stocks to protect weaker ones, and lead to micromanagement of
fishing businesses by government agencies.
The DAS system is economically inefficient and has provided no
incentive for harvesters to protect the resource. Furthermore, New
England's fishery management and stakeholder groups have become rife
with resentment and conflict. Fish stock population sizes and the food
web are now severely unbalanced, and the New England groundfishery
yields less than 20 percent of its economic potential while fishermen
go broke. DAS backed up with daily trip limits has failed miserably
because it is both static and rests upon false assumptions about fish
and about fishermen. These are the facts.
One solution to this mess has been found in several other U.S. and
foreign fisheries, and is really rather simple in concept. As in other,
successful land-based resource extraction industries, limited harvest
rights to the resource must be assigned prior to the actual harvest. In
fisheries, this concept is called ``catch-share management.'' Under
catch shares, fishermen or groups of fishermen, known as ``sectors,''
are assigned a percentage of the total quota for each species, usually
based upon their prior catch history. They are then free to harvest
their shares in whatever way maximizes business efficiency and overall
profit.
Here are some more facts. The NEFMC has spent several years
designing a sector program to replace DAS and to place management back
in the hands of fishermen. My first assignment on the Council was to
join the Sector Management Committee, chaired by the late John Nelson,
long before anyone around here had ever heard the name ``Lubchenco'' or
the term ``catch shares''. It was no rush job and all of the meetings
were completely open. We knew it was a huge step and we wanted to get
it right. There were several public hearings and the full Council
deliberated the minutest details over many public meetings. Contrary to
what has been written and implied, there were no back room deals with
enviros or politicians or mysterious big-money financiers. If anyone
seriously thinks some big city money types are going to move in and
turn a quick profit in the New England groundfishery I sure wouldn't
want him managing my retirement portfolio. In fact, the entire New
England groundfishery currently has a much lower annual gross income
than the drugstores alone do in just my one small state. Dr. Lubchenco
did come to the NEFMC after her appointment last spring to give us a
pep talk, but the sector plan was already mostly completed and neither
she, nor any environmental NGO's, nor the current administration had
anything at all to do with it.
Here is another fact. The claim that we are ``privatizing a public
resource'' is ridiculous, since we already privatized access to the New
England groundfishery years ago with limited entry in Amendment 5. If
you don't have a permit you can't fish, and permits are both limited in
number and expensive. ``Privatization'' by limited access is not the
same thing as ``property rights''. In fact, no action by the NEFMC or
NMFS can create property rights to fish before they are harvested
because it is against the law. The Magnuson Act, Sec 303A, is very
clear on that point. It totally prohibits property rights to fish
before they are harvested.
Management of the New England groundfishery has been a third of a
century of failure. The sector system of catch shares could also fail,
but if we do nothing we are certain to fail. Catch shares could fail if
we continue to manage single species instead of the entire twenty-stock
complex. They could fail if we continue to have a plethora of multiple
fishery management plans for overlapping fisheries that use different
management methods and often don't even start their management year on
the same day! Doing a separate EIS for each of several simultaneous
actions in nearly a dozen different plans that cover the same piece of
ocean is just plain nuts! Catch share management by sectors is certain
to have some unforeseen and unintended consequences that will require
adjustment, and if we can't make that process more efficient sectors
could fail, not because the idea itself is wrong but because of our own
inefficiency.
The sector management plan in Amendment 16 was designed in an open
process by the New England Fishery Management Council in a good-faith
effort to bring back a devastated regional industry that most of us
have been a part of and that all of us care about. It is time to
implement the plan. It is time to finally move forward.
______
[A letter submitted for the record by Britton Shackelford,
President, North Carolina Watermen United, follows:]
March 29, 2010
Madeleine Bordallo, Chairwoman
Subcommittee on Insular Affairs, Oceans & Wildlife
Chairwoman Bordallo,
Enclosed is a copy of the letter the North Carolina Watermen United
sent to North Carolina's Governor Perdue to request state support for
No Catch Shares and for support for the U.S. Congressional Senate Bill
1255 and House Resolution 1584--Flexibility in Rebuilding American
Fisheries Act of 2009. The letter is dated November 25, 2009.
Today, March 29, 2010, we are still opposed to Catch Shares and are
working for the passage of the Flexibility in Rebuilding American
Fisheries Act. We believe that flexibility would allow the time for
accurate Stock Assessments which could be used for making Fishery
decisions based on the Best Science, not the Best Available, which is
often incomplete and inaccurate.
With Good Science, we would have no need for Catch Shares which has
proven to limit catches regardless of the Stock numbers and to put
fishermen out of their jobs--in a time when it is important to keep
jobs. Fishermen are not asking for hand-outs or ``Stimulus Money;''
they are only asking to be allowed to continue fishing.
We ask for support from you and your Committee to oppose Catch
Shares.
Yours truly,
Britton Shackelford
President
North Carolina Watermen United
Enclosure
______
November 25, 2009
Dear Governor Perdue,
The North Carolina Watermen United is respectfully requesting the
North Carolina Governor's Office and our North Carolina Congressional
Delegation to join other East Coast Atlantic states, along with the
Gulf States, to see the inherent flaws in Catch Shares and Limited
Access fishery programs which denies the traditional users--commercial
harvesters, charter/headboat operators, recreational fishermen and
seafood consumers--access to our fishery resources.
Your Office and the North Carolina U.S. Congressional Delegation
have already received letters from the North Carolina Watermen United
and others asking for your support of H.R. 1584 (S. 1255)--[Flexibility
in Rebuilding American Fisheries Act of 2009] which will allow
flexibility within the time frame for rebuilding fish stocks.
History has borne out that Catch Shares and Limited Access programs
do not allow the most fundamental responsibility of the Magnuson-
Stevens Fishery Conservation and Management Act--to maximize the net
economic value from the use of a public resource.
The North Carolina Watermen United look forward to working with you
and a coalition of other Atlantic coastal states so that we can keep
our fishery resources available for all its consumers while maintaining
healthy stocks.
Yours truly
Britton Shackelford
President
North Carolina Watermen United
[email protected]
cc: Tate Johnson, Director, Eastern Governor's Office
North Carolina Congressional Delegation
State Senator Marc Basnight
State Representative Tim Spear
Dare County Board of Commissioners
Dare County Commission for Working Watermen
______
[A statement submitted for the record by The Honorable
Simeon Swetzof, Jr., Mayor, City of Saint Paul Island, Alaska,
follows:]
Statement submitted for the record by The Honorable Simeon Swetzof,
Jr., Mayor, City of Saint Paul Island, Alaska
Madam Chair, members of the committee, my name is Simeon Swetzof,
Jr., and I am the Mayor of the City of Saint Paul Island, Alaska. I am
also a commercial halibut fisherman, which is how I make my living, and
a subsistence hunter. I appreciate having the opportunity to offer
comments to the Subcommittee on our experiences with catch shares as a
Bering Sea community. This is an extremely important issue to the
community of Saint Paul Island, as it is thanks to the catch share
program known as the Bering Sea Aleutian Island Crab Rationalization
Program that Saint Paul continues to survive today.
Saint Paul is a unique community located in the middle of the
Bering Sea whose history is intricately tied to the history of Alaska.
Saint Paul's 450 residents are mostly Aleut Natives and it's known as
the largest Aleut community in the world. Since time immemorial, the
Aleut people have depended on the bounty of the Bering Sea for their
survival and have lived in harmony with its abundant resources. Pelts
of northern fur seals were harvested on Saint Paul and Saint George
islands (known as the Pribilof Islands) from the days of Russian
colonizers. This operation was so profitable that it spurred U.S.
interest in acquiring Alaska in 1867. For over a century, Saint Paul
was not allowed to develop a commercial fishing industry due to the
exclusive federal management of the fur seal harvest. The fur seal
harvest was phased out by the federal government in the 1980s, and the
community of Saint Paul was forced to scramble for alternative means to
survive. Since oil and gas exploration were not an option at the time
the logical choice was to develop a fisheries-based economy.
I. Saint Paul's Dependence on the Bering Sea Snow Crab Fishery
Because most of the Bering Sea fisheries were already capitalized
by this time, one of the few fisheries that Saint Paul could
participate in was the snow crab fishery. The federal, state, and local
governments, as well as the private sector poured tens of millions of
dollars into Saint Paul Island to develop a harbor and the
infrastructure necessary to become a viable port for the Bering Sea
crab fishing industry. The infrastructure necessary to support the
development of a fisheries-based economy included a fuel farm, a power
plant, water storage facilities, a landfill, and other utility
upgrades. Saint Paul became one of the most highly indebted communities
on a per capita basis in Alaska.
These investments, however, paid off. With its proximity to the
fishing grounds and the investments in infrastructure, Saint Paul
thrived as the port of choice in the derby-style snow crab fishery of
the late 1980s and 90's. Saint Paul-based processors came to process
close to 40% of the Bering Sea's snow crab. Processors based on
neighboring Saint George processed another 10%, and most of the
remainder was processed in Unalaska/Dutch Harbor. Together these three
communities processed over 90% of all the Bering Sea's snow crab. In
the cases of Saint Paul and Saint George, these two communities are
almost entirely dependent on crab processing, unlike other communities
with a diversified fisheries and economic base.
II. The Collapse of the Snow Crab Fishery
In the year 2000, the snow crab stocks suffered a collapse of about
85% from levels close to 200 million pounds to 25 million pounds. This
collapse meant that from one year to the next, 85% of Saint Paul's
economy vanished. Jobs were lost, processing facilities were shuttered
up, and longtime residents, particularly youth, left the island. The
community of Saint Paul faced economic, demographic, and cultural
extinction. In recognition of the situation, the Secretary of Commerce
declared a commercial fishery failure in the Bering Sea snow crab
fishery due to the resource disaster. The Secretary declared Saint Paul
an affected fishing community under the Magnuson-Stevens Fishery
Conservation and Management Act which entitled Saint Paul and other
affected communities to federal assistance. In addition, a vessel
buyback program was put into place to help ease the dislocation that a
collapsed fishery would necessarily cause on the industry.
III. Efforts to Save the Community
In order to save the community, community leaders worked together
with a coalition of harvesters, processors, and other key crab
dependent communities such as Unalaska and Saint George to develop a
management program that would protect the investments that all sectors
had made in the snow crab fishery. Through these efforts and the wise
leadership of the Alaska Congressional Delegation and the State of
Alaska, the Bering Sea Crab Rationalization Program was born.
Understanding the clear benefits of the program to the various
stakeholders, the NPFMC voted unanimously to adopt the program in 2002.
Congress approved the program in January of 2004.
IV. Community Protections in the Bering Sea Snow Crab Catch Share
Program
From a community perspective, the Crab Rationalization Program
includes a number of protections that ensure the continued
participation of communities in the snow crab fishery. In a collapsed
commercial fishery, consolidation of the crab fishing fleet and other
crab-related infrastructure was inevitable. This would have potentially
led to the demise of some crab-dependent communities. The program also
sought to protect the considerable federal, state, and municipal
investments made on Saint Paul that proved invaluable in developing a
commercially successful crab fishery in the Bering Sea.
One of the unique adaptations of the program is the concept of
regionalization. This concept is intricately intertwined with the
protections granted to other sectors. Harvesters, processors, and
crewmembers are issued shares in recognition of their investments and
stake in the fishery. A percentage of these shares are then subject to
regional delivery requirements that are based on communities' historic
participation in the fishery. Saint Paul is located in the so-called
Northern Region. As a northern region community, Saint Paul therefore,
is assured of a continued flow of required deliveries to processors
that are based on the island.
The other main protection extended to crab-dependent communities
under the Bering Sea Crab Rationalization Program are rights of first
refusal (ROFR) on certain transfers of processor quota shares (PQS)
derived from processing in a particular community. A ROFR is triggered
in favor of an eligible community if the current PQS holder engages in
a transaction that will remove the PQS from its community of origin. In
this manner, a community has the opportunity to acquire the PQS
involved in the potential transaction, preventing its removal and the
associated economic activities from migrating elsewhere.
One of the main weaknesses of ROFRs in this program is that
communities may not have the financial wherewithal to exercise a ROFR
in a multimillion dollar transaction. The North Pacific Fishery
Management Council (NPFMC) is considering modifications that will
strengthen a community's ability to respond to a ROFR. In addition,
with the support of the NPFMC, the five primary crab-dependent
communities in the program have reached out to the U.S. Congress and
the Administration to develop a loan program that would enable
communities to more effectively exercise their ROFRs. Such a loan
program would be consistent with the Administration's efforts to
increase community participation in the nation's commercial fisheries.
Notwithstanding these weaknesses, ROFRs are still a valuable tool for
communities and they strengthen the sense that the residents of a
fishing community have about their stake in the surrounding fisheries.
V. Implications for Saint Paul's Broader Economy
The activities of the processing facilities and the crab fleet on
Saint Paul Island, which are made possible by the Crab Rationalization
Program, generate local jobs and demand for local goods and services,
and air transportation. Local enterprises are partnered up with the
processing companies as landlords and in other business ventures. In
addition, between 300 and 400 non-residents work at the shore-based
processing facility during the crab season thereby contributing greatly
to local economic demand. The city government for its part receives
fisheries business tax and sales tax revenues related to the sale of
fuel and other services that are key to the municipal budget, continued
infrastructure investments in the community, and the salaries of local
employees. There is no question that Saint Paul has benefitted greatly
from the program, even though the community's revenues are still at 85%
of what they were in 1999.
The local halibut fishery in which local fishermen such as me
engage in also depends indirectly on crab processing. Without the
levels of crab deliveries and processing guaranteed by regionalization,
the processors would have closed their facilities a long time ago. This
would have left local fishermen with no place to deliver halibut for
processing and packing, as halibut fishing by itself is insufficient to
generate the revenue necessary to keep a processing operation viable on
Saint Paul. The sixteen active Saint Paul halibut fishermen are the
primary family-owned small business operations based on the island.
Each fisherman employs between three to six people including
crewmembers, baiters, and babysitters. Their donations of subsistence
halibut to the elderly and other disadvantaged residents is an
important source of sustenance for many on Saint Paul. Their
disappearance, therefore, would wipe out the main small business
activity on the island and constitute a severe loss to many residents.
In addition, without crab processing, the community would be unable
to attract investment in the infrastructure and other upgrades
necessary to diversify into other commercially valuable species such as
pollock and cod, which have potential to be processed on Saint Paul,
and to survive in the long term.
Today, the snow crab stock levels continue to be low in relation to
the levels witnessed in the 1990s. The total allowable catch for this
past season was set at about 48 million pounds. As such Saint Paul
continues to face economic difficulties. However, by ensuring
deliveries of crab to Saint Paul, the Bering Sea Crab Rationalization
Program has allowed the community to survive. The program has also
provided Saint Paul with the opportunity to continue diversification
efforts into other fisheries. And, finally it has allowed the community
to continue to hope for a future on this unique island.
The City of Saint Paul Island thinks that there are valuable
lessons to be shared with other fishing communities in our successful
experience with a catch share program. Thank you for this opportunity
to offer comments to the Subcommittee on our experiences with catch
shares in the Bering Sea.
______
[A statement submitted for the record by Stephen Taufen,
Groundswell Fisheries Movement, Kodiak, Alaska, follows:]
Statement submitted for the record by Stephen Taufen,
Groundswell Fisheries Movement, Kodiak, Alaska
Dear Chairwoman Madeleine Z. Bordallo and Subcommittee members:
Congress should call for a three-year moratorium that firmly stands
down the Secretary of Commerce's ability to approve Dedicated Access
Privilege (DAP) programs (``Catch Share'' allocations) until more is
known about their actual effects. Revisions in the Magnuson-Stevens Act
are needed to preserve Constitutional due process, equality (Equal
Protection Clause), economic sovereignty and other rights.
I'm Stephen Taufen, an Alaska fish industry insider who blew the
whistle on the illicit accounting practices of processing corporations
who--acting as ``resource vultures''--use product laundering to control
the means of production, product mixes, and move profits across
national borders. These tax avoidance tactics and revenue shifting
strategies (abusive Transfer Pricing) gravely harm our Nation.
A `transfer price' is the price charged by one company to a
related company whenever they allocate income and expenses
among themselves. The bottom line is whether or not the U.S.
(host nation) company properly reflects income attributable to
its operations in the U.S., or whether its foreign parent is
using illicit accounting and pricing strategies to avoid higher
effective U.S. taxes--and to transfer profits offshore and jobs
to home and foreign nations. Refer to: U.S. Internal Revenue
Code section 482 Transfer Pricing, and related code.
Allocation of fishery quota rights to transnational firms grants
them ``plenary power'' over our fisheries economy, creating job losses
and negative shocks to economic multiplier benefits that belong in the
USA.
The conversion of the public's common resource privileges to catch
shares for fish vessel owners can also foster fleet cooperative
agreements with such processors in a way that supports price-fixing,
rewards certain competitors instead of competition itself, and
establishes restraints of trade. In Alaska, all of this has occurred
through the species-by-species march of rationalization regimes:
pollock, crab, and rockfish.
In effect, all of these privatization regimes are coercive
monopolies--in violation of market theory and tenets of competition--
that only governments have the power to wickedly form. ``Once
commodified, fishing rights are alienable.''--Courtney Carothers,
``Rationalized Out''
For 18 years, I've cooperated with federal law enforcement agencies
in uprooting these harms and to aid the removal of Ted Stevens (R-AK)
from the U.S. Senate. Only with this corrupt senator gone is it now
possible for Congress to take back its powers over our nation's
fisheries laws and assist fishermen in correcting the flaws of the
Magnuson-Stevens Act. Your renewed efforts are greatly appreciated.
Directed Access Privilege (DAP) ``catch shares'' programs--
especially those ``privatizing regimes'' that establish ``tradable''
(asset commoditized) fishery allocations--have the following negative
consequences:
1. DAPs threaten economic sovereignty.
a. Home and insular territories are negatively affected re
rights of U.S. citizens for reciprocity in the conduct of trade
and indigenous peoples' rights to self-determination.
2. DAPs resulted in a Resource Curse in Alaska--``the Paradox of
Plenty'' can also occur elsewhere.
a. A few strong players link with corrupt politicians to
secure high rents for themselves, while destructing the
development of a wider economic middle class.
3. DAPs have violated WTO treaty rights and NAFTA/CAFTA trade
agreements.
a. In Alaska, Pollock and crab (and soon the rockfish)
processor rights largely flow to Foreign-controlled
Corporations (FCCs) who have been granted corporate resource
acquisition, food manufacturing and distribution rights, in
perpetuity: no longer available to other nations' firms.
b. A WTO challenge to this exclusivity--allowed only to
certain foreign-owned multinational enterprises--would likely
be upheld. The USA could face WTO sanctions, imposed on other
products or economic segments.
4. DAPs lead to directive and control by non-participants outside
fishery dependent coastal regions.
a. Using market and financial powers superior to fishermen
and coastal communities, DAPs allow a combination of FCCs,
large food conglomerates (e.g. WalMart and other hypermarts),
and investor class (hedge fund and mutual fund groups), as well
as environmental non-government organizations (ENGOs) to gain
control in perpetuity over U.S. fishing quotas to secure cheap
sources of high volume supply at the expense of our fishery
dependent communities and economy.
5. DAPs in Alaska have allowed a Closed-Class of Processors to
avoid Value-added production.
a. USA jobs have been lost as the increased market powers
granted FCCs who received processor quotas and linkage rights
to supplies have failed to generate the promised increases in
value-added production in our host nation, exacerbating
deficits in the net national balance of trade in fisheries.
Coercive monopolies control the means of production and
determine markets.
b. This goes hand-in-hand with the illicit purposes of
creating and operating ``hollow subsidiaries'' in our host
nation, as value-added failures lower U.S. side revenues and
revenues on the seller (fisherman) level, too. American
consumer choices are subjugated to corporate paradigms.
6. DAPs foster Global Tax Evasion and Restraints of Trade via
FCCs' Hollow Corporations.
a. Using abusive (illegal) accounting practices as part of
global strategies to evade U.S. taxes, in violation of Internal
Revenue Code Sec. 482 Transfer Pricing and related regulations,
FCCs who operate ``hollow subsidiaries'' within the USA (host
nation) manipulate operating profit. Again, this allows a
``closed-class of large processors'' to practice restraints of
trade and horizontally fix prices against U.S. sellers
(fishermen) on the ex-vessel (seller) level.
i. The Seattle IRS-CID and International divisions can
advise Congress on the harms to the Treasury, and discuss
their limited enforcement and audit efforts to date, and
estimated shortfalls to the net U.S. balance of trade. But
it is important to note that tax recoveries (low settlement
compromises) do not recover the net-of-tax majority of
profits product laundered or correct the multiplier
benefits lost.
b. A proportionally low percentage of the full value of fish
products is paid out on the seller side (ex-vessel). This
places great risk on the Nation in cases where a fishery might
collapse and the social and economic costs then must provided
for by government assistance and bankruptcies. The UN-FAO and
World Bank recognize the increasing trend to lower supplier
segment ratios as similar threats to governments around the
globe.
7. DAPs have caused Regulatory Capture of Regional Fishery
Management Councils.
a. Councils become so dominated by corporate special
interests that the historical rights of active participants--
such as Alaska's crab and groundfish crewmember--are unable to
be recognized in the process of allocation amendments, options
and elements.
8. DAPs have abrogated Crewmembers' maritime law ``Lay Share''
contract rights, as exorbitant Lease fees are extracted by quota
Sealords. In legal terms, this is unjust enrichment. It ignores the
lifetime boots-on-deck investments of crewmembers, which is equally
important to the amortized (recovered) financial expenditures and
government subsidized vessel procurements. Future opportunities to work
one's way up to the wheelhouse and to eventual vessel ownership end
once privatization giveaways begin.
``Labor is prior to, and independent of, capital. Capital is
only the fruit of labor, and could never have existed if labor
had not first existed. Labor is superior to capital, and
deserves the much higher consideration.''--Abraham Lincoln
Interference by quota Sealords who extract exorbitant leases
(high rents) off-the-top before doing normal Trip Settlements
results in third-party exploitation and contradicts contract
bargaining rights of skippers and crew.
In Alaska, the Council ``Crab Ratz'' privatization process
proceeded without proper consideration of one of the most
applicable U.S. laws, 46 U.S.C. Sec. 10601 (and Sec. 11107) on
Lay Share rights for crews contracted to fish on vessels over
20 gross tons. The upcoming Gulf of Alaska Rockfish
Rationalization regime contains plans to similarly ignore the
30% to 40% historical rights of crewmen.
i. Section 10601 states, in relevant part:
1. Before proceeding on a voyage, the owner,
charterer, or managing operator, or a representative
thereof, including the master or individual in charge, of a
fishing vessel, fish processing vessel, or fish tender
vessel shall make a fishing agreement in writing with each
seaman employed on board if the vessel is at least 20 gross
tons and on a voyage from a port in the United States.
2. The agreement shall--(1) state the period of
effectiveness of the agreement; (2) include the terms of
any wage, share, or other compensation arrangement peculiar
to the fishery in which the vessel will be engaged during
the period of the agreement; and (3) include other agreed
terms.
ii. 46 U.S.C. Section 11107 states, in support of
Sec. 10601 that
1. An engagement of a seaman contrary to a law of
the United States is void. If the engagement is void, the
seaman can recover ``the highest rate of wages at the port
from which the seaman was engaged or the amount [of] agreed
[wages]...at the time of engagement, whichever is higher.''
b. Coercion of crewmembers who attempted to give public
comment also occurred by their vessel owners and skippers
during NPFMC sessions.
i. The FBI and NOAA-OLE were asked to investigate this
coercion (see Addendum A for an article on the problem, and
a link to part of the actual evidence of vote-rigging
etc.).
ii. The Crewmembers Association has been long awaiting a
reply from past NOAA Administrator James Balsiger about
what the Inspector General's office is doing.
c. Hundreds of millions of dollars are extracted in high
rents by quota Leases, across a collection of major species--
and Congress should first quantify these economic extractions
(exorbitant rents) and the role of bankers (seeking interest
income) before proceeding on future DAPs.
i. This is an inherent requirement to guarantee that
DAPs do not become modern ``letters of marquee and
reprisal'' (privateer grants) or act in the Insular
territories as if ``Deeds of Economic Maritime Cession'' to
foreign interests (a non-USA Thalassocracy--regime of the
sea).
Ex-Senator Stevens regularly used propaganda such as criticizing
factory trawlers as foreign-owned (by Norwegians, who had already
converted to American ownership) while ignoring his legislative
shifting of rights to FCCs (from Japan and Korea) in the ill-named
American Fisheries Act (Pollock privatization).
However, Stevens' hypocrisy was regularly exposed by disingenuous
but responsibly sounding statements on the Senate podium that his
legislative acts then failed to uphold; a primary example being:
``I'm worried about the IFQ's from the point of view of having
another piece of paper that must be purchased by an entrant to
the fishery, to the point where only the corporations or the
very wealthy can become real participants in the fishery.''--
Senator Ted Stevens
However, speaking such a paramount truth is only as good as the
legislation that actually backs it up.
Congress should ask these serious questions before initiating more
DAPs:
``If we could not prevent Alaska's major ports from becoming
economic branches of foreign nations, stop the Transfer Pricing
abuses bleeding off billions of dollars per year and prevent
the Resource Curse and Regulatory Capture of the NPFMC, then
how can Congress justify further `Catch Share' regimes
elsewhere in the nation and its Insular regions?''
``If quota Sealords can extract high rents of up to 70% or more
right off the top of ex-vessel revenues (the seller segment
cutoff)--a `kleptocracy' transferring hundreds of millions of
dollars annually away from regional fishing economies--then do
DAP initiating arguments of `overcapitalization' and pending
bankruptcy hold any water as driving reasons; or are they
merely dishonest rationales to convert (through quota
giveaways) privileges to use public commonwealth to create
private property rights that only benefit a few select
carpetbaggers?''
SOLUTIONS:
A three-year moratorium on developing or implementing
further ``catch share'' programs.
Independent research and analysis, including economic
Impact studies, on all existing DAPs.
Scientific and economic studies on the relative
efficiencies and consumer benefits (traceability, quality) between
small-scale and industrial (large-scale) fishing and processing
operations.
Treasury, Justice Department and Federal Trade Commission
reviews of tax, antitrust and restraint of trade harms, as well as
effects of Regulatory Capture and Resource Curse problems.
Quantification of Abusive Transfer Pricing losses,
resulting deficits in net national balance of trade.
Quantification of losses due to Resource Curse ``high
rents'' extraction by quota sealords.
Assess States Rights and the coordinating compliances
required to ensure regional economies do not fall prey to national
policies that unjustly shift revenues, taxes and profits from states.
Legislative debate and changes to MSA to define the
parameters for economic management, and ensure all applicable laws
(e.g. Lay Share statutes) are part of due process.
Legislative changes to ensure stakeholder due process
(GAO 06-0289 recommendations) and guidelines for scientific and legally
justified Problem Statements and National Standard reviews before DAP
amendments proceed.
Increased protection through new legislation on
``prohibited acts'' to prevent undue foreign influence, and to
strengthen prosecution of abusive profit transfers and avoid tax
losses.
The above solutions and clarifications and legislative corrections
should occur before ending the stand down (moratorium) on developing
and implementing new Directed Access Privilege programs. Until then,
allowable catch limits, bycatch mitigation measures, and other
traditional fishery management tools can be used to better manage
national fisheries.
Bear in mind, as Robert F. Kennedy, Jr. of the Natural
Resources Defense Council reminded us, ``trespassing on common
property--is a form of subsidy that ought to end.'' And as
Peter Barnes, author of ``Capitalism 3.0'' states, ``...it's
possible to propertize a natural inheritance without
privatizing it... [as] Privatization goes further and assigns
property to corporate owners....[for] to whom are they
accountable for commons-based performance?... The basic idea is
to turn pieces of the commons into common property rather than
corporate property.''
I appreciate your efforts in learning more about the real truths
and complexities of ``Catch Share'' privatization regimes as
implemented to date in the Alaskan region. Improving ``economic
efficiency'' from a limited bundle of resources to benefit of consumers
and maintain coastal communities is far superior to wrongfully
``reframing'' needs of the Commons as ``productive efficiencies'' for
corporate players hell-bent on solely maximizing profits.
Rationalization schemes have been around for over 120 years as
means of corporate takeovers of resources. One definition of
``rationalization'' is, ``the cognitive process of making something
seem consistent or based on reason.'' The truth lies in that
definition, as DAPs only seem to be rational, when in effect they only
convert and selectively ``ration'' ownership of the Public Commonweal
to specific private entities. This disenfranchisement of living persons
in no way serves the actual participants and the fishery dependent
communities they live in.
In closing,
``Earth has resources for everyone's needs, but not for
everyone's greed.'' --attributed to Mahatma Ghandi
Sincerely,
Stephen R. Taufen, founder of the Groundswell Fisheries Movement
_______________________________________________________________________
Addendum: Crab Rationalization ``Damage Control'' Conspiracy
article with link to evidence file.
Must read: ``Enclosing the Fisheries: People, Places, and Power''
by Marie E. Lowe and Courtney Carothers, American Fisheries Society
Symposium 68,--2008; 223 pgs.; ISBN 978-1-934874-05-09.
U.S. Government Accountability Office report GAO 06-0289, February
2006; ``FISHERIES MANAGEMENT: Core Principles and a Strategic Approach
Would Enhance Stakeholder Participation in Developing Quota-Based
Programs''; http://www.gao.gov/cgi-bin/getrpt?GAO-06-289 [See also: GAO
GGD-95-101 & GGD-99-39.]
Re ATP, see: Stephen Taufen's public comment to U.S. Commission on
Ocean Policy, Seattle, WA, June 2002; which includes two papers, ``The
WTO & Fisheries: An Issue of `Accountability and Transparency'--A Case
of Global Production and Transfer Pricing Strategies versus Citizen-
Taxpayer Rights'' (1999 WTO Seattle; web published by the Institute of
Agriculture and Trade Policy), and ``Transfer Pricing Affects Fish
Catch and Sales Prices'' (published 1995 in the ``AIFMA Leader''); copy
available on the Web at: http://oceancommission.gov/publicomment/
northwest
comments/taufen_comment.pdf
Addendum: Evidence of ongoing plot against Crewmembers released for
first time.
Crab Rationalization ``Damage Control'' Conspiracy is a Reality
Anchorage, AK--December 11, 2008 (revised)--Disenfranchised crab
crewmembers have sought since 2004 to restore the historical share of
the individual transferable quotas (ITQs) that were taken from them in
the Bering Sea and Aleutian Islands crab fisheries.
At the North Pacific Fisheries Management Council (NPFMC) meeting
here this weekend, crewmembers will try again to get a separate
placeholder on the agenda--a Crew Reallocation Amendment to the
Fisheries Management Plan (FMP) for Crab Rationalization (CR).
National standards support that it is a ``fair and equitable'' goal
to reallocate as much as $400 million of the initial $1.1 billion worth
of Individual Transferable Quotas (ITQs) to all ``vessel operators''--
i.e. skippers and crew. Yet the Council persists in steering things
towards violating federal Fisheries Acts that clearly establish no
compensation needs to be made to existing ITQ holders, instead of
taking the reallocation amendment course. Apparently, there is a reason
why.
The evidence attachment (see locator below for CrabConspiracy.pdf)
surfaced in August of 2006, and speaks for itself. Crewmembers are
obviously the target of this deliberate ``damage control'' plan that
outlined how to continue defrauding them of permanent rights to access
crab.
Crab crewmembers should calmly remember that a tide must reach its
lowest point before it begins to advance. Now the prudent option for
crew is to channel justifiable anger into joining the Bering Sea Crab
Crewmen's Cooperative--to obtain their historical rights back, and
ensure Lay Share laws are followed.
The Conspiracy in 3 Nutshells:
In short, three key elements were proposed to keep crewmembers at
bay forever, and others were added when needed to keep any damage under
uncompromising control.
The first element was to combine two insurmountable hurdles of (1)
allowing no motion for reconsideration or reallocation; and if that
were to fail, then (2) to hold six council votes in opposition, in
order to reject reconsideration. Inherent to such subjugation was that
it might involve all voting Council members, save one, in order to
ensure no motion was ever seconded by another member.
The second element was to deliberately deny crewmembers the chance
for equitable change ``by insisting on a minimum five-year trial run''
of crab privatization before modifications could be made. This
roadblock flies in the face of the legal fact that the CR program could
be changed at any time, without making any compensation to existing
quota privilege holders.
Meanwhile, processors and ITQ-holders have continually pressed the
Council, successfully, to change the CR program to overcome their
problems. The ``damage control'' plan helps explain why only token
images of reciprocity were given crew concerns.
The third element was to ``quiet angry voices with a prudent
delay'' by ensuring that the Economic Data Report (EDR) information not
be timely shared with crewmembers, so that they could not calculate
historical participation rights using official data sources.
NPFMC actions to date strongly indicate coherence with the
conspiracy's blueprint. What clearer evidence is needed than the April
2008 ``strong six'' voting record of the Council, data report delays,
ITQ-holders' testimonies, and records of phone calls strong-arming crew
into not voicing public comments that they had moments before signed up
to give on the federal record? [Or the 2009 manipulations of the crew
(and lease) discussion paper, that got tabled until the 5-year review
process comes back up in October 2010?]
The current Council approach of using a modifying motion that would
merely lock crew into buying quota, from existing ITQ-holders if and
when it ever comes up for sale, looks like the addition of ``a fourth
element'' to the racket in progress.
Be assured, federal law enforcement has been seriously looking into
this for quite awhile. According to federal guidelines, ``Once
existence of a conspiracy has been established, only a slight
connection to the conspiracy is necessary in order to convict any one
defendant of knowing participation.''
Consider for example surveillance on January 28, 2004 that reveals,
with crewmembers absent, the ``Distant Waters Committee'' met in
Seattle before the February NP council meeting. Some attendees openly
discussed how favorable it was for them to be in possession of most of
the data necessary for scientists and economists to fully evaluate the
CR program, and they gleefully talked of leaving it out of required
impact reports: before the program even became law.
Lay Share Contracts Ignored:
So, given such intents, it's no surprise that the award of ITQs
blatantly disregarded ``lay share'' maritime contracts, required under
46 U.S.C. Sec. 11107 and Sec. 10601 as amended, that should have
certified the pre-rationalization level of historical skipper and crew
participation rights.
Instead, harvesting quotas were misallocated 97% to ``vessel
owners'' and a meager 3% was given to skippers. Yet skippers
historically got a ``lay share'' between 10 and 17% of harvest
settlements, and the handful of crewmembers typically onboard each
vessel historically split another 20 to 25%. But if they got 40%
before, then why shouldn't they get 40% today--quotas or not?
To resolve this requires a separate reallocation Amendment,
particularly because crewmembers will keep facing these issues,
nationwide for many species.
Consequently, the recent 9th Circuit Court's pro-prosecution ruling
on the Weyhrauch indictment's fraud charges may offer perspective about
the ``honest services'' owed by public officials and agency decision-
makers.
States' Responsibility is Obvious:
Former Alaska Governor and U.S. Interior secretary Walter Hickel
said, ``If you steal $10 from a man's wallet, you're likely to get a
fight, but if you steal billions from the commons, co-owned by him and
his descendants, he may not even notice.''
Moreover, when the government becomes extremely biased toward
privatization of the public commons for special interests, then the
eventual losers beyond taxpayers and consumers are the ecosystem and
future generations who lose opportunities to exercise privileges to
fish.
Yet it is easy to redefine fixing Crab Rationalization as a moral
imperative, with practical solutions. First, the State needs to get the
crew reallocation Amendment in place. Second, it must end high lease
rents on ITQs.
Squashing any Demagogue:
If some of Alaska's NP council members were squarely in on the
``damage control'' plan, then there's a good chance that Governor Sarah
Palin is being deliberately blindsided by those inside connivers.
The mastermind behind the ``confidential (sic) communication''
recommending damage control clearly expressed, ``Our final concern is
that someday a newly-appointed NPFMC voting member from Alaska could
mount a serious political crusade on behalf of Alaskan coastal
communities and their resident local businessmen to `do the right
thing' and `make things right for crab skippers and crewmen'--as it
would be the unwelcome rise of a ``grass roots demagogue [who] could
stress the political system in Alaska sufficiently to prompt a
reallocation--to the detriment of our clients' interests.''
Could someone explain just why protecting crewmembers would be
considered ``a serious political crusade''--instead of the expected
conduct of business for Alaska's federal council members?
Is it possible that the successful implementation of this
conspiracy also tainted the recent choice of a new Washington State
representative to the NPFMC? Is the State of Alaska even aware of the
federal lobbying dollars that key processors spent to influence the
choice of who just got that position?
Yes, Mr. Secretary, Congress, and Governor Palin, you will be asked
to keep bowing before these resource kleptocrats--until you find the
courage to stand up, execute the moral imperative, and stop this
racketeering.
We leave crewmembers with one final thought, from Mahatma Gandhi,
``First they ignore you, then they ridicule you, then they fight you,
then you win.''
Stephen Taufen, Groundswell Fisheries Movement--Website:
http://groundswellalaska.com
Locator for Original Article:
http://alaskareport.com/news1208/x61838_crew_conspiracy.htm
Locator for evidence attachment:
http://alaskareport.com/pdf/CrabConspiracy.pdf
______
[A letter submitted for the record by James and Shirley
Zuanich, Bellingham, Washington, follows:]
March 15, 2010
Subcommittee on Insular Affairs, Oceans and Wildlife
To Whom It May Concern;
Quota shares seem to have become the latest panacea for fisheries
resource problems both real and perceived.
While the `Q' of IFQ is necessary biological management, the `IF'
is largely social and economic.
If a reasonable scientifically supported quota is determined and
enforced, it is in most cases immaterial, from a biological standpoint,
whether that quota is harvested by individual shares or in an open
access fishery. IFQ fisheries will generally be somewhat safer for
participants and can significantly increase ex-vessel value, but it is
hard for me to see where they have much biological impact in the
fisheries I am familiar with.
Halibut and black cod IFQ regimes created broad based ownership of
the resource. They provided for the sustainability of small ``blocked''
share that have been instrumental in allowing crew men to acquire
assets in the fishery. They made an especially dangerous fishery safer,
provided a steady stream of product to the market, and have increased
the value of the fishery substantially.
Crab IFQ's have also made that fishery safer. They have made the
fishery more lucrative, but not necessarily for fishermen. Crab IFQ's
have concentrated ownership in the hands of a few and made the limited
number of owners extremely rich. They have eliminated well over half
the jobs in the fishery without making the remaining jobs any better
paying. In fact, creating competition for the few remaining jobs while
limiting boats, has actually made the remaining jobs substantially less
lucrative.
If created at all (and most often they should not be,) it is my
observation that IFQ fisheries need to be designed with great care.
They will not automatically, if at all, lead to more sustainable
harvest. They can create fisheries in which a small handful of quota
share owners reap fortunes while jobs and small businesses are
destroyed. They can destroy the economic basis for communities.
Fishing people generally love their work and the culture of
fishing. In spite of the cold and wet, and the absences from home,
generally fishing families feel privileged to be a part of this world.
You would have to be there to understand, but it is true.
Sincerely,
James and Shirley Zuanich Bellingham, Washington
______
To the Committee of Insular Affairs, Oceans and Wildlife;
I keep thinking about this issue of catch shares, and the over
arching problem for me is this; a few people and organizations will
enjoy fantastic power and wealth because of catch shares. I need not
recite to people in Washington DC what our country has recently endured
because of too much power and wealth in the hands of the few and the
subsequent cozy relationship with the government regulators who were
supposed to be checking them. State of Alaska fisheries management was
referred to by the National Geographic as ``State of art,'' in
fisheries management. The hallmark of Alaska fisheries management,
(outside of halibut and crab) has been broad `ownership' of those
resources by many, many independent small businesses, whose store front
happens to be a boat. Catch shares may seem like the silver bullet for
fisheries management, but I promise you, as fewer and fewer people get
wealthier and wealthier by the catch share system (and this will
happen) fisheries biologists will lose their scientific autonomy to
undue political pressure. On a personal note, knowing about the
'heavyhitters' in our industry, like any other industry, generally, but
not all of these folks are not nice people, whose main interest is
their own interest.
PLEASE, USE WISDOM! Walmart is a heavy contributor to the
Environmental Defense Fund. What is their motive? Environmental groups
(and I am largely a Democrat)) are as subject to charlatans and
charismatic nut cases as any other group-type.
Sincerely,
Shirley Zuanich
* * * * *
OVERSIGHT HEARING ON ``A COMMUNITY PERSPECTIVE ON CATCH SHARES''
----------
Thursday, April 22, 2010
U.S. House of Representatives
Subcommittee on Insular Affairs, Oceans and Wildlife
Committee on Natural Resources
Washington, D.C.
----------
The Subcommittee met, pursuant to call, at 10:07 a.m. in
Room 1324, Longworth House Office Building, Hon. Madeline Z.
Bordallo presiding.
Present: Representatives Bordallo, Kildee, Pallone,
Christensen, Capps, Shea-Porter, Kratovil, Inslee, Brown,
Cassidy.
STATEMENT OF HON. MADELINE BORDALLO, A DELEGATE IN CONGRESS
FROM THE TERRITORY OF GUAM
Ms. Bordallo. The oversight hearing by the Subcommittee on
Insular Affairs, Oceans, and Wildlife will come to order.
Today, we will hear testimony on ``A Community Perspective on
Catch Shares.''
Rebuilding fisheries has clear ecological and economic
benefits for fish, fishers, and the fishing communities. To
achieve these benefits, fisheries must be managed using the
best available science and a suite of management tools,
including, but not limited to, catch shares. Catch share
programs are one fishery management tool in which fishermen,
cooperatives, or communities are allocated a specific portion
of a total allowable fishing quota.
Management of fisheries using catch shares has thus far
been limited in the United States with only 15 existing
programs that have had mixed results. However, under the Obama
Administration, the National Oceanic and Atmospheric
Administration has taken steps to actively promote the use of
this particular tool through a draft policy and a Fiscal Year
2011 budget request of $54 million for a national catch share
program.
If funded, this would more than double the catch share
budget at the agency. Given the clear drive toward this one
fishery management tool, the Subcommittee held a hearing in
March on the need to carefully design and implement the catch
share programs to ensure their success as a conservation and
management tool.
At the hearing, there was common ground on the need for
better data and monitoring to make management decisions and
community involvement in setting goals. However, there was
limited agreement on the prioritization of catch shares over
other fishery management tools. Proponents argued that catch
share programs reduce bycatch and increase efficiency, while
opponents are concerned about fleet consolidation and the costs
of implementation.
What was clear was that once a catch share program is put
into place, it is very difficult to go back and address any
unintended consequences. Although these consequences are
difficult to predict, it is critical that we continue to
discuss the potential social and economic impacts of
implementing catch share programs. Today's hearing, therefore,
focuses on the individual community's experiences and concerns
related to the adoption of this fishery's management tool.
So, I look forward to hearing from our witnesses today to
gain a better understanding of fishing communities'
apprehensions and aspirations regarding catch share programs.
As we all know, in celebrating the 40th anniversary of Earth
Day today, stewardship of our resources begins locally. In
order to conserve our nation's fisheries, it is imperative that
the National Marine Fisheries Service consider the concerns of
the people who call our fishing communities home.
And I now would like to recognize Mr. Brown, the Ranking
Republican Member of the Subcommittee, for any opening
statement that he may have.
[The prepared statement of Chairwoman Bordallo follows:]
Statement of The Honorable Madeleine Z. Bordallo, Chairwoman,
Subcommittee on Insular Affairs, Oceans and Wildlife
Rebuilding fisheries has clear ecological and economic benefits for
fish, fishers, and fishing communities. To achieve these benefits,
fisheries must be managed using the best available science and a suite
of management tools, including, but not limited to ``catch shares''.
Catch share programs are one fishery management tool in which
fishermen, cooperatives, or communities are allocated a specific
portion of a total allowable fishing quota.
Management of fisheries using catch shares has thus far been
limited in the United States, with only fifteen existing programs that
have had mixed results. However, under the Obama Administration, the
National Oceanic and Atmospheric Administration has taken steps to
actively promote the use of this particular tool through a draft policy
and a Fiscal Year 2011 budget request of $54 million for a National
Catch Share Program. If funded, this would more than double the catch
share budget at the agency.
Given the clear drive towards this one fishery management tool, the
Subcommittee held a hearing in March on the need to carefully design
and implement catch share programs to ensure their success as a
conservation and management tool. At the hearing, there was common
ground on the need for better data and monitoring to make management
decisions, and community involvement in setting goals.
However, there was limited agreement on the prioritization of catch
shares over other fishery management tools. Proponents argued that
catch share programs reduce bycatch and increase efficiency, while
opponents are concerned about fleet consolidation and the costs of
implementation.
What was clear, was that once a catch share program is put into
place, it is very difficult to go back and address any unintended
consequences. Although these consequences are difficult to predict, it
is critical that we continue to discuss the potential socio-economic
impacts of implementing catch share programs. Today's hearing,
therefore, focuses on the individual communities' experiences and
concerns related to the adoption of this fisheries management tool.
I look forward to hearing from our witnesses today to gain a better
understanding of fishing communities' apprehensions and aspirations
regarding catch share programs. As we all know, in celebrating the 40th
anniversary of Earth Day today, stewardship of our resources begins
locally. In order to conserve our nation's fisheries, it is imperative
that the National Marine Fisheries Service consider the concerns of the
people who call our fishing communities home.
______
STATEMENT OF HON. HENRY E. BROWN, JR., A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF SOUTH CAROLINA
Mr. Brown. Good morning, Madame Chair, and Happy Earth Day.
Ms. Bordallo. Thank you.
Mr. Brown. Now, Madame Chair, as I mentioned in my
statement in the last catch share hearing, thousands of
recreational, charter, and commercial fishermen came to
Washington, D.C., in February to air their concerns about the
direction fishery management has taken in this country. Rarely
do we see all of these fishery sectors speaking with one voice,
but in this case, we did.
At a Subcommittee hearing on catch shares in March, we
heard a number of themes that were echoed by Members on both
sides of this dais--that better science is needed before
fishery managers can make good decisions; that more, not less,
funding for stock assessment is necessary; and the
Administration should not take funding away from important
science functions of the agency to fund a new catch share
initiative. While there may still be disagreements about
whether catch share management systems can or should be used in
certain areas of this country, I believe it is fair to say that
any effort to create catch share systems should not be dictated
from Washington, D.C.
If fishermen decide they are interested in some form of
catch shares, they should work within the Regional Fishery
Management Council system and within the existing rules in the
Magnuson-Stevens Act. However, before any catch share systems
are put in place, it is important that the agency has basic
information on the fishery. Some people like to forget that
NOAA is a resource management agency, and the agency has a duty
to fund the science that is necessary for these resource
management responsibilities.
Madame Chair, I know at the Subcommittee budget hearing, we
requested a breakdown on how the $17 million for catch share in
2010 is being spent and how the agency intends to spend the $54
million in Fiscal Year 2011. I don't believe we have received
that information yet, but I would also like to ask the agency
to provide us with how their Fiscal 2011 budget proposal will
be used to keep the Red Snapper Fishery open next year.
The Red Snapper Fishery is a clear example of management
decisions being made without adequate science, and those faulty
management decisions are having a huge impact on coastal
communities, including those of my congressional district.
Finally, Madame Chair, I would like to welcome all of our
witnesses, but in particular I would like to recognize Jim
Donofrio and Jeff Angers. I work with those two gentlemen on a
number of fishery-related issues and am pleased that they are
here today. With that, I yield back. Thank you, Madame Chair.
[The prepared statement of Mr. Brown follows:]
Statement of The Honorable Henry E. Brown, Jr., Ranking Republican,
Subcommittee on Insular Affairs, Oceans and Wildlife
Good morning, Madam Chairwoman, and Happy Earth Day.
Madam Chairwoman, as I mentioned in my statement at the last catch
shares hearing, thousands of recreational, charter, and commercial
fishermen came to Washington, DC in February to air their concerns
about the direction fisheries management has taken in this country.
Rarely do we see all of the fisheries sectors speaking with one voice,
but in this case, we did.
At the Subcommittee hearing on catch shares in March, we heard a
number of themes that were echoed by Members on both side of the dais--
that better science is needed before fishery managers can make good
decisions; that more, not less funding for stock assessments is
necessary; and that the Administration should not take funding away
from important science functions of the agency to fund a new catch
shares initiative.
While there may still be disagreement about whether catch share
management systems can or should be used in certain areas of the
country, I believe it is fair to say that any efforts to create catch
share systems should not be dictated from Washington, D.C. If fishermen
decide they are interested in some form of catch shares, they should
work within the regional fishery management council system and within
the existing rules in the Magnuson-Stevens Act. However, before any
catch share systems are put in place, it is important that the agency
has basic information on the fishery.
Some people like to forget that NOAA is a resource management
agency and the agency has a duty to fund the science that is necessary
for those resource management responsibilities.
Madam Chairwoman, I know at the Subcommittee's budget hearing we
requested a break-down of how the $17 million for catch shares in
FY2010 is being spent and how the agency intends to spend the $54
million in FY2011. I don't believe we have received that information
yet, but I would also like to ask the agency to provide us with how
their FY2011 budget proposal will be used to keep the red snapper
fishery open next year. The red snapper fishery is a clear example of
management decisions being made without adequate science and those
faulty management decisions are having a huge impact on coastal
communities--including those in my Congressional district.
Finally, Madam Chairwoman, I would like to welcome all of our
witnesses, but in particular, I would like to recognize Jim Donofrio
and Jeff Angers. I have worked with these two gentlemen on a number of
fishery-related issues and I am pleased they are here today.
Thank you, Madam Chairwoman.
______
Ms. Bordallo. I thank the gentleman from South Carolina,
Mr. Brown. And I would now like to recognize our first panel of
witnesses to testify. Our witnesses include Captain David T.
Goethel, Fishing Vessel Ellen Diane; Julian Magras, Chairman of
the Board, St. Thomas Fishermen's Association; Captain Wayne
Moody, Fishing Vessel Capriccio; and Jefferson Angers,
President of the Center for Coastal Conservation.
I would like to thank our witnesses for being here today.
And as we begin, I would note that the red timing light on the
table will indicate when five minutes have passed and your time
has concluded. We would appreciate your cooperation in
complying with these limits. Be assured, however, that your
full written statement will be submitted for the hearing
record.
And now, Mr. Goethel, welcome back to the Subcommittee, and
you may begin your testimony.
STATEMENT OF CAPTAIN DAVID T. GOETHEL,
FISHING VESSEL ELLEN DIANE
Captain Goethel. Thank you, Madame Chair. Thank you for the
invitation to testify on community perspectives on catch
shares. I am the owner/operator of a 44-foot dragger, the Ellen
Diane, of Hampton, New Hampshire. I am also a member of the New
England Fisheries Management Council, but I am speaking today
as a member of the New Hampshire commercial fishing community,
and not on behalf of the Council.
The number one priority our communities would like to see
established is our ability to continue to exist. As currently
constructed, Amendment 16 leaves not one vessel in New
Hampshire able to cover short-term operating expenses with the
quota they have received. In short, the effects of Amendment 16
on New Hampshire's fleet are predictable, catastrophic, and
unnecessary.
The reasons for this are many and varied. First, NOAA
Fisheries continues to define fisheries on a single-species
basis, rather than using the definition of a fishery in the
Magnuson-Stevens Act, which states the term ``fishery'' means
one or more stocks of fish which can be treated as a unit for
the purposes of conservation and management, and any fishing on
those stocks.
Thus, in New England, each fisherman has received an
individual allotment of each of the 12 species comprising 19
stocks of the multi-species ground fish fishery. All of these
fish swim together and cannot be caught in the prescribed
allotments. The practical implications of this are that catch
shares will result in massive under-harvesting of most species,
as people are forced to stop fishing when they have harvested
the species for which they have the lowest allocation, even
when that species may be a fully rebuilt stock, such as
haddock.
Second, the Council failed to fairly and equitably allocate
the fish, both between user groups--commercial and
recreational--and within the commercial fishery. By choosing a
straight catch history-based system and a time period in which
small boats were effectively shut out of the fishery by rolling
and permanent closures, differential counting of days at sea
and inshore areas, and were thus unable to establish catch
history, the Council effectively ceded control of the fishery
to large vessels, which could establish a history outside of
these inshore areas.
While I protested these actions vigorously at the Council
meetings, NOAA Fisheries, through its regional administrator,
Ms. Kurkul, and acting head of NOAA Fisheries, Dr. Balsinger,
sat silent and said nothing to remind the Council of its
responsibilities under National Standards 4 and 8 of Magnuson-
Stevens.
Finally, in response to my dissenting opinion filed with
the Secretary of Commerce in June of 2009, Mr. Schwaab, on
behalf of NOAA, responded with a letter, which arrived in my
mailbox two hours after notice of the availability of the final
rule for Amendment 16 on March 31, 2010, rendering further
discussion of their response useless. If allowed to stand
unchallenged, this will render National Standard 4 meaningless.
Thus, the small boat fishing communities of New Hampshire and
other regions are left to seek fair and equitable treatment
under the law through this committee and in lawsuits filed with
the courts.
For those boats that survive the initial consolidation, the
long-term costs of running sectors, once returned to the
fishermen, will ultimately cripple them. NOAA is proposing to
spend nearly $50 million on implementation of catch shares in
New England. The most recent ex-vessel value of the fishery is
$60 million for the fish proposed to be managed in Amendment
16. Thus, it is plainly apparent that absent long-term
government subsidies for monitoring costs, those costs render
the entire fishery non-viable.
Congress might also wish to consider that with the 150 to
200 new people being hired, combined with the existing staff at
the regional office, there are now more bureaucrats at NOAA
Fisheries than fishermen actively fishing. It is without a hint
of irony that I suggest NOAA should consider assigning each
fisherman his own personal bureaucrat who would do the catch
monitoring, observing, enforcement, VMS submissions, log books,
and other myriad requirements of sectors. This would increase
the viability of the program while dramatically lowering the
cost to both taxpayers and fishing communities.
As you can see by the aforementioned information and the
lack of consolidation controls in Amendment 16, my main concern
for the fishing communities in New England is their ability to
avoid consolidation long enough for Congress or the courts to
intervene. As Dr. Julia Olson of NOAA Fisheries stated in her
paper, which I have provided and urge the committee members to
read, the effects of consolidation, quote, ``range from
employment loss, decreased income, decreased quality of life,
changing relations of production, structural disadvantages to
smaller vessels and firms, dependency and debt patronage,
concentration of capital and market power, inequitable gains,
regulatory stickiness, reduced stewardship, decreased community
stability, loss of cultural values, and so on.''
Dr. Olson continues, ``Thus the question of capacity
reduction is ultimately not simply an issue of economic
efficiency, but a question of what values to promote and what
the future of the fishery and its fishing community should look
like.'' Catch shares are primarily an economic tool to force
consolidation. They do not, despite the millions of dollars
spent on public relation campaigns by major environmental
NGO's, necessarily produce better biological results than other
systems of management.
They do, however, radically reshape fishing communities if
adequately safeguards, such as consolidation caps and
allocation caps, are not made to ensure the viability of small
boat communities. NOAA Fisheries and the Regional Councils must
be ordered to provide these caps before the implementation of
catch share programs. Catch shares are set to begin May 1,
2010, in New England, with consolidation and the negative
social consequences to follow soon thereafter.
If you wish to preserve a way of life that has existed in
New Hampshire for over 400 years, iron men in small ships
putting little strain on the resource, but supplying a
relatively large number of jobs, it is time for NOAA Fisheries,
Congress, and the courts to fish or cut bait. Thank you.
[The prepared statement of Captain Goethel follows:]
Statement of Captain David T. Goethel, Owner/Operator,
Fishing Vessel ``Ellen Diane''
Dear Madam Chairwoman,
Thank you for the invitation to testify on community perspectives
on Catch Shares. My name is David Goethel and I am owner operator of
the 44 foot dragger the Ellen Diane of Hampton, New Hampshire. I am
also a member of the New England Fishery Management Council but I am
speaking today as a member of the New Hampshire Commercial Fishing
Community and not on behalf of the Council.
The number one priority our communities would like to see
established is our ability to continue to exist under a catch share
program. As currently constructed, Amendment 16 to the Groundfish plan,
leaves not one vessel in New Hampshire able to cover short term
operating expenses with the quota they have received. In short, the
effects of Amendment 16 on New Hampshire's fleet are predictable,
catastrophic and unnecessary.
The reasons for this are many and varied and I can only highlight a
few in the time allotted. First, NOAA Fisheries continues to define
fisheries on a single species basis rather than using the definition of
a fishery in the Magnuson-Stevens Fishery Conservation and Management
Act (99-659,101-627(13) A) which states, ``The term ``fishery'' means--
A. one or more stocks of fish which can be treated as a unit for
purposes of conservation and management which are identified on the
basis of geographical, scientific, technical, recreational, and
economic characteristics; and
B. any fishing for such stocks.''
Thus in New England each fisherman has received an individual
allotment of each of the twelve species, comprising nineteen stocks of
the multispecies groundfish fishery. All of these fish swim together
and cannot be caught, in the prescribed allotments. The practical
implications of this are that catch shares will result in massive under
harvesting of most species as people are forced to stop fishing when
they have harvested the species for which they have the lowest
allocation, even when that species may be a fully rebuilt stock such as
haddock. Second, the council failed to fairly and equitably allocate
the fish both between user groups, commercial and recreational, and
within the commercial fishery. By choosing a straight catch history
based system and a time period in which small boats were effectively
shut out of the fishery by rolling and permanent closures, and
differential counting of DAS in inshore areas, and thus unable to
establish catch history the council effectively ceded control of the
fishery to large vessels which could establish history, outside of
these inshore areas. While I protested these actions vigorously at the
council meetings NOAA fisheries through its Regional Administrator Ms.
Kurkul, and acting head of NOAA Fisheries Dr. Balsinger sat silent and
said nothing to remind the council of its responsibilities under
National Standard 4 and 8 of Magnuson-Stevens. Finally, in response to
my dissenting opinion, filed with the Secretary of Commerce in June
2009, Mr. Schwaab, on behalf of NOAA, responded with a letter which
arrived in my mailbox two hours after notice of the availability of the
final rule for Amendment 16, on March 31, 2010 rendering further
discussion of their response useless, except through the courts. If
allowed to stand unchallenged this will render National Standard 4
meaningless also. Thus the small boat fishing communities of New
Hampshire and other regions are left to seek fair and equitable
treatment under the law through this committee and in lawsuits filed
with the courts.
For those boats that survive the initial consolidation the long
term costs of running sectors, once returned to the fishermen, will
ultimately cripple them. NOAA is proposing to spend nearly 50 million
dollars on implementation of catch shares in New England. The most
recent ex-vessel value of the fishery is 60 million dollars for the
fish proposed to be managed in Amendment 16. Thus, it is plainly
apparent, that absent long term subsidization of monitoring costs,
those costs render the entire fishery nonviable. Congress might also
wish to consider that with the 150-200 new people being hired, combined
with the existing staff at the regional office, there are now more
bureaucrats at NOAA Fisheries then fishermen actively fishing. It is
without a hint of irony that I suggest NOAA should consider assigning
each fisherman his own personal bureaucrat who would do the catch
monitoring, observing, enforcement, VMS submissions, log books and
other myriad requirements of sectors. This would increase the viability
of this program while dramatically lowering the cost to both tax payers
and fishing communities.
As you can see by the aforementioned information and the lack of
consolidation controls in Amendment 16 my main concern for fishing
communities in New England is their ability to avoid consolidation long
enough for Congress or the Courts to intervene.
As Dr. Julia Olson, of NOAA Fisheries Northeast Fishery Science
Center states in her paper, which I have provided and urge the
committee members to read, the effects of consolidation, ``range from
employment loss, decreased income, decreased quality of life, changing
relations of production, structural disadvantages to smaller vessels
and firms, dependency and debt patronage, concentration of capital and
market power, inequitable gains, regulatory stickiness, reduced
stewardship, decreased community stability, loss of cultural values,
and so on.''
Dr. Olson concludes that same introductory paragraph with, ``Thus
the question of capacity reduction is ultimately not simply an issue of
economic efficiency, but a question of what values to promote and what
the future of the fishery and its fishing communities should look
like.''
Catch shares are primarily an economic tool to force consolidation.
They do not, despite the millions of dollars spent on public relations
campaigns by major Environmental NGO's, necessarily produce better
biological results, than other systems of management. They do, however,
radically reshape fishing communities if adequate safeguards such as
consolidation caps and allocation caps are not made to ensure the
viability of small boat communities. NOAA Fisheries and the Regional
Councils must be ordered to provide these caps before the
implementation of catch share programs. Catch shares are set to begin
on May 1, 2010 in New England with consolidation and the negative
social consequences to follow soon thereafter. In fact the
consolidation has already begun. If you wish to preserve a way of life
that has existed in New Hampshire and New England for over 400 years,
iron men in small ships putting little strain on the resource but
supplying a relatively large number of jobs, it is time for NOAA
Fisheries, Congress and the Courts to fish or cut bait.
[NOTE: A paper by Dr. Julia Olson, NEFSC, entitled ``Social Impact
Assessment Literature Review: Leasing and Permit Stacking'' dated
August 5, 2009, submitted for the record has been retained in the
Committee's official files.
______
Response to questions submitted for the record by David T. Goethel,
Captain, Fishing Vessel Ellen Diane
Questions from Congressman Jay Inslee (D-WA)
1. This is the second hearing that we have had on catch share fishery
management programs, so there has been a lot of discussion
about catch shares. But I'm not sure we have heard from many
witnesses that actually have participated in catch share
programs. Can you tell me your experience fishing in a catch
share program? Do you have a federal permit to fish in a catch
share managed fishery?
Answer from David Goethel: I am participating in the catch share
program and I am a member of NH Sector XII. However I have not left the
dock yet (gone fishing since the system went into effect on May 1,
2010) because I have so little white hake and winter flounder
allocation, that in one day of fishing I could exceed my yearly quota
of these species and would be shut down and potentially fined if no one
within my sector has fish to cover the overage. I also only have 1600
pounds of haddock, a fully rebuilt stock, despite having over 50,000
pounds of cod. There is currently no trading mechanism between sectors
and other members of my sector have less allocation than I do. Until I
can buy some of these species from some other sector or until some
other remedy is offered I cannot fish. NMFS was supposed to have the
trading and purchasing mechanism up and running before the sector
program went into effect on May 1st. As of today May 16, 2010 there is
no effective way to allow the trading or purchase of allocation. The
National Marine Fisheries Service has decided through its
administrative rules for sectors that even when the trading mechanism
is in place that no one in a sector may trade or purchase allocation
unless every member of a sector (active or inactive) have submitted
their logbooks for that week. This will tie boats to the dock possibly
for months until it is straightened out. (See enclosure provided)
I have one federal fishing permit which I fished as actively as
possible throughout the qualification period. In addition, I have two
permits I purchased before the idea of catch shares. They turn out to
have virtually no catch history rendering them almost worthless despite
having a fairly large number of Days at Sea from the old program. Thus
I am hampered from purchasing quota under the new system (when a
mechanism is finally put into place) because I am still paying for now
worthless Days at sea from the old system.
Finally, the Regional Office should be credited with putting this
incredibly complex program together in a very short period of time.
This has not allowed any pretesting of the components prior to
implementation. As with any complex system, bugs are occurring
regularly which only add to participant's anger and frustration.
2. You wrote a letter to the New England Fishery Management Council
last June in which you stated that Amendment 16 to the Groundfish FMP
is ``vital to ongoing efforts to rebuild New England groundfish
stocks.'' But you took issue with the qualifying periods used to
allocate the TAC to the various sectors, a situation you stated ``could
have easily been remedied by establishing a common, fair and equitable
baseline of 1996-2006 for all user groups.'' Would you therefore have
voted in favor of Amendment 16 if it used the qualifying period you
suggested to allocate TAC for all user groups?
Answer from David Goethel: At that time I would have voted for
submission if we had established an equitable period to divide the
commercial and recreational fishery and provided the commercial fishery
fair currency exchange between A days at sea and stocks landed. From
the industries perspective this was the most critical element of the
change in management strategies and the most important in maintaining
continuing community access. As such, allocation formulas require
extreme transparency so that the public can see that council members
have represented all the public not just their own or their states
special interests. In my opinion, the New England Council failed in
this critical situation.
If, however, the vote had been held after we understood the
monetary costs of this program, combined with the impossibility of
making it work on a single species basis I still would have cast a vote
against submission.
Questions from Republican Members
1. Dr. Rothschild predicts that there will be a 50% drop in employment
due to the new sector system Do you think he's accurate?
Answer from David Goethel: I believe the number will be more like
80% of captains and crew if this program is not revised. When you
figure in the number of dockside monitors, observers, sector managers
and bureaucrats hired from outside the fishing industry to run sectors,
the net employment loss may be 50%.
2. Some have argued that the New England fishing fleet is too large to
be economically viable and that even without a change to a
sector system, a large number of fishermen will go out of
business. Do you think a reduction in the fishing fleet was
inevitable and if so, what effect on the coastal communities
would this have? If not, why not?
Answer from David Goethel: The fleet has shrunk from 1800 boats at
the start of limited entry to 550 which currently have a VMS and thus
are allowed to land groundfish. I believe the fleet would have
continued to contract slowly to around 450 boats if we had continued
with DAS. I believe this is a sustainable number of vessels if the
vessel size distribution is maintained. However, no one including NMFS,
has a clear idea of a sustainable fleet composition. I think the fleet
under sectors will contract to 100-200 primarily large vessels in large
ports. Small ports will lose all of their vessels because many do not
have enough fish allocated to be viable and any that are left will not
be able to pay to keep the infrastructure in place. If we had provided
a straight conversion of A days to stocks landed most of the smaller
vessels as well as many of the larger vessels would be more likely to
survive in the short term. However, since sectors are all about
economics and not biology, ultimately a handful of wealthy large
players will emerge.
3. Dr. Rothschild expresses a concern about ``wasted'' bycatch'' that
is thrown overboard rather than landed. That raises an
interesting dilemma on how to reduce wasted bycatch without
encouraging targeting bycatch species. How do you propose NMFS
deal with this?
Answer from David Goethel: I have always felt that zero, or very
low possession limits i.e. below what people can reasonably stay away
from when targeting other species, are counterproductive. Littering the
ocean with dead fish solves nothing and probably hinders rebuilding.
However this is a strategy favored by NMFS because it is easily
enforced. I favor low trip limits that will not encourage targeting the
species and thus waste as little as possible. There are usually clear
breakpoints in the landing data that indicate bycatch amounts versus
directed trips. With zero possession limits you have an added
scientific problem of insufficient catch for sampling to do required
analysis for stock assessments.
Finally it is ironic that the chief selling point of sectors, the
elimination of regulatory discards, will be largely negated by the
creation of choke species by single species ACL's. Fishermen have been
given a very positive economic incentive to discard species for which
they have very little quota in order to achieve overall maximum
utilization of their multispecies TAC;s.
4. The changes to the Magnuson-Stevens Act which require individual
fishery accountability were an effort to change the balance
between ecological concerns and economic concerns. Do you think
the language in Magnuson went too far? If so, what should
Congress look at to correct this balance?
Answer from David Goethel: The problems are not necessarily with
Magnuson but with NMFS interpretation and the guidelines they produce
for the councils. The chief problem in New England is that NMFS insists
on managing a multispecies fishery on a single stock basis. I believe
the definition of a fishery under Magnuson already exists. (please
reference my written April 22 testimony) If NMFS can be ordered to use
this definition as written with a letter that is the simple solution.
If not, then Magnuson will have to be amended to say that a
multispecies fishery will be managed using multispecies ACL's and AM's
and a multispecies TAC.
The second area of Magnuson that needs clarification is the Limited
Access Privilege Program (LAPP's) NMFS interpretation that sectors are
not LAPP's flies in the face of common sense. Congress should clearly
state that anytime you allocate fish, in any way, on an individual
vessel basis, that it is a LAPP and requires a referenda. This will
force councils to allocate fish fairly, and burden the industry with
minimal costs in order to secure a positive vote. My suggestion, if
NMFS refuses to deal with these issues, with a letter from the
committee, would be to add the corrective language to a bill already in
Congress and amend Magnuson, rather than begin a full scale
reauthorization.
It has become apparent to many of us involved in fishery management
that there is no effective feedback loop between the oversight
authority of Congress and the guidelines published by NMFS after
passage of Magnuson. Congress needs to clearly assert its oversight
authority so that NMFS guidelines do not subvert or modify the will of
Congress as expressed in Magnuson. The easiest way I can see to
accomplish this is through Congressional hearings on proposed
guidelines prior to publication as final rules.
5. Some fishermen have complained about the new accountability
measures being implemented by NMFS. Do you also have concerns,
and if so, what are your specific concerns? What suggestions
would you give Congress to correct these concerns?
Answer from David Goethel: I do not have major concern with
accountability measures other than a preference for ratcheting down
both commercial and recreational fisheries as ACL's are approached. As
always NMFS prefers administratively simple solutions such as a fishery
opening or closure. I prefer measures such as changing the differential
counting rate of days in DAS for the commercial fishery or descending
bag limits in recreational fisheries that keep the fisheries open, but
on a reduced scale, throughout the year. My greater concern is the
amount of fish being taken off the table in the ACL setting process for
science and management uncertainty. I believe ACL's should be set just
slightly below the OFL and that NMFS should direct less money to
administrative issues and more to reducing scientific uncertainty.
6. It seems that all of the panelists today would agree that prior to
implementing a catch share management system, NMFS must have
good data on the status of the fishery, the ecological needs of
the fishery, and the economic needs of the fishery. Does NMFS
have this type of information on New England groundfish? If
not, how can they effectively implement a totally new system?
Answer from David Goethel: The problem with sectors in New England
was the ``fire, ready, aim'' approach used in their creation. What
should be done is, when considering a new approach to management, is to
assess what data will be required, and determine if it is available in
useable form. If not, audit, update and correct the data before
proceeding. In New England, because of the rush to pass Amendment 16,
this was not done. Instead major flaws such as, assigning catch history
from a faulty landings data stream, and forcing vessels to live with
it, have been exposed. This has caused hardship, anxiety and anger.
The economic and social data, which is used to determine effects on
communities, needs major updating. First it is set up to produce
aggregate information on community averages. Communities are made up of
individuals who often have no relation to the average what so ever.
This will require administrative changes within NMFS so that economic
and social scientists can have access to individual vessel data.
Currently we cannot even get aggregate information on harbors with less
than three vessels. These are usually the communities most severely
impacted by changes in management.
7. According to a NOAA document, they are suggesting that there are 8
potential catch share programs that may be developed or
implemented in the next two fiscal years (not including the
groundfish multi-species fishery). These include: sea scallops
general category, monkfish, whiting/hake, sea scallops sectors,
herring, dogfish, mahogany quahogs, and skates. Do you have any
comments on this list or the fact that NMFS believes catch
shares would work in these fisheries?
Answer from David Goethel: NMFS is irrationally consumed with catch
share fever at the moment. The council, on the other hand has received
an intervention after hitting rock bottom with New England groundfish,
and is currently suffering withdrawal. Absent, virtual unanimous
approval of sector management as a preferred way of management by a
fishery, I doubt the council will impose sector management on that
fishery. Fisheries such as monkfish, herring and scallops, that had
expressed an interest in sectors several years ago, have told the
council in no uncertain terms that they want nothing to do with sectors
after seeing what happened with groundfish. This is unfortunate because
the concept could work in some fisheries with a careful, methodical,
well conceived management plan that is voted on by industry in a
referendum. Instead because New England was rushed to please the boss
and pass a poorly thought out program they have rendered sectors toxic
to an entire generation of fishermen across all New England fisheries.
New England has a memory like an elephant. We had to wait 30 years for
an entire generation of fishermen to move through the groundfishery
after a poorly thought out and executed quota system was adopted in the
1970's. I hope we have not created a similar situation with sectors.
______
Ms. Bordallo. Thank you, Mr. Goethel, for a very
interesting testimony and for further explaining how
consolidation can occur under catch share programs.
Before we begin with the next witness, for those standing
in the back of the room, if you would care to sit, there are
seats around the lower table here. This may be a long hearing.
You are more than welcome to be seated here.
Mr. Magras, it is good to see you again as well, and you
may begin with your testimony.
STATEMENT OF JULIAN MAGRAS, CHAIRMAN OF THE BOARD, ST. THOMAS
FISHERMEN'S ASSOCIATION
Mr. Magras. I testify before you today on the response of
the St. Thomas fishing community to pressures to implement
catch shares by the National Marine Fisheries Service and the
Caribbean Fishery Management Council.
We do not support the application of catch shares in the
Virgin Islands, as we believe that they would simply be another
device to build justifications for further Draconian catch
reductions by agencies that have already used their own
failures over past decades as justification for punishing
Virgin Islands fishermen.
The St. Thomas Fishermen's Association is an entirely
voluntary, not-for-profit corporation organized in 2005 under
VI law. It was established for the purpose of involving VI
fishermen in the management process and created greater
understanding by fishermen on the matter of fishery management.
A secondary purpose was to increase understanding of Virgin
Islander fisheries by fishery managers.
Our first response when the idea of catch shares was put
forward was positive. We felt that a cohesive group of
fishermen in the STFA had already demonstrated a willingness to
take responsibility for management of their resource. For
example, in the past five years, we have formed the STFA,
attending every CFMC meeting, many technical meetings, and
participated actively in the management process. We carried out
pioneering studies of bycatch from all fisheries and created
information for the first time regarding bycatch rates,
species, and mortalities.
We carried out a pilot study for the development of escape
vents from fish traps. In association with NOAA's biogeographic
program, we are carrying out a study on trap loss, ghost
fishing, and possible retrieval of lost traps. We have just
been awarded funding from NMFS' co-active resource program to
finalize escape-vent design.
STFA members on their own initiative have begun an effort
to reduce the number of traps being used in the fishery. In
other words, the STFA has become a force for sustainable
management, which could effectively take responsibility for
management of its own resource base. In addition, STFA members
dominate local fisheries, so actions taken by the association
could effectively control effort within those fisheries.
At the April Council meeting, we stated that the STFA views
management of our resources as a partnership, where we
participate with the Council in setting standards for
performance within our fisheries and are then responsible for
meeting those standards. At the same meeting, we clearly saw
that we are the only ones who view the management process as a
partnership, as the NMFS regional office introduced sweeping
conceptual changes in the ACL process, and the CFMC simply
rubber-stamped the new proposals without any attempt to justify
or understand the need for such changes.
Our own requirements for in-season landings data were
simply ignored. Our partnership, then, is one where the
regional office makes the decisions, which opted for three
years for data analysis, and then punishes the fishermen with
accountability measures. For us, this is the problem with catch
shares. It represents a partnership with someone we know to be
untrustworthy.
Madame Chairwoman, a second problem arises from the fact
that catch shares almost always leads to consolidation within
the fishery. Virgin Islanders have been fishing here for nearly
four centuries. Local seafood was the only source of protein
for much of that time, and generations of Virgin Islanders have
built a culture and cuisine around a highly diverse resource
base.
Currently, there are both commercial and subsistence
elements to the fishery. Consolidation could lead to the exit
of these traditional fishermen and create a public health risk
for the community. It could also lead to imports, which could
displace the local industry entirely.
The cultural relationship between the populace and the
fishermen is strong, as evidenced by petition response and
continuous interaction. Consolidation within the fishery would
inherently damage the relationship, unless a totally local
entity was managing the catch share program.
In summary, if there is to be any chance for catch shares
in the Virgin Islands, there must be a considerable effort to
strengthen the possibility for partnership, and we ask this
community to create some impetus for this strengthening. I
again thank you for your consideration of these concerns.
[The prepared statement of Mr. Magras follows:]
Statement of Julian Magras, Chairman of the Board,
St. Thomas Fishermen's Association
Madame Chairwoman, Members of the Subcommittee, I greatly
appreciate the opportunity to testify before you today the response of
the St. Thomas fishing community to the National Marine Fisheries
Service (NMFS) and the Caribbean Fishery Management Council. (CFMC) to
pressures to implement catch shares.
The manner in which these actions are being taken show a
significant disregard for the Virgin Islands culture and community,
disregard for facts on the ground, and (we believe) are simply
attempting to build justification for further draconian catch
reductions by agencies who have already used their own failures over
past decades as justification for punishing Virgin Islands fishermen.
St. Thomas Fishermen's Association
The St. Thomas Fishermen's Association is an entirely volunteer
not-for-profit corporation organized in 2005 under Virgin Islands law.
It was established for the purpose of involving Virgin Islands
fishermen in the management process and creating greater understanding
by fishermen on the matter of fishery management and by fishery
managers of Virgin Islands fisheries. In addition, the STFA has carried
out a number of federally funded studies addressing bycatch and trap
fishing as a means to involve our member fishermen in all aspects of
the management process, including data acquisition, development of
management recommendations from study data and involvement of those
recommendations in the management process.
We raise funds to support member attendance at fishery management
meetings by holding raffles, dances and our annual ``Fishermen's Fun
Day'' event. The STFA is not an opposition organization but one seeking
intelligent and sustainable management of Virgin Islands fishery
resources.
The STFA has broad community support. A petition circulated prior
to the 2005 SFA Public Hearing was signed by over 6000 Virgin Islands
citizens. Our Delegate to Congress Donna M. Christiansen, Governor John
P. deJongh Jr. and local Senators regularly act in support of the
issues facing the Association and our efforts have been covered by both
local and national media. Actions taken by the STFA and by our
supporters can be found at http://www.stfavi.org/CurrentIssues.html .
Until about a year ago, our relationship with the CFMC and NMFS had
been one of collaboration and cooperation. However as the 2010 Magnuson
deadline for ACL establishment began to approach, NMFS and the Council
became less interested in a collaborative relationship and began a
unilateral effort to impose their uninformed view of Virgin Islands
fisheries. For our part, we began an active effort to resist such an
approach and return to the climate of productive cooperation which
existed in the past.
Catch Shares: Initial Response
Our first response when the idea of catch shares was put forward
was positive. We felt that the cohesive group of fishermen in the STFA
had already demonstrated a willingness to take responsibility for
management of their resource. For example, in the past five years we
have:
1. Formed the STFA and attended every CFMC meeting, many technical
meetings and participated actively in the management process.
2. We carried out pioneering studies of bycatch from our fisheries
and created information for the first time regarding bycatch rates,
bycatch species and mortality rates.
3. We carried out a pilot study for development of escape vents
from fish traps.
4. In association with NOAA's Biogeography Program we are carrying
out a study of trap loss, ghost fishing and possible retrieval of lost
traps.
5. We have just been awarded funding the NMFS' Cooperative
Research Program to finalize escape vent design.
6. STFA members, on their own initiative have begun an effort to
reduce the number of traps being used in the fishery.
In other words, the STFA has become a force for sustainable
management which could effectively take responsibility for management
of its resource base. In addition, STFA members dominate local
fisheries so actions taken by the Association could effectively control
effort within those fisheries.
Catch Shares: Concerns
At the April Council meeting we stated that ``the STFA views
management of our resources as a `partnership' where we participate
with the Council in setting standards for performance within our
fisheries and are then responsible for meeting those standards.''
At the same meeting we saw clearly, that we are the only ones who
view the management process as a partnership as the NMFS Regional
Office introduced sweeping conceptual changes in the ACL process and
the CFMC simply rubber stamped the new proposals without any attempt to
justify or understand the need for such changes. Our own requirements
for in-season landings data were simply ignored. Our ``partnership''
then is one where the Regional Office makes the decisions, waits up to
3 years for data analysis and then punishes fishermen with
accountability measures.
For us, this is the problem with catch shares-it represents a
partnership with someone we know to be untrustworthy. We will provide
more discussion on this matter.
Madame Chairwoman, a second problem arises from the fact that catch
shares have invariably led to consolidation within the fishery.
Virgin Islanders have been fishing here for nearly 4 centuries.
Local seafood was the only source of protein for much of that time and
generations of Virgin Islanders have built a culture and cuisine around
a highly diverse resource base.
The cultural relationship between the populace and the fishermen is
strong as evidenced by petition response and continuous interaction.
Consolidation within the fishery would inherently damage that
relationship unless a totally local entity were managing the catch
share program.
Currently there are both commercial and subsistence elements to the
fishery. In addition, St. Thomas has ciguatera fish poisoning in some
areas and consumers rely on fishermen (who market directly to their
customers) to protect them from risk because of their knowledge and
expertise. Consolidation could lead to the exit of these traditional
fishermen and create a public health risk for the community. It could
also lead to imports which could displace the local industry entirely.
In summary, if there is to be any chance for catch shares in the
Virgin Islands there must be a considerable effort to strengthen the
possibility for partnership. We ask that this committee create some
impetus for this strengthening.
Who's going to partner in a Catch Shares Program?
The entire Council process has been corrupted and cannot, at
present, suggest that it could be trusted as a partner in a catch share
program.
1. We have already described how the Regional NMFS Office simply
determines the agenda for the Council. Council members just vote as
directed.
2. NMFS Southeast Fishery Science Center discarded nearly 40 years
of Virgin Islands landings data despite the fact that it was they who
were responsible for funding, managing and monitoring the program.
3. The Council itself discriminates against the Virgin Islands
despite the fact that 89% of its jurisdiction is in Virgin Islands
waters.
4. Last year for every hotel room filled in the Virgin Islands,
five were filled in Puerto Rico.
5. There have only been two persons with ties to the Virgin
Islands employed by the Council throughout the past 34 years.
6. Because Puerto Rico has a 9 mile Territorial Sea and the Virgin
Islands only has a 3 mile limit, Council Regulations mainly affect
Virgin Islands fishermen.
7. Recently the Council Chairman, slandered our Chief Scientist
and lied about the Virgin Islands Conch Quota to the Scientific and
Statistical Committee on the record.
8. Illegal payments have been made to ``State'' government
employees and NMFS and the DOC IGs office are apparently attempting to
cover this up.
We could continue on, with data mistakes by the Virgin Islands
Division of Fish and Wildlife, the Southeast Fishery Science Center but
the list is already longer that it should be.
We cannot enter into a catch shares arrangement with people like
this. We view such a relationship where we would be provided with
misleading information by people waiting for us to fail and who would
eventually close the entire fishery, ending centuries of careful
fishing by Virgin Islands fishermen.
Summary:
All of these points have been raised with NMFS, CFMC and the SEFSC
and subsequently ignored. In fact, NMFS seems to be determined to
manage Virgin Islands fisheries by remote control with as little input
from the Territory as possible.
In the past year alone, STFA members have spent around 7 man months
attending various NMFS and CFMC meetings, mostly at our own expense. At
no point, has any of our input been considered or affected any decision
coming from the meetings. In large part, NMFS and SEFSC participants
come to these meetings with their conclusions already determined.
The Virgin Islands is fortunate that our Delegate Donna M.
Christiansen and Governor John P. deJongh Jr. have taken an active and
advocative interest in our situation. The Delegate has attended many of
the CFMC meetings and spent time with the fishermen on all of the
Virgin Islands. Recently she applied for designation of the Virgin
Islands as ``Fishing Communities'' under the Magnuson Act. Such
designation would provide a requirement that the CFMC consider
community and socio-economic impacts fully when implementing management
measures. This would be a small step, but a significant one in
requiring that our concerns be considered. We wish to note that the
Regional Director broached such designation at the April Council
meeting.
It is our hope in providing this testimony; that NMFS can begin to
realize that government should serve the public and the resource users
not simply impose its will through setting arbitrary standards for
inconvenient data sets. The best management decisions will come from
collaboration between fishery managers and stakeholders.
We do not support application of Catch Shares in the Virgin Islands
until such time as systemic problems within the NMFS/CFMC/Territorial
Government nexus are resolved and we could be involved in a
relationship with a trustworthy partner in guaranteeing sustainable
management of Virgin Islands Resources.
Thank you for this opportunity to address the Committee today.
______
Response to questions submitted for the record by Julian Magras,
Chairman of the Board, St. Thomas Fishermen's Association
Questions from Congressman Jay Inslee (D-WA)
1. This is the second hearing that we have had on catch share fishery
management programs, so there has been a lot of discussion
about catch shares. But I'm not sure we have heard from many
witnesses that actually have participated in catch share
programs. Can you tell me your experience fishing in a catch
share program? Do you have a federal permit to fish in a catch
share managed fishery?
Answer: There are no catch share fisheries in the Virgin Islands.
Also, because we do not trust NMFS/NOAA we are unlikely to enter in to
any such agreement.
Questions from Republican Members
1. What fisheries do your members fish in and what types of gears do
they use?
Answer: St. Thomas Fishermen's Association members fish for reef
fish, small pelagics, lobster and some queen conch. The primary gear
are West Indian fish traps and plastic lobster traps with handlines and
a small unique seine fishery making up the remainder.
2. How does NMFS collect data in your fisheries to determine harvest
levels?
Answer: Data are provided through a mandatory catch reporting
system and through port sampling. Both of these are funded by NMFS but
implemented by the Territorial Division of Fish and Wildlife. Data has
been collected since 1974 and reviewed annually by NMFS' South East
Fishery Science Center. In 2009, the SEFSC decided that the data could
not be used in setting ACLs and that local fishermen should be punished
for ``data uncertainty'' by reductions in ACL values. It is our
contention that any data uncertainty is the result of SEFSC and DFW
failures as fishermen have met every requirement for reporting for
nearly four decades. We are requesting your Subcommittee to investigate
how agency failures can be translated into punishing fishermen.
3. Are any of your fisheries considered overfished? If so, do you
agree with the determination?
Answer: In the 2005 Sustainable Fisheries Act Amendment a number of
species were determined to be ``overfished'' and management actions
taken (area closures and closed seasons) to address this supposed
overfishing. No data from the Virgin Islands was used in this
determination and ``informed judgment'' (read that as unsubstantiated
opinion) was the supposed ``process'' used to make these determination.
In every case, the ``overfished'' determination was intended to address
a specific fishery issue including spawning aggregations, a Puerto
Rican fishery for deep water snappers, conch and a St. Croix net
fishery for parrot fish. All of these fisheries have been closed now
for 3-5 years and yet the CFMC has taken no effort to reevaluate
status. Our position is that the 2005 actions addressed overfishing and
that these fisheries are no longer overfished (if they ever were in the
first place).
In the April 2010 CFMC meeting NMFS' Regional Director unilaterally
changed the entire management scenario and included all groupers,
snappers and parrot fish into single management units even thought the
bulk of affected species were not included in the ``overfished''
species units. In essence he co-opted and over rode five years of
Council deliberations and decisions. The document was only provided to
Council members at the meeting and they acceded to his scheme.
The only exception to this is the St. Croix conch fishery where
serious overfishing led to a Territorial quota in 2007. To date, the
CFMC has not implemented a compatible closure in Federal waters and
this has seriously compromised Territorial efforts to manage this
fishery.
4. Some fishermen have complained about the new accountability
measures being implemented by NMFS. Do you also have concerns,
and if so, what are your specific concerns? What suggestions
would you give Congress to correct these concerns?
Answer: Since ACLs are not in place, we have yet to see
Accountability measures. However, the current management scenario
involves a 3 year delay by the SEFSC in analyzing Virgin Islands data
so that fishermen will not have an opportunity to alter their fishing
practices during any given season and avoid the need to accountability
measures. Since we continue to see arbitrary and unfettered
manipulation by the Regional Director, we expect that he will find an
excuse to implement accountability measures as soon as he can justify
action.
Additionally, current efforts to ``improve'' data collection have
excluded fishermen from providing input and there is a very distinct
likelihood that NMFS will find justification to discard future data,
thereby leading to implementation of accountability measures.
A final comment. It is our position that the best management of
Virgin Islands resources will come from collaboration between fishermen
and fishery managers. We make this position at every opportunity but
are rebuffed and insulted. The Virgin Islands community has strong
cultural ties to local seafood and local fishermen and NMFS and the
CFMC can look forward to a long and acrimonious struggle in the Virgin
Islands until they wake up and change course.
______
Ms. Bordallo. Thank you, Mr. Magras, for your testimony and
explaining your concerns with catch shares in the Caribbean.
Mr. Moody, please begin your testimony, and thank you for being
here.
STATEMENT OF CAPTAIN WAYNE MOODY,
FISHING VESSEL CAPRICCIO
Captain Moody. Thank you. Good morning, Madame Chairwoman,
honorable Members of Congress, fellow witnesses, and
distinguished guests. My name is Wayne Moody, and I feel
privileged to be here today to give testimony on catch shares
from a community perspective.
I started commercial fishing out of Port San Louis,
California in 1974. Our present boat is a 53-foot fiberglass
trawler that my wife and I fish out of Morro Bay for salmon and
albacore. I am on the board of the directors of the Morro Bay
Commercial Fishermen's Organization. I hope to give the
Subcommittee an understanding of Morro Bay's perspective
regarding catch shares and our community's recommendations for
critical elements of the West Coast trawl individual
transferable quota, or ITQ, program that are necessary to
address our concerns.
In 1985, approximately 15 million pounds of seafood
products were landed in Morro Bay and its sister harbor, Port
San Louis, 12 miles to the south--mostly groundfish, with an
ex-vessel value of almost $19 million. By 2006, landings had
dropped to 1.2 million pounds, with an ex-vessel value of
approximately $2.9 million. In 2005, the Nature Conservancy, or
TNC, entered into discussion with local trawlers and ended up
purchasing their permits and idling them.
Without trawl landings, the new $900,000 icehouse we just
built, our one fuel facility, and our fish dock, we are losing
money. Our port infrastructure was about to collapse. Morro Bay
was getting a preview of what consolidation of the trawl
groundfish industry might do to small coastal communities.
Realizing our plight, TNC, along with fishermen and community
leaders, started working together putting the permits back to
work in and for the community.
The Central Coast Groundfish Project was started to
establish a community-based fishing group to provide for long-
term economic and ecological sustainability of the Morro Bay/
Port St. Louis groundfish fishery. An exempted fishing permit,
or an EFP, was obtained to use some of the permits with fixed
gear that historically had been used. More importantly, the EFP
tested out important elements for the then-underway West Coast
trawl ITQ program by working with fishermen on gear switching,
share and observer costs, improving log book performance, and
testing of electronic monitoring systems.
I would be remiss in my obligation to my community if I
didn't mention some of their real concerns about catch shares.
Besides the concern about cost and availability of the permits,
or the shares, and fleet consolidation, there is a concern of
catch share owners scheduling and catching their groundfish
around other fisheries in order to maximize their participation
in those other fisheries. And once catch shares are allocated,
then traded, leased, and sold, it will be very hard to change
the program, especially in reference to ownership of the
shares. It is basically a one-way street, and there is not much
room to turn around.
We recognize the need to reduce fishing effort on weak
stocks and to concentrate on the healthy stocks, and this is
exactly what the EFP gear switching portion was meant to do--
target specific healthy stocks while avoiding those of concern.
Small ports needs the flexibility to anchor quota in
communities with historic landings. Community fishing
associations, or CFAs, can provide that protection and halt
those communities from losing landings, port revenues, and
employment in the transition to rationalization.
The huge costs in the West Coast ITQ program is the use of
100 percent observer coverage. The cost of $300 to $600-plus
per day for an observer can only be paid by the larger vessels.
One method proven in other countries, at one-third the cost of
human observers, is the use of cameras. To make the West Coast
trawl catch share program work for fishermen and small coastal
communities, National Marine Fisheries needs to encourage and
help facilitate at least these three things.
Number one, CFAs need to be properly formed, and
regulations put in place in order for them to owe more than the
individual quota share limits. This would allow them to
stabilize their fishery economies. Number two, develop,
certify, and appropriate funds for cost-effective, onboard
electronic monitoring systems to be used by the small boat
fleet. And number three, set aside adaptive management
allocations and provide flexibility in catch share programs to
allow for community impacts.
Thank you for allowing me to speak for my small coastal
community.
[The prepared statement of Captain Moody follows:]
Statement of Wayne Moody, Member, Board of Directors,
Morro Bay Commercial Fishermen's Organization
Good morning, Madam Chairwoman, Honorable Members of Congress,
fellow witnesses, and distinguished guests. My name is Wayne Moody and
I feel privileged to be here today to give testimony on Catch Shares
from a Community Perspective.
I started my commercial fishing career out of Port San Luis,
California in 1974 and have fished for sea urchins, abalone, crabs,
rockfish, salmon, and albacore. Our present boat is a 53' fiberglass
troller that my wife and I fish out of Morro Bay, California for salmon
(regulations permitting) and albacore. I currently sit on the board of
directors of the Morro Bay Commercial Fishermen's Organization, with
approximately 90 members.
I hope to give the members of the Subcommittee an understanding of
Morro Bay's perspective regarding catch shares and our community's
recommendations for critical elements of the West Coast Trawl
Individual Transferrable Quota (ITQ) program that are necessary to
address our concerns.
I would like to begin by providing some background regarding Morro
Bay's fishing community.
In 1985 approximately 15 million pounds of seafood products were
landed in Morro Bay and its sister harbor, Port San Luis, with an ex-
vessel value of almost $19 million. Much of the seafood delivered into
Morro Bay and Port San Luis was groundfish that was harvested by
smaller vessels using highly selective fixed gear.
During the 1980s, trawl fishing effort in our region increased, in
part because of government subsidies that encouraged fishermen to
increase their harvesting capacity. Trawlers displaced our local small
boat groundfish fleet, and our fishermen either started trawling or
moved into other fisheries. By the time of the Federal groundfish
emergency declaration in early 2000, our ports were supported almost
completely by trawl landings, and our local fleet had undergone
dramatic consolidation. The severe reductions in groundfish allocations
that followed were devastating. By 2006, landings had dropped to 1.2
million pounds with ex-vessel value of approximately $2.9 million.
In 2005, The Nature Conservancy (TNC) entered into discussions with
some of the local trawlers on how to develop some new and sustainable
approaches to the trawl fisheries. They petitioned the Pacific Fishery
Management Council (PFMC) for the protection of 3.8 million acres off
the California coast that would be set aside as Essential Fish Habitat
(EFH) and where no trawling would be allowed. At the same time, TNC
purchased the federal trawl permits and most of the vessels from local
fishermen wishing to retire from the local trawl groundfish industry, a
total of seven. Eventually, there were no local owner operated
groundfish trawl vessels in the Morro Bay/Port San Luis area and TNC
became a large holder of groundfish permits on the West Coast.
Morro Bay had just finished building a new $900,000 ice facility. A
local fish dock had been sold to the city and leased to the Morro Bay
Commercial Fishermen's Organization (MBCFO). But fish offloading in
Morro Bay Harbor was drastically reduced and, despite receiving grants,
the MBCFO was operating the dock at a loss. Dock workers were reduced
to part time and on an as needed basis. Ice from the new ice house was
being dumped periodically to keep the refrigeration equipment
operational and in working order. The local fuel dock threatened to
close because of lack of business. It became immediately obvious; the
local Morro Bay community would suffer tremendously without the
landings of groundfish from these vessels. This would have a ripple
effect not only on the other groundfish gear types, but the entire
community. The infrastructure that the fishing community depended on
was on the verge of collapse. Morro Bay was getting a preview of what
consolidation of the trawl groundfish industry might do to the small
coastal communities.
Rather than just hold the federal groundfish trawl permits, TNC
decided to lease them back to the community, with the condition that
they would use more species selective gear to target certain stocks and
reduce habitat impacts. Local fishermen, a conservationist NGO, and
community leaders decided to do something different and we started
working together on mutual goals. The Central Coast Groundfish Project
was started as an effort to establish a community based fishing group
to provide for the long term economic and ecological sustainability of
the Morro Bay/Port San Luis region groundfish fishery. This wasn't, and
still isn't, always easy. We went to the PFMC together and obtained an
Exempted Fishing Permit (EFP) to use some of the permits in ``gear
switching'' back to the type of fixed gear that historically had been
used and which TNC considered environmentally preferred. More
importantly for the subject today, the EFP tested out important future
elements for the then underway west coast trawl ITQ program, by working
collaboratively on gear switching, sharing observers costs, improving
log book performance and testing electronic monitoring systems, a vital
element for small boat fleets who simply can't afford or accommodate
100% human observers. We also put one trawl permit back to work
trawling under a modified habitat and gear plan, which is now being
used in an innovative experiment to test trawl impacts on habitat.
Things are better now in Morro Bay but we are still in critical
care. The increased quota for open access for the Conception area has
really helped the Central Coast small boat fleet in the past year. The
quota for sable fish in the Conception area went from 220 metric tons
to 1300 metric tons, and the weekly allowable open-access landings went
from 600 pounds to 1500 pounds. This increase in landing limits made it
worth the approximate 40 mile round trip to the fishing grounds.
However, this allocation can change with changes in the stock
assessment. While in general West Coast fishing stocks are in recovery,
recent petrale stock assessments appear to threaten the very viability
of the existing trawl operation. We have recognized that changes need
to occur, and are moving forward.
I would be remiss in my obligation to my community if I didn't
point out some of their real concerns about catch shares. Many of our
fishermen and our fishing community have some well-justified fears and
concerns about our traditional fishing communities moving to catch
shares.
There's the concern that quota or shares will be given to those
``free of charge'' who may at some time put them up for sale, or lease,
to the highest bidder. Already, in the West Coast ITQ program, many who
have been notified of their quota share, are looking for buyers or
lessees. No longer will a fisherman be able to gain access to a fishery
without purchasing quota at a large expense and then, only if it's
available
These shares or quota will most likely be sold to those who already
have shares, consolidating the fishery amongst a smaller select group.
It has been estimated that in the proposed West Coast ITQ program that
most of the shares will be held by 40-60 vessels. These vessels will
most likely operate close to the few remaining processing plants
causing more pressure on the ``local'' groundfish resources. While it
might be necessary in some cases to accumulate share or quota in order
to make operations more cost efficient, it will also have the negative
impact of forcing out smaller operators. And what happens when the
entire resource gets back to Maximum Sustainable Yield; will the entire
West Coast trawl quota be in the hands of 40-60 owners?
While proponents of catch shares speak of the value of fishermen
being able to plan on catching their quota to maximize the value of
their catch, it also creates another concern. They can now schedule
their groundfish season ``around'' other fisheries in order to maximize
their participation in those other fisheries. Also, the proponents say
that as the fishery becomes more efficient, fewer boats and gear are
needed. Those once productive groundfish boats don't just disappear,
they look for other fisheries to enter. Fishermen want to be productive
members of their communities.
We hear the stories of fishermen turning into sharecroppers even if
they are able to hold on to their own boats, paying out up to 70% of
their landings proceeds to the holder of the fish allocation. I was
recently told of one Canadian vessel that paid a lease fee based on the
current fish price only to have the price drop when they delivered,
thus losing money. Crew income declines because of leasing overhead
expense; and many fishermen are forced to leave their native coastal
communities because of lack of employment opportunity.
The Draft NOAA Catch Share Policy states that ``Councils should
periodically review all catch share and non-catch share programs. The
intent is to ensure that management goals are specified, measurable,
tracked and used to gauge whether a program is meeting its goals and
objectives.'' Once catch shares are allocated, then traded, leased, and
sold, it will be very hard for the councils to change the program,
especially in reference to ownership of the shares. It's basically a
one-way street and there's not much room to turn around.
We recognize that until some West Coast groundfish stocks are
rebuilt, we need to reduce fishing effort on those stocks and
concentrate on the healthy stocks. And this is exactly what the EFP
gear switching portion was meant to do, target specific healthy stocks,
while avoiding those of concern. Catch shares create a market that
removes excess capacity from the fleet on a compensated basis, which
helps achieve that goal. However, that very transition awards the value
of the fishery to initial catch share recipients, and can make it more
difficult and expensive for others to enter the fishery.
To address this problem, we need strong and enforceable
accumulation limits that restrain consolidation and maintain diversity
in the fishery. The PFMC has adopted quota share use limits that could
result in as few as 40 or so vessels participating in the non-whiting
groundfish fishery. We need effective regulations to prevent persons
with access to capital from directly or indirectly obtaining control
over the fishery in excess of those limits. We also need room within
those limits for Community Fishing Associations (CFAs) or cooperative
arrangements to hold the amount of quota necessary to stabilize their
fishery economies and support their costs of operation in smaller
traditional groundfish harbors and coastal communities.
Catch shares can result in landings migrating from ports that have
a history of engagement in and reliance on the fishery to those that
have infrastructure or market access advantages. To address this
problem, we need a method for anchoring quota in communities with a
history in the fishery. CFAs can provide that anchor, and protect those
communities from losing landings, port revenues and employment in the
transition to rationalization.
Catch shares can result in fishermen being individually accountable
for their share of the fishery, which gives them the incentive to be
good resource stewards. However, the cost associated with monitoring
each fisherman's harvest can be a very heavy burden, especially for
small, fixed gear boats. Already, all boats that harvest groundfish
must carry a Vessel Monitoring System that periodically transmits their
position to National Marine Fishery Service (NMFS). The cost of this
service is paid by the vessel and runs about $50-$60/month. However,
the huge cost in the West Coast ITQ program is the use of 100% observer
coverage. At present there is the ``proposal'' for the federal
government to pay for 90% of the observer coverage for the first year,
but we are very concerned about what happens after that period. The
cost of $300-$600/day for an observer can only be paid by larger
vessels. While human observer coverage creates jobs, there needs to be
some common sense used and other options explored. One such method is
the use of cameras that would be in operation while the vessel is
actively engaged in fishing, hauling gear, and landing fish. It is
estimated that the use of cameras for onboard monitoring could reduce
the cost to 1/3 of human observers.
So the real question is will the West Coast catch share program,
which is on the verge of implementation, work for fishermen and
communities that rely on these family owned businesses for identity and
economies.
To make it work the NMFS needs to encourage and help facilitate at
least these three things:
1. Community Fishing Associations need to be properly formed and
regulations put in place in order for them to hold more than the
individual quota share limits. This would allow them to stabilize their
fishery economies.
2. Develop, certify and appropriate funds for cost-effective on-
board electronic monitoring systems to be used by the small boat fleet.
3. Set aside adaptive management allocations and provide
flexibility in catch share programs to allow for community impacts.
Thank you.
______
City of Morro Bay
HARBOR DEPARTMENT
1275 Embarcadero
Morro Bay, CA 93442
Ph: (805) 772-6254
Fax: (805) 772-6258
January 27, 2010
The Honorable Jane Lubchenco
Undersecretary and Administrator
National Oceanic and Atmospheric Administration
1401 Constitution Ave. NW
Room 5128
Washington DC. 20230
Dear Dr. Lubchenco:
The City of Morro Bay highly values the cultural and economic
benefits derived from local sustainable fisheries. As you know we have
been striving to work with new partners on innovative ways to preserve
our working waterfronts and promote healthy fisheries and ocean
environments. We are also very proud of our fishermen's role in
providing healthy and high-quality food options for the U.S. consumer.
Thank you for taking the time on Saturday, October 24, 2009 to meet
with the partners in the Central Coast Groundfish project in Monterey,
California. We can only imagine how intense the demand for your time
is, and in this community we have noted your interest in our work and
commitment to transitioning our fisheries into the future.
Small working harbors on the West Coast are in crisis. The
regulatory framework for fish will ultimately lead to even more healthy
fish stocks in our country, but we do not have the right pieces on the
board now to ensure another generation of professional fishermen or
continuation for our small working harbor infrastructures.
We are encouraged by your December 9, 2009 marine spatial planning
interim framework in hopes that this is a step to secure sustainable
and predictable access to our healthy fish stocks so that our
businesses can plan for the future and attract a new generation of
commercial fishermen. Frankly we are a little frightened too, since we
see that it will take monumental leadership on both sides to forge a
better way to manage fisheries than constantly restricting access based
on overfished species stock assessments that often seem to have little
relevance on regional stocks.
The kind of leadership that you and The Nature Conservancy are
demonstrating. Hopefully more and more of us can set aside our fears in
the future and concentrate on the opportunities in change. We want to
take just a minute to support the points outlined in the attached
letter from The Nature Conservancy to you of November 2, 2009 regarding
the West Coast Trawl IFQ program. A Safe Harbor provision in the West
Coast Trawl IFQ program for Community Fishing Associations that are a
legitimate community stability effort is a tool that is needed. Also
creating affordable alternatives to human observers for groundfish
fishermen is paramount to our survival, indeed no matter what else is
done, the West Coast Trawl IFQ program will be a failure in our
communities if small boats do not have an economically sustainable
regulatory framework. We have committed to work on these issues. Please
let us know if there is anything we can do to help you. We wish you
well in your difficult voyage, and you have a standing offer of the
grand tour of Morro Bay harbor any day, any time.
Andrea Lueker
City Manager
Rick Algert
Harbor Director
cc: Honorable Lois Capps
Frank Lockart
______
City of Morro Bay
Morro Bay, CA 93442
(805) 772-6200
March 8, 2010
Honorable Lois Capps
1707 Longworth Building
Washington, DC 20515
Re: Funding for West Coast Groundfish Catch Share Management Program &
Key Issues for Local Fishing Communities
Dear Lois:
The City of Morro Bay is a partner in the Central Coast Groundfish
Project (CCGP), an effort by our local fishing industry, community and
conservation interests to reform our traditional groundfish fishery to
more economically and environmentally sustainable practices. Our non-
traditional partnership has put aside past differences to focus and
work together towards shared objectives, specifically:
1. Preserve heritage and economic contribution of local fishing
industry.
2. Retain access to resource and create stable economically viable
fishing opportunities.
3. Develop fishery practices that protect marine habitats and
reduce bycatch & waste.
In November of 2008, The Pacific Fisheries Management Council
(PFMC) voted to transition this fishery to Individual Fishing Quota
(IFQ) management. This fundamental change in management will have large
impact on the future of this important and traditional fishery for
Morro Bay and many other California fishing communities. The CCGP
partnership is making changes to the harvest and marketing model of our
fishery to help it adjust and remain viable within the new IFQ
management structure.
It is crucial for the CCGP, as well as all other interests in this
fishery, that the new IFQ management structure be designed and
implemented properly, which will require the resources and effort of
both the federal government and fishery stakeholders. The CCGP
partnership has been deeply engaged with the PFMC to encourage the
adoption of key IFQ terms and conditions that are critical to the
ability of our community and partnership to achieve its goals. While we
have made significant progress and our unique partnership has developed
a strong voice within the PFMC, there are still critical IFQ management
terms that have not yet been adopted. Those include:
1. Electronic Monitoring for non trawl boats--given our port's
loss of large processing facilities, changes in the seafood market and
our interest in improving the environmental performance of the fishery,
we have transitioned a significant portion of our traditional bottom
trawl fishing effort to hook & line and traps. These lower volume/
overhead fishing operations allow us to harvest fish in a premium
quality condition and access higher value markets. IFQ management will
require full catch accountability and reporting. Our partnership and
other interests in the industry are encouraging the use of electronic
monitoring (video cameras) for hook & line and trap vessels. This type
of monitoring has proven effective in other fisheries and its lower
cost is essential for our new fishery model to be economically viable.
In addition, many of the family owned fishing businesses in Morro Bay
simply do not have physical room on their vessels to adequately
accommodate crew and human observers. Now is the time when available
funding must be used to restart an experimental electronic monitoring
program our partnership began two years ago but had to drop due to cost
considerations.
2. Community Fishing Associations (CFA)--the CCGP partnership is
encouraging the IFQ management structure to allow qualifying community-
based entities to hold quota in amounts higher than the individual
ownership cap. This would allow such an entity to anchor quota in small
port communities that are most vulnerable to the market forces of quota
consolidation.
It is clear to our partnership that the development of the new IFQ
management program that includes these important community and
conservation design elements will necessitate appropriate federal
funding. For this reason, the City of Morro Bay requests that you
support allocations from federal funding appropriations set aside for
the establishment of catch share fishery management to the West Coast
Groundfish Trawl IFQ. Furthermore, we respectfully request that we
begin a dialogue between your staff and CCGP representatives to
identify ways in which we can work together to encourage the National
Marine Fishery Service and the Pacific Fisheries Management Council to
adopt the above-identified IFQ management terms that will help protect
small fishing community interests and transition the fishery to greater
economic and environmental sustainability. For example, we stand ready
to work with NMFS on electronic monitoring to ensure survival of small
boat fleets and traditional coastal fisheries in California
communities. As always, thank you very much for your time and
consideration in this critical matter.
Sincerely,
Janice Peters
Mayor
______
City of Morro Bay
Morro Bay, CA 93442
(805) 772-6200
October 29, 2007
Mr. Donald K. Hansen, Chairman
Pacific Fishery Management Council
7700 NE Ambassador Place, Suite 101
Portland OR 97220-1384
RE: TRAWL RATIONALIZATION ALTERNATIVES--REQUEST TO RETAIN THE ADAPTIVE
MANAGEMENT TRUST OPTION FOR THE GROUNDFISH TRAWL FISHERY
Dear Chairman Hansen and Members of the Pacific Fisheries Management
Council,
Morro Bay, California (population 10,000) is a coastal community
with long and deep ties to fishing. Our local fishing industry is
constantly exploring proactive ways to improve fishing methods and
maintain viability for this industry in response to on-going changes in
regulations.
With this in mind, in the upcoming DEIS for the groundfish trawl
fishery, we ask you to retain for analysis the adaptive management
trust option, which could help meet adaptive management and public
trust objectives. This mechanism, which would be funded by holding back
a small portion of the quota, will serve as an insurance policy for the
program and will help to enable the social and conservation goals to be
met.
While adoption of an individual quota program may create
significant economic benefits, we are seriously concerned about
potential negative economic impacts to the viability of small ports and
harbors if trawling activity were consolidated to a few ``buyer's
markets'' or offshore.
We are also concerned about unanticipated impacts that arise
whenever there is a major shift to a new management system. An
alternative capable of addressing known concerns, as well as remedying
unanticipated impacts that the current alternatives are unprepared to
address, would help ensure that the transition to the quota system
creates tangible benefits for the greatest number of people.
Please retain for inclusion in the analysis this alternative
capable of meeting adaptive management and public trust purposes, which
will enhance the program's ability to meet important social and
ecological objectives.
Sincerely,
Mayor Janice Peters
City of Morro Bay
cc: Morro Bay City Council
City Manager
Environmental Defense
______
Response to questions submitted for the record by Captain Wayne Moody,
Fishing Vessel Capriccio
Questions from Congressman Jay Inslee (D-WA)
1. This is the second hearing that we have had on catch share fishery
management programs, so there has been a lot of discussion
about catch shares. But I'm not sure we have heard from many
witnesses that actually have participated in catch share
programs. Can you tell me your experience fishing in a catch
share program? Do you have a federal permit to fish in a catch
share managed fishery?
Answer: No, I do not participate in a ``Catch Share'' managed
fishery. The fisheries on the west coast have never been managed under
this type of plan. And looking at the current cost of approximately 4-8
times the value of the fish product to buy into other ``Catch Share''
fisheries (Alaska halibut and sablefish), I doubt I will ever be able
to participate in one. Our community has historically depended on
groundfish for local jobs and support of our marine dependent
businesses. The Trawl sector in West Coast Groundfish is scheduled to
go under a ``Catch Share'' program on Jan. 1, 2011. Because securing
access to plentiful groundfish stocks in our area is critical to being
able to maintain infrastructure and the economic/cultural value of our
working waterfront, community representatives, trawl permit holders and
groundfish fishermen have been actively involved in the development of
the West Coast Trawl ITQ program for over five years. We have
investigated examples of ``Catch Share'' programs in Alaska and
internationally and feel that concerns about community stability need
to be considered in making sure that future catch share programs are
well designed.
Questions from Republican Members
1. You note in your testimony that you fear the groundfish fishery may
be made up of only 40-60 vessels under the IQ plan. How many
currently are in the fishery and at the current quota levels
what would be the optimum number of vessels for all of the
vessels to be economically viable?
Answer: The answer to this question would depend on the size of the
vessels that are involved. their type and cost of operation, and if it
was owner operated. The Pacific Fishery Management Council/National
Marine Fishery service staff has projected that west coast trawl
vessels will go from approx. 120 active trawl operations (there are
actually about 170 trawl permits on the west coast, but many are
inactive currently) to 40-60 under the trawl ITQ program on the west
coast. Six of the over eighty commercially harvested groundfish species
are currently listed as overfished, and management of those overfished
species under the precautionary principle drives a very restrictive
management system on the West coast: for example to protect certain of
those overfished species a Rockfish Conservation Area (RCA) prohibits
Fishing in 30 to 150 fathoms from Mexico to Canada. Unfortunately, with
these spatial closures and the current 60 day quotas set using the
precautionary principle, again driven by the need to rebuild a few
``overfished '' or ``species of concern'' the current management system
cannot support even the existing active permitees. One benefit of the
West coast trawl ITQ program is that some fishermen may be able to
obtain Quota Pounds and target certain healthy stocks with gear other
than trawl, which may allow many of the currently inactive trawl
permits to be used. Under this ``gear switching'' scenario we could see
up to 150 separate fishing operations being supported on a seasonal
basis in the West coast trawl ITQ program, if the program is well
designed with allowance for cooperative arrangements in community
fishing associations, and using electronic monitoring instead of 100%
human observers.
2. What do you suggest should be added to the trawl IQ plan to ensure
more favorable community protections? Were community protection
concerns raised and dealt with during the Council
deliberations?
Answer: The PFMC needs to support the 10% holdback of quota pounds
for community stability issues, and develop the details of that program
so that it is effective in providing mechanisms for new entrants, and
tying Quota pounds to historical groundfish ports to avoid
consolidation out of those ports. The PFMC needs to develop and approve
and implement the Community Fishing Association concept so that groups
now forming in places like Morro Bay can work within the rules in
attempting to tie quota to our area. NOAA needs to budget for and
support cost effective electronic monitoring systems so small boat
fleets can be economically viable in the Trawl ITQ program.
3. You and Mr. Dooley both note the costs associated with the 100%
observer coverage required in the trawl IQ plan. Why did the
Council determine that 100% coverage was necessary? Is this
level of coverage necessary for the life of the program or will
this level of coverage be reduced as time goes on?
Answer: The goal is full accountability, and since human observer
programs are already in place NOAA has assumed the default position
that the only known system for full accountability is 100% human
observers. Electronic monitoring systems are in place and effective in
Canada, and if Canada can do it so can we. We are not unsympathetic
with NOAA's personnel who have a huge workload in implementing this
catch share program on a very ambitious schedule, and are resistant to
a ``new'' system, but this point is critical in the survival of small
boat fleets historically operated out of smaller west coast
communities.
4. The Magnuson-Stevens Act allows for regional fishery associations
which sound very similar to your suggestion of Community
Fishing Associations. Did the Pacific Council examine this
authority for use in the trawl IQ plan?
Answer: RFA's and CFA's have been discussed and investigated to
some extent by the Pacific Council, however at this time finalizing
action on creating a RFA/CFA program description is not even formally
on their agenda this year. We are asking the PFMC to put this item on
their agenda for their Sept. 2010 meeting, but we are not yet assured
that it will be. The biggest challenge is that we support strong and
effective control limits/ownership caps in Catch share programs to
avoid consolidation and excessive market control, BUT, by their nature
a community fishgig assoc. represents a group of people cooperatively
managing Quota, which probably violates any strong control limit. We
have worked with The Nature Conservancy on a suggested program
description in an effort to assist the PFMC and attached for your
information is a white paper ``control Rule and Collective
Arrangements'': that was submitted to the PFMC at a CFA agenda item
discussion in March of 2010. We will continue to work with the PFMC to
adopt an effective CFA/RFA trailing amendment, but it must be done this
year, before the actual Catch share program is implemented.
______
Ms. Bordallo. I thank you very much, Mr. Moody, for being
here today and to help us understand Morro Bay's perspective
regarding catch shares.
Mr. Angers, you may now begin your testimony.
STATEMENT OF JEFFERSON ANGERS, PRESIDENT,
CENTER FOR COASTAL CONSERVATION
Mr. Angers. Good morning, Madame Chairwoman, Mr. Brown, and
members of the committee. My name is Jeff Angers. I am the
president of the Center for Coastal Conservation. I am a native
Louisianian and a recreational fisherman. My testimony this
morning is presented on behalf of my organization, the American
Sport Fishing Association, the Coastal Conservation
Association, the International Game Fish Association, the
National Marine Manufacturers Association, and the Bill Fish
Foundation.
In the toolbox of fishery management tools, catch shares
are a tool. Implementing catch shares, as we are talking about
this morning, in commercial-only fisheries can be a useful tool
for managing harvest. But catch shares are an inherently
inappropriate tool for recreational fisheries. In mixed use
fisheries, where there are both recreational and commercial
components, such exclusive fishing rights proposals maximize
benefits to the commercial fishing industry while ignoring the
participation, conservation value, and economic contribution of
recreational fishing.
NOAA's Draft Catch Share Policy currently lacks the
necessary guidance to protect the recreational sector from
adverse impacts associated with the implementation of any catch
share policy. With the cascading impacts of fishery
restrictions and closures across the country currently underway
in key fisheries, the protection of the recreational sector
should be a priority for the Congress, and for NOAA Fisheries
as it develops any new overarching policy on catch shares.
At a very minimum, NOAA should ensure, number one, that
vital socioeconomic information on recreational fisheries is
gathered prior to the issuance of any policy; number two, that
they undertake a reevaluation of allocations prior to
implementing a commercial catch share system; and number three,
that they allow inter-sector transfers of catch shares through
mechanisms that ensure equitable access to the recreational
sector.
According to NOAA Fisheries, the recreational fishing
sector contributes over $82 billion in sales, $24 billion in
income, and provides 534,000 jobs. Compare this to domestic
commercial landings of fin fish in the U.S.: $28 billion in
sales, $12 billion in income, and 423,000 jobs. The
recreational sector is as significant in the commerce mission
of NOAA as the commercial fishing sector, although it is at
substantially lower environmental costs.
Our economic contribution is provided with much less impact
on the resource. Recreational harvests account for only 3
percent of fish harvested. Commercial harvests account for 97
percent of fish harvested.
I want to speak to reallocation for a moment. The Councils
and NOAA Fisheries have a long and unfortunate history of not
addressing sector allocation. However, if one of this
Administration's national policies will be to promote a system
that provides the commercial sector with an inherent advantage
to accessing a fishery, it can no longer be business as usual.
NOAA must face the allocation challenge head on through its
catch share policy. Otherwise, the existing allocations
guarantee inequitable and harmful treatment of the recreational
sector.
I might call your attention to the comments of Dr. Jane
Lubchenco offered Friday at NOAA's recreational fishing summit.
She said, quote, in speaking to the recreational sector, ``You
have pointed out that changes in demographics and economics
should be fairly considered in allocations, and that no one
sector should be guaranteed a specific, permanent allocation. I
agree,'' she said. We thought those were very hopeful remarks,
as we view--as we anticipate a final policy forthcoming.
Without a meaningful reevaluation of existing allocations for
fisheries considered for catch shares, our organizations must,
and will, strongly oppose the implementation of the policy.
As to inter-sector transferability to ensure the minimal
adverse economic impact on the recreational sector, any formal
policy should provide for inter-sector access to catch share as
a way of reallocating and ensuring free market access. The
clear assumption of NOAA's draft policy is that this portion of
the quota is dedicated to the commercial sector for a time
uncertain, regardless of any economic or demographic changes.
This puts the recreational sector at an immediate disadvantage
that we believe must be remedied. Consideration of inter-sector
transfers ought to be a mandatory part of any analysis.
One final comment. Many believe that catch shares are a
panacea. Some will convince you that they will solve all
problems, perhaps even bring about world peace. Listen
carefully to their arguments. For instance, you might be
tempted to believe that catch share systems in the Gulf red
snapper fishery increase the total allowable catch by 30
percent in just one year. When you hear such assertions, remind
the blind loyalists to catch shares of other tools in the
toolbox, like reductions in shrimp trawl bycatch from the use
of better technology. Remind them of hurricanes named Katrina,
Rita, and others that devastated the Gulf fishing fleets, both
recreational and commercial. Catch shares are a tool in the
toolbox, nothing more and nothing less.
Thank you again, Madame Chairman, for the opportunity to
comment this morning.
[The prepared statement of Mr. Angers follows:]
Statement of Jefferson M. Angers, President, Center for Coastal
Conservation, on behalf of the Center for Coastal Conservation,
American Sportfishing Association, Coastal Conservation Association,
International Game Fish Association, National Marine Manufacturers
Association, and The Billfish Foundation
Good morning Madame Chairwoman. My name is Jeff Angers, and I am
the president of the Center for Coastal Conservation. I am native
Louisianian and a recreational fisherman. I would like to thank you for
this opportunity to address the Committee as it discusses community
perspectives on catch shares.
My testimony today is presented on behalf of my organization,
American Sportfishing Association, Coastal Conservation Association,
International Game Fish Association, National Marine Manufacturers
Association and The Billfish Foundation.
Our organizations appreciate that implementing catch shares in
commercial-only fisheries can be a useful tool for managing harvest,
however they are an inherently inappropriate tool for recreational-only
fisheries.
We have serious concerns about the potential impact of commercial
catch shares on the recreational sector in mixed-use fisheries (in
which there are both recreational and commercial components). Our
organizations respectfully submit that the Draft Policy Catch Share
Policy of the National Oceanic and Atmospheric Administration under
consideration lacks the necessary guidance to protect the recreational
sector from adverse impacts associated with the implementation of a
catch shares policy in mixed-use fisheries.
Given the cascading and substantial impacts of fisheries
restrictions and closures currently underway in a number of key
recreational fisheries, the protection of the recreational sector
should be a priority for the Congress--and for NOAA Fisheries as it
develops any new overarching policy on catch shares. At a minimum, NOAA
should ensure that vital socio-economic information on recreational
fisheries is gathered prior to the issuance of any final policy;
undertake a re-evaluation of allocations prior to implementing a
commercial catch share system, and allow inter-sector transfers of
catch share quota through mechanisms that ensure equitable access to
the recreational sector.
In mixed-use fisheries where there is a large and growing
recreational sector, exclusive fishing rights proposals maximize
benefits to the commercial fishing industry while ignoring the
participation, conservation value and economic contribution of
recreational fishing, which totals $80 billion and provides over half a
million jobs--an economic impact equal to or greater than commercial
fishing economic impacts.
Catch shares in mixed-use fisheries are viewed by recreational
fishermen as permanently setting quotas, which in sustainable fisheries
impedes and ultimately retards growth for the recreational sector.
Freezing fisheries participation is directly contrary to sustaining
recreational fishing development and encouraging a greater conservation
ethic.
We recommend that the following principles should be included in
the national catch share policy.
Thorough Economic Impact Analysis on Recreational Sector
The implementation of a catch share system is intended to make
significant changes in the operation and benefit distribution in the
commercial sector of the fishery. By its very nature it will have an
impact on every other sector of the fishery. As part of its advocacy
for the increased use of catch shares, NOAA Fisheries frequently points
to a very laudable goal--achieving the full economic value of the
commercial sector. However, the goal should not come at the expense of
the recreational sector. Instead it should be the policy of NOAA to
maximize the economic potential of an entire fishery, including the
recreational sector. According to NOAA Fisheries, recreational fishing
contributes about $80 billion to the nation's economy annually, which
is roughly equal to the commercial sector, while accounting for 54% of
the jobs (in domestic fin fishes) and only three percent of the catch.
NOAA Fisheries needs to recognize this contribution and place equal
investment in thoroughly analyzing the economic impacts of catch shares
on all the sectors in the fishery prior to the initiation of a catch
share system.
NOAA's Draft Catch Share Policy states that, ``Instances where such
impacts are reasonably foreseeable, Councils and NOAA should evaluate
the effects of catch shares on all sectors associated with the fishery,
regardless of whether they are in the catch share program'' (p. 5).
However, a full-fishery evaluation should be undertaken regardless of
whether or not the councils reasonably foresee an impact on the
recreational sector. This analysis should include the economic
contribution of industries directly related to a recreational fishery
and relevant downstream economic impacts, including boat sales, marina
activity, boat construction and repair, fishing gear and tackle sales,
hotels, restaurants, grocery stores and other peripheral businesses and
industries.
Updated Sector Allocation Prior to Catch Share System
Once councils and NOAA Fisheries have the necessary economic
information, councils should then undertake a review of current
allocations for any mixed-use fishery under consideration for a catch
share program. Catch share systems are put in place using a
``snapshot'' of the economic contribution and catch history of a
fishery. It is incumbent upon the regional council and NOAA Fisheries
to ensure that this snapshot is up-to-date and equitable prior to
moving forward with a catch share program. Rather than relying on a
snapshot of the past, we believe NOAA Fisheries has a stewardship
obligation to position these resources to provide a better future.
Any final policy should include guidance requiring regional
councils to review the current allocations to determine if it is
consistent with the best use of the resource for the nation as a whole.
If the allocation is deemed not to be in the best interest of the
nation as a whole, a reallocation should be conducted by the regional
council.
The councils and NOAA Fisheries have a long and unfortunate history
of not addressing sector allocation. However, if one of the
Administration's national policies will be to promote a system that
provides the commercial sector with an inherent advantage to accessing
a fishery, it can no longer be business as usual. NOAA must face the
allocation challenge head-on through its Catch Share Policy otherwise
the existing allocations guarantee inequitable and harmful treatment of
the recreational sector.
If a meaningful reevaluation of existing allocations is not
undertaken for fisheries considered for catch shares, our organizations
will strongly oppose the implementation of the policy.
The catch share policy should include a requirement that periodic
reviews (not to exceed three years) of the allocation should be part of
the design of the catch share system to ensure that the fixed
regulatory allocation reflects the best interests to the nation of the
use of the resource.
Provisions for Inter-Sector Transferability
Our final recommendation to ensure minimal adverse economic impact
on the recreational sector is to provide for inter-sector access to
catch share as a way of reallocating and insuring free market access.
The clear assumption of NOAA's Draft Policy is that this portion of the
quota is dedicated to the commercial sector, for a time uncertain,
regardless of any economic or demographic changes. This puts the
recreational sector at an immediate disadvantage that must be remedied.
Consideration of inter-sector transfers ought to be a mandatory
part of any analysis.
There are many key components that should be part of inter-sector
transferability. First and foremost, commercial quota holders should
not be permitted to lease quota for the long-term or permanently. Such
a scenario would equate to a commercial fisherman retiring off the
benefits acquired from a common property resource. Fishermen should be
required to either fish their quota for the long-term or sell it to a
party willing to take advantage of the opportunity.
In addition, NOAA should provide guidance to councils on how to
permit state-established entities to purchase quota on behalf of their
citizens. States have a long history of fishery management and, on the
whole, a trusted relationship with recreational anglers. Providing them
with the ability to purchase quota on behalf of their angling public
will help to maintain public access to a public resource, while
promoting sound fisheries conservation. In addition, recreational
fishing data collection could be improved through the states. Such a
mechanism will help alleviate any inherent negative impacts on the
recreational sector, especially if the councils and NOAA Fisheries are
unwilling or unable to achieve sector reallocation that most accurately
reflects the full economic value of a fishery.
Should a state be allowed to purchase commercial quota on behalf
the recreational fishing community, a process should be established to
provide transparency to recreational anglers. Transfers to states for
recreational fishing should be managed under the same regulations that
otherwise apply to the recreational fishery. It must also ensure
fairness among all anglers to avoid further allocation fights regarding
the state-held quota. We recommend that NOAA undertake pilot projects
in the Gulf of Mexico and Southeast Alaska to test the merits of inter-
sector transferability.
Thank you again for the opportunity to comment on community
perspectives on catch shares. It is our goal to ensure that any
forthcoming policy recognizes and protects the economic contribution of
the recreational fishing and boating industries. We would like to work
with the Subcommittee toward that end.
Madame Chairman, that concludes my testimony, and I would be happy
to take questions.
About our organizations...
The Center for Coastal Conservation (Center) is a coalition of the
leading advocates for marine recreational fishing and boating. It is
dedicated to promoting sound conservation and use of ocean resources by
affecting public policy through the political process.
The American Sportfishing Association (ASA) is the sportfishing
industry's trade association, committed to looking out for the
interests of the entire sportfishing community. We invest in long-term
ventures to ensure the industry will remain strong and prosperous as
well as safeguard and promote the enduring economic and conservation
values of sportfishing in America. ASA also represents the interests of
America's 60 million anglers who generate over $45 billion in retail
sales with a $125 billion impact on the nation's economy creating
employment for over one million people.
The Coastal Conservation Association (CCA) is a national
recreational fishing membership organization of some 100,000 members
and is organized to do business is 17 States on the Atlantic, Gulf of
Mexico and Pacific Coasts. It has been actively involved in the
majority of the nation's marine resource debates since its inception in
1977. Its membership is composed of recreational fishermen who fish for
every important marine recreational fish available in the EEZ. CCA
brings not only an educated perspective on how to fish, but a
conservation ethic which recognizes the value of recreational fishing
as a pastime and obligation to take care of the resource and use it to
the best benefit to the nation.
The International Game Fish Association (IGFA), is a 70 year old
world renowned not-for-profit organization committed to the
conservation of game fish and the promotion of responsible, ethical,
angling practices through science, education, rule making and record
keeping. IGFA accomplishes its mission by enlisting the voice of over
300 official IGFA representatives in nearly 100 countries, and more
than 15,000 angler-members around the globe.
The National Marine Manufacturers Association (NMMA), the nation's
leading marine industry trade association, represents nearly 1,600 boat
builders, engine manufacturers, and marine accessory manufacturers who
collectively produce more than 80 percent of all recreational marine
products made in the United States. The U.S. recreational marine
industry contributes more than $30 billion in new retail sales and
300,000 jobs to the economy each year.
The Billfish Foundation (TBF) is dedicated to conserving and
enhancing billfish populations around the world. The non-profit
organization is an effective advocate for international change,
synthesizing science and policy into fishery management solutions. By
coordinating efforts and speaking with one voice, TBF is able to work
for solutions that are good for billfish and not punitive to
recreational anglers.
______
Response to questions submitted for the record by Jefferson Angers,
President, Center for Coastal Conservation
Questions from Congressman Jay Inslee (D-WA)
1. This is the second hearing that we have had on catch share fishery
management programs, so there has been a lot of discussion
about catch shares. But I'm not sure we have heard from many
witnesses that actually have participated in catch share
programs. Can you tell me your experience fishing in a catch
share program? Do you have a federal permit to fish in a catch
share managed fishery?
I have never been a participant in a catch share program.
Questions from Republican Members
1. A number of witnesses have discussed the need for better data
collection. The 2007 Magnuson-Stevens Act reauthorization
requires NMFS to develop a better data collection program for
recreational fisheries. Do you believe this effort will yield
better recreational harvest data?
I am hopeful that it will ultimately yield better, more accurate
data. I am disappointed that the congressionally mandated deadline of
January 2009 came and past without the new data collection system in
place. It is still not in place.
2. NOAA lists four stocks in the Gulf of Mexico that are overfished
and which are experiencing overfishing (red snapper, greater
amberjack, gag, and gray triggerfish). Do recreational
fishermen participate in these fisheries and what percentage of
the harvest is caught by recreational fishermen? Do you agree
with NOAA's determinations that these fisheries are overfished?
What would actions are being taken to address these fisheries
and do you agree with the actions being taken?
While the four species are overfished and have not recovered
completely, actual overfishing has stopped and the appropriate annual
catch levels are being used to allow for a timely recovery. The best
science indicates these species are overfished, although that science
is always based on catches from several years in the past. The bag
limits, size limits and seasons seem appropriate measures to manage the
fishery.
3. Do you agree with the concept of each sector in a fishery being
accountable for its harvest level and if overfishing takes
place, that the sector should be required to ``pay back'' that
overage?
I believe the commercial and recreational sectors should stay
within their allowed harvest levels. Because the data collection for
the recreational sector is flawed and often has high margins of error,
it is best if recreational overages and underages are averaged across a
three to five year period and adjusted accordingly.
______
Ms. Bordallo. I thank you, Mr. Angers, for being here
today, and I will now recognize Members for any questions they
may wish to ask, beginning with myself.
My first question is for you, Captain Goethel. In your
view, what specific changes could be made at this point to
remedy the unfair and inequitable allocations between
recreational and commercial fishers, and amongst commercial
fishers in the New England groundfish fishery?
Captain Goethel. Quite frankly, I think what needs to be
done is it needs to be remanded back to the Council with clear
guidance from the National Marine Fisheries Service to observe
National Standard 4, and put everybody on a common baseline. It
is quite obvious to me. I think the other thing that needs to
be done is that they need to be reminded that there is National
Standard 8, and that these allocations have a big effect on
communities.
One thing in New England, if we had had an IFQ program, it
would have required a referenda, and in order to get people to
vote for the referenda, you have to get 80 percent of the
people that catch 20 percent of the fish to get enough fish to
feel like it is in their best interest to vote for it. In New
England, this was a straight resource grab, nothing more,
nothing less. Eight percent of the people here are probably
going to be made instant millionaires on May 1st, and 92
percent of the people are going to be virtually thrown out of
the fishery.
That wouldn't have happened if they had to have a
referenda. So, by NOAA declaring that this was not a lap, that
it didn't require a referenda, they almost sealed the fate of
all of these small boats.
Ms. Bordallo. Thank you. My next is for Julian Magras from
St. Thomas. Today and in the past, you have characterized NMFS
has having a lack of understanding of the Virgin Islands
culture and a disregard for the fishing community. How do you
think basic communications can be improved to remedy this
situation?
Mr. Magras. Well, I think one of the keys to the whole
process is when they are setting rules and guidelines, that the
stakeholders, which are the fishermen, need to be in the
process from the beginning. We have been involved with them for
the last five years. We sit down with real concerns to the
table. They say yes to everything, ``Oh, we are going to fit it
in.'' And then when you see proposals come forward, a lot of
our ideas that we have presented are not there.
A perfect example is the annual catch limit process. We
have been looking at a document for the last two years, and the
document has been about 25 pages long. And at this last April
meeting, they produce the final draft to go to public hearing
of the ACL document, and it was 315 pages long. And it was
given to us just a week before the meeting. That was very
difficult for the association to sit down and go through and
analyze everything that they added to the process. And while at
that meeting, they sat down and went through it, and the
Council members didn't understand, because they didn't have
access to the document until the same time that we did, which
was a week. They went ahead and approved the document to move
forward to public hearings. And that creates a big problem in
the Virgin Islands.
Ms. Bordallo. Thank you. Thank you very much. Captain
Moody, your community's concerns about moving to catch shares
are familiar to us now, including fears about consolidation of
quota amongst the highest bidders, and the financial hurdle
facing new entrants into the fishery. Why is it so important to
anchor quota in fishing communities?
Captain Moody. Thank you, Madame Chair. I think that with
this deal we have been going through with the Nature
Conservancy, when they came in and purchased the trawl permits
from the local trawlers, and we saw that all of a sudden our
local infrastructure was in trouble--and even though we were
getting some grants to fund some of the fuel dock and unloading
dock, we still were not able to get enough fish across the dock
to keep those pieces of the infrastructure viable. And so we
realized that we have to have groundfish landings in our harbor
in order for our infrastructure to be viable.
One of the reasons to anchor quota in our community,
especially if we can anchor it there by some community fishing
association or permit bank, then that would stay in the
community in perpetuity. It would not have the chance to be
balled up by some speculator in some other community and moved
out of the community.
Ms. Bordallo. Thank you. And my final question is for Mr.
Angers. What types of socioeconomic information on recreational
fisheries should be collected? Is NOAA collecting any of that
data already, and why is this data important in the development
of catch share programs?
Mr. Angers. Yes, ma'am. Sadly, NOAA's data collection
functions are woefully lacking, not just in fisheries stock
assessments, not just in angler data, but also in socioeconomic
data. Recently, the South Atlantic red snapper fishery was
closed in January of this year. Part of the requirement that
the agency was faced with was to analyze the socioeconomic
impacts to coastal communities. They didn't have any of the
data, and so they reported, we don't have the data, so we are
just not going to consider it, and they proceeded with the
closure.
That was a particular disappointment to the thousands of
businesses, from North Carolina to Cape Canaveral, who were
drastically affected. And one of our friends at the American
Sport Fishing Association decided that if the agency was
incapable of collecting the data, then ASA would collect it
themselves. And they sent out surveys to 3,200, 3,200 small
businesses in coastal communities from North Carolina to Cape
Canaveral to ask them to assess what the economic impact of the
red snapper closure was going to be.
It would seem like when the agency is statutorily required
to consider the data, and they don't, that is a problem for us.
Ms. Bordallo. Thank you very much. And now I would like to
recognize the Ranking Member, Mr. Brown, for any questions he
may have.
Mr. Brown. Thank you, Madame Chair, and thank you,
gentlemen, for being here today. And I hope that we can bring
some resolve to this issue before it is too late. Didn't you
say the deadline is like May 1st?
Captain Goethel, Dr. Rothschild predicted that there will
be a 50 percent drop in employment due to the new sector
system. Do you think he is accurate?
Captain Goethel. I think he is optimistic. I think it is
going to be greater than that. I think the first year, a number
of people are going to try to kind of hang on for a year to see
if somebody straightens this mess out. But by year two, I think
you can see more like 80 percent.
Mr. Brown. I think in your analogy, you said that when you
are fishing, you don't just fish for one species; you are
fishing for a goodly number. And what happens when you reach
the quota in one? Do you stop fishing, or what do you do then?
Captain Goethel. Yes, we have to stop fishing. You can
trade with other people, either within your sector or
secondarily outside of your sector. But the problem is there
are what we call choke species. They are species that everybody
seems to have very little of, and so nobody wants to trade
them. So, there is going to be no trading, none to speak of.
Basically, in my case, as an example, I have 50,000 pounds of
cod, which is kind of the signature species of New England, but
I only have 190 pounds of white hake. So, when I catch 191
pounds of white hake, if I can't find somebody to give more
white hake, I am done for the year, even if I have only caught
5,000 pounds of cod.
Mr. Brown. Is it true that you can barter your quota with
somebody else?
Captain Goethel. There are complex rules surrounding the
transferability of quota. You can--well, first of all, it is
not quota. We shouldn't say that. It is percent sector
contribution.
Mr. Brown. OK. That sounds like a good word.
Captain Goethel. Well, a ``quota'' means you own it, and we
don't own it. That is one of the problems.
Mr. Brown. I see, OK.
Captain Goethel. So, you can trade, you can barter. The way
the sector rules are set up, at least in my sector, you have to
offer it to members first. The problem is, as I said, this fish
all swim together. So, let us say 30 people in my sector, they
go out, and everybody goes fishing, and somebody has a big tow
of something. Then under the rules of engagement here, I don't
have any choice. If he needs it, I have to give it to him
because the sector is jointly and severally liable for not
going over.
So, there is a chance as an individual I might not ever get
to fish at all.
Mr. Brown. So, what do you think the motive behind this is?
Captain Goethel. What do I think the motive is? I think the
motive is to force people off the water. I think the head of
NOAA has very clearly stated that there are too many boats, and
she wants a bunch of them gone, especially in New England. And
I would respond that, at least for me, my job is pretty
important to me. There aren't a lot of job opportunities, as
you folks are well aware of, right now.
Mr. Brown. What is the unemployment up there?
Captain Goethel. About 10 percent. And as an example, my
crewman, he graduated from the University of New Hampshire, has
a degree in engineering. He can't find a job. I have an
engineer on the boat as a deckhand cutting codfish. There is a
guy waiting to take his place that has an MBA from Cornell. He
is about my age. He has been out of work for almost two years,
can't find a job. His unemployment benefits have run out.
So, I guess what I am saying is that we can do the same
thing here if we spread it out over a little longer period of
time. We end up with the same results. It would just take
longer to get there, and we could still keep these jobs.
Mr. Brown. But nobody is listening.
Captain Goethel. It certainly--well, you folks are
listening. You are here today. But quite frankly, I think NOAA
is tone deaf.
Mr. Brown. Thank you. Mr. Angers, a number of witnesses
have discussed the need for better data collection. The 2007
Magnuson-Stevens Act reauthorization required NMFS to develop a
better data collection program for recreational fishermen. How
is this effort working so far?
Mr. Angers. Not so well, would be the short answer. The old
data collection system was known as MRSS, the Marine
Recreational Statistical Survey something. And MRSS had
inherent problems--so much so that the National Academy of
Sciences called it fatally flawed.
The new system that was authorized by the 2007
reauthorization of Magnuson is called MRIP, the Marine
Recreational Information Program. I would note that the
initials are M-R-I-P, like ``rest in peace,'' which can be
disconcerting to some. The goal of MRIP, though, was to lessen
the errors of MRSS, not so much so to provide the agency with
the opportunity to have good, solid data that they can use to
make in-season adjustments so that fishermen--so that managers
can actually manage fisheries instead of manage crises.
We did discuss quite a lot about MRIP and all of the data
gathering by the agency at the NOAA summit this past weekend. I
think that they have made some progress, but they still have a
long way to go.
Mr. Brown. I guess that goes to my next question. I
apologize for running out of time. But NMFS hosted the
recreational fishing summit last weekend. Did any positive
development come out of this summit?
Mr. Angers. Yes, sir. I would say that it was broadly a
positive experience. There were about 170 recreational fishery
leaders from all over the country, and this summit was a
fulfillment of a commitment made by Dr. Lubchenco in September
of last year that she was going to gather everyone together and
have an open conversation.
We had a pretty doggone open conversation. The agency has a
number of shortcomings. To the extent that they were not aware
of some of those shortcomings, I think that the 170 of us that
were there made sure that they were going forward. We had folks
from CEQ there and from throughout NOAA to have what I think
was a pretty good conversation.
I am cautiously optimistic, more so than I have been in
many years, about where this Administration can bring us. But
still, the topic of catch shares particularly was on the minds
of all of the participants in the conference this weekend.
Mr. Brown. Thank you very much. And I hope that we find
some resolve.
Mr. Angers. Me too.
Ms. Bordallo. I thank the Ranking Member from South
Carolina, Mr. Brown. And now I would like to recognize the
gentlelady from New Hampshire, Ms. Shea-Porter.
Ms. Shea-Porter. Thank you. And I would like to thank all
of the witnesses for being here. And I would like to say that
we certainly are listening, and I appreciate you coming here
again, Captain, and you have been just terrific for the voice
of the New Hampshire, and indeed the New England, fisherman.
So, my first question has to do with my concern--and you
know that we sent a letter. I am happy to report that the many
Members of New England and elsewhere are sending letters about
these issues. And, of course, Congressman Frank had one calling
for some pretty important changes right now. But the question
that I wanted to ask is--it has been a concern, and it is
stated in this letter as well, that what we will see is
consolidation, that we will indeed see the small fisherman
pushed out.
As a matter of fact, I just got an e-mail today that said
that a large number won't even try because of the fiscal
impossibility of being able to make a living. Would you like to
comment on that? Do you think this really is the death of the
small fisherman, and that the consolidation will harm not just
New England, but elsewhere, that we will see larger as better?
Captain Goethel. That is correct. Because of my position on
the Council, a number of fishermen have come up to me and
showed me their letters from NOAA, their percent sector
contributions, usually with a, you know, throw it down on the
table, look at this, followed by a stream of obscenities. And
so I have seen--you know, these are confidential documents, but
I have seen a fair number of them. I can guarantee you that a
number of fishermen don't have enough to even remotely bother
untying the lines. And they have already begun the process of
consolidation.
As I said, I think most people will hang on for a about a
year in the hopes that either the courts or you folks will
straighten this out. But most people don't have big financial
resources here. They can't hang on forever with no job. As far
as the consolidation issue goes, yes. I mean, we are already
seeing it. The people that are relatively well off--and believe
me, nobody is well off under this system, but the people that
are relatively well off are already going around offering to
buy your quota. And again, they misuse the word, but the haves
are already buying up the have-nots, and we haven't even
started yet.
Ms. Shea-Porter. I think we both know how fiercely
independent we are in New England, and in particular the
fishermen. So, we have to make sure that they can earn their
livelihood while still protecting the environment. And I
believe that we can do this.
Now, we have other problems there, as you know. I have
heard from many fishermen about their individual allocations.
In some cases, fishermen have lost thousands of pounds of fish
because of poor recordkeeping. And it wasn't their poor
recordkeeping, as you know, but it was done by the dealer
submitting their information to NMFS.
You also pointed out in your dissenting opinion on
Amendment 16 that there is a serious inequity when determining
allocations between previously existing sectors--the
recreational industry and the rest of the commercial fleet. Can
you speak to how those allocations have positioned New
Hampshire's fishermen under Amendment 16?
Captain Goethel. OK. To the first issue of the data, that
surfaced when we first started talking about catch history. We
never really realized that nobody had ever done an audit of the
data. So being on the Council, I took my own information and
went through it, and I found a number of errors. I think, on
987 days worth of trips, I had about 70 errors, and some of
them were quite substantial.
A number of reasons. We work with NOAA; they have done--the
person in charge, Vic DiVecchio, has done an excellent job of
trying to get to the root of the problems. A number of them
have been identified. But again, nobody ever bothered to check
prior to doing this. So, obviously, the data should have been
checked before we even went down this road.
To the second issue of the inequitable allocation, as I
said, if people had known two things--one is that they were
going to at some point be judged on their catch history; and
second of all, if they had been able to establish catch history
in an equal fashion--in other words, there hadn't been all
these import controls over the entire period that disadvantaged
people, especially off New Hampshire, where we have a year-
round closure, and we have the largest rolling closure, three
months, which is the three months you could catch fish.
But NOAA said we couldn't go back in the record prior to
the import controls; we couldn't use that data. It was too
faulty. I don't know it was really any worse than what we are
using right now. So, the result is that boats in New Hampshire
were particularly disadvantaged by using a straight catch
history formula. If we had gone and converted--the currency
into time has been A days, which were the days that you could
fish for multi-species. And most boats had on the order of 48
days.
If we had just done a straight conversion of A days to
pounds, then you would have seen a very different picture. You
would see a very different distribution of the allocation, and
you would have a very different set of winners and lowers. You
would have more fish in these communities and less fish on some
of these larger vessels, which have established very big catch
histories during the past 10 years when they could fish outside
all these restricted areas.
Ms. Shea-Porter. OK. Thank you. Do I have one more second
for follow-up, or is that----
Ms. Bordallo. You are over.
Ms. Shea-Porter. I am over. OK. Thank you. I yield back.
Ms. Bordallo. Thank you very much to the gentlelady. And
now I would like to recognize the gentleman from Louisiana, Mr.
Cassidy.
Mr. Cassidy. Thank you. Mr. Magras, you mentioned in your
testimony how Puerto Rico has a 12-mile state limit. The Virgin
Islands have only a three-mile, and so inherently that biases
the process toward that with a larger amount of state waters.
Can you give me--you have obviously thought about this. So,
what would be a potential solution to that issue? Do you just
toss out the whole system or, no, you can compensate for it in
a certain way?
Mr. Magras. Well, I think the Congresslady for the Virgin
Islands has a bill before Congress to try to establish our
territorial sea at the same distance as the Puerto Rican sea,
and that would be able to justify the fairness. But for right
now, we have 88 percent of the jurisdiction of any rule set in
Federal waters falls within the Virgin Islands. And Puerto
Rico, for the smaller percentage that they have, there is a
very small area that they can do any fishing at all in Federal
waters. So, setting the rules in place would really be
discriminatory against us. And we feel that, number one, we
would like to see the islands separated as St. Croix, St.
Thomas, St. John, Puerto Rico in setting any kind of limits
from catch limits to annual catch shares because it is totally
different fisheries.
One island fishes for a different type of fish; the next
island fishes for a different type of fish. It is what the
people prefer.
Mr. Cassidy. But I presume that your boats could go over
there, and their boats could come over to you, and you could
each catch the type of fish that your particular population is
more likely to purchase, correct?
Mr. Magras. Well, I disagree on that. The size of our fleet
ranges from 17 feet long to 25 feet. That is more than 85
percent of the size of our boats. And the other 15 percent
would fall where we have a couple of 36-footers. But we are
fishing in our waters, and whatever is--like, for example,
whatever is caught in St. Thomas/St. John stays on St. Thomas/
St. John. We don't do any export at all. The same for St.
Croix. The only thing that St. Croix would maybe send over to
St. Thomas is conch.
But we don't send anything outside of there, so we don't
venture into Puerto Rico. Puerto Rico might venture into our
waters, but we don't have any reports on that happening right
now.
Mr. Cassidy. OK. Mr. Angers, you had mentioned--I was
struck that the recreational harvest is only 3 percent. Is that
only for Federal waters? Is it that the recreational fishermen
are taking a greater catch within state waters?
Mr. Angers. Well, clearly, the management regimes are
different. But those statistics that I gave you earlier were
only for Federal waters. I mean, state waters, that is going to
be a different story, depending on the particular fishery.
Mr. Cassidy. Now you had mentioned--now as I am thinking
carefully about your testimony, and at first your concern
regarding the applicability of catch shares to mixed use
fisheries, but then you mentioned inter-sector transfer. But in
a sense, to have inter-sector transfer, that would be within
the catch share system, correct?
Mr. Angers. Yes, sir. You know, the simplest way to look at
it is in a commercial-only fishery, there are certain economies
that you can achieve by using this tool that is in the tool box
of catch shares. In a recreational-only fishery, catch shares
don't make any sense. But where the two sectors do mix, there
are going to be some substantial problems.
We already have some catch shares in place, for instance,
the Gulf red snapper fishery, now for three years. And there
are inherent problems when we have a management system that
views the allocation discussion as rusted shut. Although
Magnuson----
Mr. Cassidy. What do you mean by ``rusted shut''?
Mr. Angers. Let me explain. Magnuson requires the Councils
to look at allocation between the commercial and recreational
sectors, for instance, in red snapper. We do not find that the
Councils, nor the agency, have the political will or interest
to look at reallocating from one sector to another.
So, the point of my testimony was to say that if we are
going to have catch shares in mixed use fisheries, there are
certain things that have to be accounted for--lest we have this
static allocation.
Mr. Cassidy. So, what I am gathering from you is that even
if the recreational people had the wherewithal to go to the
commercial guys and say, listen, I am going to buy your
allotment, your whatever, your permit----
Mr. Angers. Right.
Mr. Cassidy.--and that would be 10 percent of, say, the
total commercial share, that currently that would not be
allowed. You can pull that 10 percent over to the recreational,
but that is not allowed by the statute or by the Council?
Mr. Angers. That is currently not allowed by the Council.
Mr. Cassidy. In the Gulf. Is that true all around or just
for the Gulf?
Mr. Angers. I believe so. I believe so, yes, sir.
Mr. Cassidy. OK. So, that is a local rule that could be
theoretically overwritten by a political decision of the
Council or by a statute modification of Congress.
Mr. Angers. Well, and by a make-up on the various Regional
Fishery Management Councils that would have the political
courage to address it because, although they are allowed to
reallocate, they never do.
Mr. Cassidy. OK. Thank you very much. I yield back.
Ms. Bordallo. I thank the gentleman from Louisiana. Now I
would like to recognize the gentlelady from the Virgin Islands,
Ms. Christensen.
Ms. Christensen. Thank you, Madame Chairman. Thank you for
holding this second hearing on this really important issue and
complex issue. Before asking a few questions, I want to take
the opportunity to welcome all of our panelists, but especially
Mr. Julian Magras, a 22-year full-time commercial fisherman,
founding member of the St. Thomas Fishermen's Association, a
member of the Caribbean Fisheries Management Council Advisory
Panel, and also, as you have heard, Chairman of the Board for
the St. Thomas Fishermen's Association. Julian, I appreciate
your taking the time to be here, and all of the other witnesses
as well for traveling from far and near to give testimony on
behalf of our fishing communities.
I guess you had--and in answering the Chairwoman's question
on the relationship between NOAA and our fishing community in
the Virgin Islands. As you know, we talked a lot, we have
worked a lot together, and I share your concerns on the
management of the USVI fisheries and will continue to work with
you to address those concerns. But can you offer some
additional insights in how you see our efforts to designate the
U.S. Virgin Islands as a fishing community under the Magnuson
Act helping communities in the territory? And in particular, do
you see that as a way that might help to improve the
relationship between NOAA and our fisheries?
Mr. Magras. Thank you, Delegate Christensen. Actually, at
the April meeting, the regional director for NMFS put on the
record that at the next Council meeting, which will be taking
place in August, they are recommending that the Virgin Islands
become designated fishing communities. Now I personally feel
that me and my group, the Fishermen's Association, that they
realize that this is not going to make a big impact in setting
the rules and regulations through the ACL process and the catch
shares. So, they are throwing this out to us to try to make us
feel that, oh, we are going to become fishing communities. The
only thing that they are going to be looking at is the
socioeconomic impact of us being fishing communities.
So, it can help in one way if they really sit down and look
at the impact that it is going to be. But I strongly believe
that it is not going to make much of a difference. I think what
they need to do is really look over how they are doing the
entire process. We want to set all of these new rules and
regulations in place, but we still haven't come up with a way
of collecting the data correctly.
Without the data, setting rules and regulations doesn't
make any sense. The only people that will suffer, which we are
suffering from right now, are the fishermen. We submitted 36
years of data, and now they are telling us that they can't use
the 36 years of data. So, we want to come up with this whole
new catch report, which they said that they were going to
involve the fishermen, the stakeholders, in the development
process. Well, that has not happened.
They are keeping a meeting next month in Puerto Rico at the
Ponce Hotel. They invite us to come to the meeting. They pay
for everyone else to attend the meeting. Over 36 people, they
stay at this five-star hotel, and they refuse to pay for one
member of the St. Thomas Fishermen's Association to attend this
meeting. I have a serious problem with this because millions of
dollars are dumped into the different Councils for outreach and
education, and they say that they can't set any of these rules
and regulations without the stakeholders' input. Well, we need
to be at these meetings. Everyone else gets paid a salary to be
there. When we attend these meetings, we don't get paid a
salary to be there. We give up our own personal time, fishing
time, to be at these meetings.
Ms. Christensen. Is anyone else on the panel in a place
that is designated as a fishing community? No? Yes? Mr. Moody,
you are----
Captain Moody. We in Morro Bay are considered a fishing
community, and a small fishing community.
Ms. Christensen. And has it helped or not? Has it made a
difference?
Captain Moody. I am not--could you rephrase your question,
please?
Ms. Christensen. The issue was the relationship between the
fisheries and NOAA, and whether the communities have more input
into how the regulations are designed and implemented.
Captain Moody. Thank you. It is real hard for--on the West
Coast, the Pacific Fishery Management Council goes from the
Mexico border all the way up to the Washington border with
Canada, and they have meetings in Boise, Idaho, Seattle. It
makes it really hard for the local fishermen to attend a lot of
these meetings. Thank you.
Ms. Christensen. OK. Could I get in one more question?
Just, Julian, like many in the room today, you and I are
strapped to the belief that there is not one approach to every
fishery. What type of fishery do you think catch shares would
be most appropriate in, and what management do you think would
be most effective in the Virgin Islands?
Mr. Magras. Well, if we can get the relationship with the
NMFS, the Caribbean Fishery Management Council, our territorial
Fish and Wildlife, and the fishermen--if we could get that
communication going where it needs to be, and everybody is on
the same page, I think that the first area that we would see a
chance for setting catch limits would be in the trap fishery.
The reason for that, the St. Thomas Fishermen's Association,
with its membership, after doing analysis, we have 87 percent
of the trap fishery as members. And that is in the fish trap
fishery. And we have 95 percent of the lobster fishery as
members of the association.
So, we feel that in the future, if we could get the
relationship working where it needs to be, we can attempt to
try doing catch shares in that industry. But how I would like
to see the catch share program work, if we decide to, is I
don't want to see the little boats get kicked out of the
industry at all because, if that is what is going to happen,
well, then we would always be against catch shares because in a
small community, as the Virgin Islands is, fishing has had such
an important role in the Virgin Islands.
And right now, the young ones coming up don't want to
invest the time and the money to go into the fisheries because
of all of the new rules and regulations that are coming down.
So, they are waiting to see what the outcome of the entire
process is going to be. So, that is where we stand.
Ms. Christensen. Thank you. And thank you for your patience
in allowing me the extra questions.
Ms. Bordallo. I thank the gentlelady from the Virgin
Islands. And now I would like to recognize the gentlelady from
California, Ms. Capps.
Ms. Capps. Thank you, Madame Chair, especially for having
this hearing on Earth Day. I want to thank each of our
panelists for being here to share your views on catch shares. I
particularly want to welcome Wayne Moody, who is a commercial
fisherman from Morro Bay, which is in my district. He is joined
in the audience by Jeremiah O'Brien, who is the president of
the Morro Bay Commercial Fishermen's Organization.
As he said, Wayne has spent over 30 years fishing along the
West Coast. He has been using--he has been a real steward of
the sea, and only fishes using hook and line methods, catching
one fish at a time. Along with his wife, Wayne sells his
premium hand-packed albacore tuna to local restaurants. If
anybody here wants to try some delicious, sustainably caught
seafood, you can purchase some from his web site at
eatalbacore.com. And with the little commercial here, on the
container is the picture and name of his vessel, the Capriccio,
and the same statement, ``Caught hook and line, one at a
time.''
So, I want to focus my questions on the impacts on local
fishing communities, our historic working waterfronts, if their
fishery transitions to catch shares. And I do this with the
understanding that catch shares can be beneficial, even though
they are not a panacea. They must be part of a comprehensive
approach that supports communities and creates jobs and
strengthens conservation. If properly designed, catch shares
could help achieve these important goals.
We all know that the Pacific Fishery Management Council is
designing, and will be implementing, a catch share program for
Pacific groundfish trawl fishery by 2011. This design will
affect fishing jobs and coastal communities. It will also
impact fishery resources and the environment. As we learned at
last month's hearing, we must get this policy right to ensure
vibrant fishing communities and healthy ocean ecosystems.
So, Mr. Moody, small fishing businesses, which are family
owned, like those in Morro Bay and others in California, stand
to be the most affected if catch share programs are not
designed properly. You would agree that catch share management
may not be appropriate for every fishery, right?
Captain Moody. Thank you, Congresswoman Capps, and thanks
for the nice ad. Yes, ma'am, I would have to say that we have
to really use a lot of care with catch share management design.
And I will let you know that we are really concerned in our
community about how catch shares will be implemented.
Ms. Capps. Now you would agree also that if a catch share
program is being developed, it needs to be tailored to meet
specific community goals upfront, and before it is implemented.
Captain Moody. Yes, ma'am, most definitely.
Ms. Capps. What are some of the economic, social, and
conservation goals of the Morro Bay fishing community?
Captain Moody. First off, we need to make sure that we
preserve our fishing heritage and the economies of the
community. We need to make sure that we do it sustainably. And
we also want to make sure that we retain access to the stocks,
to the local stocks, by our local fishermen for the local
community.
Ms. Capps. I want to get into the ways to make the Pacific
trawl catcher program work for individual fishermen and their
communities, as you are an example of that. Our Chairwoman
asked about the anchoring quota in the community, a question.
And you explained really very well the reason for an anchoring
quota in communities with historic landings, and why this is an
important design feature.
Could you expand just briefly on why these communities are
so vulnerable to market forces?
Captain Moody. Well, as we have heard, quota, when it is
individual, transferable quota, it is a market commodity. And
when that commodity is sold, it can leave the community, never
to return again. Then when consolidation happens, the market
forces build up, and it makes it tough for that to come back.
So, we need to make sure we anchor some quota in the local
communities for our local fishermen.
Ms. Capps. Thank you. That is so important. So, when
designing the Pacific trawl catch share to allow community
fishing associations to hold quota, this is going to help the
fishing communities like Morro Bay to achieve its goals, right?
Captain Moody. Yes, ma'am. It will protect us from losing
jobs, landings, and the infrastructure.
Ms. Capps. So, as you know, the Pacific trawl catch share
program includes design features requiring every boat--this is
a sticking point now I am going to get into--and I beg your
indulgence. I know we are already in the yellow light. Could I
continue this chain of questions with my constituent, who has
come all the way from California? This feature requiring every
boat to carry an observer to account for the harvest, this is a
very big concern for small boats like those in California,
right? And this is something you have now been doing for over
two years.
Captain Moody. Yes, ma'am. It is a real concern. It almost
seems like this ITQ West Coast trawl program has been designed
for the larger boats. When you have to look at $300 to $600 a
day for an observer, a lot of our small boats cannot
financially pay that price, and it will force them to sell
their quota.
Ms. Capps. Let me ask you, since you have been forced to do
this for over two years, what has the result been?
Captain Moody. There has been no bycatch, none at all.
Ms. Capps. Absolutely no bycatch, and you are already
demonstrating that. Yet you continue to be required to carry
these observers on board.
Captain Moody. Yes, ma'am.
Ms. Capps. Do you have any designs or recommendations to
improve this design feature?
Captain Moody. It has already been shown in other countries
at one-third the cost of human observers that electronic
monitoring would be sufficient.
Ms. Capps. Especially when you do one at a time over the
edge of the boat. It is very easy to observe that with a
camera.
Captain Moody. Total retention, yes, ma'am.
Ms. Capps. OK. Now in Morro Bay--just a couple of more
questions, Madame Chair. In Morro Bay, several groundfish trawl
permits are working under a PFMC-approved exempted fishing
permit that allows these vessels to access the groundfish
resource using hook and line and trap gear. What has been the
record over the last two years? You already mentioned this, but
I want to make sure this is in the record--over the last two
years using these methods, which you have done in order to
comply with the requirements. What about the bycatch?
Captain Moody. There has been none. They have been able to
target the species of--the healthy species.
Ms. Capps. So, your willingness to adopt this method has
really resulted in the environmental goals of Pacific Coast,
also of the environmental community in doing so. I have one
last question, Madame Chair. I beg your indulgence. One of the
take-home messages for me in the last hearing we held on catch
shares was the need for flexibility in the design. And one of
the items under consideration now is setting aside an
allocation for adaptive management. Would you explain what you
interpret that to mean? And why would that be so important for
small communities like Morro Bay?
Captain Moody. This is where we are really concerned. This
adaptive management in the West Coast ITQ trawl program has a
10 percent set-aside, and that is to go to the small coastal
communities who would have problems once there is
consolidation. And there will be consolidation; it has already
been said that it is possible for the whole West Coast trawl
ITQ to be owned by 40 to 50 vessels--the whole coast. And we
need this adaptive management set-aside, 10 percent, for CFAs
or community fishing associations, and that needs to be
guaranteed.
There is real concern, even in NOAA, that that will never
come back to our coastal communities.
Ms. Capps. So, you would say as a recommendation to this
committee and also to NOAA and to the Pacific Coast Fishing
Council, find some way to guarantee that that 10 percent stays
in the community. Would you like to rephrase that for us so we
really get it right?
Captain Moody. We need the assurance of the National Marine
Fisheries that that 10 percent set-aside, which is supposedly
going for the first two years to the trawl sector, will never
come back to the coastal communities--we need to make sure that
that 10 percent set-aside comes back to the communities, small,
affected, negatively affected, coastal communities.
Ms. Capps. And that would be that guarantee that you need
to be assured that the way of life that you are adapting to is
going to be there for your children and grandchildren and for
the fishing community itself to be maintained.
Captain Moody. Yes, ma'am.
Ms. Capps. I thank you very much, and I now----
Ms. Bordallo. I thank the gentlelady from California. I
would like to remind--I think we have votes in a few minutes.
So, we are going to try to get the second panel on, but before
we do, I would like to recognize Mr. Cassidy for a second round
of questions.
Mr. Cassidy. Step up to the mike, buddy.
Mr. Angers. Yes, sir.
Mr. Cassidy. You mentioned on several occasions--you have
testified here before. You have expressed strong concerns
regarding the NOAA system of acquiring data as it relates to
recreational fishermen. And I have had several meetings, if you
will, in my office with folks to discuss this. And they say,
well it is not great, but there is a strong correlation. We
think that as bad as it is, it nonetheless correlates with a
trend, if you will. So, if we do a phone survey, and we find
out that--of course, people always lie about their fishing, but
nonetheless, we adjust it down 50 percent, and we come up with
something that reflects a trend in populations.
First, what would you comment about that? And second, if
you disagree with its usefulness, what would you propose in its
stead? And keeping in mind financial constraints, so it has to
be reasonable.
Mr. Angers. Yes, sir. Excuse me. First of all, there are
three different types of data that I think we want the agency
to be acquiring. First is stock assessments. We want to know
how many fish are out there. No fisherman wants the ocean to be
barren of fish, but we have to know how many fish out there to
start.
The second kind of data is the socioeconomic data that
shows the impact of fishing management on the local communities
that we have been talking about today. So, we have biological
data. We have socioeconomic data. And then we also need the
data about the anglers.
The old data system, the big joke about MRSS, which I
mentioned earlier, was that in their statistically perfect way
to do intercepts dockside, to ask people what they caught, and
then supplementing with a national phonebook, that a
grandmother in Kansas could receive a phone call and be asked
how many goliath grouper did you catch when you were
recreationally fishing saltwater today. I mean, it was utter
foolishness.
We know that the National Marine Fisheries Service, through
the various science centers, is capable of getting an
incredible amount of data, both on fish and on people. We know
that because in the Pacific Northwest, one of the other big
jokes is it seems like NOAA has named every single salmon
because they know so much about the fish in the Pacific
Northwest.
Mr. Cassidy. But salmon come onshore, but they go offshore
as well. I presume that must be easier if you have a tollgate,
and they are saying, hey, there goes Sam, there goes Betty,
there goes Ruth.
Mr. Angers. Right, true. No. That is a----
Mr. Cassidy. Whereas if they are way out in the ocean it is
like they are off at college. You don't know what is happening.
Mr. Angers. Well, good analogy, good analogy. But the
reality is that in gathering the data in the Southeast, for
instance, it is a lot more difficult because--let us just take
our home State of Louisiana. Everyone who lives on the water,
or everyone that lives on a tributary that can get you to
saltwater--or to freshwater for that matter--they are a
potential landing dock. And in the Pacific Northwest, it is
not----
Mr. Cassidy. But how is that difficult--yes. So, I agree.
Every Cajun that lives on a bayou can go out and fish and come
back to her backyard. So, how do you do it? What would be your
better way of doing it, knowing that we have a different setup
in the marshes than they do in the Pacific Northwest?
Mr. Angers. Well, I will tell you first, Mr. Cassidy, how I
would not do it. Currently, in the Gulf of Mexico, there are 44
species in the reef fish complex, that is, red snapper, yellow
snapper, vermillion snapper, lane snapper, gag grouper, yellow
grouper, red grouper--all of the different colors and all of
the----
Mr. Cassidy. The yellow light is on, man. Hurry.
Mr. Angers. Thirty-four of the 44 species of fish in the
Gulf reef fish complex, the agency has no data. Thirty-four of
the 44.
Mr. Cassidy. Now is that because they are not endangered or
because they just don't want to do it?
Mr. Angers. It is a question of if they have the will to do
it or not. But I will tell you, by next year, the agency is
required to certify to the Congress that over-fishing is not
occurring on species that as of today, in mid-2010, they have
no data on whatsoever. That is not how a science agency should
be conducting itself.
Mr. Cassidy. OK. So, we are almost out of time. So, how
would you do it?
Mr. Angers. Learn lessons from the successes in the Pacific
Northwest. They do it, they do it properly, not just because
Norm Dicks cares so much about fish in the Pacific Northwest,
but because there is a culture there and the science and the--I
am not a scientist, clearly. But the processes have been
developed, they have been established, and that is transferable
technology that can come to the Gulf, that can come to the
South Atlantic, Mid-Atlantic, throughout the entire country.
But the way to not do it is what they are doing today,
shortchanging all anglers, all commercial fishermen, from one
coast to the other.
Mr. Cassidy. So, what you are telling me is that even
though the salmon come onshore, the portion of the technology
that refers to the fish that are out there, so to speak, is
transferable.
Mr. Angers. Yes, sir.
Mr. Cassidy. And that is equally efficacious, even though
the fish do not come upon shore in the Gulf.
Mr. Angers. That is correct, yes, sir. And, of course,
there are a number of fish in the Gulf, for instance, redfish
that spend some time in the inshore marshes and state waters
and sometimes in the offshore marshes. So, it is somewhat
analogous to the salmon situation.
Mr. Cassidy. OK. Thank you very much. I yield back.
Ms. Bordallo. I thank the gentleman from Louisiana, and I
thank the witnesses on the first panel for their testimony and
for being here today. And I now call up our second panel of
witnesses.
[Pause]
Ms. Bordallo. I would like to welcome the witnesses on the
second panel. They include Mr. James Donofrio, Executive
Director of the Recreational Fishing Alliance; Mr. Bob Dooley,
President, the United Catcher Boats; Dr. Brian Rothschild,
Montgomery Charter Professor of Marine Science and Technology,
University of Massachusetts and Dartmouth; and Captain Terry
Arnold Alexander, Fishing Vessels Jocka and Rachel T.
I would like to welcome our second panel of witnesses and
thank them for appearing before this Subcommittee. And again, I
would like to note that the red timing light on the table will
indicate when five minutes have passed and your time is
concluded. We would appreciate your cooperation in complying
with these limits. Be assured, however, that your full written
statement will be submitted for the hearing record.
Mr. Donofrio, welcome back to the Subcommittee, and please
begin your testimony.
STATEMENT OF JAMES DONOFRIO, EXECUTIVE DIRECTOR, RECREATIONAL
FISHING ALLIANCE
Mr. Donofrio. Thank you, Madame Chair. Good morning, and
good morning, Mr. Brown and members of the committee. Mr.
Brown, I appreciate your comments this morning. They were very
thoughtful.
Madame Chair, my name is Jim Donofrio, Executive Director
of the RFA. I appreciate the opportunity to appear before you
today to discuss the application of catch shares or other
limited access privileges programs in the recreational fishing
sector. Today I have the distinct privilege of representing the
Marine Retailers Association of America, the Fishing Rights
Alliance, United Boatmen of New Jersey, United Boatmen of New
York, the Maryland Saltwater Sportsmen's Association,
Conservation Cooperative of Gulf Fishermen, the National
Association of Charter Board Operators, the Southern Kingfish
Association, New York Sport Fishing Federation, and the New
York Fishing Tackle Trade Association.
These groups represent the interests of millions of
saltwater anglers and tens of thousands of jobs in the
saltwater fishing industry from Maine to Alaska. All of the
aforementioned groups, including the RFA, are adamantly opposed
to any catch share program in the recreational fishing sector
that comprises the traditional open-access of season size
limits and bag limits. And to our surprise, NOAA and the Obama
Administration have diverted millions of dollars of resources
from cooperative research and other scientific programs toward
the implementation of catch shares. And the results from
fisheries where catch share programs were implemented should
spark serious trepidation for the commercial and recreational
sector.
The facts certainly do not support the lofty, unfounded
status the Administration has afforded to catch share
promotion. The application to catch shares in the recreational
sector would completely destroy the open access structure of
the fishery and substantially affect fishing-related tourism in
coastal states, as Mr. Brown has pointed out before in the
other hearing.
It is apparent from NOAA's actions that the overall health
of the recreational fishing industry is not a priority for the
agency when enforcing Magnuson mandates and crafting management
policies. NOAA has indicated that no fishery or sector is
obligated to adopt catch shares, and that the final decision
will be left up to the consideration of the Regional Fishery
Management Councils.
However, the RFA finds no comfort in this stipulation. As
you all know, there are numerous politically appointed
personnel within the upper administration of NOAA that worked
with pro-catch share environmental organizations prior to their
employment with NOAA. NOAA has established a precedence of
superseding the Regional Councils on matters of fisheries
management, even when conservation is not a primary concern.
The 2011 NOAA budget included a massive increase in funding for
the development of catch share programs. And finally, in 2009,
there were six appointments made to the Regional Councils where
the candidates were affiliated with non-fishing interest groups
that supported the use of catch shares.
This leads us to believe they were purposely appointed to
help advance a pro-catch share agenda. RFA firmly believes that
all anglers are entitled to equal right to access to
recreational fisheries. The very definition of catch shares
contained in Magnuson includes the use of limited access
privilege programs, which are fundamentally incompatible with
traditional open-access of our fisheries.
In many recreational fisheries, it is impossible to equally
divide annual recreational harvest limits among its
participants because there are so many more anglers than
numbers of fish, and clearly Congress should be aware of that
limitation. Some groups have suggested limiting the number of
recreational anglers to those individuals with financial
resources to pay for access, thereby creating free markets for
catch shares.
RFA hopes Members of Congress share our disgust with this
notion of selecting recreational participation based on a
criteria of money. RFA finds this approach to be in complete
violation of the public trust doctrine established when our
nation was founded to protect its citizens from the ownership
of natural resources. The public trust doctrine states that the
public rights are superior to private claims and private
rights. The idea of providing the exclusive rights of free-
swimming fish to a selected few is in complete contradiction to
this law. And in fact, the Supreme Court, in 1842, declared
that wildlife resources are owned by no one and ought to be
held in trust by the government for the benefit of present and
future generations.
Furthermore, RFA is very much concerned about the
collateral damage to the recreational sector when commercial
catch share programs are implemented. In a sense, commercial
catch shares would memorialize allocations that are not
necessarily consistent with the current or traditional
magnitude of the corresponding recreational component in that
fishery. The allocation of every single fishery with a
commercial and recreational component needs to be considered
before any commercial catch share program is implemented.
And again, Madame Chair, I thank you for the opportunity. I
am happy to answer any questions today.
[The prepared statement of Mr. Donofrio follows:]
Statement of James A. Donofrio, Executive Director,
Recreational Fishing Alliance
Madam Chairwoman and Members of the Committee, my name is Jim
Donofrio, Executive Director of the Recreational Fishing Alliance
(RFA). The RFA is a national 501(c)(4) non-profit political action
organization whose mission is to safeguard the rights of saltwater
anglers, protect marine industry jobs, and ensure the long-term
sustainability of our Nation's marine fisheries. The RFA represents
individual recreational fishermen, recreational fishing boat
manufacturers, party and charter boat owners and operators, bait and
tackle businesses, marina operators and other businesses dependent on
recreational fishing.
I appreciate the opportunity to appear before you today to discuss
the application of catch shares or other limited access privilege
programs in the recreational fishing sector. Today I have the distinct
privilege of representing the Marine Retailers Association of America
(MRAA), Fishing Rights Alliance, United Boatmen, United Boatmen of New
York, Maryland Saltwater Sportsmen's Association (MSSA), National
Association of Charterboat Operators (NACO), Southern Kingfish
Association (SKA), Conservation Cooperative of Gulf Fishermen (CCGF),
New York Sportfishing Federation, and New York Fishing Tackle Trade
Association. These groups represent the interests of millions of
saltwater anglers and tens of thousands of jobs in the saltwater
fishing industry from Maine to Alaska. All of the aforementioned
groups, including the RFA, are adamantly opposed to any catch share
program in the recreational fishing sector, in any way, shape or form.
This is a fact that cannot be compromised. We do not want any
discussion on any program that compromises traditional open access of
seasons, size limits and bag limits.
The RFA operates under the premise that recreational fishing is
good for the Nation. It is a traditional activity which brings families
and friends together, enhances the quality of life for millions of
Americans, provides tremendous economic benefits for the country in
terms of jobs and tax revenues, and has a low impact on our marine
resources. In fact, NOAA estimates the total recreational saltwater
economic value exceeds $30 billion annually. Based on the profound
benefits recreational saltwater fishing provides to our Nation, RFA
believes proper management is absolutely necessary.
Recreational fishermen were among our Nation's first
conservationists and continue to be at the forefront of pushing for
appropriate marine conservation measures because our businesses and our
quality of life depend on healthy marine fisheries. Those who
experience all that saltwater fishing has to offer often develop a
sense of responsibility and desire to pass on the experience to younger
generations and want to do their part to ensure that there are healthy
resources for future generations to enjoy. This strong conservation
ethic has played a significant role in the tremendous rebuilding
progress made in many important recreational fisheries since the
passage of the Sustainable Fisheries Act (SFA) in 1996 and amendments
to the Magnuson Stevens Fishery Conservation and Management Act
(MAGNUSON) in 2007. Currently, 81% of our nation's fisheries are not
overfished and 76% are not experiencing overfishing. These statistics
represent significant progress and a cooperative effort between
fishermen and regulators.
Unfortunately, many in the recreational fishing public and fishing
related businesses are not realizing the benefits of rebuilding and
maintaining fish stocks at sustainable levels and are being denied
accesses to some of the most important recreational fisheries. This
adverse situation illustrates that the rationale offered to fishermen
by NOAA that short-time pain in way of reduced access will result in
long-term benefits when stocks are rebuilt is invalid. We now know that
the absolute size of a fish stock is not the most vital component
necessary to support a healthy recreational fishery. What has emerged
as the most vital component in the post SFA and 2007 MAGNUSON
reauthorization regime is access to fish stocks. The lack of reasonable
access at times of high abundance is a cause for the general mistrust
of NOAA and the general management framework of MAGNUSON. RFA believes
this approach defies the very spirit and intent of domestic fisheries
management when Magnuson was penned by Congress in 1976 Of additional
concern is that this dysfunctional management approach threatens to
compromise recreational anglers' willingness to be active players in
future rebuilding efforts.
RFA has identified three major challenges facing our sport and
industry; 1) stability in the recreational fishing industry, 2)
preserving traditional access and participation, and 3) inadequate
monitoring and/or assessment of recreational fisheries. Accountability
measures and annual catch limits mandated by the MAGNUSON 2007
reauthorization result in mid-season closures that disrupt fishing
activities, cause charter boats to cancel trips and leave tackle shops
straddled with unsold inventory. These management practices create a
very unstable business environment. In addition, anglers are dealing
with some of the most restrictive regulations in fisheries that are
either rebuilt or at historic high levels of abundance. Many of the
2007 MAGNUSON reauthorization amendments, including accountability
measures and annual catch limits, demand a vastly improved recreational
data collection system which currently does not exist. We believe that
addressing these problems through minor changes to MAGNUSON is
necessary to ensure a vibrant future for the industry. We only make
this point because NOAA and the Obama Administration seem to be moving
forward with catch shares in a panicked state.
NOAA and the Obama Administration have diverted million of dollars
and resources from cooperative research programs towards the
implementation of catch shares. They claim that such a management tool
will solve all the problems currently being experienced in both the
commercial and recreational fisheries and will promote more sustainable
and profitable fisheries--a magic bullet. RFA must respectfully
disagree with this overly optimistic assessment of catch shares. The
results from fisheries where catch share programs were implemented
should spark serious trepidation for commercial and recreational
fishermen. The facts certainly do not support the lofty and unfounded
status the administration and NOAA have afforded to catch shares. The
underlying objective of any catch shares or limited access privilege
program is to reduce capacity or the number of participants in a given
fishery. The application of this objective in the recreational sector
would completely destroy the open access structure of the fishery and
collapse the influx of new participants that are necessary for a
vibrant recreational fishing industry. Furthermore, catch shares would
substantially affect fishing related tourism in coastal states.
There is no question that the recreational sector can be managed
better. Based on the current management, it is understandable why the
recreational fishing community is apprehensive towards the
implementation of a catch shares programs administered by NOAA. It is
apparent through NOAA's actions that the overall health of the
recreational fishing industry is not a priority for the agency when
enforcing MAGNUSON mandates and crafting management policies. Most
glaring, is the failure to fully implement important sections of
MAGNUSON that would improve recreational data collection programs.
These improvements were deemed necessary by the fishing community and
the National Research Council. Yet, it has been 3 years since the
reauthorization and NOAA has done very little to make the improvements.
During that time however, NOAA have moved forward with implementing
management tools that demand an improved data collection system. This
illogical approach will result in significant damages to the
recreational sector. If NOAA cannot be trusted to implement MAGNUSON in
a fair and balanced manner, how can the recreational fishing community
be expected to trust NOAA with a catch shares programs.
NOAA has indicated that no fishery or sector is obligated to adopt
catch shares and that the final decision will be left up to the
consideration of the regional fishery management councils. However, the
RFA finds no comfort in this stipulation for several reasons. First,
Dr. Lubchenco, NOAA Administrator, served on the Environmental Defense
Fund board of directors. Environmental Defense is probably one of the
most vocal proponents of catch shares. There are numerous other
political appointed personnel within the upper administration of NOAA
that worked with pro-catch share environmental organizations prior to
their employment with NOAA. Second, NOAA has established a precedence
of superseding the regional councils on matters of fisheries management
even when conservation is not the primary concern. Third, the 2011 NOAA
budget included a massive increase in funding for the development of
catch share programs. And finally, in 2009, there were 6 appointments
made to the regional councils where the candidates were affiliated with
non-fishing interest groups that support the use of catch shares. The
fact that these candidates were not supported by the commercial and
recreational fishing communities and that they all had ties to
environmental organizations pushing catch shares leads one to believe
that they were purposefully appointed to help advance a pro-catch
shares agenda. Many of the people taken off the councils were
incumbents doing a fine job representing the fishing interests. It is
clear that NOAA has a political agenda with this Administration like
none seen before. This is a very troubling situation and one that does
not provide the recreational fishing community with much confidence
that their collective voice will be given due consideration.
RFA firmly believes that all anglers are entitled equal right to
access recreational fisheries. The very definition of catch shares
contained in Magnuson includes the use of limited access privilege
programs which are fundamentally incompatible with the traditional open
access of recreational fisheries. Open access has already been
identified as a primary factor that sustains the overall health of the
recreational fishing industry. There has been a precedence set in the
commercial sector where catch share programs have been implemented,
where a share is based on past activity in the fishery. In many
recreational fisheries it is impossible to equally divide an annual
recreational harvest limit among its participants because there are
many more anglers than numbers of fish. In red snapper, each angler
would have to be allocated less than one fish. Therefore, participation
must be reduced in order for a recreational catch share to be
successful. Clearly NOAA should be aware of this limitation.
Some groups have suggested limiting the number of recreational
anglers to those individuals with the financial resources to pay for
access, thereby creating free markets for catch shares. RFA hopes
members of the Committee share our disgust with this notion of
selecting recreational participation based on the criteria of money.
RFA believes this approach would set a profound precedence of forcing
anglers to pay for fishing access, creating the very real possibility
of turning sportfishing into a privatized luxury for the elite. As
market factors drive the cost for each fish, the recreational fishery
would become cost prohibitive for many anglers to engage the fishery.
The result would be a fishery reserved exclusively for the wealthy and
those financially privileged enough to afford to fish.
RFA finds this approach to be in complete violation of the Public
Trust Doctrine established when our nation was founded to protect its
citizens from the ownership of natural resources. The public trust
doctrine states that the public rights are superior to private claims
and private rights. The idea of providing the exclusive rights of free
swimming fish to a selected few is in complete contradiction to this
law. The U.S. Supreme Court ruled in 1842 that wildlife resources are
owned by no one and are to be held in trust by government for the
benefit of present and future generations. This interpretation is the
very basis of the traditional, open-access currently seen in U.S.
recreational saltwater fisheries.
RFA believes such an approach would violate the Magnuson Stevens
Fishery Conservation and Management Act (Sec. 301 (a)(4) and (5) that
state ``If it becomes necessary to allocate or assign fishing
privileges among various United States fishermen, such allocation shall
be (A) fair and equitable to all such fishermen.'' Section (5)
continues to state that ``no such measure shall have economic
allocation as its sole purpose.'' RFA contends that catch shares and
limited access privilege programs based on market value would not be
fair and equitable to all fishermen and that by reserving fish for
those who can pay the most, violates Magnuson. RFA believes everyone
should have the right to fish, not just those with the financial
standing to buy their right.
RFA believes it to be poor public policy to allocate marine
resources to an individual based on that individual's economic
situation. It is clear that under such an approach, certain
demographics and communities would be disadvantaged and adversely
affected. This approach would make it burdensome for new entrants into
the fishery. Without new fishermen coming into the fishery, the very
progression of new participants that tackle shops and other fishing
related businesses depend upon would collapse. This also goes against
the multimillion dollar marketing campaigns funded by federal excise
taxes on fishing products to attract new fishermen. Furthermore, as
illustrated in the commercial red snapper fishery where price per pound
increased 15% in the first year of the IFQ system, market demands in a
recreational IFQ/catch share program would accelerate attrition as
costs rise. Such a proposal would quickly lead to a small scale,
boutique recreational fishery only accessible by elite fishermen. RFA
envisions and hopes the future of recreational fishing is far different
from this potential view.
It appears that in rolling out their plan to implement catch shares
in U.S. fisheries, the Obama Administration and NOAA have failed to
recognize some very basic characteristics of the recreational fishing
community. Each angler is driven by different motivations when engaging
the fisheries and the dynamics of the fishing community vary greatly by
region and time. For example, some recreational fisheries are almost
entirely catch and release while in other fisheries harvest is the
primary motivation. Tackle shops and the for-hire sector often speak of
the importance of anglers that decide to engage the fishery on impulse.
These impulse fishermen can account for a substantial part of a fishing
business's annual income and yet these fishermen may only fish one or
two times a year or every other year. Failure to recognize these basic
characteristics of the recreational fishery indicate that the effort to
advance catch shares in the recreational sector is agenda driven as
opposed to being driven by legitimate concern to address the real and
pressing problems of the recreational sector.
Finally and with regard to the implementation of catch shares in
the commercial fisheries, the RFA does not intend to take a position on
their use in this sector. However, RFA is very much concerned about the
collateral damage to recreational sector when commercial catch shares
programs are implemented. The definition of catch shares and limited
access privileges included in MAGNUSON describe catch shares as an
amount of fish to be harvested based on the total allowable catch of
the fishery that may be held for the exclusive use by the permit
holder. The consequence of granting exclusive rights to commercial
fishermen under the new annual catch limit regime of the 2007 MAGNUSON
reauthorization would result in a permanent loss of potential harvest
for the recreational sector. In a sense, commercial catch shares would
memorialize allocations that are not necessarily consistent with the
current or traditional magnitude of the corresponding recreational
component in that fishery. RFA has challenged the commercial/
recreational allocations in many important recreational fisheries such
as New England groundfish, summer flounder, tilefish and some species
in the snapper/grouper complex. For example, commercial fishermen of
the summer flounder fishery were allocated 60% of the annual landing
limit based on sector specific landings performance during a subjective
timeframe. The timeframe was selected by the Mid Atlantic Fishery
Management Council. At the time, the council had more commercial
members and therefore voted for a timeframe that favored the commercial
sector. Despite historical and current records that support a more
equitable recreational allocation, recreational fishermen are denied
their traditional portion of the summer flounder fishery. The RFA and
United Boatmen challenged this allocation in federal court and the Mid-
Atlantic council has not properly disposed of the issue. The allocation
of every single fishery with a commercial and recreational component
needs to be considered before any commercial catch share program is
implemented.
In conclusion, the recreational fishing community is dealing with
some of the most adverse management in recreational fishing history
which ironically comes at a time when many fish stocks are rebuilt or
well on their way to being rebuilt. Anglers have been restricted to
unprecedented levels and even completely excluded from important
fisheries. It is unfortunate that the recreational fishing community is
in a depressed state due to broken promises made by NOAA of benefits to
the recreational fishing community when stocks reach rebuilding
targets. NOAA continues to fail to recognize that access to the marine
fisheries is one of the most important problems the recreational
fishing community faces. Heavy handed management and inconsistent
implementation of the 2007 MAGNUSON reauthorization has caused extreme
mistrust of NOAA. NOAA cannot be trusted to administer or oversee a
catch shares program in the recreational fisheries. The use of catch
shares in the recreational sector would destroy the traditional open
access structure and collapse the entrance of new participants in the
fishery.
I thank you Madam Chair for the opportunity to provide the position
of the RFA and the above mentioned groups before this committee. We all
agree that there are significant problems facing our industry but we
firmly believe that catch shares in the recreational sector are not the
answer. I will be happy to answer any questions.
______
Response to questions submitted for the record by James A. Donofrio,
Executive Director, Recreational Fishing Alliance
1. Can you tell me your experience fishing in a catch share program?
Do you have a federal permit to fish in a catch share managed
fishery?
Fortunately, no domestic recreational fisheries have been subjected
to a limited access privilege program or catch share program. For this
reason, I have not participated in a recreational catch share program.
However, I have been professionally involved with the traditional open
access recreational fisheries for over 25 years. It is undeniable that
a recreational catch share program would completely destroy the
principles and business model upon which this fishery is based.
2. Do you believe the traditional fishery management is failing
recreational fishermen? What proposals does your industry have
to improve the situation and ensure the long-term viability of
federal fisheries?
It is fair to say that recreational fishermen are spending less
time on the water. For the most part, this is not a consequence of
depleted fish stocks or a lack of availability of fish to the
recreational sector but excessively restrictive regulations prompted by
inflexible mandates contained in the Magnuson Stevens Fishery
Conservation and Management Act (MSA). Mandates that jeopardize the
future of our sport without achieving any legitimate conservation
objectives. RFA is actively working with members of Congress to correct
the flaws in MSA so we can enjoy longterm sustainability of our
nation's marine resources along with a vibrant recreational fishing
industry.
3. Can you give an estimate of the number of recreational fishermen in
the U.S. and the number of recreational fishing vessels in the
U.S.?
There are two commonly accepted estimates for the number of
saltwater anglers produced by the U.S. Department of the Interior and
the National Oceanic and Atmospheric Administration (NOAA). These
federal agencies estimate the number of saltwater anglers to be 9.1
million and 24.7 million, respectively. This significant variation
between the two agencies is a result of the different methodology
employed. Based on the number of boat registrations in coastal states
and applying an assumed percentage that 43.5 of all boats are used in
saltwater fishing, a fair minimum estimate of the number of
recreational saltwater fishing boats in the U.S. is 2,621,926.
4. Do you believe the efforts to improve recreational data collection
will yield better recreational harvest data?
MSA mandated improvements to MRFSS should improve the efficiency of
the survey design. Specifically, the phone survey component will be
linked to active fishermen identified through license and registry
programs. Efficiency does not always correlate to accuracy or
representativeness. Furthermore, the new approach may create biases
that have not been quantified yet. RFA supports the MSA requirements to
make improvements to recreational data collection programs but is
cautious about the magnitude of any realized improvements.
5. Can you give us an example of an unreasonable rebuilding target?
The process of setting a stock's rebuilding target and other
biological reference points is driven by the amount and quality of the
information available to the stock assessment scientists. Thus if the
data is poor, the rebuilding target will carry the same level of
uncertainty and likely be artificially high due to the precautionary
approach. In the summer flounder fishery, the rebuilding target has
been lowered 3 times as stock assessment improved. Likewise, many
question the red snapper rebuilding because of the profound flaws and
imprecise data incorporated in the red snapper stock assessment.
6. How much of the recreational fishing effort in the U.S. takes place
on charter boats?
This varies greatly from fishery to fishery and by region. However,
NOAA estimates that in 2009, there were 66,602,781 total recreational
fishing trips of which 2,001780 were taken on charter boat. This
represents 3 percent of the total recreational effort.
7. Do you have thoughts on how managers can track recreational catches
with a similar degree of certainty and timeliness? How should
recreational catch-and-release mortality be quantified for each
fishery and factored into the scientific processes?
It is unlikely that the recreational fishing sector can be
monitored with the same mechanisms as the commerical sector where
nearly every fish that is passes through a fish house can be counted.
MRFSS is good for estimating trends in fishing activity but management
demands a much more immediate assessment of fishing that is simply not
possible with MRFSS as designed. A much more robust sampling program
with a considerable budget and staff would be needed to attain the same
level of monitoring confidence as seen in the commercial sector. A high
level of timeliness can be achieved in the for-hire sector. Those
vessels fishing under federal permits are required to complete vessel
trip reports (VTRs) upon completion of each fishing trip. Copies are
then mailed to NOAA and state agencies. Some states are converting this
paper based reporting system to an electronic one which obviously
improves timeliness. However, as mentioned above, the for hire sector
only represents a small fraction of the overall recreational fishing
effort. Of greater concern, for hire VTR are rarely even looked at by
NOAA. From an assessment or science standpoint, mortality associated
with discarding should be treated no differently than mortality
associated with harvest. A dead fish is a dead regardless of its final
disposition. From a management standpoint, discard mortality needs to
be addressed on a fishery by fishery basis.
8. Can you tell me your experience fishing in a catch share program?
Do any of you have federal permit to fish in a catch share
managed fishery?
During my 25 years of professional experience in the recreational
fisheries, there were no catch share programs in place. Currently,
there are no federal permits issued for recreational catch share
programs. Since the colonists first engaged in recreational fishing in
this country, it has been managed in a traditional open access manner
consistent with the Public Trust Doctrine. It does not require
experience in a catch share fishery to know that such a program would
destroy the open access recreational fisheries.
9. Do you think it is reasonable to have some restrictions -either on
new entrants into a fishery or some limits on effort--in
fisheries where rebuilding is necessary?
Limiting the participants is unnecessary. Traditional management
tools including adjustments to seasons, size limits, and bag limits
have the ability to effectively control effort in rebuilding fish
stocks. Many of the most important recreational fisheries have seen
marked rebuilding success based on this approach.
10. Do you also have concerns, and if so, what are your specific
concerns regarding accountability measures. What suggestions
would you give Congress to correct these concerns?
RFA is concerned about the use of accountability measures in the
recreational sector. In fact, accountability is already the standard
when seasons, size limits, and bag limits are set in response to the
previous fishing seasons performance relative to the harvest target.
RFA contends that no additional accountability is needed in the
recreational sector. Furthermore, accountability measures must rely on
MRFSS for which is was never intended or designed to be used for.
Congress should exempt the recreational sector from accountability
measures included in MSA because current practice already satisfies
this mandate.
______
Ms. Bordallo. Thank you very much, Mr. Donofrio, for
further explaining the impacts of catch shares on recreational
fishers.
Mr. Dooley, thank you for being here with us today, and you
may proceed with your testimony.
STATEMENT OF BOB DOOLEY, PRESIDENT,
UNITED CATCHER BOATS
Mr. Dooley. Chairwoman Bordallo and members of the
Subcommittee, thank you for the opportunity to testify before
you today regarding catch shares, and in particular the West
Coast trawl rationalization program. My name is Bob Dooley. I
live in Half Moon Bay, California, and have been a commercial
fisherman for over 40 years.
My brother John and I own and operate three boats that
participate in Alaska and West Coast fisheries. I have been
involved in fisheries prior to, during, and after the
implementation of a catch share program, and therefore can
provide you with this firsthand insight. One of the fisheries I
participate in is the Bering Sea pollock fishery. A catch share
was implemented in 1999 under the American Fisheries Act. I not
only helped in the implementation of that program, but also
have the unique perspective of having participated in that
fishery since 1981.
I have seen the problems an open-access race for fish
creates and the resulting downward spiral, both economically
and environmentally. I have witnesses firsthand the benefits to
the health of the fishery, communities, crews, and environment
a catch share fishery provides.
In the early years, we took some big risks, ventured into
unknown fisheries, built boats, found markets, and basically
fished year-round. Over time, too many boats entered the
fishery, and the seasons started getting shorter and shorter.
In 1998, the pollock winter season had dwindled down to just
one month. To try to make it, fishermen borrowed more money and
invested in bigger boats with more capacity. But this became a
race to the bottom.
Small independent fishing companies were disappearing, and
large multinational corporations were picking up the assets and
consolidating the fishery. In the mid-1990s, Alaska fishermen
and the coastal communities started talking about how to save
the fishery. The outcome was a proposal by the Bering Sea
pollock industry called cooperatives. Co-ops are a form of
catch share that assign a quota to a group of fishermen and
allow the co-op to decide how and when to fish that allocation.
There is no doubt in my mind that the catch share co-op
saved the pollock fishery and saved the independently owned
fishing companies. By owning a share of a pollock cooperative,
I am now able to work at minimizing my costs while increasing
the value of my harvest. More importantly, the stability
created by catch shares programs not only protects my
investment, but also the investments of the related
communities. In our co-ops, we work together to actively
address fish stock challenges and provide solutions to
environmental challenges in a quick manner.
I would now like to talk to you about the catch shares
program that the Pacific Council has recently recommended. This
is the West Coast trawl rationalization program. This program
has been designed from the ground up through a collaborative,
open, public process over the past six years. I am looking
forward to fishing whiting under a coop-style management for
the very same reasons that have benefitted Alaska pollock
fishermen over the past 12 years. I will have the tools
necessary to deal with bycatch problems, rather than racing for
bycatch. I will be able to work with my fellow co-op members to
maximize the use of a fixed allocation of rockfish bycatch to
achieve full utilization of the whiting quota.
I am able to work with my processor to choose what time of
year is best to fish, not based on when the season opens, but
rather based on what time of year the bycatch rates are the
lowest and the fish values and recovery rates are the highest.
The points I have tried to address today through my
personal experience are straightforward. First, catch shares
need to be designed from the bottom up and tailored to the
specific needs and characteristics of a particular fishery.
Second, fishermen become directly engaged in management of the
fishery in solving scientific challenges, and use their
resources and knowledge to work with government to better
manage fish stocks. Third, catch shares do not cause negative
impacts to the communities. Poor fishery management does.
Currently, thousands of tons of fish are discarded. As a
result, a fishery that could be worth $70 million is currently
only worth $25 million. Catch shares provide fishermen and
communities with means to protect them against things like
consolidation, corporatization, and the loss of fishing
opportunity that you see today in open-access management.
If I would leave you with one thought today, it is this. A
lot of Federal money has been spent on bad management. This
only leads to more fisheries disasters and more job losses. But
an investment in implementing catch shares like the Alaska
pollock and West Coast groundfish program will pay huge
benefits to our fishing families and coastal communities. Thank
you.
[The prepared statement of Mr. Dooley follows:]
Statement of Robert E. Dooley, President, United Catcher Boats
Chairwoman Bordallo, Ranking Member Young, and Members of the
Subcommittee; thank you for the opportunity to testify before you today
regarding NOAA Catch Shares and, in particular, the West Coast
groundfish rationalization plan. My name is Bob Dooley. I am the
President of United Catcher Boats and co-owner of a commercial fishing
company with my brother John.
John and I have lived in Half Moon Bay, CA our entire lives and
have been commercial fishermen for over 40 years. Our families have
been active in commercial fishing and it's supporting businesses on the
West Coast for over 70 years. We presently own and operate three
vessels. Two participate in the Alaska Pollock fishery and the West
Coast Pacific Whiting fishery and our third vessel fishes Dungeness
crab off the West Coast.
United Catcher Boats (UCB) is a trade association of 62 commercial
fishing vessels that participate in the Alaskan Pollock, Alaskan crab,
and West Coast groundfish fisheries. Our vessels are called catcher
boats because that is all we do--we catch fish and deliver our catch to
processing facilities. UCB members are very familiar with the benefits
of catch share programs, participating in American Fisheries Act
Pollock cooperatives as well as the Alaskan crab IFQ program, both of
which were approved by Congress and developed through the North Pacific
Fishery Management Council process.
I am here today to express the strong support of both UCB and
myself for Catch Shares programs in general and specifically for the
West Coast Trawl Rationalization Program approved by the Pacific
Fishery Management Council (PFMC). We also support the subsequent
request for federal funding to help implement this new fishery
management program that is presently in the President's FY 2011 draft
Budget.
I participate in the fully rationalized Bering Sea Pollock fishery
in Alaska. That fishery was fully rationalized in 1999 through the
provisions of the American Fisheries Act. I not only helped in the
implementation of that program but also have the unique perspective of
having participated in this trawl fishery since 1981. I have seen the
problems an open access race for fish creates and the resulting
downward spiral, both economically and environmentally. I have
witnessed first hand the benefits to the health of the fishery,
communities, crews and environment a rationalized fishery provides.
This is what has been missing in the current and past management of the
West Coast trawl fisheries.
Over the past two decades the PFMC has struggled with finding a way
to rebuild depressed fish stocks off the West Coast, implement an
accurate catch accounting system both at-sea and at the dock, and
structure the fishery so the trawl boat owners can once again be
profitable and thus support the local communities that they live in and
deliver their harvests to. During this time period, the federal
government has declared the Pacific Coast ground fish fishery a federal
disaster and the PFMC has implemented a license limitation program that
did not control effort. The fishery has been managed via monthly trip
limits that required regulatory discards and has a minimal observer
program. Congress authorized and funded a vessel and license buyback
loan program that failed to reduce overall effort in the fishery. My
2009 Pacific Whiting Season lasted just three weeks. All of these
measures have failed to rebuild the fishery and the value of the
fishery continues to be at an all-time low. Six years ago, the PFMC
embarked upon a project that would allow for ``rationalization'' of the
West Coast Trawl fishery, otherwise known as a Catch Share program, and
last year made their final recommendation to the Department of
Commerce. This new management program is scheduled to go into effect
just prior to the start of the 2011 fishery.
The first point I would like to make is that this program was
developed from the ground up with full participation of all
stakeholders in the West Coast groundfish fishery from Southern
California to Northern Washington. This is not an example of NOAA
Headquarters in Washington, DC trying to impose catch shares on the
fishery. The PFMC established a special stakeholders committee that
included a broad membership of fishermen, processors, NGOs and
community representatives. Out of this open process came a preferred
option for an IFQ-based system for the shoreside groundfish and Whiting
fisheries and a Co-op-based system for the offshore Whiting fisheries.
The second point I want to make is that this new program will do
two things that will have a dramatic positive effect on the health of
the fish stocks and the value of the fishery. The first is that it will
end the practice of ``regulatory discards''. Under the present trip
limit style management fishermen are required to throw valuable fish
overboard. This discard is subtracted from existing quotas under an
assumed estimated discard rate thus contributing to the actual decline
of the resource while no value is being added to the fishery or our
communities. Under the new program, each fisherman will be allocated
their own quota, or percentage, of the stocks of fish they catch and
once they reach their assigned amount, will either have to stop fishing
or find another fishermen to acquire fish from. This individual
allocation allows each fisherman the opportunity to harvest their own
fish when it is most valuable and the ability to utilize each pound of
their quota to return the maximum benefit to themselves and their
communities.
The second thing that will occur under this new program is accurate
accounting all fish that are harvested. Every boat will be required to
carry a federal observer that will account for the harvest at-sea.
There is also a requirement of a federal weigh-master at each
processing or receiving plant to observe the delivery of fish and to
check the weight of each delivery. These measures will result in
accurate accounting of the fish that are harvested and delivered.
My third point has to do with federal funding of this new Catch
Shares Program. To implement this new West Coast program, NOAA is
requesting about $12 million in the FY2011 budget. A large portion of
this requested funding will go to help fishermen afford the cost of
having a federal observer on board their boats (estimated at between
$300 and $900 per day per observer).
Note that this request of funding is not a request to subsidize the
federal groundfish trawl fishery. In fact the federal government has
the authority under the Magnuson-Stevens Act to assess fishermen a LAPP
management fee of up to 3% of the value of the fishery. The fishermen
participating in the program will pay an annual fee for the cost to
manage the fishery. The $12 million request is for the start-up cost of
the program in 2011.
Some have said that this funding for implementation of our new
Catch Shares program will take funds away from current collaborative
fishery research and fishery science research. This is simply not true.
Mr. Barry Thom, the Acting NMFS West Coast Regional Director, and Dr.
Eric Schwaab, the newly appointed head of NMFS, both have stated
recently that the new Catch Shares programs will not take federal money
away from current research programs (Mr. Thom at the March 2010 PFMC
Meeting in Sacramento and Dr. Schwaab at the previous House Resources
Subcommittee hearing on Catch Shares on March 16, 2010.)
Good management of a fishery requires accurate stock assessments of
the fish populations, and a reliable system to determine the amount of
fish that can be sustainably harvested all based on good science. Catch
Share programs in other parts of the country and world have resulted in
the stakeholders, namely the fishermen, demanding the best available
science and research be used. The reason for this is under a Catch
Share system the fishermen have a vested interest in the sustainability
and health of the fishery resource.
Catch Share programs also set up the opportunity for fishermen to
find solutions to management problems without a government mandate, or
regulation. Rather, fishermen work cooperatively to find creative,
voluntary programs to solve real problems. Let me give you a couple of
examples of what I am talking about by looking at the Bering Sea
Pollock fishery. The first is the Pollock fleet's actions to address
the problem of incidental salmon bycatch taken while we are fishing for
Pollock. Under our co-op system, the boat owners developed and approved
a voluntary program to close small, discrete areas on the fishing
grounds for a limited duration when high rates of salmon bycatch are
encountered. We call these areas Hot Spot Avoidance Areas. Unlike the
government, we are able to close these areas to individual boats or a
group of boats that have above average rates of salmon bycatch while
keeping these Hot Spots open to boats that have low rates of bycatch.
This fleet-sponsored bycatch avoidance program can only happen when we
are operating under a Catch Share program. We are beginning the process
of designing a rockfish bycatch avoidance and management program for
the West Coast Whiting fishery when the Groundfish Trawl
Rationalization program goes into effect. So what we did in the Alaska
Pollock fishery due to AFA we will do in the West Coast Whiting
fishery. Our goal is to harvest 100% of our allocation while at the
same time stay under a bycatch cap for incidentally caught species.
Government initiated regulations have failed to achieve this goal.
The second example is the development of a salmon excluder device.
Through a Pollock industry initiative, we designed, developed and
tested a number of devices to put into our mid-water trawl nets that
exclude the bycaught Chinook salmon. After four years of trials and
testing we now have arrived at a device that over 60% of the Pollock
fleet is now using ``without any government regulation requiring us to
do so.
As I mentioned in my introductory comments, I fish in both the
rationalized Bering Sea Pollock fishery and the soon-to-be rationalized
West Coast Whiting fishery. I can tell you that back in 1998 when
Congress and the North Pacific Fishery Management Council were
developing the American Fisheries Act, many of us out on the water
fishing were very skeptical of this new program. Because of this, our
concerns expressed at NPFMC meetings when they were developing the AFA
regulatory provisions were very skeptical and there were a lot of boat
owners that were quite nervous and in fact didn't support the program.
You have to realize what we were going through in those days. Most if
not all of the fishermen were just trading dollars and a number of the
Pollock companies had gone bankrupt. In addition, many of the multi-
national, large fishing companies were acquiring a lot of the vessels
and consolidation was happening. During a 10-year period, from 1989-
1999, the Pollock industry experienced three bloody sector allocation
battles at the NPFMC. For me personally, the only reason I am still in
the Pollock business is due to the provisions of the AFA that gave me
and my brother a certain, known allocation of Pollock annually and the
ability to get the most value out of our harvest of Pollock. The
ownership and use caps in this law have protected the smaller fishing
companies. I do not know a single participant in the Bering Sea Pollock
fishery today that does not emphatically support the American Fisheries
Act and the rationalized manner of the fishery.
I can also tell you that the Whiting fishermen who also fish
Pollock, like myself, were the first ones to go to the Pacific Fishery
Management Council and ask for an AFA-style co-op management structure
6 years ago, to address the very same problems we were experiencing in
the Alaska Pollock fishery 15 years ago. Again, this is a ``ground
up'', not ``top down'' built program and one that the fishermen who are
dependant on this fishery are very excited about.
Thank you very much for the opportunity to share my and UCB's
perspective on catch shares.
______
Ms. Bordallo. Thank you very much, Mr. Dooley, for
explaining the perspective of the United Catcher Boats on catch
shares. And now I would like to welcome back to the
Subcommittee Dr. Rothschild. And you may begin your testimony.
STATEMENT OF BRIAN ROTHSCHILD, PH.D., MONTGOMERY CHARTER
PROFESSOR OF MARINE SCIENCE AND TECHNOLOGY, UNIVERSITY OF
MASSACHUSETTS DARTMOUTH
Dr. Rothschild. Thank you, Madame Chairman. Members of the
committee, thank you for the opportunity to testify before you
this morning. I also chair the Mayor's Ocean and Fishery
Council in New Bedford, Massachusetts, the largest port in the
Nation in terms of value. Our Council is a sounding board for
much of the Massachusetts fishing industry, and I bring you
their greeting.
In my testimony this morning, I want to provide background
on the initiation of the catch share concept in New England,
and point out structural and conceptual difficulties that make
the catch share initiative an experiment, rather than an
example of implementation of a well-thought-out policy.
For over a decade, fishery management in New England has
been wasteful and inefficient. Over-fishing and a failure to
rebuild stocks have been widely cited. A less publicized aspect
of waste are the hundreds of millions of dollars of fish that
could have been caught without over-fishing that were not
caught because of inflexible regulations. In addition, tons of
valuable bycatch are thrown back in the ocean because of
management regulations.
The blame for over-fishing and failure of stocks to rebuild
is often laid at the feet of a prevailing days at sea
management system. In this effort-based system, only the
effort, the days at sea, are precisely controlled. It was
reasoned that instead of controlling effort, controlling catch
would eliminate over-fishing and result in increased stock
abundance.
Controlling catch is called the quota system. For varying
reasons, the quota system morphed into a sector system. The
sector system in New England is being launched with mixed
reception. The facts of the matter are that property rights
systems such as sectors reduce the open access like wasteful
imbalance between capital and the amount of fish that can be
caught. However, they also change the social structure of the
industry, reduce boats, reduce jobs, negatively affect
shoreside businesses, as well as destroying the cultural fabric
of fishing communities.
The launching of the sector system in New England has been
associated with a plethora of advice, most of which is
unheeded. This advice contains nuggets, some of which come from
NOAA, that relate to equity, taking time to conduct adequate
planning, thinking about buy-back programs, providing a safety
net for those who are disaffected, considering the fundamental
issues associated with the transfer of public property to the
private sector, and most of all, properly designing the
management system.
Many in the community do not believe that the New England
catch share system is well designed, and that its operation and
present configuration will unfairly disaffect existing
fishermen and industries, who otherwise would not be
disaffected if it were well designed.
The people who have this view cite quotas are too risk-
adverse. With anticipated quotas, 50 to 75 percent of the fleet
and thousands of jobs will be lost in a relatively short time.
It is the failure to take into account the mixed species nature
of the fishery in current management regulations. Unless this
is changed, catch share management will only propagate and
continue ongoing under-fishing and bycatch waste.
Structural details in the exchange of quota shares or
allocations do not make sense. Stock assessments are not
current. Critical assessments will not be completed before the
start of the fishing year. Mechanisms to address the needs of
the disaffected are not in place. Allocations for scallop
bycatch have not as yet been resolved. This is a very critical
problem that concerns anywhere from tens to hundreds of
millions of dollars.
The intent of Congress, as expressed in the plain language
of the Magnuson-Stevens Act, does not appear to have been taken
into account, particularly with regard to National Standard 8.
Most telling, there appears to be no users manual for fishermen
newly engaged in the system. A users manual would explain the
structure of the system and the day-to-day details of how it
would operate. How in the real world would 20 sector managers
control the flow of 20 species of fish, 400 possibilities in
virtual real time?
It seems that the approach to developing catch shares in
New England has transformed the ready, aim, fire sequence into
a fire, aim, ready sequence. This is not a good way to develop
public policy. We cannot minimize the importance of the users
manual and of conducting sufficient analysis to understand the
fate and effect of this major Federal action.
In my written testimony, I have made a number of
suggestions, and the most important one appears to be that the
Congress or Administration should form a task force, an ad hoc
task force, to reform fisheries management in New England. This
task force should consist of members of the fishing, science,
environmental community, and work from the ground up. And we
think that this will be a really good opportunity to move ahead
in the future. Thank you very much.
[The prepared statement of Dr. Rothschild follows:]
Statement of Brian J. Rothschild, Montgomery Charter Professor of
Marine Science, University of Massachusetts Dartmouth, and Chair,
Mayor's Ocean and Fisheries Council
Madam Chairwoman and members of the Committee, thank you for the
opportunity to testify before you this morning. My name is Brian
Rothschild. I am the Montgomery Charter Chair of Marine Science at the
University of Massachusetts Dartmouth. I also Chair the Mayor's Ocean
and Fisheries Council in New Bedford, Massachusetts, the largest
fishing port in the Nation in terms of value. Our Council is a sounding
board for much of the Massachusetts fishing industry. I bring you their
greetings.
In my testimony this morning, I want to provide background on the
initiation of the catch-share concept in New England and point out
structural and conceptual difficulties that make the catch-share
initiative an ``experiment'' rather than an example of implementation
of a well thought out public policy. I conclude that it is necessary to
1) maximize economic survival of participants during the first year by
relaxing annual catch limits (ACLs) without overfishing; 2) facilitate
and accelerate an independent coherent review of the status of the
stocks in New England waters; 3) establish bold new and innovative
scientific programs focused directly on the needs of fishery
management; 4) establish a systems engineering/inventory management
approach to day-to-day fisheries management; and 5) refocus budget and
programs on the needs of fishery management. We also need institutional
reform, including 1) making the New England Fishery Management Council
an elected body; 2) institutionalizing a systems of checks and balances
in the Agency; and finally 3) ``consulting with the people'' on how to
reform fisheries management in New England by establishing an ad hoc
New England Fishery Management Reform Commission.
For over a decade, fishery management in New England has been
wasteful and inefficient. Overfishing and a failure to rebuild stocks
have been widely cited. A less publicized aspect of waste are the
hundreds of millions of dollars of fish that could have been caught
without overfishing but are not caught because of inflexible
regulations. In addition, tons of valuable bycatch are thrown back in
the ocean because of management regulations.
The blame for ``overfishing'' and failure of stocks to ``rebuild''
is often laid at the feet of a prevailing days-at-sea (DAS) management
system. In this effort-based system--only the ``effort''--the DAS are
precisely controlled. It was reasoned that instead of controlling
effort, controlling catch would eliminate overfishing and result in
increased stock abundance. Controlling catch is called a ``quota
system.''
For varying reasons, the quota system morphed into a property
rights system, or an individual-transferable-quota like system (ITQ).
This then morphed into a sector system. The sector system, where groups
of boats form sectors and each sector is allocated a ``share'' of the
fish, is thought to be under the umbrella of ``catch share''
management.
The sector system in New England is being launched with a mixed
reception. The facts of the matter are that property rights systems
such as ``sectors'' reduce the open-access-like wasteful imbalance
between capital and the amount of fish that can be caught. However,
they also change the social structure of the industry, reduce boats,
reduce jobs, negatively affect shore side businesses, as well as
destroying the cultural fabric of fishing communities.
The launching of the sector system in New England has been
associated with a plethora of mostly unheeded advice. This advice
contains nuggets (some of which come from NOAA) that relate to equity;
taking time to conduct adequate planning; thinking about buy-back
programs; providing a safety net for those who are disaffected;
considering the fundamental issues associated with the transfer of
public property to the private sector; and, most of all, properly
designing the management system.
Many in the community do not believe that the New England catch-
share system is well designed and that its operation, in its present
configuration, will unfairly disaffect existing fishermen and
industries who otherwise would not be disaffected if it were well
designed.
They cite
Quotas are too risk averse. With anticipated quotas, 50-
75% of the fleet and thousands of jobs will be lost in a relatively
short time.
There is a failure to take into account the mixed-species
nature of the fishery in current management regulations. Unless this is
changed, catch-share management will only propagate ongoing
underfishing and bycatch waste.
Important structural details in the exchange of quotas,
shares, or allocations do not make sense.
Stock assessments are not current. Critical assessments
will not be complete before the start of the fishing year.
There are limited mechanisms to address the needs of the
disaffected.
Mechanisms for scallop bycatch have not as yet been
resolved. This is critical because the allocation of flounder bycatch
to scallopers involves tens of millions of dollars, if not more.
The intent of Congress as expressed in the language of
the Magnuson-Stevens Act does not appear to have been taken into
account, particularly with regard to National Standard 8.
Most telling, there appears to be no ``user's manual'' for
fishermen newly engaged in the system--a user's manual would explain
the structure of the system and the day-to-day details of how it would
operate. How in the real world would 20 sector managers control the
flow of 20 different species of fish (20 x 20 = 400 possibilities) in
virtual real time?
It seems that the approach to developing catch shares in New
England has transformed the ``ready-aim-fire'' sequence into a ``fire-
aim-ready'' sequence--not a good way to develop public policy. We
cannot minimize the importance of a ``user's manual'' and of conducting
sufficient analysis to understand the fate and effect of this major
federal action.
BACKGROUND ON THE TRANSITION FROM DAYS AT SEA TO SECTORS
Fishery management in New England has been wasteful and inefficient
for over a decade. This negative view generally results from heavily
publicized overfishing and failure to rebuild some groundfish stocks.
This negative view would be accentuated if the public realized that in
addition to overfishing and the failure to rebuild stocks, wasteful
under fishing, bycatch, and unrealistic rebuilding requirements have
been induced by management regulations. In addition, regulations have
resulted in seemingly counterproductive ecosystem experiments (e.g.,
the explosion of the dogfish shark population).
Regarding Underfishing--It is generally not realized that fishery
management in New England over the last several years has limited
landings to c. 25% of the scientifically allowable catch. This amounts
to a 75% waste of the resource amounting to an ex-vessel (ex-vessel
value means price at the dock--by the time the product exits the
economy, its value increases by a factor of about three) loss at the
dock of $300-400 million per year (a substantial amount of the loss
relates to underfishing haddock, which have become stunted). It is
important to recognize that the underfishing statistics are very
difficult to interpret. (For example, the Gulf of Maine cod TAC in
Fiscal Year 2007 was 10,000 tons. But landings amounted to only 4,000
tons. In other words, 6,000 tons of cod disappeared. The 6,000 tons
were either not caught, discarded, or not recorded.)
Regarding Overfishing--It is important to acknowledge that it is
very difficult to explain the concept of overfishing in a multispecies
setting such as that which exists in New England. Because it is
difficult to explain, it is difficult to produce credible regulations.
Regarding Bycatch--Regulations in the current fishing year forced
throwing overboard many species as bycatch. For example, 1.5 million
pounds of yellowtail flounder were discarded at sea. This amounts to a
waste of about $2.5 million ex-vessel.
Regarding Unrealistic Rebuilding Schedules--Most ecologists would
agree that a rigid 10-year rebuilding schedule does not make sense, nor
would they agree that the carrying capacity of ecosystems would be
sufficient to bring all fish populations to their historically maximum
level at the same time. This lack of flexibility should change.
Regarding Ecosystem Experiments--New England fishery management by
itself has arguably modified the ecosystem and habitat to a greater
degree than any other human activity by virtually eliminating fishing
mortality on dogfish sharks so that this species of voracious predator
is now one of the most abundant fish in the ecosystem.
Any property rights system contributes to economic efficiency by
tuning the capital in the fishery to the magnitude of the stocks. So a
property rights or catch-share system can eliminate the situation where
there are boats that fish only a score of days per year. But the sector
system was advertised as a great advance in conservation: sectors will
stop overfishing, stocks will rebuild, and the race to fish will be
eliminated. These are however generally false claims. What is true is
that the sector system will reduce the number of boats in the fleet,
employment, and reduce the quality of many fishing jobs. While in the
long run most shore side businesses--a key component of local
economies--would be devastated. The negative aspects of the catch-
share/sector system is the reason it is being eschewed by the European
Union (had quota system for many years); the United Nations; and Pew
Charitable Trusts. Furthermore, for sectors to work, the structural
problems that have been associated with the DAS system in New England
need to be rectified. If they are not, and it does not appear that they
are, then the only advantage induced by catch shares is an economic
disruption of the fleet, which is specifically counter to the intent of
Congress, as specified in National Standard 8.
COMMUNITY PERSPECTIVE
With regard to community perspective, there is general
dissatisfaction with the sector program. It is fair to say that the
sector system is viewed with almost universal angst and suspicion;
allocations of fish were unfairly or illogically developed; and there
are glaring issues with the operational mechanism. Many fishermen at
this point in time do not understand how they will be affected by the
catch-share system.
The catch share approach is insufficiently analyzed (what will be
the economic effect of catch shares: fishermen say 50% reduction, but
Amendment 16 refers to relatively small losses in revenue); poorly
planned (no ``user's manual,'' policy statement not completed, stock
assessments not completed, many unanswered questions, unfair
allocations, unworkable operating principles); and insufficiently
budgeted (see recent requests for more funds without giving priority to
needs of fishermen and root scientific issues).
Given this unhappy state, most claim that catch shares will result
in a significant decline in the fleet and jobs. There appears to be a
consensus that after the first of May the fleet and employment will be
reduced by 50%.
The lack of planning, analysis, and budgeting; the lack of what we
might call responsible management, juxtaposed with the destruction of
livelihoods and the culture of our coastal way of life, has given rise
to two points of view.
The first is to agree to move ahead with the seemingly flawed
program on May 1 and take whatever community losses result from the
program. The second is to postpone the inception of the program until
the necessary planning can be executed--this approach is favored by
many, including the mayors of Gloucester and New Bedford.
Fishermen who favor moving ahead with a flawed program fall into
two classes. In the first, are those few fishermen who have attained
very large allocations of fish and will profit immediately. In the
second, are fishermen who feel there is no legal or legislative option
to halt the onset of the catch share program; they fear that any delay
would return them very limited access DAS. Moving ahead at this time
seems to categorize the catch-share system in New England as an
``experiment.''
Those who favor a delay, should it be possible, insist that a delay
is only acceptable if quantities of fish were guaranteed in the interim
so that fishermen would not lose income and that there would not be a
draconian reduction in DAS until effective planning could be
accomplished.
Regardless of whether one favors the muddling-through approach or
the delay, there is a general concern that issues related to the plain
language of law--equity--illogical operating principal--not enough
fish--and no plan for failure are serious constraints on the success of
the program.
THE PLAIN LANGUAGE OF THE LAW--Regarding the plain language of the
law, the community does not understand the disconnect between the
catch-share system and National Standard 8. It is generally agreed that
the catch-share system is simply an economic reallocation of the fish
stocks that in the medium and short run would completely change the
economic and social fabric of fishing communities and generate huge
welfare costs. Yet National Standard 8 is designed specifically to
protect the economic and social welfare of the community. If National
Standard 8 has no meaning, then why is it in the statute?
EQUITY AND FAIRNESS--Regarding equity and fairness, there is a
belief that the initial allocations of fish have been made unfairly.
Some fishermen claim that over the years they were discouraged from
trying to catch certain valuable species such as cod in order to
achieve conservation goals. As a result of their good efforts to reduce
fishing on cod, the catch of cod was reduced. So now when allocations
are based on catch history, those who took advice to catch less cod are
penalized by being allocated less cod.
As another example, management regulations resulted in the industry
catching only 10% of the haddock total allowable catch (TAC). So the
few fishermen who caught haddock obtained a tremendous windfall of
haddock allocation.
Another sticking point is that in the Council process some
allocations appeared to favor certain groups over others.
Finally, what really bothers fishermen is the fact that they were
given an option of either fishing in sectors or in the common pool.
After they made there decision, which was not reversible for many, the
Agency reduced the catch potential of the common pool, leaving
fishermen stranded in an uneconomic position.
It has to be remembered that for any management system to work, the
disaffected need to be accommodated. It is important to realize that
existent catch-share systems are heralded because the voices of those
who benefit are widely publicized, while the voices of the disaffected
majority are silent.
ILLOGICAL OPERATING SYSTEM--With regard to unworkable operating
principles, consider the following. The fundamental core of valuing
catch versus valuing quota seems to be broken. To exemplify, a
fisherman is allocated 50,000 pounds of fish by species. Suppose he is
allocated 100 pounds of cod and 49,900 pounds of haddock. He fishes on
the first day, and he catches 101 pounds of cod--1 pound greater than
his quota. He has to return to port and buy 1 pound of cod allocation
from another fishermen. If for some reason he cannot buy the 1 pound
allocation, then he summarily can no longer fish during the remainder
of the year. If he cannot find someone to sell him the 1 pound of cod
allocation, then he must try and sell his 49,999 pounds of quota.
Knowledgeable observers predict that he can only sell his quota for
about 30 cents on the dollar, while the 1 pound of cod allocation will
cost far more than the average price of cod. These numbers are of
course exaggerated, but they convey in a clear way the disincentive of
the operational scheme.
UNDERFISHING AND EXTENSIVE RISK AVERSION--With regard to not enough
fish, it is clear that the ACLs have been ratcheted down substantially.
Most of the knowledgeable observers of the system as it now stands
predict that it will result in dire economical consequences. However,
they do point out that if the Magnuson-Stevens Act could be interpreted
such that ACLs were defined at the overfishing level (OFL) less 10% to
account for scientific uncertainty, sufficient fish would be available
to at least give the catch-share system a fighting chance. There are
two aspects of the ``not enough fish argument.'' The first is that the
gross underfishing experienced in New England can be controlled; and
the second is that the degree of risk aversion adopted by the Agency
far exceeds that contemplated by Congress.
With regard to underfishing, the root cause of underfishing and
bycatch is the Agency's failure to adopt flexibility measures such as
the mixed stock exception. It appears that the mixed stock exception is
permitted under the plain language of the Magnuson-Stevens Act.
The Magnuson-Stevens Act simply states that ACLs should be set at a
level that overfishing does not occur. However, this is interpreted in
National Standard 1 guidelines as setting the ACL to be sufficiently
less than maximum sustainable yield (MSY) so that the MSY level is not
exceeded. The guidelines advise that this is to account for scientific
uncertainty. Guidelines further advise the Council to reduce the catch
limits even further to account for management uncertainty.
This degree of risk aversion is unnecessary, counterproductive, and
not required by law. First, many of the stocks are managed not by MSY,
but by MSY proxy. These proxies produce calculations that are already
25% less than MSY. Second, while it is easy to define the probability
of overfishing, methods for estimating the probability of overfishing
are not well developed. Third, the reduction by 25% (this 25% is in
addition to the 25% cited in the previous sentence) that is used for
many of the New England fisheries is essentially arbitrary. Finally,
because this regulation like other regulations does not have the force
and effect of law and its application results in not obtaining the
optimum yield, as specified in the plain language of National Standard
1, it should be abandoned so that any management system could function.
It is important to recognize that while ``overfishing'' is relatively
easy to define on a species-by-species basis, it is difficult to define
in a multiple species complex such as the New England groundfish
fishery.
WHAT DO WE DO NOW?
The haste in which the catch-share system was propagated in New
England has caused a serious dilemma for the community. The community
is cognizant that the Council is reported to be not working
effectively, and it has also read the admonishments of experts in the
conservation community that successful catch share programs need to be
properly designed, need time to develop, and often require vessel buy-
back programs. The transition and early implementation appears to be a
work in progress; there are suspicions that the operational mechanisms
and motivations are not sound; the quantitative extent of vessel
financial defaults along with concomitant job losses and shore side
bankruptcies have not been calculated. What is the magnitude of costs
in lost taxes and increases in welfare payments to communities like New
Bedford, Gloucester, or Scituate?
On one hand the community places high priority on any management
system working properly and resulting in the greatest economic good
while maintaining the social and economic fabric of the community.
Putting the greater good as its highest priority, the community is led
to an ineluctable conclusion that the best option is to postpone May 1
start date and engage in the necessary planning, analysis, and
budgeting to make the system work!
On the other hand, an option to postpone the May 1 start date until
adequate planning could be undertaken appears to have been foreclosed.
Surprisingly, there appears to be little, if any, political will to
postpone and engage in seemingly requisite analysis, planning, and the
public discourse that is the American way of life.
So with a lack of political support to properly design the catch-
share system, the community has no recourse but to choose the
experimental muddling-through approach, under which a substantial
fraction of the fleet will be lost without any plans, as far as we can
see, to provide a safety net to the fishing industry and businesses
that support the industry, let alone the communities that derive taxes
from profitable fishing and are subject to welfare costs generated from
unprofitable fishing and loss of jobs.
Perhaps worst of all, is the lot of individuals who will be
economically harmed or disadvantaged and who otherwise would not be
harmed or disadvantaged if the Agency undertook the appropriate
analysis that would guide it to more satisfactory solutions.
While this is obviously a problem for New England, it is evidently
also a problem for the rest of the Nation as evidenced by the March 16
hearings held by your Subcommittee. While concerns need to focus on the
folks most directly affected, they must also relate to the general
public interest in public management and regulation of a privatized
public natural resource. (Imagine an equivalent scenario where we wake
up one morning to learn that the Secretary of the Interior has
unilaterally privatized the National Park System without the sound
analysis, planning, and debate that usually accompanies major federal
environmentally related actions.)
It appears that your Subcommittee is hearing a balanced view of the
intent of Congress expressed in the plain language of the Magnuson-
Stevens Act and how it relates to the evolution of catch shares. It is
realizing that catch shares are simply economic instruments that
reallocate the wealth accrued from a public resource. They have by
themselves little, if any, conservation impact. It is also learning
that efficiency at the producing level may not be overall optimal. And
a reorganization of the producing sector is likely to dissipate the
centuries of cultural values associated with the fishery. (Do not
forget the sacred cod that hangs from the ceiling of the statehouse in
the commonwealth of Massachusetts.) It is also learning that the great
success stories of catch shares emanate from the few that won
allocations while the voices of the disaffected many are silent.
The analysis that I have given you paints a picture of moving ahead
at any cost. My personal view is associated with the need to slow down
or postpone the May 1 implementation date until a reasonably proper
design of the system can be certified. As this seems unlikely, we need
to take steps to get fishery management back on track.
Applying our experience with the New England ``experiment'' to the
National good, it would seem that it would make sense to put a halt on
the drive to new catch share approaches so that specifics can be
analyzed and vetted and debated. It is important to remember that these
discussions need to be related to real fisheries and need to take
account of those who are disaffected as well as those that are winners.
We cannot afford to have a massive transition of passing public
property into private hands without requisite analysis, planning, and
debate. Consider the New England experiment in the national analysis
and debate. The New England experiment study would inform those in New
England and the Nation on how to move ahead with fisheries management.
It will be a real world, not theoretical, demonstration.
SUBSTANTIVE REFORMS
1. To develop the New England catch-share experiment, it is
necessary to maximize the survival of participants in order to minimize
economic loss. This will require relaxing ACLs, but not overfishing.
For the experiment to work in a fair and equitable way, those that are
most affected need to be protected. We need to protect individuals from
economic collapse generated by the lack of analysis, planning, and
debate. The Secretary needs to relax the overzealous precautionary
approach limiting the catch of fish. We believe that this can provide
enough fish to sustain the system until the requisite planning can be
executed. This approach could be obtained without overfishing in the
sense that the overfishing level would not be exceeded.
2. Facilitate and accelerate an independent coherent overview of
the status of the stocks in New England. As we embark upon this
experiment, the magnitude of the individual stocks and their
``condition'' is not understood by the public in a comprehensive way.
Some stock assessments are based upon 2007 analyses. Others are pending
(e.g., pollack). Some do not make sense (e.g., skate). The public needs
to have an overview of the status of stocks as they presently exist in
order to move ahead with a management program.
3. Establish bold new and innovative scientific programs. Many of
the contentious arguments that surround the fishing debate result from
stock assessments. Many believe that there is little consistency
between the abundance of fish predicted by science and the abundance
observed by fishermen. Actually, the problem with stock assessments
relates to the assumptions and knowledge underlying the assessments,
rather than the assessments themselves. We need to establish a bold new
program that engages in more realistic stock assessments (i.e.,
includes the ocean environment, the interaction among fish species, and
develops a better understanding of the interaction of fishing boats and
fish), develops a comprehensive understanding of the ocean ecosystem
and fishing, and understands the role of climate and fishing.
Cooperative research needs to be intensified to a considerable degree.
While some of these activities are pursued, they are not at a critical-
mass level
4. Establish a systems engineering/inventory management approach
to day-to-day fisheries management. This is the most efficient way to
systematize the flow of management information and to use modern
technology in fisheries management.
5. Engage in programmatic analysis. We need to focus budget
allocations. Emergency funds need to be provided to disaffected
fishermen and municipalities. Buy-back programs need to be considered.
These may amount to c. $150 million. Retraining and permit banks need
to be considered. It is necessary to understand how reprogramming of
existing funds can result in programs that do a better job of managing
contemporary problems associated without ocean resources.
INSTITUTIONAL REFORMS
1. Make the New England Fishery Management Council an elected
body. The New England Fishery Management Council is not working well.
It is disenfranchised from those that it serves. It is not always clear
that decisions made by the Council are consistent with the intent of
Congress. A Council member's job is a full time commitment. We should
consider electing Council members to full time positions so they can
optimize their performance. A smaller and more focused council of five
to seven members might be about right.
2. Develop checks and balances in the Agency. A second
institutional problem is that there are no checks and balances in the
Agency. Because of this, there is no safety valve to deal with
contentious issues; bold and innovative plans need to come from within
the agency, and major initiatives like catch shares careen between a
seeming common sense and infeasibility. For these reasons, it is
important to establish institutional checks and balances in a model
similar to the relationship between the Federal Aviation Administration
(FAA) and the Civil Aeronautics Board (CAB).
3. Establish an ad hoc New England Fishery Management Reform
Commission. A reasonable premise is that reform of fishery management
in New England cannot be accomplished without considerable stakeholder
input. Accordingly, a New England Fishery Management Reform Commission
needs to be appointed by the Administration or Congress to take stock
of the present state of management, determine how management should be
reshaped, and provide advice on resources required to implement the
plan. The Commission needs to comprise highly qualified stake holders--
leaders in the fishing industry, environmental representatives, and
scientists. The Commission should have an 18-month life.
Madam Chairwoman, I have tried to share with you the community
perspective centered in New Bedford. I have attempted to provide some
background on where we are and steps that we think bear important
consideration as we move into the future.
______
Response to questions submitted for the record by Brian Rothschild,
Ph.D., Montgomery Charter Professor of Marine Science and Technology,
University of Massachusetts Dartmouth
Questions from Congressman Jay Inslee (D-WA)
1. This is the second hearing that we have had on catch share fishery
management programs, so there has been a lot of discussion
about catch shares. But I'm not sure we have heard from many
witnesses that actually have participated in catch share
programs. Can you tell me your experience fishing in a catch
share program? Do you have a federal permit to fish in a catch
share managed fishery?
The catch share program in New England did not begin until May 1,
three weeks after the hearing, so I could not participate in the catch
share program. I do not have a federal permit, but I am conversant with
the view points of industry members throughout New England. We are now
nearly two month into the catch share program. Studies by the Gulf of
Maine Research Institute confirm the pessimistic views held by many
people before the outset of the program.
2. I understand that ``sector'' catch shares are going into effect in
only a few short weeks in New England groundfish. Have any sector
managers asked to delay implementation? And it sounds like you're
saying that fishermen stick with status quo regulations rather than
shift to sectors. If so, why have fishermen who collectively comprise
98% of the available fish opted into sector management? Are you
suggesting they don't know what they are doing?
I do not know whether sector managers have asked to delay
implementation, but many rank and file fishermen have. There were two
choices for fishermen: 1) the common pool, or 2) sector management. The
catches in the common pool were significantly more limited so that
being in the common pool was uneconomic. Many fishermen did not want to
join sector management, but they had to because of the way economic
choices were structured.
Questions from Republican Members
1. You cite a problem with the stock assessment situation in New
England. How could this be fixed and how much would it cost the
agency to implement your recommendations?
This is a very complex question. One of the strategies would be to
improve data collection by more extensive use of fishing vessels and
port sampling. This is supposed to take place under the sector program,
but I do not know whether it will be at a critical mass level. The
Agency could reprogram funds from lower priority programs to this high
priority critical need.
2. You express a concern about ``wasted'' bycatch that is thrown
overboard rather than landed. That raises an interesting
dilemma on how to reduce wasted bycatch without encouraging
targeting bycatch species. How do you propose NMFS deal with
this?
Wasted bycatch arises from a variety of sources. One source of
wasted bycatch arises from trip limits. Suppose a fisherman has a
10,000 pound per day trip limit. This would mean that at the end of a
five-day trip that the fishermen would catch 50,000 pounds. The
fisherman catches 10,000 pounds per day for the first four days
amounting to 40,000 pounds. But on the fifth day he catches 25,000
pounds, so he has to throw 15,000 pounds back into the ocean.
3. Some have argued that the New England fishing fleet is too large to
be economically viable and that even without a change to a
sector system, a large number of fishermen will go out of
business. Do you think a reduction in the fishing fleet was
inevitable and if so, what effect on the coastal communities
would this have? If not, why not?
A reduction in the fishing fleet was inevitable. The problem is
that the catch share system will serve to reduce the fleet in such a
way to maximize the pain to the coastal communities.
4. You note that ``structural problems that have been associated with
the [Days At Sea] system in New England need to be rectified''.
Can you give us examples of these ``structural problems''?
One of the biggest structural problems is the so called choke
species problem. This is also called the mixed species exclusion.
Failure to apply the mixed species exclusion has resulted in a loss of
hundreds of millions of dollars of fish over the last several years. It
is important to understand that these fish could have been caught
without violating overfishing regulations.
5. During the previous Administration, the position was that as long
as overfishing was stopped, rebuilding efforts and timetables
could be flexible. Do you agree with this position? If
overfishing in New England stopped, would stock rebuild fairly
quickly?
I agree with maximum flexibility. All managers, whether they are
managing a company or fish stock, seek flexibility to deal with
contingencies. One of the difficulties regarding overfishing is that
sometimes a stock is declared to be overfished and then it turns out
that it is not overfished. Stocks are influenced both by fishing and
the ocean environment. Some stocks would rebuild fairly quickly if the
cause of their low numbers was fishing, but stocks would not rebuild if
the cause of low numbers was the ocean environment.
6. In your testimony you note that the gulf of Maine cod quota was
10,000 tons, yet only 4,000 tons were harvested. Why did that
happen and what can be done to change that situation?
The cod quota was not caught because of constraints in the catches
of other species. This can be eliminated by applying the mixed species
exclusion.
7. Many people argue for ecosystem management, but then refuse to
allow for the intentional ``fishing down'' of certain stocks
such a dogfish to allow for rebuilding of other stocks. Can
NMFS currently allow the intentional ``fishing down'' of
stocks? If so, why are they hesitant to do so?
It seems to me that NMFS can allow intentional fishing down of
stocks by interpreting the Magnuson-Stevens Act to allow this. I do not
know why they are hesitant to do so. If we are serious about ecosystem
management, then we need to look at the fishery as a whole, not look at
the fishery species by species.
8. How would your idea for an independent fishery reform commission
work? Is this something NOAA could create now or should
Congress look at authorizing something like this?
NOAA of course could create a fishery reform commission, but I
think that this commission needs to report to Congress. To me, this has
high priority.
9. If the sector system implementation is unlikely to be postponed,
are there any short-term things that could be done by NMFS to
help soften the impacts?
There are many short-term things that could be done by NMFS to
soften the impacts. One of these is to be flexible in the amount of
fish that can be caught. It appears that this is happening with skate
and pollock. How all of this will work out, I do not know.
10. How many years would it take to get better stock assessments that
could lead to more realistic quotas? What should Congress be
telling NMFS to do to get better information?
There are two parts to this. One is getting more data from fishing
vessels, and the second is to use modern computer techniques and
information systems to transmit the data to all users. It seems that
this is a short-term problem.
11. Do you think there should be minimum scientific information
available before a Council can consider a catch share
management system?
I think it is fair to say that not only minimum scientific
information but many other aspects of the catch share system were not
in place at the time it was implemented. It was known that the dogfish
shark was at a high level of abundance for some time, but this was not
announced until two months into the catch share system. The pollock
stock is supposed to be five times greater than previously reported
according to press releases from conservation groups. The availability
of pollock is critical to business decision making. Why do we need to
wait months before the quota is set? Issues with skate are similar. I
think it is fair to say that the system was not ready to go for a
number of reasons, including minimum scientific information.
12. You feel that the New England Council is dysfunctional. Other than
a complete change, what step should be taken to make the
Council process work better?
I believe that the New England Council has become disenfranchised
from the fishing industry. Doing a better job of working with the
constituencies would improve matters materially. The Council Chairman
wrote a letter to the Secretary citing concerns with the management of
the Council, yet his concerns, to my knowledge, have never been
publically addressed.
13. Congress required that the Councils' Science and Statistical
Committees meet concurrent with the Council meetings. This was
done partly as a result of the disconnect between the
scientists and the fishing industry in New England. Has this
change made any difference in the New England Council and the
ability of fishermen to understand how scientific decisions are
made? If not, why not?
I do not find that changing the meeting day has contributed to
improving the understanding of fishermen regarding how scientific
decisions are made. One of the reasons is simply a lack of
communication. This lack of communication is physically reinforced by
the fact that there are thousands of fishermen and it is difficult for
a reasonably representative proportion of them to interact with the
Science and Statistical Committees.
______
Ms. Bordallo. I thank you very much, Dr. Rothschild. Mr.
Alexander, you are the last to testify on the second panel.
Please begin.
STATEMENT OF CAPTAIN TERRY ARNOLD ALEXANDER, FISHING VESSELS
JOCKA AND RACHEL T
Mr. Alexander. Good morning. Members of the Subcommittee,
thank you for the opportunity to testify regarding catch share
management of commercial fisheries.
I have been a commercial fishermen vested in the New
England ground fishery for over 30 years. I am currently the
president of the board of directors of the Sustainable Harvest
Sector. We are over 100 groundfish permit holders--from Maine,
New Hampshire, Massachusetts, Rhode Island, New Jersey, and New
York--who have joined to fish under catch share management in
New England groundfish beginning May 1, 2010.
The management of New England groundfish, which includes 19
different fish stocks, has produced extraordinary biological
results over the past 20 years. Many of the stocks within the
complex are at the highest levels since the 1980s. The status
of others continue to perplex scientists, managers, and the
industry. For example, during the last five years, commercial
fishermen in New England have under-harvested scientifically
based catch limits for some stocks by millions of pounds, only
to be informed that retrospective patterns have reversed the
positive projections of earlier stock assessments.
These biological gains were achieved at the cost of
hundreds of New England groundfish businesses and jobs. For
example, from 2001 to 2007, the number of active vessels in New
England ground fishery has shrunk from nearly 1,100 to 574. And
in Massachusetts, from which the largest percentage of
vessels----
Ms. Bordallo. Mr. Alexander, could you please talk a little
closer to the microphone, please?
Mr. Alexander. Sorry.
Ms. Bordallo. Thank you.
Mr. Alexander. For example--where was I? Massachusetts,
which has historically held the most number of active vessels,
has declined from 629 vessels to 300. In Maine, less than 75
boats remain in the fishery, and groundfish have plummeted from
30 million pounds to 6 million pounds. The loss of these
businesses and jobs came well before the implementation of
catch shares. And make no mistake about it, with or without
shares, more business and jobs will be sacrificed in New
England because the continued job loss cannot be attributed to
any particular management scheme but, instead, can be directly
attributed to the stringent rebuilding requirements of the
Magnuson-Stevens Act.
Many Members of Congress have said that the intent of the
Magnuson Act was to protect communities as well as fish
populations, but that is not the outcome we have experienced in
New England. Let me be perfectly clear, the Sustainable Harvest
Sector is not embracing catch share management. We have been a
long-term vocal opponent of catch shares, but we have now come
to the conclusion that under the current mandates of the law
and facing the alternative of only 24 allowable days to fish,
catch share management in New England groundfish is the lesser
of two evils.
The catch share program for New England groundfish was
developed over a three-year process with considerable input
from stakeholders. We are not satisfied with all of the design
details. In particular, we oppose the plan to shift monitoring
costs to an industry that cannot afford the cost. Congress must
provide the funding for the cost of the catch share monitoring.
Projected costs for at-sea monitoring alone for New England
groundfish sectors is close to $5 million annually.
NOAA should prioritize funding for monitoring of the
existing catch share programs before advocating for new or
expanding catch share programs, a buyout that is crucial to
lessening the negative impacts of the impending restrictions on
the New England groundfish industry. We have known for decades
that there is an over-capacity problem in New England
groundfish. A buyout could remove that excess capacity, give
those who wish to leave the industry a dignified way to exit,
and allow those who remain to increase allocations at a minimal
cost. Congress must provide the funding necessary for a buyout
or advance the industry-funded buyout proposal.
If catch share management of New England groundfish is to
succeed, we need a greater investment in stock assessment
science. It is clear that NOAA's budget request places priority
on a catch share agenda over the goal of improving stock
assessments. We would like to see improved science as a number
one priority of NOAA.
Fishery science at its best is guesswork. The stock
assessment models are based on assumptions, and outputs are
called projections. Yet the Magnuson Act continues to hold
fisheries managers and industry to arbitrary time frames and
unrealistic goals. The most important message I have to convey
today is Congress must amend the Magnuson Act in a way that
clearly articulates the flexibility necessary for fisheries
managers to restore fisheries resources while preserving
fishing communities. Thank you.
[The prepared statement of Mr. Alexander follows:]
Statement of Terry A. Alexander, President,
Sustainable Harvest Sector, Cundy's Harbor, Maine
Chairwoman Bordallo and members of the subcommittee, thank you for
the opportunity to testify regarding catch share management of
commercial fisheries.
I have been a commercial fisherman vested in the New England
groundfish fishery for over 30 years. I am currently the President of
the Board of Directors of the Sustainable Harvest Sector. We are over
100 groundfish permit holders from Maine, New Hampshire, Massachusetts,
Rhode Island, New Jersey, and New York who have joined to fish under
catch share management in New England groundfish beginning on May 1,
2010.
The management of New England groundfish, which includes nineteen
different fish stocks, has produced extraordinary biological results
over the past 20 years. Many of the stocks within the complex are at
the highest levels since the 1980s. The status of others continues to
perplex scientists, managers, and the industry. For example, during the
last five years, commercial fishermen in New England have under-
harvested the scientifically based catch limits for some stocks by
millions of pounds, only to be informed that ``retrospective patterns''
have reversed the positive projections of earlier stock assessments.
These biological gains were achieved at the cost of hundreds of New
England groundfish businesses and jobs.
For example, from 2001 to 2007 the number of active vessels in the
New England groundfish fishery has shrunk from nearly 1100 to 574, and
in Massachusetts, from which the largest percentage of vessels has
historically hailed, the number of active vessels has declined from 629
to 300. In Maine, less than 75 boats remain in the fishery and
groundfish landings have plummeted from 30 million pounds annually to 6
million pounds.
The loss of these businesses and jobs came well before the
implementation of catch shares--and make no mistake about it--with or
without catch shares, more businesses and jobs will be sacrificed in
the New England groundfish industry.
The cause of continued job loss cannot be attributed to any
particular management scheme, but instead can be directly attributed to
the stringent rebuilding requirements of the Magnuson Stevens Act. Many
Members of Congress have said that the intent of the Magnuson Stevens
Act is to protect fishing communities as well as fish populations, but
that is not the outcome we have experienced in New England.
Let me be perfectly clear--the Sustainable Harvest Sector is not
embracing catch share management. We have been long-time vocal
opponents of catch shares--but we have now come to the conclusion that,
under the current mandates of the law, and facing the alternative of
only 24 allowable days to fish, catch shares management of New England
groundfish is the lesser of two evils.
The catch share program for New England groundfish was developed
over a three-year process with considerable input from stakeholders. We
are not satisfied with all the design details. In particular, we oppose
the plan to shift monitoring costs to an industry that cannot afford
those costs.
Congress must provide funding for the costs of catch share
monitoring. Projected costs for at-sea monitoring alone for New England
groundfish sectors is close to $5 million dollars annually. NOAA should
prioritize funding for monitoring of existing catch share programs
before advocating for new or expanded catch share programs
A buyout is crucial to lessening the negative impacts of the
impending restrictions on the New England groundfish industry. We have
known for decades that there is an overcapacity problem in New England
groundfish. A buyout could remove that excess capacity, give those who
wish to leave the industry a dignified way to exit, and allow those who
remain to increase allocations at minimal cost.
Congress must provide the funding necessary for a buyout, or
advance an industry-funded buyout proposal.
If catch share management of New England groundfish is to succeed,
we need a much greater investment in stock assessment science. It is
clear that NOAA's budget request places priority on a catch share
agenda over the goal of improving stock assessments. We would like to
see improved science as the number one priority of NOAA.
Fisheries science, at its best, is guesswork--stock assessment
models are based on ``assumptions'' and the outputs are called
``projections''. Yet, the Magnuson Stevens Act continues to hold
fishery managers and the industry to arbitrary timeframes and
unrealistic goals.
The most important message I have to convey today is this: Congress
must amend the Magnuson-Stevens Act in a way that clearly articulates
the flexibility necessary for fisheries managers to restore fisheries
resources while preserving fishing communities.
______
Response to questions submitted for the record by
Captain Terry Arnold Alexander, Fishing Vessels Jocka and Rachel T.
Questions from Congressman Jay Inslee (D-WA)
1. This is the second hearing that we have had on catch share fishery
management programs, so there has been a lot of discussion
about catch shares. But I'm not sure we have heard from many
witnesses that actually have participated in catch share
programs. . Can you tell me your experience fishing in a catch
share program? Do you have a federal permit to fish in a catch
share managed fishery?
Response: I have been the President of the Board of Directors of
the Sustainable Harvest Sector (SHS) for the past two years. The Board
has developed the bylaws and the operations plan, reviewed the
applications of individual sector members, hired a manager and we are
now overseeing the manager's activities.
I own two federally permitted multispecies vessels, and several
federal multispecies permits that are enrolled in the SHS. Due to the
low allocations made to each of my vessels/permits, I have had to
retire one vessel and consolidate the allocations onto the remaining
vessel.
I have made one successful fishing trip under the SHS operations
plan since May 1 2010. Other than the complicated and sometimes
duplicative reporting required by the National Marine Fisheries
Service, I am, to date, satisfied with my fishing experience under the
SHS operations plan.
2. I understand that ``sector'' catch shares are going into effect in
only a few short weeks in New England groundfish. Have any
sector managers asked to delay implementation? And it sounds
like you're saying that fishermen stick with status quo
regulations rather than shift to sectors. If so, why have
fishermen who collectively comprise 98% of the available fish
opted into sector management? Are you suggesting they don't
know what they are doing?
Response: To my knowledge no sector managers have asked for delay--
certainly the SHS manager and the SHS Board have not asked for a delay.
I believe you have misunderstood my comments: I did not say that
fishermen want to stick with the status quo regulations. I said, in my
testimony, that members of the SHS chose sector management as the
lesser of two evils. I believe it would be fair to say that is why the
majority of active fishermen (as defined as those with 98% of the
allocation) chose sector management.
It is important to reiterate that the alternative to sector
management in the New England multispecies fishery is an allocation of
24 allowable days to fish - that combined with very low annual catch
limits, is likely to be a result in a very short derby fishery.
Questions from Republican Members
1. Dr. Rothschild predicts that there will be a 50% drop in employment
due to the new sector system Do you think he's accurate?
Response: I am not an economist.
As stated above, I have had to retire one of my vessels, and had to
lay off the crew, so in my own company, 50% of the crew is no longer
employed by me. I do not know if they have obtained new jobs.
As I said in my testimony, many jobs in New England multispecies
fishery were lost prior to the implementation of sector management, and
many more will be lost regardless of the type of management system that
is used.
The fundamental problems in the New England multispecies fishery
are overcapacity and inflexible legislation.
2. You apparently did not support the switch to a sector allocation
scheme, yet you are reluctant to continue the days-at-sea
management system. Are there any other alternatives?
Response: The only way to make the New England multispecies fishery
economically viable is to reduce capacity and to provide more
flexibility to fisheries managers. Congress must authorize a buyout and
clarify the Magnuson Stevens Act. If Congress would eliminate the
referendum requirement for New England individual transferable quota
(ITQ) programs, we could transition the multispecies sector management
program to an ITQ. This would reduce cost and increase the
accountability of individual participants.
3. The changes to the Magnuson-Stevens Act which require individual
fishery accountability were an effort to change the balance
between ecological concerns and economic concerns. Do you think
the language in Magnuson went too far? If so, what should
Congress look at to correct this balance?
Response: I disagree that the changes to the Magnuson Stevens Act
were not made with the intent to ``balance . . . ecological concerns
and economic concerns''. The latest changes to the Magnuson Act were
advocated for by environmental organizations that have made a
profession of securing unreasonable legal mandates, and then suing the
government when fisheries managers fail to achieve unrealistic
deadlines. The latest changes to the Magnuson Stevens Act added yet
another deadline to ``end overfishing immediately''. While I would
agree that ending overfishing should be the primary goal, there are
circumstances in the New England multispecies management plan where
overfishing has been ended over a 2-3 year timeframe with far less
negative economic impact.
4. Some fishermen have complained about the new accountability
measures being implemented by NMFS. Do you also have concerns,
and if so, what are your specific concerns? What suggestions
would you give Congress to correct these concerns?
Response: It is unreasonable, in a multispecies fishery, to allow
one or two problem stocks to control the entire fishery. For example,
the most recent assessment of Gulf of Maine winter flounder was
rejected by the peer reviewers, who also recommended not using the
assessment to set management advice. However, the assessment was used
to set an annual catch limit of roughly 150 mt. The combined annual
catch limits for all other species found in the Gulf of Maine is
several hundred thousand metric tons. So, in short, Gulf of Maine
winter flounder could easily, and very quickly shut down the entire
Gulf of Maine, resulting in loss of millions in fisheries revenue.
I am neither a fisheries scientist nor a lawmaker, so my advice to
Congress is limited to my common sense approach to fisheries management
and the economic viability of my business. Therefore, I can only
suggest that Congress should make it clear that in the case of
multispecies fisheries, a combined annual catch limit should be set,
rather than individual catch limits for each species.
5. It seems that all of the panelists today would agree that prior to
implementing a catch share management system, NMFS must have
good data on the status of the fishery, the ecological needs of
the fishery, and the economic needs of the fishery. Does NMFS
have this type of information on New England groundfish? If
not, how can they effectively implement a new management
system?
Response: If Congress expects NMFS to be able to set and monitor
appropriate catch limits for a multispecies fishery, then Congress
needs to invest a great deal more money into more frequent stock
assessments and more money into catch monitoring. The cost of these
essential activities cannot be borne by the industry.
6. I understand that at least one component of the New England
groundfish fishery is still going to be managed under a days at
sea system. Why is that being done and how will this work?
Response: My understanding is that the Northeast Regional
Administrator now has the authority to make in-season adjustments to
the days at sea system to reduce trip limits and adjust the days at sea
counting rate. Since this portion of the fishery will not be monitored
at the same high level as the sector management system, I expect that
the RA will have to make projections that will result in reduced trip
limits and high differential days at sea counting rates, which will all
combine to quickly close the days at sea fishery.
7. According to a NOAA document, they are suggesting that there are 8
potential catch share programs that may be developed or
implemented in the next two fiscal years (not including the
groundfish multi-species fishery). These include: sea scallops
general category, monkfish, whiting/hake, sea scallops sectors,
herring, dogfish, mahogany quahogs, and skates. Any comments?
Response: The northeast Monkfish fishery is an essential component
fishery to New England multispecies fishery and therefore it makes
sense to transition monkfish to a catch share system so that fishermen
do not have to operate under a dual system of days at sea and catch
shares. However, before the NMFS goes much further with catch share
management of fisheries other than monkfish, we need to give everyone
some time to make the multispecies catch share system workable.
______
Ms. Bordallo. I thank you, Mr. Alexander. And I will now
recognize Mr. Frank Pallone from New Jersey for any questions
he may have.
Mr. Pallone. Thank you, Madame Chairwoman. I first want to
thank you for holding this important hearing, and I do want to
also thank Captain Alexander for his statement. I know it is
not directly on point today, but your support for Magnuson
flexibility and for more science and emphasis and priority on
science and research I think is really important.
But today, we are talking about catch shares. And I just
wanted to express my concern with catch share plans and the
process that is moving forward on them. Let me just express
some of my concerns. First, will fishermen be priced out and be
denied access? Will they create consolidation and force job
losses? What will be the mechanism for adjusting allocations
between recreational and commercial sectors, and will Councils
have the ability to choose which management tool to use if
needed funds only come with catch shares?
Now these issues have grave consequences, and I am afraid
that NOAA is moving forward with implementation without fully
addressing these issues of great concern. And at the end of the
day, my concern lies with my constituents. Will my constituents
have fair access to a public resource that has served our
community so well over the years? Our fisheries are not only an
economic driver, but provide invaluable recreational enjoyment
for the millions that use our nation's coastal waters.
Now let me first thank you for including Mr. Donofrio from
the RFA as one of the panel members today. I actually missed
part of your opening there because my Health Subcommittee was
meeting. But let me just get to a couple of questions, Jim, in
the time that we have. You are aware that $54 million has been
allocated for catch shares in NOAA's Fiscal Year 2011 budget
request--an increase of 100 percent. NOAA repeatedly states
that catch share implementation will be at the discretion of
the Regional Councils. However, this seems to be a classic
stick and carrot routine, where the Councils must implement
catch shares to access the needed funds for the science and
research.
How do you see the Council process playing a role in
implementation of catch shares? And are the Regional Councils
being pressured into utilizing catch shares?
Mr. Donofrio. Thank you. Good morning, Mr. Pallone. Good
question, and as I said in my written testimony, as I said to
the Chairwoman, we had a recreational fishing summit last week,
as you are aware of. And I got a chance to talk to Dr.
Lubchenco frankly about some of the things that happened the
first five minutes of this Administration. As you know, the
Administration came in and took sitting incumbents off the
Councils, sitting incumbents that had a track record of showing
up, attending other committee meetings, doing all of their
homework, and replaced them with pro-catch share people that
had no experience on the Council before. This is unheard of.
As you know, over the years, incumbents normally, when they
are doing a good job, they stay, whether they are recreational
or commercial or environmental. If they are doing a good job,
they stay. The Administration took a hostile position toward
these people. And again, we are seeing them stack the deck.
That is what it appears. They are running in a panic state here
to get into catch shares without having the discussion with the
user groups, including the commercial people. Some want it,
some don't. But let them decide through their leadership rather
than have it shoved down their throat. And that is how we feel.
Mr. Pallone. Well, it disturbs me a great deal, Jim,
because, historically, these Councils and the decisions have
not been that political, have not been that ideological, and it
really pains me to think that that is what happening now. And I
think we really--it shouldn't be the way things are done.
But let me issue a second question. I believe--I have said
it is my constituents' right to fish and utilize public
resources, such as summer flounder or black sea bass fishery.
What effect do you anticipate these catch shares are having on
the ability of recreational anglers being able to access public
resources?
Mr. Donofrio. I think it is going to almost shut us down
completely. And as you know, we are already shut down in sea
bass in a completely rebuilt fishery. So, I can imagine if we
have a catch share, we are going to have no fish to divide
amongst the boats and the private citizens they are actually
targeting. We are going to have nothing left here.
Mr. Pallone. And then I have heard from a lot of
constituents that catch shares will hurt local businesses such
as tackle shops and marinas. I have also heard from commercial
fishermen, such as the Belford co-op in my district, that they
have concerns over the implementation of catch shares.
I know you are here today representing the RFA, but can you
give me a sense of what the impact of catch shares may be on
the fishing industry in general, and what you are hearing from
some organizations other than the RFA, for example?
Mr. Donofrio. Well, absolutely. As you may recall, on
February 24th, when we were down here for our rally, catch
shares was a big issue. And we had some conversations regarding
state seafood and others in the commercial sector, and I
believe they feel they want to discuss this amongst themselves,
rather than have it forced down their throats. And that is
exactly--they feel there is a political agenda here again with
NOAA, and we see it. It is obvious. It is transparent. And I
think this is where we come to you, Mr. Pallone, and the
Chairwoman to help us.
Mr. Pallone. I appreciate it. Thank you. And thank you,
Madame Chairwoman, for having this hearing. I know we have a
lot of time constraints today, and I appreciate your bearing
with us.
Ms. Bordallo. Thank you very much to the gentleman from New
Jersey. And I do have a few questions here before we close out
today. The first is a question for Mr. Donofrio. Can you
envision a situation where the commercial side of a fishery is
managed by catch shares, and the recreational allocation is
open-access? Is that what you are suggesting for fisheries
where catch shares are developed?
Mr. Donofrio. No, not at all, Madame Chair. Our position is
if it is a tool for the commercial sector, as it has been in
certain fisheries in Alaska and others, the commercial sector
needs to decide where it is. What we are hoping for, if NOAA is
going to move rapidly and get into all of the East Coast
fisheries here and Gulf fisheries, where there are multiple
users, both commercial and recreational, before they decide,
then we want to talk about allocation criteria because we want
to revisit that again.
For instance, we filed a petition for rulemaking with the
courts to split the summer flounder 50/50. It is 60/40 now--60
commercial and 40 recreational. And we failed on that level.
But we would like to at least revisit those kinds of
allocations before there is any catch share set in motion on
the commercial sector.
Ms. Bordallo. And the next question I have is for Mr.
Dooley. Given your very positive involvement in catch share
programs, how do you reconcile your experience with the
concerns you have heard expressed here today?
Mr. Dooley. I hear a lot of concerns about going into catch
share programs. We had those very same concerns when they were
first proposed to us and brought up through industry as a
proposal. But once they were instituted and understood, how to
maximize our catch and maximize the benefit, we soon learned
that that was the way to go.
One example of that and how it might pertain to the West
Coast fishery is that you have--right now, you have a fishery
that is constrained by catch limits, or your trip limits, and
it is constrained by regulatory discards. That was my reference
in my testimony to a fishery that is worth $25 million that
should be worth $70 million. That fish is being either left in
the water or thrown in the water, discarded, no value being
taken out to the communities or the fishermen. That would be
solved by catch shares.
These fish would be allocated to the fishermen. And as I
have experienced in my experience in Alaska, the challenge then
is to the fishermen to figure out how to harvest it with the
use of new gear technologies, new methods, and area management
to be able to harvest fully this resource and maximize the
benefit. Once you maximize the benefit, the cost, such as
observer cost, become less significant because you are able to
realize so much more value out of your product. The communities
become much stronger because of that added value. You are able
to pay your bills instead of having a part-time job. That is
really important.
I also hear concerns about consolidation. And consolidation
isn't always bad. You know, the benefit of a catch share
program is that it voluntarily lets a person with a quota, a
permit holder, a vessel owner, to choose whether this is a
season with enough catch in a quote to employ, like in my
hometown, seven vessels, or would you just use four this year.
Right now, those vessels are going out, maybe once every two
months, to fish a very few days for these catch limits.
They are not being able to have full-time jobs. They talk
about job losses. Jobs that are a day or two every month are
not a job. But a job that is a sustainable job, based on the
resource and based on the added value, now that is a job that
is a benefit to the community and the safety of the vessels.
Ms. Bordallo. Mr. Dooley, I know you have a large vessel,
or a big boat, whatever way you want to put it. What about the
little guys?
Mr. Dooley. Actually, that is a good question. I do have a
big vessel, but I also came from a small town. And I have many,
many relatives and friends that have worked for years. And I am
concerned with them. I think that this program is critical to
their livelihood. When they talk about this fishery being
consolidated and taken over by a few owners or a few entities,
that is what the West Coast rationalization program has
addressed, and it has been addressed over a six-year program.
This can't happen. There are control limits that are applicable
to each fishery, whether it be the inshore groundfish fishery,
non-whiting, or the offshore whiting fishery, or the inshore
whiting fishery for that matter.
These protect the character of the communities. They keep
the fishery in the hands of individuals rather than huge
corporations. They prohibit this consolidation and this
monopolization of a quota. The way it is now, without the catch
share program, that can happen right today, and is happening
today. With the catch share program implemented as the Pacific
Management Council has proposed, this won't happen. It
prohibits--the social engineering has been figured into this
plan.
Ms. Bordallo. Another question for you. Your first point in
your testimony is that the West Coast trawl rationalization
program is not an example of NOAA headquarters trying to impose
catch shares on the fishery. From your experience then, how can
other communities ensure that any catch share programs
involving them are developed from the ground up?
Mr. Dooley. I really can't speak to the East Coast, and I
hear their concerns. However, I can relate what has happened on
the West Coast and in Alaska. Those programs were not mandated
from on high. Those programs were built from industry, asked
for by industry. Communities, fishermen, processors--everybody
has had a seat at the table, gone through committee processes,
opened public hearings and opened public process of the Council
meetings, and many side committee meetings that ranged up and
down the coast so people could attend these meetings to put
their input into this program, over six years for the West
Coast rationalization program. And I believe that is critical
to this.
Another critical part is that all the way through the
process--now with the new deeming requirements the Pacific
Council has taken on, industry, public, everyone has had the
opportunity to view the regulations coming forward as they are
being written and as they are being approved by the Council,
before they are published. So, it is a really transparent, open
process, and they have vetted many, many concerns.
And I might add, I heard Mr. Moody talk about adaptive
management. That is the Council's tool to take care of
unforeseen problems with this program. And I think they have
done a stellar job of putting this together and making sure
that all of the concerns are being addressed. However, they
also realize this will not be a perfect program coming out of
the box. So, they have reserved 10 percent to take care of
these unforeseen problems. I think it is a great job they have
done.
Ms. Bordallo. I would like to thank you for answering these
questions, and I thank all of the witnesses for their
participation in the hearing today. Members of the Subcommittee
may have some additional questions for the witnesses, and we
will ask you to respond to these in writing. In addition, the
hearing record will be held open for 10 days for anyone who
would like to submit additional information for the record.
And if there is no further business before this
Subcommittee, the Chairwoman again thanks the members of the
Subcommittee and our witnesses for their participation here
this morning. And the Subcommittee now stands adjourned.
[Whereupon, at 12:06 p.m., the Subcommittee was adjourned.]
[Additional material submitted for the record follows:]
[A statement submitted for the record by Richard B. Allen,
Commercial Fisherman and Fishery Consultant, Westerly, Rhode
Island, follows:]
Statement submitted for the record by Richard B. Allen,
Commercial Fisherman and Fishery Consultant, Westerly, Rhode Island
I appreciate the continuing interest shown by the House of
Representatives in the well-being of the New England fishing industry.
History tells us that the second Act of the First Congress, passed on
July 4, 1789, included a subsidy for the New England fishing industry,
sponsored by Massachusetts' own Representative Elbridge Gerry of
Marblehead. This bit of history offers more lessons than may be
immediately apparent. At the time of the American Revolution,
Marblehead was considered the premier fishing port in New England and
held that position until it was surpassed by Gloucester in the mid-
1800s. Marblehead disappeared from the list of major U.S. fishing ports
sometime in the distant past and appears to have no interest in
regaining its former status. The fate of fishing communities, like
other communities, has been, and will continue to be, determined by
many factors, most of which have nothing to do with catch shares.
Anyone reading the fishing news today might think that the history
of the New England fishing industry was all sweetness and light until
the New England Fishery Management Council decided to limit fishermen's
future catches based on their catch history. The facts are that the
Council has spent the last 30 years trying every conceivable idea for
fixing a system that was failing both the fish and the fishermen. Each
of those attempts was marked by frustration, controversy, and
fishermen's protests that were at least as emotional as those that we
see today.
Those who protest the current changes in fishery management seem to
ignore history and lack a workable alternative. The claim that catch
shares will privatize our fisheries ignores the fact that almost every
major fishery in the United States has operated under a system of
limited, transferable permits for many years. These permits are not
divisible and they are often expensive. The existing system of
transferable permits poses more of a barrier to entry into the
fisheries than will divisible quota shares. I have always opposed
limited entry into fisheries because the number of permits in any given
fishery is an accident of history, rather than a rational response to
market forces. One of the reasons that I support catch shares is that
catch shares make limited entry unnecessary, opening fisheries up to
broader ownership opportunities, including crew members who may never
have been able to buy an expensive permit. Ownership of catch shares by
crew members is common in catch share fisheries, but is unheard of with
limited permits.
I began my fishing career in 1964, digging quahogs with hand tongs.
I worked as a crewman on lobster boats and trawlers until I could
afford the down payment on my own small boat. During the 1970s, when I
bought my first boat, permits were not limited and permit fees were
minimal to non-existent. Various government and private lending sources
made it relatively easy for a fisherman to buy his first boat or to
expand his fishing business.
The ease of entry into the fisheries can be seen in the number of
groundfish boats that entered that fishery during the 1970s and early
80s. The number of vessels landing Northeast groundfish during the
1960s and early 1970s, prior to the passage of the Magnuson Act with
its 200-mile fishery jurisdiction, was relatively stable at 500-600.
During the late 1970s and early 1980s the groundfish fleet doubled to
more than 1100 boats. New boats continued to enter the fleet during the
1980s, but vessel losses approximately equaled the new additions and
the fleet remained relatively stable.
The increase in vessel numbers coincided with a rapid increase in
the catching capacity of each vessel. Prior to 1970, most New England
groundfish boats were side trawlers, relatively inefficient compared to
the newer stern trawlers that entered the fleet after 1970. The newer
boats also tended to have higher horsepower, better winches, more
sophisticated electronics and better nets. All this new equipment made
it easier for fishermen to find fish and to catch them in areas that
had not been accessible to older boats.
While the passage of the 200-mile limit enabled the United States
to exclude foreign fishing vessels from coastal waters, it also
restricted the fishing grounds available to the boats that had
historically landed the most groundfish in New England. In 1984, when
the expansion of the New England groundfish fleet reached its peak, the
stocks available to the groundfish fleet were further restricted by the
World Court decision that established the U.S.-Canadian Maritime
Boundary. That decision gave Canada exclusive rights to the rich
fishing grounds on the eastern side of Georges Bank. The result of all
of these developments was that the New England fishing industry came
out of the 1980s with an expanded fishing fleet that was capable of
catching far more than the limited stocks then available could produce.
The contraction of the New England fishing fleet that has been seen
since the mid-1990s was inevitable--the increase in catching capacity
that occurred in the 1970s and 1980s was not sustainable. The local
stocks suffered while the fishery management system struggled to bring
the fishery under control. We are still in the process of adjusting to
disruptions that occurred twenty to thirty years ago.
Also during the 1970s, I helped to found a fishermen's organization
and worked to protect fishermen from the threats facing the industry at
that time: foreign fishing in local waters; offshore oil drilling;
foreign imports; escalating insurance costs; and limited entry,
including catch shares, which I was determined to thwart.
In the 1970s and 1980s, the Bureau of Commercial fisheries and its
successor, the National Marine Fisheries Service, along with many state
fishery agencies, was pushing limited entry and catch shares. I was
part of the opposition. In 1978 I told a National Conference on Limited
Entry that there were too many bureaucrats chasing too few fishermen,
suggesting that we would need to divide up the limited number of
fishermen among the competing bureaucrats. At that time I would have
agreed completely with those who are protesting against catch shares
today.
In the mid-1980s I became so angered by the fact that the National
Marine Fisheries Service was putting the power of the federal
government behind the push for limited entry and catch shares that I
set out to prove that fisheries were essentially self-regulating, with
no need for artificial limits on the number of fishermen or how much
they could catch. My research, however, convinced me of just the
opposite.
One of the most important pieces of information that I gathered
during my attempt to discredit limited entry and catch shares was an
article by the late Francis Christy. Christy explained how traditional
fishery conservation regulations work by making it too expensive for
fishermen to catch too many fish. Closed areas make fishermen fish
where the fish are scarce, trip limits force fishermen to waste fuel
and time making multiple trips when they could land more fish in one
trip, size limits and trip limits force fishermen to kill fish more
fish for the same amount of income. I could see exactly what Christy
was talking about in the regulations that we faced in New England.
I remember one meeting of the New England Fishery Management
Council's Groundfish Committee where a frustrated fisherman told the
Committee: ``You know where we fish, close the area.'' The obvious, but
somehow acceptable, result of closing the areas with the best catch
rates was to make fishermen fish harder to catch the same amount of
fish. This provided little benefit to the fish stocks and a great deal
of economic harm to the fishing community. When the original closures
proved ineffective at conserving the stocks, more areas were closed.
Francis Christy not only explained the problem facing fishermen and
fishery managers under traditional management approaches, he suggested
a solution. In 1972 Christy proposed fishermen's catch shares as a way
to achieve conservation while letting fishermen decide how to run their
own businesses. Within a few years, fisheries around the world were
experimenting with this new idea, most often called individual
fishermen's quotas, or IFQs.
In the United States, Wisconsin was apparently the first state to
implement IFQs for a significant commercial fishery in 1979. That
program was expanded in subsequent years and my contacts in Wisconsin
tell me that the program continues to work well. In 1995, when I first
met Charlie Henriksen, the President of the Wisconsin Commercial
Fishermen's Association, he told me that the ITQ system had saved the
Wisconsin commercial fishing industry from extinction. I have heard
that same comment from fishermen in many catch share programs since
that time.
There is no question that New England fishermen and their families
are mad right now. From my perspective, however, I would suggest that
most of the complaints are directed at the new catch limits, not at
catch shares per se. Most of the New England fisheries were faced with
reduced catch limits as the result of NMFS interpretation of the
required annual catch limits that were incorporated into the most
recent reauthorization of the Magnuson-Stevens Fishery Conservation and
Management Act. I believe that dissatisfaction with the resulting catch
limits is the basis for most of the protests that have been organized
by the fishing industry in recent months. If catch shares had been
implemented without restrictive new catch limits, it is my opinion that
catch shares would have received much more acceptance as a sensible way
to manage our fisheries.
The opposition to catch shares can't be fully understood without
considering the implications of real limits on the total catch. New
England groundfishermen have not operated under hard quotas since the
first attempt at quota management was abandoned in 1982. Quota
management was abandoned because New England fishermen didn't want to
stop fishing when the quota was reached.
New England opted to replace quota management with regulations that
told fishermen how, when, and where they could fish. In the absence of
strict quotas, every fisherman had an incentive to find a way to
maintain or increase his catch despite regulations that were ostensibly
designed to limit the total catch. The result was ineffective
conservation and continual tightening of the rules. As Francis Christy
had explained, the tighter rules made it more expensive to catch fish,
reducing the profitability of fishermen who could not keep ahead of the
rules. That ``race against the rules'' was not sustainable for either
the fish or the fishermen. Not only were the rules tightened, but
Congress also tightened the law as well, eventually requiring the
fishery management councils to impose annual catch limits and
accountability measures on all fisheries.
Many New England fishermen believe that transferable catch shares
will be necessary to provide fishermen with the flexibility to run
economically viable fishing businesses in an era of hard catch limits.
Fishermen will be accountable for their discards as well as their
landings, another new challenge to New England fishermen. Transferable
catch shares will make it possible for fishermen to adjust their quota
holdings to their planned catch and to their realized catch. Most
thoughtful fishermen who consider all of the requirements of the
Magnuson-Stevens Act in its present form are likely to come to the
conclusion that transferable catch shares are the only form of
management that can meet those requirements while allowing a viable
commercial fishery to exist. People who oppose catch shares do not seem
to have any better suggestions for meeting the requirements of the
Magnuson-Stevens Act in a way that will allow profitable fisheries to
exist. Most of the opponents of catch shares seem to think that catch
limits will go away if catch shares disappear. I'm not aware of any
Congressional intent to eliminate the conservation requirements in the
Magnuson-Stevens Act.
The benefits of catch share management don't stop at greater
flexibility for fishermen. The fact that the catch share program will
entail new at-sea and on-shore monitoring programs means that fishery
scientists will have better data with which to measure the impact of
fishing on stocks. Better data will have at least two positive results
for New England fishermen: the reductions applied to annual catch
limits can be reduced as the level of uncertainty goes down; and stocks
are more likely to rebound if catches stay within prescribed limits.
It is my opinion that the opponents of catch shares in New England
spent so much time just saying ``No,'' that they ignored catch share
design features that might have met some of their concerns. Amazingly,
the New England groundfish plan has never had any accumulation limits
for either permits or catch shares. The New England Council will be
meeting in the near future to consider such limits. Other design
features might be added to the groundfish plan to address social and
economic concerns.
It has been almost 40 years since Francis Christy identified both
the root cause of the chronic crises facing fishermen around the world,
and the solution to that problem. Catch shares hold the potential to
restore the flexibility that fishermen once enjoyed while maintaining
an effective conservation program. I urge you to support the
President's budget request for the support of catch share programs,
including the necessary, continuing improvements in fishery science to
establish appropriate catch limits.
______
[A statement submitted for the record by Rick Bellavance,
President, Rhode Island Charter and Party Boat Association,
follows:]
Statement submitted for the record by Rick Bellavance,
President, Rhode Island Charter and Party Boat Association
For more than a quarter of a century, the ocean has been a central
part of my life.
I take paying customers out to fish a variety of species, including
summer flounder, striped bass, cod, tuna and shark. I grew up on the
sea and learned about the ocean from my father. When I was 10, he
bought me my first 12-foot wooden skiff, which I motored around
Narragansett Bay. My father was also a high-school science teacher who
taught oceanography, biology and aquaculture. For him, the sea has
always been about education and respect. Together we now operate a two-
boat charter fishing and diving business.
For much of my career I kept my head down and focused on what I do
best--fish. But, as a charter-boat operator, an important part of my
job is education. After spending thousands of hours on the ocean, one
lesson is becoming increasingly clear--the ocean is not limitless; nor
is our current industry model sustainable.
Fortunately, there is a solution that offers an alternative--the
catch-shares system.
Catch shares are a way of managing fisheries that allocates a
percentage of the annual catch to participating fishermen and monitors
and enforces those allocations while providing fishermen like me
improved flexibility and control of our businesses. This means I decide
when I fish and can provide my customers the excitement of fishing a
run of summer flounder rather than limiting them to ever decreasing
daily bag limits or seasonal closures.
This flexibility is critical to our livelihoods. How many people
are willing to pay me enough to make a living so they have the thrill
of bringing home a couple of small fish?
I've never participated in any formal conservation effort before,
but our current system does very little to promote or encourage such
efforts. Daily catch limits for the commercial fleet, which force the
overfishing of many species and generate tremendous waste, will no
longer be an issue under a catch-shares program. Illegal charters,
which for years have ravaged our business through overfishing, will
have a much tougher time operating under a catch-shares system that has
more accountability.
To successfully implement a catch-shares system, certain challenges
must be resolved, including allocations, monitoring and funding. Share
allocations must be fair so that fishermen can make a living. Effective
monitoring is essential to ensure that everyone is operating under the
same and equitable rules, as well as to limit illegal charters.
Finally a funding system will need to be created that allows for
the long-term existence of our industry. All of these concerns are a
priority, and as someone who has been in the fishing industry for 25
years, I know they must be addressed.
But these challenges don't alter the fact that a catch-shares
program will almost certainly be coming to our area because it has to.
We can't keep operating under a system that has failed in every way.
The charter-boat industry in particular struggles under the current
system that uses seasonal closures, minimum size limits and bag limits.
As a charter-boat operator, I give families and individuals the chance
to experience the ocean and fish by boat. A collapse of our industry
could eliminate their access to this experience.
These changes may seem difficult, but the current reality of our
industry is even harsher. When I was young, one of my father's goals
was to teach me how to read water. Reading the ocean now, it's clear
that our fishing will not survive forever with the way things are now.
The days when fishermen could catch as much as possible without any
limits have passed. Catch shares are the best option I've seen to date,
one that with the appropriate implementation, will let our industry
continue to thrive for years to come.
______
[A letter submitted for the record by Gulf of Mexico
Charterboat and Headboat Captains follows:]
April 2010
Subcommittee on Insular Affairs, Oceans and Wildlife
187 F3rd House Office Building
Washington, DC 20515
Dear Members of the Subcommittee on Insular Affairs, Oceans and
Wildlife:
As charterboat and headboat captains living along the Gulf of
Mexico coast, we feel that it is important to convey our support of
catch share programs in light of the hearing that the House
subcommittee on Insular Affairs, Oceans and Wildlife is holding on this
management system on Thursday April 22, 2010. Many cherished fish
stocks in the Gulf of Mexico have been severely depleted, resulting in
smaller bag limits and shorter seasons that threaten the future of our
fishing heritage. Commercial catch share programs restore fish
populations for a given fishery by taking a previously established
allocation for commercial harvest, subdividing it among the catch share
participants, and holding them accountable for fishing within their
specified portion of that overall limit. These programs help end
overfishing, while preventing, and even reversing, the collapse of
fisheries in the commercial sector, and we believe these programs, with
adequate planning can similarly be used to benefit the for-hire
(charter and headboat) sector.
We believe that a healthy marine resource is vital to the local
economies of our coastal communities and is a significant contributor
to the overall economy of each of our states. Catch share programs
provide conservation benefits that result in more fish for everyone,
and therefore more healthy and robust coastal economies. The catch
share program currently in place for commercially-caught red snapper in
the Gulf of Mexico has been extremely successful--it allows for
fishermen to lower operating expenses, increases the price paid at the
dock and meets high conservation standards, which has improved both
economic performance and safety at sea.
For example:
Bycatch (accidentally-caught fish that must be thrown
back in the water and often die); has been significantly reduced;
Reliable and timely data systems verify landings and
transactions on commercial catches which provide the data needed to
keep the sector within their regulatory catch limits;
The fishing season has been extended from a few months to
year-round, which has allowed fishing to take place when weather
conditions are safe and prices are higher;
Fishing businesses are earning more for their fish and
spending less to catch them, while consumers are receiving a higher
quality product.
Chronic overfishing is to blame for season closures which devastate
the for-hire fishery and the amount of business it can receive. Catch
shares are a tool that can end the overfishing, rebuildfish populations
and help save fishing businesses, which will solidify the Gulfs
reputation as a sportsman's paradise and keep fresh seafood in grocery
stores and on restaurant tables.
Anglers are conservationists at heart. Therefore, we support catch
shares in commercial fisheries. Furthermore, many recreational for-hire
captains have learned about the flexibility and increased profitability
in fishing under commercial catch share programs. We feel that similar
programs should be explored and developed to meet the unique needs of
the recreational industry.
Than t you for your commitment to a robust and healthy fishing
industry.
Best regards,
[GRAPHIC] [TIFF OMITTED] 55542.008
.eps[GRAPHIC] [TIFF OMITTED] 55542.009
.eps[GRAPHIC] [TIFF OMITTED] 55542.010
.eps[GRAPHIC] [TIFF OMITTED] 55542.011
.eps__
[A letter submitted for the record by Mary Beth de
Poutiloff, Scallop Fishing Family, F/V Patience Too, P.O. Box
1101, Provincetown, Massachusetts 02657, follows:]
Mary Beth de Poutiloff
Scallop Fishing Family
F/V Patience Too
PO Box 1101
Provincetown, MA 02657
[email protected]
401-226-5955
April 30, 2010,
Greetings to the Members of the Catch Share panel,
Our country's economy is in dire straits. One of every six jobs in
the U.S. is marine-related. Over 1/3 of the Gross National Product
originates in coastal waters. Our public resources are precious. We are
about to lose them to privatization through Catch Shares. Catch
Shares=Corporate Shares.
The solutions to our FMP's (fishery management plans) depend on
input from fishermen, scientists, environmentalists and regulators. The
special interests, namely EDF (environmental defense fund) has
infiltrated key positions in NOAA/NMFS and the Council.
This imbalance has devastating effects on our environment,
resources, fishermen and our communities. Fishermen are being ignored
in the process of managing our resources. Cooperative research is also
minimal.
EDF with their skilled public speakers, lobbying power, strong
media ties and endless supply of money from the mega-corporations is
driving the Catch Share train-wreck. Millions and millions of dollars
is being dumped into pr campaigns supporting Catch Shares.
In some cases, news reports are being twisted beyond recognition.
Recently, Mr. Wayne Moody, from Morro Bay, CA spoke to the committee
against Catch Shares. The San Luis Obispo-Tribune's headline stated
just the opposite. These media mishaps are happening too often to be
coincidental.
Catch Shares have to be carefully devised to meet the mandates of
the MSA (Magnuson-Stevens Act). In the general category scallop
fishery, Catch Shares did not promote fairness, use science or consider
the damage to small boats and their communities. How will we provide
access for future generation? The abundance of scallops makes severe
consolidation from Catch Shares unnecessary.
Catch Shares is discriminatory and the UN (United Nations) agrees.
It is unfair to the fishermen who do not have access to capitol. Wealth
is a prerequisite to fishing access.
This contentious tool is far too complicated to be used fairly. In
my opinion, the gifting of resources to the minority, while the
majority suffers loss of jobs, boats, homes and futures should never be
considered. Catch Shares is a feudal system.
Fishermen are familiar with the oceans, the fish and our coastal
communities. Why do we not have a seat at the management table? NOAA/
NMFS and the Council are not looking for solutions. Their science and
management plans have become agenda-driven. Frankly, FMP (fishery
management plans) are being designed to fail. This should be
disturbing.
Fishermen do NOT want Catch Shares. We are frustrated beyond belief
through misrepresentation of our opinions by government agencies and
the corporate- run media. We are at the point of having nothing left to
lose. It is up to our elected officials to speak for ``we the people''
not'' we the corporations''.
The US fish stocks are healthy. To punish us further for global
overfishing is a betrayal. US fishermen are abiding by the strictest
fishing regulations in the world. We have made sacrifices while our
fish stocks rebuilt. Over 80% of the seafood consumed in this country
comes from countries that do not practice sustainable fishing.
Catch Shares will be bad for everyone (fish, fishermen and
communities) except investors. Wall Street does not have the knowledge
or inclination to protect and sustain our resources for generations to
come. Public resources should not be sold.
I respectfully, am asking each and every one of you to implore the
Secretary of Commerce to pass a 2 yr. Catch Share moratorium. This
would allow us time to delve into the dysfunction, corruption and
conflict of interest of the current system.
Respectfully,
Mary Beth de Poutiloff
______
[A statement submitted for the record by Shawn C.
Dochtermann, Executive Director, Crewman's Association,
F/V Isanotski, Kodiak, Alaska, follows:]
Statement submitted for the record by Shawn C. Dochtermann,
Executive Director, Crewman's Association, F/V Isanotski, Kodiak,
Alaska
Honorable Chairwoman Madeleine Z. Bordallo and Subcommittee
members:
We would like to comment on Catch Shares as the focus on individual
communities' negative experiences and concerns related to the adoption
of this inappropriate management tool.
Catch Shares as a management tool are like a chainsaw that cuts off
the access for most fishermen that actually prosecute the fisheries and
rewards non-participants with the privilege to lease the fish back to
the actual harvester.
The Crewman's Association is an advocate for the protection of
Alaskan fishermen. We believe the implementation of a Catch Shares
system which privatizes publicly owned fisheries resource is
destructive to local fishermen and coastal communities. The record
shows that implementing Catch Shares does not necessarily protect
fisheries resources. We believe there are other existing management
tools which are less destructive.
Kodiak has experienced two Catch Shares programs over the past
twenty years. Halibut and sablefish (black cod) catch shares were
implemented in the 1990s under a program called Individual Fishing
Quotas. The IFQ program eliminated 13,000 jobs in Alaska. The original
plan mandated that the owner be on board the vessel and that quota
shares could not be leased. This plan was not adopted. The result is
that the majority of the initial quota share recipients have leveraged
more quota shares using their initial free quota as collateral.
The second catch share program that has affected Kodiak and other
coastal communities is the Bering Sea Crab Rationalization program,
instituted in 2005. Before crab rationalization, sixty-four Kodiak
vessels fished crab in the Bering Sea, primarily with Kodiak skippers
and deckhands. Crab rationalization winnowed this fleet down to sixteen
Kodiak vessels fishing crab in the Bering Sea. Those forty eight boats
represent 264 crewmen jobs removed from our community.
Also, access to the fisheries, the right to fish on a crab vessel,
is now leased to vessel operators by the crab owners at rates between
50% and 80% of the ex-vessel value of the crab. This is money which is
taken off the amount from which crewmen are paid their percentages of
the catch. This money, skimmed off the top, is estimated to be between
$140 and $180 million over the past five years. Approximately $50
million would have flowed into Alaska's coastal communities. Now it is
removed from the communities by absentee owners, which has led to
serious and harmful economic and social consequences for coastal
Alaskan communities.
These negative effects have occurred despite the assurances by
former Chairman Dave Benton of the NPFMC that the concerns and
interests of coastal communities would be addressed before catch shares
programs would be implemented. In a letter to Congress on August 5,
2002 Chairman Benton stated:
``Rationalization will improve economic conditions substantially,
for all sectors of the industry. Community concerns and the need to
provide for economic protections for hired crew will be addressed.''
In June of 2006, one year after the implementation of catch shares
in the Bering Sea crab fisheries, the North Pacific Fisheries
Management Council, the body which administers fisheries regulations in
Federal waters of Alaska, came to Kodiak to listen to the views of the
public on the issue. The overwhelming majority who testified spoke
against fisheries privatization. Many spoke of the loss of income and
jobs. Others testified that crewmen's rights had been ignored in the
process of awarding ownership of the public crab resource to only one
small segment of the industry--the vessel owners. And some testified
that by awarding processor shares and mandating that vessels deliver
crab to specific processors, the crab rationalization program had
caused ex-vessel prices to fall.
With this negative experience of the privatization of fisheries in
Alaska, the Crewman's Association views with alarm the imminent
implementation of catch shares in the New England fisheries on May 1,
2010. We share the concerns of the Governor of Massachusetts, the
Massachusetts Congressional delegation, and the mayors of Gloucester,
New Bedford, Massachusetts, Kodiak Island Borough, Aleutians East
Borough, and the City of King Cove, Alaska about the harmful effects on
coastal communities of fisheries privatization.
Please carefully assess the effects of catch shares on coastal
communities and on the men and women who fish in those communities
before moving forward with new privatization programs. We also urge
Congress and NOAA to examine the role of private investors and
speculators in the fisheries privatization process. In order to provide
time for these assessments to be made Congress and NOAA should
establish a 2-3 year nationwide moratorium on the implementation of
catch shares programs.
We also request Congress amend the Crab Rationalization program so
that its economic benefits are ``fairly and equitably'' distributed--in
line with economic sharing in accordance with their historical
participation--to all segments of the fishery, especially crewmen and
new vessel entrants.
______
[A letter submitted for the record by Food & Water Watch
follows:]
Food & Water Watch
1616 P St. NW, Suite 300
Washington, DC 20036
Chairwoman Madeleine Bordallo and Subcommittee Members
Subcommittee on Insular Affairs, Oceans and Wildlife
The House Natural Resources Committee
April 30, 2010
RE: April 22,2010 oversight hearing on ``A Community Perspective on
Catch Shares.''
Dear Chairwoman Bordallo and members of the Subcommitee:
Food & Water Watch (FWW) is a nonprofit consumer advocacy
organization headquartered in Washington D.C. We work with grassroots
organizations around the world to create an economically and
environmentally viable future. Through research, public and policymaker
education, media and lobbying, our Fish Program promotes safe and
sustainable seafood for consumers while helping to protect the
environment and support the long-term wellbeing of coastal and fishing
communities.
Last week you heard testimony on a community perspective on catch
shares from the commercial and recreational fishing communities.
FWW has a vision of healthy ecosystems supporting robust fish
stocks that are both skillfully managed and sustainably used, in order
to support the long-term socioeconomic wellbeing of coastal communities
and the nation as a whole. Through research and policy analysis, we
have worked to understand the root causes of previous global fishery
management failures and models for reform, including the variety of
catch share management programs.
The result of this work has been an understanding of the many
problems privatized catch share programs have caused and will cause, if
they continue to be implemented in the United States. It has also
resulted in our support of a Fair Fish, ``Cap-rent-recycle'' model of
catch share management. This model supports public control of wild fish
stocks, provides flexibility for management improvement over time, and
creates an evenhanded business setting. The attached factsheet, ``Cap-
Rent-Recycle: Common Sense on Catch Shares'' provides more details on
this approach.
The Catch Shares model that is currently being pushed by Fishery
Management Councils is more of a ``cap-giveaway-trade'' model, which is
essentially a privatization mechanism that takes a public resource out
of the public's control. As echoed by Jim Donofrio at the hearing, this
model violates the federal government's responsibility to hold this
resource in the public trust, and allocate it fairly between citizens.
In the same vein, Chairwoman Bordallo captured well the logical
consequence of loss of the public control through fishery
privatization--that it is difficult to reverse once implemented, and it
results in ``locking-in'' access for certain user groups.
In fact, the lack of flexibility and failure to serve as a useful
management tool over time has forced costly taxpayer-funded reform
interventions in other regions. In 2007, the United Nations Human
Rights Committee ruled that Iceland's privatized catch share systems
violated international law, because the system forced fishermen to pay
money to a privileged group of citizens who exclusively held the
nation's fishing rights. After this ruling and repeated challenges in
domestic courts, the newly elected government has proposed buying back
all access units (catch-shares). They propose returning to a better
management system by purchasing 5% of the quota each year over 20
years, so that it can once again be properly managed and allocated
under the government's jurisdiction. (Unfortunately, Icelandic
taxpayers have to buy back the quota at exorbitant above market rates
in order to convince the private owners to sell back to the
government.) The government then plans to directly rent access units to
private parties while allotting some access units to fishing villages
to manage within a community-based system. The attached factsheet,
``Illegal Catch Share Programs: Learning from Iceland's Mistake''
provides more information on this topic.
The system that Iceland hopes to achieve is similar to what FWW
believes the U.S. should implement from the start. We urge you to
recognize the failure of privatization programs in other countries, and
support a better program from the start.
Congress included important provisions in the Magnuson-Stevens
Fishery Management and Conservation Act to try to direct the design of
limited access privilege programs toward balanced economic, social and
environmental outcomes. By law, programs must include features to limit
consolidation and control, and yet, in practice, these features are
often weakened in regional programs as a result of special interests,
resulting in high levels of consolidation; protections from competition
through perpetual privileges; and poor transparency on control and
privilege transfer. These problems have been evidenced on the west
coast for the Pacific Coast Groundfish Fishery Management Plan
Amendment (A20 & A21); in the Northeast for the Multispecies Fishery
Management Plan Amendment 16; and in the Gulf Plan Amendment 29.
Under privatized catch share programs, unfair allocation can
prevent commercial fishing from being a viable economic activity for
coastal communities. Many fishermen can lose their jobs, as well as the
opportunity to respond to growing consumer demand for local,
sustainably caught seafood from artisanal fishing and primary
producers.
As noted on ``FishingForaLiving,'' a website dedicated to
commercial fishing in Key West, Catch Share programs have become the
``single most effective tool for the elimination of small boat
fishermen.'' Furthermore, it will ``place a limit on every fisherman's
income and freeze out young people from ever entering the fisheries,''
\1\ essentially taking commercial fishing out of the community's hands
and putting an end to traditional fishing. For other brief examples of
where catch shares have harmed coastal communities both here and
abroad, see the attached one-pager: ``FWW: Examples of failures with
IFQs (catch share programs--Domestic and International.''
---------------------------------------------------------------------------
\1\ Bade, Peter. ``Individual Fishing Quata's--Background.'' March
18, 2010. Available at: http://fishingforaliving.com
---------------------------------------------------------------------------
In addition to the grave detriment privatized catch share programs
may cause to coastal communities, it is important to note that catch
share programs do not necessarily improve ecological conditions, as
noted by a study by the Lenfest Ocean Program of Pew Charitable Trusts
published in the journal Proceedings of the National Academy of
Sciences. The study, which analyzed impacts of catch share programs in
North America, concluded that while these programs may make fisheries
more predictable, they do not necessarily lead to more robust fish
populations. This study disproved the common argument in favor of catch
shares programs, that they supposedly benefit conservation and fishery
sustainability. \2\
---------------------------------------------------------------------------
\2\ T, Essington. ``Ecological indicators display reduced variation
in North American catch share fisheries.'' Proceedings of the National
Academy of Sciences. 2009.
---------------------------------------------------------------------------
When developing a catch shares program, there is a choice. Systems
can be privatized to benefit only a few, or they can benefit the public
interest through fair allocation, and a flexible ``rental'' system. Our
goal is to make the public more broadly aware of that choice, and to
steer policymakers toward the latter option, and we hope you will join
us in this work.
The fish in the U.S. Exclusive Economic Zone (EEZ) ocean waters
belong to all U.S. people equally and are part of the ocean commons: a
living public trust asset to be passed from one generation to the next.
We thank you for considering these comments, and the attached
documents, and ask that you help protect these public resource for
future generations by bringing oversight to the fragmented catch-shares
implementation process that is occurring across the country, and
steering plans in a ``cap-rent-recycle'' direction.
______
[NOTE: An article entitled ``Cap-Rent-Recycle: Common Sense on
Catch Shares'' has been retained in the Committee's official files.]
______
[A statement submitted for the record by Troy Fussell,
Morriston, Florida, follows:]
Troy Fussell,
Gulf of Mexico Reef Fish Fisherman
F/V Irma Lee
Morriston, FL
352-528-5667
[email protected]
Date: 04/26/2010
To: All Members of the Subcommittee on Insular Affairs, Oceans and
Wildlife
Subject; Gulf of Mexico Grouper Tilefish IFQ (Catch Share) Program
Introduction
This letter is intended to inform the members of the subcommittee
of the effects the Gulf of Mexico Grouper Tilefish IFQ program has had
on my operation. I have been following the development of the program
and kept communications with Gulf Council members, advisory panel
members and personnel of NMFS St. Petersburg over the years.
In September of 2000 I bought the fishing vessel Irma Lee and
permit together as a package. At that time I was new to the commercial
reef fish fishery and intended to grow in experience to one day make it
my full time occupation. That day came in late 2006 when my employer of
many years went out of business. From that time until December of 2009
I enjoyed moderate success and earned income from grouper fishing to
support my family. Now the IFQ program is underway I have the boat
hauled and sitting idle. In the following paragraphs I will explain how
and why I was forced to make this decision.
Nature of Grouper Fishing
When most people think of commercial fishing they think of big nets
pulled along the bottom capturing anything and everything, or perhaps
gillnets or traps. The shallow water grouper fishery is one of the most
environmentally friendly fisheries in the U.S. Almost all swallow water
grouper harvest is accomplished with hook and line, except for a small
percentage of spearfishers. My fishing method of choice is simply a rod
and reel (vertical line fishing). The gear is tended at all times and
when a fish is hooked it is immediately brought to the surface. This
method allows the fisher to quickly identify if it is a lawful species
and size, if not it is immediately returned, with little or no harm.
Pertinent History
1990--First reef fish permits were issued
1992--Moratorium on issue of new permits
July 15, 2004--Red Grouper TAC dropped to 5.31MP
November 15, 2004--TAC of Red Grouper met
November 16, 2004--Announcement of October 15, 2004 as IFQ control date
March 3, 2005--10,000 lb trip limit set
October 10, 2005--TAC of Red Grouper met
January 1,2006--6,000 lb trip limits set
January 2007--Magnuson-Stevens Reauthorization Act Signed
February 7 2007--Grouper Traps removed permanently
January 2009--Grouper Tilefish Referendum Results Reveled
January 1, 2009--Commencement of Grouper Tilefish IFQ Program
Detailed Sequence of Events
As observed from the pertinent history list the TAC (total
allowable catch) for red grouper was reduced to 5.31MP on July 15,
2004. For the first time in the fishery's history on November 15, 2004
the TAC was met and by rule the entire shallow water grouper commercial
fishery must be halted for the remainder of the year. The following
year the TAC was met October 10, 2005 the fishery again closed until
the first of the year. January 1, 2006 6,000 lb trip limits were
instated the TAC was never reached again. These two closure events set
into motion the NMFS push for a catch share program.
In January 2007 the Magnuson-Stevens Reauthorization Act (MSA) was
signed giving the Gulf Council and the Secretary of Commerce the
authority to invoke a Limited Access Privileged Program (catch shares)
if desired. The MSA contains very explicit guidelines and procedures
detailing program initiation, initial allocation and cost recovery.
These rules insure the small owner-operated vessels that currently
depend on the fishery receive a fair and equitable initial allocation.
In December 2008 NMFS held a referendum to determine if qualified
grouper fishers approved of the IFQ program. 81 percent were in favor.
Around October 5, 2009 I received a package from NMFS indicating
the amount of my permit's initial allocation amount.
My Situation
During August 2008 the Gulf Council determined who was eligible to
vote in the December referendum. They decided to use catch histories
from the years 1999-2004 as the qualifying years and an 8000 lb
landings average per year as an additional voting qualification. Of
about 1000 permits with grouper landings only 300 were eligible to
vote. Approximately 69% of fishermen who held valid Reef Fish permits
as of December 2008 were denied an opportunity to vote. I was denied
the opportunity to vote.
The following are quotes from the official referendum results
bulletin.
``Of 301 ballots distributed, 273 (90 percent) were returned by
eligible voters, 23 ballots received by eligible voters were
not returned, and 5 ballots were not claimed by the
addresses.''
``Of 273 votes cast, a total of 220 votes (81 percent) were in
favor and 50 (18 percent) were opposed. Three returned ballots
were declared invalid.''
In my opinion the high average annual landings threshold was set to
produce a predictable result. Those with lower landings would be more
incline to vote no because their initial allocation would be relatively
low. The MSA 16 U.S.C. 1853a (c)(6)(D)(i) states, ``For multi species
permits in the Gulf of Mexico, only those participants who have
substantially fished the species proposed to be included in the
individual fishing quota program shall be eligible to vote in such a
referendum.''
The phrase ``substantially fished'' can have a very broad
interpretation.
The Gulf Council used the same qualifying years 1999-2004 as the
initial allocation formula. Using these selected years gave no
consideration to those who are currently dependant on the fishery as
the MSA demands. The council used catch histories from 11 to 6 years
before the implementation of the program, and obviously did not include
catch histories as close to the program start date as possible.
Below are excerpts from the MSA Reauthorization Act 2006.
MSA 16 U.C.S. 1853 (b)(6)(A-G).
(6) establish a limited access system for the fishery in order
to achieve optimum yield if, in developing such system, the
Council and the Secretary take into account--
(A) present participation in the fishery;
(B) historical fishing practices in, and dependence
on, the fishery;
(C) the economics of the fishery;
(D) the capability of fishing vessels used in the
fishery to engage in other fisheries;
(E) the cultural and social framework relevant to the
fishery and any affected fishing communities;
(F) the fair and equitable distribution of access
privileges in the fishery; and
(G) any other relevant considerations;
MSA 16 U.C.S. 1853a (c)(5)(A-E)
(5) ALLOCATION.--In developing a limited access privilege
program to harvest fish a Council or the Secretary shall--
(A) establish procedures to ensure fair and equitable
initial allocations, including consideration of--
(i) current and historical harvests;
(ii) employment in the harvesting and
processing sectors;
(iii) investments in, and dependence upon, the
fishery; and
(iv) the current and historical participation
of fishing communities;
As the MSA proclaims, present, current AND historical
participation/harvest must be considered when developing and allocating
IFQ programs and shares. The Gulf Council used historical only.
Using historical only landings, as the initial allocation formula
is the major factor that was most detrimental to my operation. After
2006 my landings substantially increased due to my full-time
involvement. During the years after 2006 my average yearly landings
were about 15,000 lbs. In October 2009 I was officially notified of my
initial allocation for 2010 of about 3,000 lbs, only 20% of my most
recent years landings.
The Gulf Council's and NMFS solution to this deficit is for me to
lease or buy shares from someone. After talking with other shareholders
some shares could be leased, but at prohibitive costs. The amount of
shares needed to bring me back to viable levels are simply too costly.
Currently the boat is hauled and sitting idle. I am presently working
odd jobs to support my family and searching for permanent work.
Another consequence of the program will be a forced relinquishment
of my Reef Fish Permit. This will come about due to the fact that less
than 50% of my income will come from commercial fishing, pursuant to 50
C.F.R. 622.4(a)(2)(v). I simply do not have the resources to lease or
buy shares.
One would instinctively consider other species to supplement or
replace Grouper. However Grouper and **Red Snapper are the most viable
Reef Fish species in my area. Lesser viable Reef Fish species are
naturally not as abundant within my vessel's range as in other areas of
the Gulf. As you are quit aware Grouper and Red Snapper are currently
managed under the new IFQ programs with many of the lesser Reef Fish
species to soon follow. A control date of December 2008 has been
announced.
**My yearly allocation of Red Snapper issued in 2006 was/is 34lbs
(thirty four pounds).
Solutions
I am not opposed to the concept of IFQs I am opposed to the way the
Gulf Council and NMFS bent the guidelines of the MSA and harmed a lot
of fishermen. Below are some suggestions on how to fix the current Gulf
of Mexico Grouper Tilefish IFQ program.
1) Put the current IFQ program on hold.
2) Redefine ``substantially fished''.
3) Conduct a proper referendum to include more of the current
participants.
4) If passed, base initial allocations on the most recent
landings data.
5) Make shares sales only, No leasing.
6) Shares can only be owned by fishermen with Permits. (the
current plan in 5 years will allow any U.S. citizen or legal
alien to buy shares without a permit).
7) Abolish the 50% income rule.
Closing
I am not a fisheries management expert, but I am a small vessel
owner operator that depended on the Grouper fishery. I was forced out
with no viable alternatives, no exit compensation and not even a
financial assistance opportunity (loan).
I hope from my experiences and comments the committee can use it to
help alleviate some of these problems for existing and future fisheries
programs.
Thank you for your attention on this matter.
Troy Fussell
______
[A statement submitted for the record by Jim Gilmore, At-
sea Processors Association, follows:]
Statement submitted for the record by Jim Gilmore,
At-sea Processors Association
The At-sea Processors Association (APA) submits this testimony for
the hearing record for the Subcommittee on Insular Affairs, Oceans and
Wildlife's second hearing on the use of catch shares as a fishery
management option. APA member companies have experience with fish
harvesting cooperatives--a type of catch share program--going back to
the late 1990s. Hopefully, the Committee will find useful this
reporting of our positive experience with fishing cooperatives in
achieving conservation benefits, providing family-wage jobs, and
promoting international competitiveness for our sector of the fishing
industry. We also take this opportunity to share our thoughts on the
promising draft catch shares policy issued by the administration in
December 2009.
Background on APA
APA is a fishery trade association composed of five companies
that--among other commercial fishing and fish processing interests--own
and operate 19 U.S.-flag trawl catcher/processor vessels. All 19
vessels are eligible to participate in the nation's largest fishery,
the Bering Sea/Aleutian Islands pollock fishery. Ten of the vessels are
also licensed to participate in the catcher/processor sector of the
west coast Pacific whiting fishery.
APA members have worked together in both the Alaska pollock and
Pacific whiting fisheries to implement fish harvesting cooperatives,
which are catch shares-style programs. In 1997, members of APA created
the Pacific Whiting Conservation Cooperative (PWCC). Two years later,
following passage of the American Fisheries Act, APA members formed the
Pollock Conservation Cooperative (PCC). As described below, both
cooperatives have delivered significant conservation benefits and
fostered economic stability in the industry.
Benefits of Catch Shares-Style Fish Harvesting Cooperatives
Following passage of the Magnuson-Stevens Act in 1976, the Alaska
pollock and Pacific whiting fisheries were among those west coast/
Alaska fisheries that transitioned from being harvested by foreign
fishermen to being harvested and processed by U.S. fishermen and
processors. U.S. fishery managers have done an excellent job over the
past 30-plus years conducting stock assessments and setting science-
based annual catch limits for the Alaska pollock and Pacific whiting
fisheries, among other groundfish fisheries in the region. The
``Americanization'' of these fisheries created thousands of new jobs
for fishermen and fish processing workers. By the early 1990s, however,
the race among vessels to catch the available quota resulted in
substantial overcapitalization of the industry. Regulations limiting
licenses were not implemented until the overcapitalization problem
existed, and limiting new entrants did not bar existing participants
from continuing to invest in equipment designed to fish and process
faster.
APA members recognized the Hobson's choice: A fishing company could
either join with most, if not all, of the other participants in
borrowing more to purchase equipment to fish and process faster just to
maintain its current share of the catch. Or a fishing company could
stand pat but fall behind others in the race for fish. APA members'
innovative solution was to advocate for limits on new entrants into
already overcapitalized fisheries. Most importantly, APA members then
agreed to form fish harvesting cooperatives among the eligible
participants in which those participants agreed by private contract to
divide the harvest quota based generally on each company's historical
percentage of landings.
With individual harvesting allocations in place, less efficient
qualified vessels are generally not operated. The remaining vessels
conduct fishing and processing operations in a manner that optimizes
performance, helping the industry to reduce costs. The catcher/
processor sector is now producing about 50% more fish products per
pound of fish harvested than the fleet was able to achieve under the
race for fish format. In short, fish harvesting cooperatives have been
effective in helping companies reduce operating costs while increasing
the value of fish harvests. With crewmember wages often linked to the
value of fish harvests, the benefits extend beyond company owners to
all the men and women working in the harvesting and processing
operations.
The fish harvesting cooperatives are also delivering measurable
conservation benefits. The Alaska pollock and Pacific whiting fisheries
are notable for their low incidental catch of non-target species with
only about 1% of the harvest consisting of non-target species.
Notwithstanding such ``clean'' fishing, cooperative members have
initiated voluntary incidental catch avoidance programs for each
fishery to further improve conservation performance. Among other
initiatives, cooperative members share catch information collected by
federal fishery observers assigned to the catcher/processor fleet.
Observer reports are transmitted electronically to NOAA Fisheries'
observer program offices. Vessel owners retain a private company,
SeaState, to collate and analyze observer data and to provide the fleet
with real-time information that identifies any incidental catch
``hotspots.'' Through terms of an enforceable private contract, fishing
areas closures for cooperative members are instituted. This incidental
catch avoidance program is an adaptive management approach that is
difficult, if not impossible, to replicate in the federal fishery
management regulatory process.
APA members' positive catch shares experience is hardly unique. In
the Alaska region alone, all sectors of the Alaska pollock fishery have
formed fish harvesting cooperatives, flexible Individual Transferable
Quota (ITQ) catch share programs have been designed for the halibut/
sablefish and crab fisheries, and additional fish harvesting
cooperatives are being established in the multi-species non-pollock
groundfish fisheries. Including west coast Pacific whiting, these
fisheries account for about half of all seafood landed annually in the
U.S. The success of these programs demonstrates that regional decision
making that tailors catch shares to the specific elements of the
fishery being managed can bring measurable benefits to fishing
communities and the environment.
NOAA's Fishery Management Responsibilities and Catch Shares
Many of the benefits of catch shares realized in the Alaska pollock
and Pacific whiting fisheries, as well as other Alaska fisheries, have
been replicated in catch shares programs around the U.S. and abroad.
Our fish harvesting cooperative experience, for example, is consistent
with the scientific analyses referenced in NOAA's catch shares policy
report showing ``that fisheries managed with catch shares have
demonstrated improved biological and economic performance relative to
prior management using traditional tools.'' Given that track record of
success, it is reasonable for NOAA to develop a policy that, among
other things, encourages regional fishery management councils to
consider catch shares at least as a management option to be analyzed by
councils when addressing extant problems in U.S. fisheries. The NOAA
policy to encourage consideration of catch shares programs is wholly
consistent with the agency's commitment and responsibility to enhance
fishery sustainability, including fostering economic and social
stability for commercial fishing interests.
Among other benefits, catch shares programs, where appropriately
used, should effectively complement new annual catch limit requirements
mandated in the 2006 Magnuson-Stevens Act amendments. We particularly
agree with NOAA's finding that catch shares can complement annual catch
limits (ACLs) by helping achieve additional economic and social
objectives necessary to support sustainable fisheries. As our testimony
noted earlier, science-based catch limits alone do not ensure a healthy
fishing industry. In the case of the Alaska pollock fishery, fishery
managers applied science-based ACLs for that fishery from the time the
U.S. extended its jurisdiction to 200 miles in the late 1970s. The ACLs
helped maintain sustainable fish stocks, however, annual catch quotas
did nothing to prevent a race to catch the available quota, resulting
in chronic harvesting and processing overcapitalization.
Overcapitalization resulted in numerous bankruptcies in the industry in
the 1990s. Economic and social stability eluded the industry until the
advent of fish harvesting cooperatives in the late 1990s that ended the
pernicious race for fish.
While the 2006 Magnuson-Stevens Act amendments requiring ACLs and
accountability measures represent an important step forward for further
strengthening U.S. fishery management, it is appropriate to encourage
the regional fishery management councils to consider catch shares
programs contemporaneous with implementation of ACL and accountability
measures. The catch shares policy properly reserves this responsibility
for the regional councils and recognizes that successful implementation
of catch shares programs depends on early stakeholder participation in
the scoping process, goal development, and flexibility. Most
importantly, one size does not fit all when it comes to developing
catch shares, and the agency's proposal to commit resources to
facilitate the sharing of experiences among different fisheries
recognizes that critical point.
NOAA's Proposed Support for Councils and Stakeholders is Important
Further to the point above, it is helpful that NOAA has enumerated
the programmatic actions necessary to assist councils and stakeholders,
including providing technical and administrative support, providing
expertise, informing and educating stakeholders to increase
understanding about the advantages and disadvantages of catch shares,
and coordinating data collection to monitor the performance of catch
shares programs. NOAA has thoughtfully articulated more than two dozen
specific activities to accomplish the four proposed programmatic goals.
NOAA's emphasis on assisting industry sectors to make the business case
for instituting catch shares programs and providing tools for fishing
communities to use in assisting with the design of new catch share
programs is appropriate.
Conclusion
In sum, rationalizing fisheries through catch share-style programs
promotes science-based approaches to management, enhances conservation,
and strengthens the economic vitality of fishing communities. APA is
pleased that the Subcommittee is focusing on this critically important
issue area and overseeing implementation of NOAA's catch shares policy.
Thank you, for considering our views.
For additional information, please contact Jim Gilmore, Director of
Public Affairs of the At-sea Processors Association, 1225 I Street, NW,
Suite 600, Washington, D.C. 20005. E-mail: [email protected]. Ph.
206.669.6396. More detailed information about the Alaska pollock and
Pacific whiting cooperatives can be found at www.atsea.org and
www.pacificwhiting.org.
______
[A statement submitted for the record by Dick Grachek,
Stonington, Connecticut, and Point Judith, Rhode Island,
follows:]
Statement of Dick Grachek, Stonington, CT and Point Judith, RI
The following is not an account of fisheries scientific theory or
of management philosophy, or of legal chicanery, or one of debunking
the Eco-NGO marketing talking point lies and misinformation. This is
intended solely as a clear personal statement of fact concerning one
small fishing business, comprised of one vessel, with one Multi-Species
groundfish license. This is a local New England small business that
employs 5 fishermen and supports 5 families with eight children. My
wife and I have our life savings and retirement invested in it, as
well.
Our 73 foot groundfishing vessel was acquired in July of 2005. This
vessel was an upgrade from a smaller vessel which, although well found
and stout, was too small to safely fish offshore in the North Atlantic,
full time, year round.
The new vessel's hull and basic machinery were sound but neglected
and needed a complete rehabilitation; so from July of 2005 through
October of 2006 the vessel was laid up and totally refitted, deck,
superstructure, electrical and machinery, rebuilt or replaced. These
dates are significant because the only fishing trips that occurred
under my ownership during the NOAA decreed ``qualification period'' for
the allocation of catch shares, i.e. the fishing years between 1996-
2006, were the initial ``shakedown'' trips mostly to ascertain what
upgrades were still needed on the vessel.
In other words, the fish poundage allocation this vessel was
assigned by NOAA was based solely on the catch history of the previous
owner. I purchased the vessel when the ``currency'' for fishing
allocation was in the form of Days-At-Sea; this license had the maximum
days allowed at the time. The rules have changed recently to basing
allocation on the total accumulated poundage of catch per license, per
species, during the 1996-2006 fishing years period, and then measuring
this poundage against the total poundage per species landed by all
boats in that period.
The previous owner of my boat and license fished three boats
concurrently, so my vessel was fished only a portion of the available
time, and not always for groundfish, but also for Squid, Whiting, Scup,
and Fluke; species that are not counted as groundfish and would not
appear in my current catch share allocation for groundfish.
The result is that my vessel was allocated a very small percentage
of the significant groundfish species, approximately 5% of the amount
of fish that we have landed per year over the last 4 years and which
are necessary for this operation to remain viable. In all likelihood
our survival will be a matter of months under the current catch scheme.
The New England Multi-Species stocks by The New England Fisheries
Management Council's own figures are 80% rebuilt, 15 of the 19 species
are completely rebuilt and overfishing is not occurring. The other 4
stocks are on the rise and are on schedule to achieve healthy numbers.
Only 25% of the amount of fish declared by government scientists,
available to be safely harvested, was landed last year due to the
inflexible regulations. Overfishing is not occurring in New England;
the fish stocks are healthy. This is an abundant and healthy source of
food. After 20years of sacrifice and downsizing, the fish are back in
force; and a major restructuring is completely unnecessary and
irreversibly destructive.
The majority of local fishing operations are in similar straits to
mine, some in worse predicaments, and some have already disappeared.
The implementation of the Amendment 16 catch share sector scheme must
be stopped before the few remaining boats like mine are gone; and we
lose entirely this vital industry.
______
Dick Grachek, A Report for the AAFC
American Association of Fishermen and Their Communities
Mystic, CT
March 2010
CATCH SHARES, CONSOLIDATION and THE TIPPING POINT
Proponents claim Catch Shares will stop overfishing, restore the
stocks, create high paying quality jobs, and make the fishermen
profitable and safe. A closer look at Catch Share programs in place for
decades shows no data to support these claims.
Further consolidation or reduction of the commercial fishing fleet,
a known consequence of Catch Shares and stated by NOAA during their
push for implementation, will take the independently owned at sea
fishing vessel operations and the dockside support businesses beyond
their financial ``tipping point''. This will cause the small, family
owned, independent fishing businesses and their communities to
collapse.
CATCH SHARES
WHAT IS A CATCH SHARE?
The New England Fishery Management Council is in the process of
installing the Amendment 16 management scheme of Catch Shares or
Individual Fishing Quotas (IFQ's), or Individual Transferrable Quotas
(ITQ's). The various terms and acronyms for the program can all be
defined by the concept of owned percentages of the Total Allowable
Catch (TAC) by individuals, or groups, or corporations, or
organizations, or cooperatives. A ``Sector'' is a cooperative of Catch
Share holders.
This Catch Share management approach is actually an idea of
economics, claiming production efficiency, and not one of fishery
conservation. It is the private ownership of the shares of a natural
resource. Catch shares are an extension of the faulty deregulated free
market theories of economists such as Milton Friedman, which in this
case have evolved into the concept of Free Market Environmentalism
which is the approach of ``ownership equals responsibility; or render a
commodity profitable enough and somehow the owners and the mechanism of
market capitalization will automatically stabilize and sustain that
resource or industry. For a natural resource such as a fishery this
thinking is based on the following principles:
Private property rights encourage stewardship of
resources
Market incentives spur individuals to improve
environmental quality
Government controls and subsidies often degrade the
environment
Polluters should be liable for the harm they cause to
others
This information can be found at www.perc.org , Property and
Environment Research Center, a ``think tank'' located in Bozeman,
Montana, which proclaims itself as having ``...championed the
successful approach [ITQ's] to eliminating overfishing (see
www.ifqsforfisheries.org).''
The Claim: Fish populations worldwide are imperiled from
overfishing. The Remedy: Individual Transferrable Fishing Quotas will
stop overfishing by making fishing operations more ``efficient'',
therefore making fishermen more profitable, and therefore they will
become more ``responsible stewards'', and therefore sustain the health
of the resource.
A BRIEF HISTORY
Individual Fishing Quotas have been in existence since 1976 in
Iceland, since 1986 in New Zealand, and more recently in the US,
Pacific Whiting and North Pacific Pollack since the late nineties, and
Bering Sea Crab in 2005. New Zealand and Iceland are most often cited
as being in the forefront of developing catch shares or ITQ's for their
fishery; they've certainly been at it the longest and their programs
will be looked at more extensively in the next section.
The New England Groundfishery had a brush with catch shares in
1995. The Staff of the New England Fisheries Management Council (NEFMC)
concluded at that time that although these ITQ programs did improve the
economic efficiency of some fisheries, there was little evidence that
they improved the biological condition of the stocks. They specified
that the Catch Share or ITQ scheme is not practical for the diverse
multi-species nature of the New England Groundfishery. They also noted
that groundfish stocks at that time were in trouble world wide,
including those managed with ITQ's and fishing mortality targets. Also
they found that the management costs for this type of program were
enough to drive certain governments (e.g., The Netherlands) to move
away from Catch Shares or ITQ's.
In New Zealand fisheries failures occurred in three species under
this scheme, and Canadian east coast Cod and their other groundfish
populations collapsed after ten years of IFQ management.
This information was enough so that in 1995 the National Marine
Fisheries Service dropped promoting Catch Shares; but then resumed the
push for them in 2005 which culminates today with the impending
implementation of Amendment 16 Catch Shares/Sectors program. The
question is: Why? Can any evidence for this renewed commitment by NOAA
to Catch Shares be found in the stock assessments and TAC's of
fisheries that have operated for decades under this type of regime?
A CLOSER LOOK
Do Catch Shares Rebuild the Stocks?
A Review of Stock Assessments: The fisheries of Iceland, New
Zealand, and U.S., which have operated in a Catch Share or ITQ program
for at least 5 years.
Fisheries often cited as a successful examples of the ITQ
management scheme are Iceland, New Zealand, and in the US, Northwest
Pacific Whiting, Alaskan Pollock, Alaskan Crab fishery, Alaskan halibut
and groundfish.
Certainty of successful stock rebuilding is professed when
proponents are advocating Catch Shares and citing existing ITQ programs
as examples; this paper will concern itself with a closer review of the
TAC's of those countries' stocks to illustrate the effect (or lack of)
that the ITQ's actually have on the fish stocks. It will also look at
the effects of ITQ's on coastal fishing ports and communities.
This is not to claim that ITQ's are necessarily a detriment to the
stocks, although they could be; it is to claim that Catch Shares as a
panacea for the fish and the fishermen is a marketing slogan more than
a statement that is based on fact. It is therefore stated that ITQ's in
themselves are not the answer to the problems experienced by the
fisheries and to claim so is misleading.
Iceland
(I am enclosing these Stats for Iceland because some are quite
extreme and I didn't want the impact to be lost in consolidation.)
Timeline of ITQ Development:
Introduced Individual Vessel Quotas for Herring in 1976; they were
made transferrable in 1979.
Introduced Individual Vessel Quotas for Capelin in 1980; they were
made transferrable in 1986.
Introduced Individual Transferrable Quotas for larger vessels for
Demersal (Groundfish) 1984.
ITQ system for all fisheries, (small vessels exempt) 1991.
ITQ for small vessels as well 2004.
Landings of Icelandic Stocks for 2008/2009 and potential TAC's for
2009/2010 for 31 species:
This information can be found at The Icelandic Ministry of
Fisheries website:
www.fisheries.is/ -- Go to ``Status of Marine Stocks'' from left
side menu.
[GRAPHIC] [TIFF OMITTED] 55542.007
.epsIn Iceland and in some other areas as well, Cod are holding
their own; the exploitation rate of 40% in 2000 is now at 22%. Fishing
mortality has declined by 40% yet productivity is considered impaired
because the seven most recent year classes have been below average with
poor recruitment and low weight at age, most likely due to lower
capelin abundance.
Most all other species for the 2009/10 fishing year have had the
TAC significantly reduced, some drastically.
An interesting side note illustrating a perspective on the fishing
industry which is not hostile but supportive is a press release from
Einar K. Guofinnsson, Icelandic Minister of Fisheries and Agriculture,
on January 19, 2009, announcing an increase of 30,000 tons in the cod
TAC, and by way of qualifying the increase wrote:
``This decision has been taken not least in view of the
economic difficulties facing the Icelandic nation, but also in
consideration of positive indications as to cod stock size
resulting from trawl service [surveys] of demersal species this
past autumn. Those assessments indicated that the overall cod
index was considerably higher than in preceding years.
The cod TAC for the next fishing year is also expected to be at
least 160,000 tonnes.
Although rebuilding the cod reference and spawning stock biomass
will be slower than planned, this decision is in line with declared
objectives for sustainable fishing of cod and other commercial stocks
in Icelandic waters.'' (Underline emphasis is mine)
So the stock assessments look pretty good, and factoring in
economic realities, they're going to slow down the rebuilding process,
confident that the stocks are in the process of achieving
sustainability. That is common sense governance that U.S. fisheries
have been deprived of for decades. Also worthy of note: it is Fisheries
and Agriculture; not Fisheries and International Commerce and Big
Business, which is what the placement of the U.S. fisheries amounts to
in the Department of Commerce.
Cod seem to be on the rebound in all the fisheries reviewed; but
they are alone; almost all TAC's for the Icelandic fisheries reviewed
have been cut. It would seem that there are other factors governing the
health of the stocks besides the allotment of Individual fishing
quotas. If the ITQ's were solely responsible for any successes, than
what about the rest of the fish under ITQ's, why haven't they
rebounded? What is abundantly clear is that ITQ's promoted as a panacea
for all that ails the fisheries is either a grossly ignorant
oversimplification of a very complex set of circumstances which effect
the health of the fish; or such statements have a predisposition
because of some external agenda that has little or nothing to do with
the actual health of the fish or the fishery.
This is not to make the argument that ITQ's are causing the decline
in the fish population, but simply put ITQ's are certainly not
necessarily helping the stocks as they are purported to do.
New Zealand
Fisheries statistical information was found at The New Zealand
Ministry of Fisheries website: www.fish.govt.nz ``New Update for Status
of Stocks'', September 2009
The New Zealand fisheries have been under ITQ's or QMS's (Quota
Management Systems as they are known in New Zealand), since 1986. The
results are mixed concerning the sustainability and health of the fish.
According to the Ministry of Fisheries' statistics out of the 117 major
commercially harvested stocks evaluated that are in the QMS, 79 are
near or above target levels while 38 are not. The report goes on to
disclose that of the 117 the number of stocks depleted or overfished is
18, not depleted, 77; while 8 stocks are collapsed and closed to
fishing, orange roughy and scallops among them, and 19 stocks are
overfished.
The Orange Roughy Fisheries of New Zealand and Australia (a story
by themselves) were on ITQ's since 1986 and 1989 respectively. By some
accounts the stock is now at 10% of what it was estimated to be before
a market developed for the fish, whether or not that figure is accurate
is another question; but it's safe to say that the ITQ scheme did
little to sustain the fishery. The brilliant ITQ strategists failed to
take into account the fact that the fish for which they were advocating
ITQ's have a lifespan of 120-150yrs and spawn at 30 years of age. As a
species, they're just a bit sluggish on the rebound. Clearly there's
more to management than marketing shares of the TAC; it also helps if
something about the characteristics of the fish is known. Each fishery
is unique, and some are more complex than others, such as the New
England Multispecies Fishery where many regulated species inhabit the
same area.
They don't seem to greatly emphasize the ITQ system part of their
management program; although it has been used for almost all their
fisheries for the last 26 years. The New Zealand system is seen as much
as an ``input controls'' system (i.e., restricting how, where, and when
fishing is carried out, days at sea, and closed areas, etc) as it is an
``output system'' (or limiting the amount of fish taken, TACs and
ITQs). They use both; and do not make any claims of either being a
panacea. In a comprehensive study titled, ``The historical development
of fisheries in New Zealand with respect to sustainable development
principles'', http://www.ejsd.org/ Archives, volume 1,issue 2,
Sustaining the Seas, Dr. Mark T. Gibbs, the Stream Leader of Aquatic
Resources Monitoring and Modeling at the Commonwealth Scientific and
Industrial Research Organization, concludes that although he thinks
that they are probably a good idea, after 26 years of ITQs in New
Zealand he writes with a sense of honesty and reality in the
conclusion, in fact, the very last paragraph of the paper on p31:
``It therefore appears that ITQ regimes as presently practiced
are neither a necessary nor a sufficient condition to ensure
sustainable development. However, at least in the case of New
Zealand, they have been a major milestone on the pathway that
ultimately hopes to achieve sustainable fisheries.''
This, after 26 years of ITQ's, an honest appraisal can only offer
the ITQ pathway as a ``hope'' to ultimately achieve sustainability.
U.S. Fisheries: Pacific Whiting, Alaskan Pollack, Crab, and Halibut
The Pacific Whiting Fishery, in ITQ's since 1997, is essentially
owned by four companies running ten vessels; their TAC for 2009 has
been cut by 50% by the Pacific Fishery Management Council, alleging
declining stocks.
The North Pacific Pollack Fishery has been in ITQ's since 1999. A
huge fishery in terms of landings, it accounts for 35% of all U.S.
landings and is worth billions. The bottom line is that the fishery is
in the hands of a powerful few and the TAC was reduced by 29% for 2009
for alleged stock decline.
Since 2005 the Bering Sea King and Opilio crab fishery has been in
ITQ's, or ``Crab Ratz'' as the rationalization of the fishery is
affectionately known to the fishermen involved. The TAC's for these
fisheries have not increased in recent years.
In Southeast Alaska the Red and Blue King Crab fishery did not open
and the biomass is at its lowest level in sixteen years. Halibut
fishermen in this area have seen their TAC decline by more than half in
the last five years.
It is not argued that ITQ's or catch shares are causing the decline
in TAC for these species; or that a declining TAC is necessarily an
accurate indication of declining fish populations. It is argued,
however that there is no evidence in these assessments to indicate that
Catch Shares or ITQ's have any demonstrable beneficial effect on the
fish stocks. The Catch Shares or ITQ scheme is just that, an economic
scheme to produce a new tradable commodity and a new path for economic
expansion--wealth for a few investors with good timing (or
connections).
Any management program that uses Catch Shares or ITQ's still needs
to use a Total Allowable Catch or TAC in order to manage the stock
populations. The TAC's were cited above only to illustrate that the
claim for ITQ's or Catch Shares as having a profound beneficial effect
on the health of fish populations and therefore a benefit to the
fishing community cannot be statistically supported; and the opposite
seems true, most TAC's show a decline over the years. Fish populations
have increased and declined over the years with apparent disregard for
the management regime in place. What effects fishing mortality is TAC
and trip and daily catch limits not who owns what percentage of the
TAC.
The report, ``Updated Status of New Zealand's fish stocks'',
September 2009, begins with the statement:
``In New Zealand, setting and adjusting Total Allowable Catches
(TACs) and/or Total Allowable Commercial Catch (TACCs) to limit
annual catches is the primary mechanism for managing our
fisheries. This is generally thought to be the most effective
management method worldwide.''
Do Catch Shares rebuild the stocks? NO. Additionally it is only
common sense to understand that if the resource is owned by absentee
investors (``sealords'') there will be far less good stewardship
involved than with a publically owned resource, procured by local
fishermen who are accountable to the local consuming community.
Catch Shares are nothing but more faulty Milton Friedman free
market economics. Consider what's already been privatized and
corporatized and market capitalized: Schools, Prisons, Energy, War,
farm food; and look at the corporate track record in those areas:
Enron, Exxon Valdez, Halliburton, Blackwater, the U.S. has the largest
prisoner population on the planet, Judges taking kick backs for
populating juvenile prisons, e-coli and poison peanut butter, etc.
After fish become tradable commodities, why would we think the
fisheries resource would be handled with any more integrity and
enlightenment by the corporate ``Funds'' investors that are licking
their chops as we speak? (See Festa courts Milken, Gloucester Daily
Times, June 30 '09)
What will be the effect of being privatized, corporatized,
commoditized, and derivitized on the ocean and its inhabitants (both
finny and human)? Has free market, profit oriented, corporate
stewardship improved the health of anything it has touched? Consider
the current state of the world economy after the deregulated free
market ``profit is all that matters, it will float all boats'' economic
policies of the last decade were so vigorously and consistently applied
to our financial institutions.
CONSOLIDATION
WHAT IS CONSOLIDATION?
Does Consolidation through Catch Shares Increase Profitability and
Safety for the Fishermen?
Consolidation is fleet reduction; and is a known consequence of
Catch Shares. In fact fleet reduction is a stated goal for the
fisheries of the ENGO's and NOAA. Consolidation is their answer to
their own sound bite, ``...too many boats, chasing too few fish''.
Consolidation results from commoditizing a resource into individual
quotas or Catch Shares because the allocation process is so flawed it
can for instance, cut out single license holders from receiving a
viable allocation. In addition the mechanics of the allocation such as
the ``qualification period'' on which the percentage of the overall
catch is based, might entail a period when the catch history of a
license was in the hands of a previous owner who could have had a fleet
of boats and fished each one at various times, but might not have
accumulated a decent total catch history for any one of them. Accurate
government agency record keeping in this process is crucial; NOAA/NMFS
has admitted its allocation data is flawed.
Of course if the overall TAC allotted by NOAA is not reasonable,
then all but the largest allocation holders will go down the drain.
WHY CONSOLIDATION? WHAT IS THE RATIONALE?
The claim: Fish populations worldwide are imperiled from
overfishing. The remedy: Individual Transferrable Fishing Quotas or
Catch Shares will stop overfishing by making the fisheries more
efficient.
Efficiency is a mainstay in the argument for consolidation through
Catch Shares. Economists and the free market environmentalists talk
about more efficient fisheries. What exactly do they mean by this? They
mean cheaper production costs and more profit i.e., less people, less
jobs, fewer boats, and more production,--usually fewer but larger
factory vessels. In the case of aquaculture it entails the centralized
raising and feeding or industrialized mass production of fish on fish
farms.
The World Bank's Global Program for Fisheries (PROFISH) has an
ongoing study of the efficiency of the world's fisheries. It is called
``The Rent Drain Project''. ``Rent'' is a term in economics which
essentially means the profit or net economic benefit from a property or
resource with the connotation of not being involved in the actual
``hands on'' production process.
The study also has the title of ``The Sunken Billions. The Economic
Justification for Fisheries Reform'' in which the specific countries'
fisheries are studied and advised as to their ``inefficiency'', usually
citing excess fleet capacity as the culprit and recommending reductions
of from 40% to 80% in the number of fishing vessels. This would
increase consolidation, therefore efficiency, to the level where
governments would not see their ``rent'' or profits from the resource
being drained by small privately owned, community based ``inefficient''
fishing boats.
In other words, by extracting rent from our local fisheries through
consolidation, the allocations would pay dividends to individuals or
funds that own, but don't enter into the hands on production.
This is Wall Street investor mentality: exacting profit through
buying and selling shares of production or catch without doing the work
involved; without touching a fish. Catch Shares and this entire system
have nothing to do with the health of the fish or the fishery. Wall
Street is hungry for a new investment tool, a new derivative package.
This system leads to overcapitalization in the fishery, not as
money flows to the vessels and fishermen, but as it rattles around
among the investors, and constantly increases the price of buying the
right to catch a pound of fish, until eventually the undercapitalized
fisherman is priced out of his own business.
Catch Shares essentially render a fishing license worthless. They
ultimately will allow outside or non-license holders to own and collect
``rent'' from the fish poundage landed; and the license then becomes
nothing more than the opportunity to do the back breaking work while
someone else collects the rent or the profit.
In the days-at-sea effort control system, fishermen can buy and
sell each other's right to fish for groundfish species, but it all
stays with the license holders. Catch Shares will open up the actual
ownership of the pounds of fish to outside investors i.e., ``outside''
of the licensed fishermen.
These Catch Share or ITQ concepts are based on academic theories of
economics and business, written by the professors at universities such
as University of Rhode Island, University of British Columbia, and
University of Iceland. Many of these university departments are
supported by grants from environmental organizations which are hostile
to fishing, and doing the bidding of the funding parent corporations,
which have various agendas all aimed at increasing their profit
margins. Many of these economic theorists know little or nothing about
sustaining the resource or the welfare of the fishing communities
dependent on that resource.
Some of these academics have the title of bio-economist, or
resource economist, but it's clear from the sometimes devastating
effects of these theories out in the world, that the theoreticians
don't know much about the fish and even less about the fishing
industry.
In British Columbia fisheries leasing fees or the ``rent'' for
catch shares (the privilege to catch the fish) can take up to 70 to 80
percent of the value of the fish that come out of the fish hold.
For a cogent statement of an Icelandic economist's ``interest'' in
the fisheries, see Ragnar Arnason, Prof. Dept of Economics at the
University of Iceland, ``Iceland's ITQ system creates new wealth''
http://www.ejsd.org/public/journal_article/9 .
SOME EXAMPLES OF CONSOLIDATION
In New Zealand today Eight (8) Fishing companies own 80% of
production and the value of the full fishery quota is $3.5bn. There are
2200 individuals and companies that own quota, so if eight companies
own 80% and even if each company holds several licenses, then at least
2000 individuals and companies own the remaining 20%. That's some
distribution of fish; and also makes one wonder about who will have the
political clout and the price setting ability.
In the North Pacific Pollack Fishery cooperatives were formed by
large catcher processor vessels. They were exempted from the antitrust
laws through the American Fisheries Act of 1998 (AFA). The offshore
fish are caught by a handful of catcher-processor vessels (factory
ships) and 3 motherships that handle product from 20 additional catcher
vessels. The inshore fishery consists of 5 processing plants and 80
catcher vessels delivering to the plants. It is not important to go
into great detail regarding the many and complicated administrative
difficulties and controversies of this type of arrangement, but just to
name a few: the anti trust or monopolistic, and hence price setting
nature of the factory ship cooperatives create inequalities between
them and the independently owned inshore fishing vessels and processing
plants; then comes government micro (mis)management, as usual, through
regulations in the AFA, with inequities and market destroying
consequences. The common pool fishermen's livelihoods are controlled
through price manipulation by the large factory ship cooperatives and
the relatively few processing plants. The bottom line is that the
fishery is in the hands of a powerful few, with market destroying price
setting powers.
The Pacific Whiting Fishery, in ITQ's since 1997, is essentially
run by four companies fishing ten vessels.
The Bering Sea King and Opilio Crab fishery rationalization has
shut down the fishing operations of 200 boats (there are 68 remaining)
and has cost an estimated 1200 fishing jobs. Kodiak is said by the
locals to be ``dying''.
In Canada's halibut fishery it is estimated that since the
installment of ITQ's, for every dollar that the boat earns 70 cents
goes to the cost of leasing the quota for those fish caught.
Essentially this triples the overhead cost to the vessel owner, the
captain, and crew. Where is the increase in job quality, and
profitably, and safety in that? The fleet was reduced by 50%.
ITQ's do however have a profound effect on the fishing communities
that have operated under such a regime. Vessel, captain and crew shares
have decreased on average by 50%. When profit margins are decreased by
that much, there is less incentive and funding for upkeep and
maintaining vessel safety equipment.
Our fishing regulation approach seems dominated by science, mostly
economists and biologists; but there are people living amongst all
these theories. Catch Shares or ITQ's do have an effect on the fishing
community, on people, and the effect is negative. Catch Shares have
nothing to do with the common good, or public purpose, security of the
food supply, safety of those at sea, or the health of the resource.
Do Catch Shares increase profitability and safety for the fishermen?
NO.
COUNTERPOINT: THREE STUDIES
Although there is a paucity of attention paid to the socio-impact
of the Catch Share scheme, below are a few studies that provide some
balance to the largely unsupported talking points of the proponents.
The entire issue of Catch Shares or ITQ's should still be in the debate
phase.
Ecotrust Canada outlines eight potential trouble spots in a paper
aimed at helping Obama's U.S. Task Force on Catch Shares avoid
difficulties they've already experienced in their ITQ experiment,--our
administrators don't seem to be listening.
The British Columbia Fishery ITQ management regimen has been held
up as a model of success by Catch Share proponents and has been in
effect since the early 1990's. Here is a report by a Canadian
Environmental NGO, Ecotrust Canada; they apparently have not been
adulterated by corporate grants. They seem not to have lost their
integrity as they report here on the realities that BC fishermen have
faced over the years. Realities which run counter to the marketing
pitch of Catch Share proponents' media campaigns. In the words of the
report, ``A cautionary tale about ITQ fisheries'', http://
www.ecotrust.ca/fisheries/cautionarytale front page, 2nd paragraph:
``Debate about ITQ's is often polarized and fuelled more by
ideology than by reality. Proponents hail ITQ's as a solution
for both conservation and the financial ills plaguing the
fishing industry. However, too many people--including some
environmentalists--accept exaggerated claims about ITQ's
without clearly knowing the facts. Downplayed is the critical
role that sound science and good governance--that is,
inclusive, transparent, co-management between government, and
industry and stakeholders--plays in ensuring the sustainability
of fisheries.''
The report discloses 8 lessons ``...learned from the practical
experiences of designing, implementing and managing ITQ's in BC.''
It is worth listing the 8 lessons here since they are in direct
contrast to the latest talking points blog released by a principal
proponent of the catch share scheme, the Environmental Defense Fund,
www.edf.org titled ``NOAA's New National Catch Share Program: An
investment that makes (dollars and) cents'' which contains the
statement, ``Fishermen are increasingly embracing catch shares because
they boost profitability, wages, and safety.''
This shorter version of the 8 lessons can be found under
``BACKROUNDER'' in the Ecotrust paper http://www.ecotrust.ca/fisheries/
study-cautions they are as follows:
With refreshing facts and sobering analysis, Ecotrust Canada's
Cautionary Tale describes eight lessons to be learned from BC's
experience with ITQ fisheries since the 1990s.
Lesson 1: ITQs promote quota leasing, not ownership. In
1993, only 19 percent of the halibut quota was leased compared to 100
percent in 2008. Lucrative leasing has caused quota purchase prices to
soar, making ownership prohibitively expensive.
Lesson 2: ITQs give fishermen a false sense of security.
By allocating individual fishermen a defined share of the catch, ITQs
can reduce a bit of uncertainty, but they by no means eliminate it and,
in some cases, can exacerbate it. For example, quota lease fees
negotiated pre-season can expose fishermen to increased financial risk
if fish prices drop, fuel prices rise or foreign currency exchange
rates change.
Lesson 3: ITQs facilitate resource privatization. Fishing
licenses and quotas are not property de jure, that is ``in law.''
Rather they are property de facto, that is ``in practice.'' ITQs create
new forms of de facto property that can be divided, capitalized and
transferred with even greater ease.
Lesson 4: ITQs increase capitalization in fisheries.
While ITQ systems can rationalize fleets, reducing capitalization in
vessels and equipment, they can also lead to speculative buying and
leasing which increases the capitalization in quotas themselves. Today,
fishing quotas and licenses, or intangible assets, are worth $1.8
billion or five times the value of all the vessels and equipment in
BC's commercial fisheries. That means total capitalization in tangible
and intangible assets has actually increased.
Lesson 5: Quota leasing hurts the financial performance
of working fishermen. Quota lease fees are as high as 75 percent of
catch landed value in many BC fisheries, draining revenues from working
fishermen. In BC's trawl fishery, as the amount of quota leased rises
to 100 percent on a vessel crew shares decline by about 50 percent.
Lesson 6: ITQs don't enhance science and monitoring.
While ITQs fisheries usually require stricter monitoring because of
high-grading problems, there is nothing about the nature of ITQ
fisheries that inherently improves monitoring or scientific data
collection.
Lesson 7: ITQs have safety problems of their own. The
high cost of buying and leasing ITQs bleeds income away from working
fishermen, causing boats to go out with inexperienced or insufficient
crewmen, which can lead to accidents. Anecdotal reports and safety
statistics suggest that the groundfish trawl fishery has become less
safe since ITQs were introduced in 1997.
Lesson 8: Sound science and co-management underpin
fisheries sustainability. ITQs don't guarantee sound science and good
governance. They represent only one alternative, among many input and
output controls, to responsibly manage fisheries
The question is: have these eight points been adequately considered
and addressed for the impending Catch Share system here in New England;
no less, allotted the time and energy required in order to create their
preventative remedies for our fishery, ``and will they ever be
seriously dealt with?
Dr. Julia Olson (July 1, 2009), ``Social Impact Assessment
Literature Review: Leasing and Permit Stacking'', New England Fisheries
Science Center, Woods Hole, MA writes,
``the primary social impacts that have been documented in
empirical cases involving consolidation (explained in greater
detail below) range from employment loss, decreased income,
decreased quality of life, changing relations of production,
structural disadvantages to smaller vessels and firms,
dependency and debt patronage, concentration of capital and
market power, inequitable gains, regulatory stickiness reduced
stewardship, decreased community stability, loss of cultural
values, and so on.'' (Underlines and parentheses are Olson's)
Dr. Olson concludes that same introductory paragraph with,
``Thus the question of capacity reduction is ultimately not
simply an issue of economic efficiency, but a question of what
values to promote and what the future of the fishery and its
fishing communities should look like.''
This broader perspective from Julia Olson's paper, (i.e., what
about the people?) is found again in a paper that contains a great deal
of common sense and knowledge of fishing communities by Seth Macinko
and William Whitmore, Dept of Marine Affairs, Uni. of Rhode Island,
Revised June 2009, A New England Dilemma: Thinking Sectors Through,
Final Report to Massachusetts Division of Marine Fisheries.
Sectors are the cooperatives that fishermen are required to join
thus pooling their individual Catch Shares. Sectors are supposed to be
self-governing and self-policing. This is an aspect that many feel to
be so administratively costly and unwieldy, that it's a setup for
failure.
Macinko and Whitmore's relevant bullet points in the ``Executive
Summary'' are as follows:
``The current push for sectors obscures the fundamental policy
decision at stake: whether to pursue catch shares via a model
that emphasizes ``privatization'' of public resources or a
model consistent with public ownership of fishery resources.
The privatization model carries with it known inequities while
the public ownership model could offer equity for all interests
involved. Sectors can occur via either route but there has been
no public recognition or discussion of this choice.''
``The current approach to sectors appears to be driven by an
extreme faith in privatization, deregulation, and devolution of
authority. Mere faith that private ownership promotes
stewardship will not contribute towards solving the monitoring
and enforcement challenges on which conservation truly depends,
and could spell disaster for sectors.''
``While arguments can be made either way, on balance the
available evidence suggests that sectors are likely to
accelerate the consolidation that is already happening in the
groundfish fleet. In addition to affecting sheer vessel
numbers, consolidation will likely have a geographic component,
shrinking the number of ports actively involved in the
fishery.''
``In view of the Council's [New England Fisheries Management
Council] expressed concern for adverse impacts on communities,
as well as the statutory mandate to reduce such impacts
(National Standard 8) [of the Magnuson Stevens Act], the
relationship between sectors and community benefits warrants
closer attention. Community benefits cannot be just assumed to
happen via a trickle-down process.''
It is clear from these three studies alone that the headlong rush
into Catch Shares, ITQ's, IFQ's or whatever they are called is a
disastrous vector for the fishing industry, the fishing communities,
and the fish. They need to be in a moratorium until these issues are
addressed at length.
TIPPING POINT
Even during the best of times, because of unpredictable market
forces, the illusive prey, and extremely high operating costs, fishing
businesses do not have a very fat reserve account backing them up. They
don't have a great cash flow margin of error. Their financial ``burn
time'' is not impressive. Any irritant to these shallow financial
margins, if sustained for any length of time, can be disabling and
before too long will cause the business to shut down. This is true not
only for the vessels that go to sea; but just as importantly, it is
also true for the many shoreside support businesses that make a fishing
operation possible. These dockside businesses have a point of ``no
returns''. Currently, the majority of the boats and shoreside
businesses are on the edge of going under financially due to the
``Perfect Storm'' of the slow choking of landings revenues through
overzealous regulation, and the even higher than normal overhead costs
due to escalation in fuel price and insurance premiums, and low fish
prices because of the poor economy and cheap imports.
Fishing vessel operations have a mutually dependent relationship
with their dockside support business counterparts; they need each other
in order to exist. Vessels depend on ice suppliers; look to wholesalers
to pack and sell their catch; and call on net makers, electricians,
welders, and mechanics for immediate repairs which will enable them to
return to sea without too much costly down time. Without these support
services, the thin financial margins of vessel operations threaten the
continued solvency of even the best boats. Similarly the support
businesses are not publically owned corporations with unlimited
resources. If the boats are not frequent enough or don't pay their
bills, these shore side businesses, the foundation of the system, will
be jeopardized and if they fold, the entire local fishing industry will
collapse.
There is a solvency tipping point where the number of vessels
coming in for repairs, ice, fuel, groceries, net refurbishing, or with
fish to pack out, i.e., the overall volume of transactions, is simply
not yielding enough cash flow for these businesses to keep the doors
open. It is the point where overhead overwhelms income and the business
operates in the red, and will soon close.
It is one thing for academic economists to theorize about the
economic ``efficiency'' resulting from fleet consolidation; but the
reality off-campus is that the 50% percent reduction of an already
reduced and starved fleet will not be enough to keep the support
businesses open; they will disappear. Then without the necessary
dockside support, the fishing vessels will soon follow and easily slip
down the same sinkhole as the dockside facilities. We will then see a
complete 100% consolidation of the small boat fleet. In its place will
be vertically integrated companies of self sufficient factory trawler-
processors, contracted directly to Wal-Mart and McDonald's, providing a
cheap, uniform, and low quality product. See the Northwest Pacific
Whiting Fishery for an example of the effects of ITQ consolidation.
Consolidation or fleet reduction is a known consequence of the
Catch Share management scheme. But when business ``tipping points'' are
factored in, a ``domino effect'' comes into play. Further fleet
reduction becomes a very real and immediate threat to the continued
existence of the major fishing ports in New England, and throughout the
entire industry, jeopardizing entire communities and thousands of
livelihoods.
Unrealistic fishing regulations and vessel consolidation have
brought this industry, both at sea and at dockside, right up to the
``tipping point''. Any further loss in the volume of working vessels
due to consolidation from a Catch Share management regime will render
the majority of the support businesses and consequently the entire
fleet no longer viable. It will be the end of the independent family
owned small fishing operation and the end of a dependable and safe
national food supply.
JOBS:
Do Catch Shares Create High Paying Quality Jobs?
In Alaska fishing provides more direct jobs than the oil, gas,
mining, agriculture, forestry, and tourism, industries combined. Some
54,000 at its height
If Alaska employs 54,000 people in its fisheries, add in fishermen
from the Southeastern States, the Gulf of Mexico, the Mid Atlantic
States, and the New England Fisheries, plus the commercial aspect of
the recreational fisheries then multiply that by 6.6 which is the
University of Maine's multiplier for dependent land jobs for each
fisherman at sea, and the number of fishing jobs is huge. There is a
great deal at stake here for the economy in general and job loss is a
direct result of Catch Shares and consolidation.
According to a paper by Dr. Julia Olson (July 1, 2009), ``Social
Impact Assessment Literature Review: Leasing and Permit Stacking'', New
England Fisheries Science Center, Woods Hole, MA
``Employment in the Mid-Atlantic surf clam fishery dropped by
nearly 80% between 1990 and 1999 (from 155 to 34 employed crew
members) as the industry consolidated in the wake of ITQ's...''
It is estimated that approximately 1200 jobs have been lost in the
Bering Sea Crab fishery.
Crew quality decreases with decreased crew pay and safety is
compromised in extremely dangerous fisheries.
Fishermen often turn to underpaid assembly line work on factory
processor trawlers, or turn into sharecroppers even if they are able to
hold on to their own boats, paying out up to 70% of their landings
proceeds to the holder of the fish allocation. Crew income declines
because of leasing overhead expense; and many fishermen are forced to
leave their native coastal communities because of lack of employment
opportunity.
Catch Shares kill jobs.
CONCLUSION
CATCH SHARES: NOT A GOOD IDEA!
Catch Shares do not help the fish.
Catch Shares do not help the fishermen and the fishing communities.
Catch shares were not put to the referendum vote as statutorily
mandated by the MSA.
Catch Share Sectors were not ``voluntarily'' joined by the majority
of the fishermen. The common pool was not a viable option.
The NOAA/NMFS allocation data is admittedly flawed and inaccurate.
Catch Shares have been ``ramrodded'' without due deliberation or
adequate planning.
Finally catch Shares or ITQ's are just a tool like any of the
others that have been tried; only if this one goes wrong, the fishery
is gone forever. Fleet consolidation through ITQ's and the consequent
collapse of shore side support facilities, possible factory ship
cartels, (legal under the American Fisheries Act 1998), and the
transfer of ``fishing rights'' into the wrong hands, are most likely
irreversible consequences of this plan, and may be the end of the
independent fisherman and their communities.
``Fisheries that begin with limitations on transferability can
quickly lobby to remove them given market pressures as in
Canada, Iceland, and Tasmania'' (Olson)
Catch Shares don't boost small fishing business profitability,
increase safety, help the fish stocks, or the communities. They destroy
the independent small boat fishing operation in several ways, but
essentially by putting the price of shares of a public resource beyond
the financial reach of the small boat fisherman. Due to extracting
``rent'' and open market trading, the costs associated with leasing or
buying quota become prohibitive, especially for a financially strapped
industry. The small independent fisherman is left out.
European Union Fisheries Commissioner Joe Borg suggested scrapping
their Catch Share Quota system for effort controls (Days-at-sea, etc.)
after 25 years of experimenting with them.
A BETTER IDEA:
``...the critical role that sound science and good governance--
that is, inclusive, transparent co-management between
government, and industry and stakeholders--plays in ensuring
the sustainability of fisheries.'' Ecotrust Canada (intro. to
``A Cautionary Tale'')
The fisheries can be successfully managed. With integrity, common
sense, and clarity of purpose it can be done. Everyone involved knows
that successful effective management is absolutely necessary for
survival. The problems managing the complicated North East Multi-
Species Fishery have more to do with the huge and detached autonomous
bureaucracy we've built and its unwieldiness, confusion, and
ineptitude, than with uncooperative fish or rogue fishermen.
Fishing cannot be managed from sound-bites or marketing slogans
created by environmental organizations with a prejudice and an agenda.
Good scientific observation, stock assessments and governance does not
result if there is a predisposition or a given blind allegiance to the
postulate that ``the fish are endangered due to illegal and immoral
overfishing''.
Fishing can also not be managed from an academic economist's or
biologist's point of view only. Fishing is a multi-faceted issue and
requires a multi-discipline approach, including sociologists, social-
psychologists, social-anthropologists, and social-historians, and
especially must include the fishermen whose lives will be directly and
sometimes drastically affected by the outcome of the regulation
decisions. The words men and women, the humans, have to be put back and
coupled with the term ``fishers'' (so favored by the detached anti-
fishing theorists).
These issues and problems are not insurmountable; but there needs
to be honest communication about the purpose and long term goals for
the fisheries. There can't be hidden corporate agendas or personal
ambition driven politics if the management endeavor is going to succeed
at preserving the resource and the fishing dependent communities.
WHAT CAN BE DONE RIGHT NOW?
Stay for now with the present system of effort controls. The days-
at-sea, governed by cooperative research, is actually working and the
infrastructure is already established. THE FISH ARE BACK!
Return to Framework 42 days-at-sea. Devote funding to cooperative
transparent research and analysis in order to review and revise the
assessments and current TAC's and closures of Winter Flounder,
Yellowtail Flounder, Pollack and Fluke allocations, Sea Bass, Red
Snapper, dogfish, etc.
Employ scientists and analysts who know fish and who know the
fishing industry and pair them with accomplished fishermen and their
vessels. Employ accomplished fishermen who know how to set a net and
who know whether it's tending bottom or not. For a start hire people
like, Dr. Brian Rothschild, Kevin Stokesbury, Ph.D., Nils Stolpe,
Ph.D., and Capt. Jim Rhule on the F/V Darana R., for an intelligent and
accurate appraisal of the health of the stocks.
Devote some funding to developing a management model based on a
hierarchical concept of ecosystems, using a point system to direct
catch effort away from vulnerable stocks as outlined in Apollonio and
Dykstra, ``An Enormous, Immensely Complicated Intervention'':
Groundfish, The New England fishery Management Council, And The World
Fisheries Crisis.
Allocate funding to develop even more selective gear innovations as
a way to deal with the problems associated with the complex New England
multi-species ground fishery (i.e., regulating to the weakest species
etc.). Include fishermen and professional net designers in every phase
of the process. Phil Rhule and Jon Knight accomplished building such
gear which won awards, the ``Rhule Trawl'' has been sanctioned by NMFS.
Jon Knight can be commissioned to continue with more such research and
development.
A fleet of many privately owned small boats have conservation
systems and limits built in. They are restricted by weather and
funding, market prices, fuel and mechanical repair costs; so they
naturally spend down (non-fishing) time. Due to narrow financial
margins and weather safety issues, they can only fish for the stocks
that are plentiful and within reach of their ports. It is not
financially viable for them to fish on depleted stocks. This coupled
with intelligent management will secure the health of the resource and
the fishery.
A Fleet of many small ``inefficient'' boats will sustain the fish,
preserve jobs, provide a vital healthy source of fresh food daily, and
keep the traditional coastal fishing communities thriving.
______
[An email submitted for the record by Brian Lewis,
Clearwater, Florida, follows:]
Catch shares and oversight hearings
From: Brian Lewis ([email protected])
Sent: Mon 5/03/10 7:54 AM
To: Katherine Romans ([email protected]); Bill Young
([email protected]); Troy Fuss ([email protected])
May 1st, 2010
Dear all,
My name is Brian Lewis I own the fishing vessel Sandy-Em 2, which
my son in law operates here in Clearwater fl.
We have been supplying fresh grouper caught in the Gulf of Mexico
for the last 5 years. Our grouper are caught one at a time on rod and
reel which gives the fish a better chance of survival if it is an
undersized fish or of a species that we can't keep. Our gear type is
non destructive compared to other types of gear efforts and yet we are
the ones being forced out, something is drastically wrong here.
The way our economy is how can you allow small scale fishermen to
be forced out of business, some of these guys have been doing this all
of their lives and despite this we are depriving them of making a
honest and decent living.
On January 1st a catch share program known as amendment 29 to the
fishery management plan became effective for the grouper- tile fish
fishery here in the Gulf of Mexico.
We did not get any catch shares because we were not fishing during
the qualifying years [1999-2004] for a catch history
A sham referendum for the grouper ifq was held but only 30 percent
of the 1100 permit holders were allowed to vote on it based upon their
catch history during these qualifying years.
Due to these criteria I and many others was not allowed to vote on
the referendum as well as not awarded any catch shares of grouper or
tile fish.
The way that the program works has cost us an additional 1500.00
per trip than with our previous program.
The people who possess the shares can now sit on the couch and not
work while the guy like us has to do all the work and go broke in the
process.
A catch share program was not necessary, We had a 6000 lb trip
limit for grouper that was working just fine there was no derby fishing
occurring since 5 yrs ago . Since the trip limit had been 6000 LBs per
trip the season remained open all year. This was fair and equitable to
all fishermen but with catch share program it is not.
The frame work used in developing catch shares is not the same for
all fisheries and does not work in a multi species fishery, for example
we throw back on the average 300 to 500 pounds of red snapper per trip
directly because of the catch share program in which we can't keep
because there is no catch shares available so how can we keep letting
this happen. I seriously doubt that they all survive despite our best
efforts and the gulf council wants catch shares for all reef fish.
The only reason it was approved is because over 700 permit holders
were not allowed to vote in which it allowed only the people that the
program favored no wonder it passed. Imagine if we could eliminate 70
percent of voters in November it would be real easy for whoever you
wanted to win.
The voting process was definitely not fair and equitable amongst
all fishermen, in fact food and water watch conducted a survey and 90
percent of the respondents would have voted no on the referendum for
the Ifq program for amendment 29 had they been allowed to vote on it.
I represent many other fishermen who are in similar situations
including fishing families, communities, vessel builders and owners who
are feeling the negative effects of this catch share program.
THE CATCH SHARE PROGRAMS that are being implemented around the
United States are not being used to conserve the fisheries it is being
used to put the small business people out of business and with this it
consolidates the shares so that only a select few own the shares.
FACT: CATCH SHARE PROGRAMS ALLOW PRIVATE INVESTORS TO BUY UP THE
QUOTA SO THAT IT CANT BE FISHED FOR, I ASK HOW CAN WE BE GOOD STEWARDS
TO OUR FISHERY IF OTHER THAN FISHERMEN POSSESS THE SHARES, QUITE
FRANKLY WE CANT.
FACT: CATCH SHARE PROGRAMS ALLOW CONSOLIDATION AND PRIVITIZATION OF
THE PUBLICS RESOURCE AND STRANGLES NEW ENTRY.
FACT: CATCH SHARE PROGRAMS DO NOT FOLLOW THE MAGNUSSON STEVENS
CONSERVATION ACTS INTENT ACCORDING TO NATIONAL STANDARDS [2], (4), [8]
Conservation and management measures shall not discriminate between
residents of different States. If it becomes necessary to allocate or
assign fishing privileges among various United States fishermen, such
allocation shall be (A) fair and equitable to all such fishermen; (B)
reasonably calculated to promote conservation; and (C) carried out in
such manner that no particular individual, corporation, or other entity
acquires an excessive share of such privileges.
As you can see these catch share programs are in direct violation
of Magnuson Stevens Act, National Standard number 4 intent was not
followed because the shares were not fairly distributed and there are
individuals who have more shares than they need who aren't even fishing
they are sitting back and leasing the shares and or selling at
exorbitant prices that does not allow new entry or even keep most small
businesses afloat, we take all the risk.
We feel that the persons holding the shares should either be out
using them to fish or lose them so that others who need them will be
able to survive.
If catch shares are here to stay then we need financial assistance
to stay in business like a low interest loan for each fishery to help
with the transition of these plans, right now there isn't any for
fisheries that are undergoing overfishing or are overfished. Amendment
29 needs to have congressional over sight based on the following
national standards of the magnuson Stevens act page 58. s16 U.S.C. 1851
MSA Sec. 301 58
TITLE III--NATIONAL FISHERY MANAGEMENT PROGRAM
SEC. 301. NATIONAL STANDARDS FOR FISHERY 16 U.S.C. 1851 CONSERVATION
AND MANAGEMENT
(a) IN GENERAL.--Any fishery management plan prepared, and any
regulation promulgated to implement any such plan, pursuant to this
title shall be consistent with the Following national standards for
fishery conservation and management: 98-623
(1) Conservation and management measures shall prevent overfishing
while achieving, on a continuing basis, the optimum yield from each
fishery for the United States fishing Industry.
(2) Conservation and management measures shall be based upon the
best scientific information available.
(3) To the extent practicable, an individual stock of fish shall
be managed as a unit throughout its range, and interrelated stocks of
fish shall be managed as a unit or in close coordination.
(4) Conservation and management measures shall not discriminate
between residents of different States. If it becomes necessary to
allocate or assign fishing privileges among various United States
fishermen, such allocation shall be (A) fair and equitable to all such
fishermen; (B) reasonably calculated to promote conservation; and (C)
carried out in such manner that no particular individual, corporation,
or other entity acquires an excessive share of such privileges. 104-297
(5) Conservation and management measures shall, where practicable,
consider efficiency in the utilization of fishery resources; except
that no such measure shall have economic allocation as its sole
purpose.
(6) Conservation and management measures shall take into account
and allow for variations among, and contingencies in, fisheries,
fishery resources, and catches.
(7) Conservation and management measures shall, where practicable,
minimize costs and avoid unnecessary duplication. 104-297, 109-479
(8) Conservation and management measures shall, consistent with
the conservation requirements of this Act (including the prevention of
overfishing and rebuilding of overfished stocks), take into account the
importance of fishery resources to fishing communities by utilizing
economic and social data that meet the requirements of paragraph (2),
in order to (A) provide for the sustained participation of such
communities, and (B) to the extent practicable, minimize adverse
economic impacts on such communities.
In closing I want to be involved with the oversight committee on
catch shares, I would like to be able to be allowed to borrow money to
stay afloat .
We need a low interest loan, asap so that we can buy some shares
to[ 1] be profitable and [2] Be good stewards in our fishery or some
kind of buyback program for the fallout on these catch share programs .
NOAA, National Marine Fisheries service and the Gulf Council won't
listen to us because I'm the little guy; we need someone to hear our
cries for help.
I want some of these violations of the Magnusson Stevens acts
National Standards be reviewed as well as the voting process that was
held.
I need an invite to any of the oversight hearings that occurring in
our country.
What I would do differently if I was going to set up an individual
quota program again is I would set up a loan program for displaced
skippers, crew, and new entrants. I would be more inclusive in the
initial allocation and I would study other quota systems prior to
implementing one.
Thank you for your consideration
Sincerely
Brian Lewis
102 south nimbus ave
Clw, fl 33765727-423-6950 or email me at [email protected] or
[email protected]
______
[A letter submitted for the record by Hon. Henry Mack,
Mayor, City of King Cove, Alaska, follows:]
CITY OF KING COVE
P.O. BOX 37
KING COVE, AK 99612
(907) 497-2340 PHONE
(907) 497-2504 FAX
RE: Fisheries Catch Shares--letter to Congress
To: 111th U.S. House Committee on Natural Resources
Subcommittee on Insular Affairs, Oceans and Wildlife
187 Ford House Office Building (Oceans and Wildlife)
Tel: (202) 226-0200 Fax: (202) 225-1542
Honorable Chairwoman Madeleine Z. Bordallo and Subcommittee members;
We would like to comment on the catch share proposals now before
your committee.
Based on the experience of the King Cove community, we believe the
implementation of a Catch Shares system, which privatizes publicly
owned fisheries resources, is destructive to local fishermen and
coastal communities. We also believe the record shows that implementing
Catch Shares does not necessarily protect fisheries resources, and that
there are other existing management tools to accomplish this which are
less destructive to communities and fishermen.
King Cove has experienced two Catch Shares programs over the past
twenty years. Halibut and sablefish (black cod) catch shares were
implemented in the 1990s under a program called ``Individual Fishing
Quotas.'' The IFQ program eliminated 13,000 jobs in Alaska, jobs which
have never come back. The original plan mandated that the owner be on
board the vessel and that quota share could not be leased. This plan
was not adopted, with the result that the majority of the initial quota
share recipients have leveraged more quota share using their initial
free quota as collateral.
The second catch share program which has affected King Cove is the
Bering Sea Crab Rationalization program, which was instituted in 2005.
Before crab rationalization ten King Cove vessels fished crab in the
Bering Sea, primarily with King Cove skippers and deckhands. Crab
rationalization winnowed this fleet down to zero King Cove vessels
fishing crab in the Bering Sea. With an average of five and half
crewmen per vessel those ten boats represent 50 crewmen jobs removed
from the community.
Also, access to the fisheries, the right to fish on a crab vessel,
is now leased to crewmen by the crab owners at rates between 50% and
80% of the ex-vessel value of the crab. This is money which is taken
off the amount from which crewmen are paid their percentages of the
catch. This money, skimmed off the top, is estimated to be between $8
and $10 million over the past five years. The loss of that money, which
used to be spent in King Cove and other coastal communities but is now
removed from the communities by absentee owners, has had serious and
harmful economic and social consequences for coastal Alaskan
communities.
These negative effects have occurred despite the assurances by
former Chairman Dave Benton of the NPFMC that the concerns and
interests of coastal communities would be addressed before catch shares
programs would be implemented. In a letter to Congress August 5,2002,
Chairman Benton stated:
``Rationalization will improve economic conditions substantially,
for all sectors of the industry. Community concerns and the need to
provide for economic protections for hired crew will be addressed"
In June of 2006, one year after the implementation of catch shares
in the Bering Sea crab fisheries, the North Pacific Fisheries
Management Council, the body which administers fisheries regulations in
Federal waters of Alaska, came to King Cove to listen to the views of
the public on the issue. The overwhelming majority who testified spoke
against fisheries privatization, Many spoke of the loss of income and
jobs. Others testified that crewmen's rights had been ignored in the
process of awarding ownership of the public crab resource to only one
small segment of the industry--the vessel owners. And some testified
that by awarding processor shares and mandating that vessels deliver
crab to specific processors, the crab rationalization program had
caused ex-vessel prices to fall.
With this negative experience of the privatization of fisheries in
Alaska, the King Cove City Council and Aleutians East Borough view with
alarm the imminent implementation of catch shares in the New England
fisheries on May 1,2010. We share the concerns of the Governor of
Massachusetts, the Massachusetts Congressional delegation, and the
mayors of mayors of Gloucester and New Bedford about the effects on
coastal communities of fisheries privatization.
We urge Congress and NOAA to carefully assess the affect of catch
shares on coastal communities and on the men and women who fish from
those communities before moving forward with new privatization
programs. We also urge Congress and NOAA to examine the role of private
investors and speculators in the fisheries privatization process. Tn
order to provide time for these assessments to be made of the effects
of catch shares on communities and fishermen, we ask that Congress and
NOAA establish a 2-3 year nationwide moratorium on the implementation
of catch shares programs.
We ask Congress to amend the Crab Rationalization program so that
the economic benefits are 'fairly and equitably' distributed--in line
with economic sharing in accordance with their historical
participation--to all segments of the fishery, especially crewmen and
new vessel entrants.
Sincerely,
Mayor Henry Mack
______
[A letter submitted for the record by The Honorable Stanley
Mack, Mayor, Aleutians East Borough, follows:]
April 22, 2010
RE: Fisheries Catch Shares--letter to Congress
111th U.S. House Committee on Natural Resources
Subcommittee on Insular Affairs, Oceans and Wildlife
187 Ford House Office Building (Oceans and Wildlife)
Tel: (202) 226-0200 Fax: (202) 225-1542
Honorable Chairwoman Madeleine Z. Bordallo and Subcommittee members:
We would like to comment on the catch share proposals now before
your committee.
Based on the experience of Aleutians East Borough, we believe the
implementation of a Catch Shares system, which privatizes publicly
owned fisheries resources, is destructive to local fishermen and
coastal communities. We also believe the record shows that implementing
Catch Shares does not necessarily protect fisheries resources, and that
there are other existing management tools to accomplish this which are
less destructive to communities and fishermen.
The Aleutians East Borough has experienced two Catch Shares
programs over the past twenty years. Halibut and sablefish (black cod)
catch shares were implemented in the 1990s under a program called
``Individual Fishing Quotas.'' The IFQ program eliminated 13,000 jobs
in Alaska, jobs which have never come back. The original plan mandated
that the owner be on board the vessel and that quota share could not be
leased. This plan was not adopted, with the result that the majority of
the initial quota share recipients have leveraged more quota share
using their initial free quota as collateral.
The second catch share program which has affected the Aleutians
East Borough communities is the Bering Sea Crab Rationalization
program, which was instituted in 2005. Before crab rationalization
there were local vessels that fished crab in the Bering Sea primarily
with local skippers and deckhands. Crab rationalization has diminished
this local fleet and has dramatically declined the number of crab
fishing jobs in our communities. Rationalization has cut into sales of
some local businesses that sell to crab boats and crab fishermen such
as pot storage, welding, marine supplies, taxis, and provisions. Also,
harbor moorage fees collected by some Aleutians East Borough
communities have declined. Residents have also indicated that the most
important effects might be associated with a restriction on their
option to participate in the crab fisheries.
Also, access to the fisheries, the right to fish on a crab vessel,
is now leased to crewmen by the crab owners at rates between 50% and
80% of the ex-vessel value of the crab. This is money which is taken
off the amount from which crewmen are paid their percentages of the
catch. This money, skimmed off the top, is estimated to be between $8
and $10 million over the past five years. The loss of that money, which
used to be spent in Aleutians East Borough coastal communities but is
now removed from the communities by absentee owners, has had serious
and harmful economic and social consequences for coastal Alaskan
communities.
These negative effects have occurred despite the assurances by
former Chairman Dave Benton of the NPFMC that the concerns and
interests of coastal communities would be addressed before catch shares
programs would be implemented. In a letter to Congress August 5, 2002,
Chairman Benton stated:
``Rationalization will improve economic conditions
substantially, for all sectors of the industry. Community
concerns and the need to provide for economic protections for
hired crew will be addressed.''
In June of 2006, one year after the implementation of catch shares
in the Bering Sea crab fisheries, the North Pacific Fisheries
Management Council went to King Cove, the Aleutians East Borough
community most impacted by the decision, to listen to the views of the
public on the issue. The overwhelming majority who testified spoke
against fisheries privatization. Many spoke of the loss of income and
jobs. Others testified that crewmen's rights had been ignored in the
process of awarding ownership of the public crab resource to only one
small segment of the industry--the vessel owners. Some testified that
by awarding processor shares and mandating that vessels deliver crab to
specific processors, the crab rationalization program had caused ex-
vessel prices to fall.
Because of this negative experience of the privatization of
fisheries in Alaska, the Aleutians East Borough view with alarm the
imminent implementation of catch shares in the New England fisheries on
May 1, 2010. We share the concerns of the Governor of Massachusetts,
the Massachusetts Congressional delegation, and the mayors of
Gloucester and New Bedford about the effects on coastal communities of
fisheries privatization.
We urge Congress and NOAA to carefully assess the affect of catch
shares on coastal communities and on the men and women who fish from
those communities before moving forward with new privatization
programs. We also urge Congress and NOAA to examine the role of private
investors and speculators in the fisheries privatization process. In
order to provide time for these assessments to be made of the effects
of catch shares on communities and fishermen, we ask that Congress and
NOAA establish a 2-3 year nationwide moratorium on the implementation
of catch shares programs.
We ask Congress to amend the Crab Rationalization program so that
the economic benefits are ``fairly and equitably'' distributed--in line
with economic sharing in accordance with their historical
participation--to all segments of the fishery, especially crewmen and
new vessel entrants.
Sincerely,
Stanley Mack
Mayor
Aleutians East Borough
______
[A letter submitted for the record by A. Pierre Marchand,
President, Jessie's Ilwaco Fish Co., Inc., follows:]
April 20, 2010
Rep. Madeleine Bordallo
U S House of Representatives
Washington, D C 20515
Dear Representative Bordallo,
These are my comments on the catch-share program. First, I am
unalterably opposed to the program. There are several reasons:
1. As proposed, the programs will freeze the younger generation out
of the fish business as it makes it too expensive to get in. Because
they will not be entering the fishery, eventually the fishery will
cease to exist.
2. This is a fundamental change in the way the U S does business.
No longer will a person be able to enter into a business, work hard,
save his money and get ahead. It will grant the ownership of a public
resource to individuals with exclusive rights to that resource.
3. The system, as proposed, will not work. The cost of management
will become too high. It could make some fisheries uneconomical to do
and not even the government will be able to pay their share of the
management costs of these types of programs.
4. It will not do what you say it's designed to do. We will see
rapid consolidation of the fleet and of the processing sectors. There
will be no new investments in boats or plants. Small companies like
mine will probably be driven out of business as well as the small towns
and ports that depend upon our businesses for support. Coastal
infrastructure (docks, ice plants, unloading facilities, marine stores)
will all begin to rapidly disappear.
5. This idea was tried on ground fish in Western Canada and is not
working. Boats have disappeared, plants have disappeared, jobs have
disappeared and the industry is in the state of losing its viability.
6. This whole process is taking money away from basic fisheries
research and that money is being spent for the catch-share program. We
have seen this happen in the archival tagging systems program which for
25 years has been a joint operation between NOAA and the American
Fishermen's Research Foundation. We were informed last week by the NOAA
people that there would be no money available for the foreseeable
future. This will end the best industry/government research program on
Albacore tuna that has ever been done. This is wrong! I can see much
more of this happening in all industry/government research projects.
7. In the final analysis this is not fisheries management but
social engineering at its worst.
For all these reasons and many more, the whole catch-share programs
should never be allowed to proceed.
If you have any questions, please feel free to contact me at 360-
642-3773 or [email protected].
Sincerely,
A. Pierre Marchand, President
Jessie's Ilwaco Fish Co., Inc.
______
[A letter submitted for the record by Brian Mose, Nanoose
Bay, British Columbia, Canada, follows:]
April 20, 2010
Subcommittee on Fisheries, Wildlife and Oceans
187 Ford House Office Building
(202) 226-0200
Dear Chairwoman Bordallo, Ranking member Brown and members of the
subcommittee:
I write today in support of your efforts to help fishermen on the
U.S. West Coast make the transition to sustainable fisheries using
fully monitored catch share management. The commitment to a National
Catch Shares Program supports a shift in fisheries policy that in my
opinion will accrue benefits for conservation, fishermen, coastal
communities, the oceans and the nation.
I know first-hand that conventional fisheries management is a no-
win situation. I have been a multi-species trawl fisherman in British
Columbia for more than 30 years. I have experienced open access olympic
fishing, through to limited entry licensing and the setting Total
Allowable Catch quotas (TAC's) for nearly all species. When landed
catches began exceeding TAC's the Department of Fisheries and Oceans
(DFO) started setting trip limits and limiting the number of trips.
Over the same period fishery managers and industry representatives were
applying dozens of restrictive rules in an attempt to maintain an
annual fishery by limiting the expansion of fishing effort. As a result
we sold into a vicious circle of ratcheting down the number of trips
and trip limits for individual species and areas. This was a futile
attempt to manage continuity of supply to market while failing to meet
the conservation requirements to stay within assigned TAC's.
We had serious problems. Discarding and misreporting were rampant
as fishermen raced to catch the fish before the limits were ratcheted
down further. Safety was compromised, markets glutted, quality and
value were constantly eroded. Furthermore fishery managers and science
had no way to know true mortality by species and stock from the
fishery.
In September of 1995 the fishery was closed for the balance of the
year, the first time in our history. The fishery reopened a few months
later with an observer on every vessel. DFO then engaged in a highly
controversial discussion around catch shares in the multi species trawl
fishery. DFO offered the stakeholders Individual Transferable Quota
(ITQ) as the management tool and presented a process where the
stakeholders could develop the social and economic objectives for the
fishery. DFO's first objective was conservation and it was clear the
fishery would be fully monitored and all catch would be accurately
accounted for within the assigned TAC for each species and area. After
an extensive process a comprehensive catch share management plan was
implemented and continues to be improved upon consistent with stated
objectives and new challenges.
In 1995 I was opposed to both full monitoring and catch shares and
was one of the many fishermen who lobbied to stop the process and
failed. The first year was very difficult but by the third year my
colleagues and I became advocates for a fully monitored ITQ program.
Catch shares are only one of many management tools, and needs to be
combined with other tools such as catch monitoring, to achieve maximum
benefits. The appropriate management tools to use are largely based on
your objectives. I believe a fully monitored catch share program has
made it more possible for us to achieve our objectives.
I must humbly admit, that if it were not for the strong leadership
of DFO this fishery would look very different today and likely be
limited by overfished species, poor data, low values, failing
infrastructure and negligible benefits for all involved.
I urge you to continue your leadership in supporting fishermen and
fish by supporting the development and implementation of a fully
monitored trawl catch share program for the U.S. West Coast.
Thank you for your attention to this important matter.
Sincerely,
Brian Mose
3516 Goodrich Road
Nanoose Bay, British Columbia, Canada V9P 9K8
______
[A statement submitted for the record by Bernard Norvell,
Sr., F/V Donna J, et al., follows:]
Statement submitted for the record by Bernard Norvell, Sr., F/V Donna
J; Michelle Tarantino-Norvell; Vince Doyle, F/V Verna Jean 3; Tom and
Shelley Estes, F/V Tara Dawn; Brian Jourdain, F/V Blue Pacific; Richard
Kelley, F/V Miss Hailee, F/V Miss Kelley, F/V Miss Kelley II; and
Randall Schlect, F/V Northern Light, Fort Bragg, California
Madam Chairwoman and members of the Subcommittee:
Thank you for the opportunity to submit written testimony
concerning ``A Community Perspective on Catch Shares.'' We are a group
of long-time vessel owners operating out of Fort Bragg, California.
Between us, we own eight trawl vessels that have fished for groundfish
between Moss Landing to Cape Mendocino for over 25 years. Our families
have been fishermen for many years and more than one generation, and we
fully support conservation measures that lead to sustainable fisheries
so that the next generation will also be able to earn a living fishing.
We understand the theory behind catch shares and have heard the
argument that these types of programs will assist in rebuilding
depleted or overfished fish stocks. However, our experience with the
development of the proposed catch share program for the Pacific
groundfish fishery (Amendment 20 to the West Coast Groundfish Fishery
Management Plan) has shown us that catch share programs are not a ``one
size fits all'' solution to fishery management problems and that
wholesale adoption of such programs across the nation has the very real
possibility of making fishery management problems worse, not better.
First, we cannot have a thoughtful dialogue about catch shares
unless there is a shared recognition that catch share programs are
ultimately about the allocation of the resource--they are not the means
of ending overfishing. Instead, scientifically-based annual catch
limits that are consistently and fairly enforced are the key to
rebuilding fisheries. When catch shares are advertised primarily as
conservation measures, economic outcomes and the potential for
devastating social and community impacts often get pushed aside or
minimized. This is the case with Amendment 20. Bad economic and social
policy should not be blessed under the guise of conservation.
Our experience with Amendment 20 demonstrates that catch share
programs must be designed very carefully if they are to avoid having
negative impacts such as consolidation of quota shares from individual
fishermen to corporations or entities that will not actually fish, and
the destruction of small traditional fishing communities such as Fort
Bragg. Catch shares should only be used when the economic impacts of
implementing a catch share program in a particular fishery have been
fully evaluated in the design of the program and the potentially
devastating impacts on fishermen have been mitigated before the program
is implemented. We are finding out first hand that this is easier said
than done, and that lengthy deliberations--over five years in the case
of Amendment 20--do not necessarily mean that a program has been
evaluated fully or insightfully, with an eye toward practical
implications for small communities.
NOAA states in its Draft Policy that catch shares are not always
the ``best management option for every fishery or sector.'' For this
reason, NOAA states that it intends to ``encourage the careful
consideration of catch shares as a possible choice to best meet the
conservation, social, and economic goals of fishery management.'' As we
have followed the development of Amendment 20 by the Pacific Fishery
Management Council, we are convinced that it is just such an example of
an inappropriate use of catch shares. Catch shares are not appropriate
to solve the problems in our shoreside groundfish fishery because the
Council has been unable to design a program that will allow small
shoreside vessels to continue to fish, and it does not have either the
will or the funding to mitigate this result. Amendment 20 proves that a
flawed catch share program is not better than no catch share program at
all.
Our experience leads us to be very concerned that NOAA's enthusiasm
for catch shares may lead it to implement programs in fisheries where
the economics of the program are not sustainable--and without
performing adequate economic analyses of the impact of such programs.
For example, the Pacific Council has not provided transparent or
sensible cost estimates for Amendment 20, which will apparently be
around $6.5 million in implementation, $8 million in agency costs, and
between $6 to $20 million in observer/monitoring costs. The trawl
fishing fleet from Fort Bragg cannot afford to bear the costs of this
program if it has to pay the maximum 3% for agency administrative costs
and 100% observer coverage. The Council has not addressed these issues
through analysis or mitigation of economic consequences of Amendment 20
on small fishing communities. Even though individual members of the
Council will acknowledge that Amendment 20 is seriously flawed and
should not be passed as is, we are being given the strong signal that
it is a ``done deal'' because catch shares are the new national
directive, so Amendment 20 will be passed now and supposedly fixed
later. This is not the way to do business under the Magnuson Act and
not what NOAA's policy should be.
Although NOAA professes in its Draft Policy to not put ``catch
shares first,'' its $54 million budget allocation devoted exclusively
to the development of catch share programs makes us question whether
NOAA's policy is really so neutral. If catch shares are truly just one
tool in the tool box, then why are the Councils being given financial
incentives only to develop catch share programs instead of incentives
aimed at empowering Councils to design the best possible management
measures for sustainable fisheries? Why are well-established limited
access programs treated as if they must be automatically changed as a
result of the Draft Policy? There should be no consequences to the
Councils, either positive or negative, if they take the time to
thoroughly evaluate the potential impacts of a proposed quota share,
IFQ, or catch share program and then conclude that it is not a good fit
for a fishery.
We recognize that evaluating whether catch shares are appropriate
for a particular fishery is an expensive, complex, highly technical,
and time-consuming process. Having invested the effort in designing a
program, the natural inclination is to pass it regardless of whether
it's the right thing to do for the fishery--exactly what is about to
happen with respect to Amendment 20.
If catch shares generally, or Amendment 20 specifically, are
designed to reduce capacity and overcapitalization and eliminate
certain fishery participants, then NOAA and the Councils need to be
upfront about that intent. Catch shares should not be promoted
primarily as a conservation tool, and the negative impacts on
communities cast as unintended but unavoidable consequences, if the end
game is actually eliminating trawl fisheries from certain states. The
human costs of Amendment 20 should not be treated as an afterthought.
We want to continue fishing. But if the Agency and Council plan to make
that impossible, then we and other long-time participants should be
compensated fairly.
Fishermen who question the design and implementation of a
particular catch share program are not the enemies of good fishery
management. Catch share and limited access programs can have grave
consequences for us, our families, and our communities.
Please do whatever is necessary to make sure that responsible,
long-time fishermen can continue to fish and that small fishing
communities like Fort Bragg do not disappear from America's coasts. If
catch share programs with bad designs and inequitable allocations are
pushed through as a result of the Draft Policy, in a very short period
of time small fishermen such as ourselves will be gone, and only big
vessels and big companies will be fishing out of a very few ports.
Thank you for your consideration of our comments.
______
[A letter submitted for the record by Giovanni (John)
Pennisi, F.V. Irene's Way, follows:]
April 21, 2010
Subcommittee on Fisheries, Wildlife and Oceans
187 Ford House Office Building
(202) 226-0200
Dear Chairwoman Bordallo, Ranking member Brown and members of the
subcommittee:
I write today in support of your efforts to help fishermen in the
Monterey / San Francisco region make the transition to sustainable
fisheries using catch shares, where appropriate. Whereas conventional
management is increasingly pushing fishermen off the water to control
over fishing, catch shares is a solution that keeps fishermen fishing
while fish resources recover. The commitment to a National Catch Shares
Program supports a continuing shift in fisheries policy that will
quickly accrue benefits to fishermen and the oceans.
Current fisheries management is failing struggling fishermen and
the oceans. Fisheries have declined, and thousands of fishing jobs have
been lost as a result. Many valuable fisheries face huge closures or
dwindling seasons, which will have devastating impacts on fishing jobs
and coastal communities.
I know first-hand that conventional fisheries management is a no-
win situation. I am a third generation trawl fisherman. Without more
effective fisheries management tools, our livelihoods--and the
resource--are increasingly threatened. I used to make a good living;
now my fishing season continues to shrink, putting me out of business.
I believe that catch shares are a better alternative. Rather than
continued shrinking seasons and closures, which push fishermen off the
water, catch shares can provide for continued fishing, even as stocks
recover, while increasing full-time employment, wages, and safety for
fishermen. Catch shares can provide fishermen like me the ability to
adapt my operation to earn more money when prices are high or fish when
the weather is good.
Catch shares are locally-designed to meet economic, social, and
conservation goals. Catch share management is not a one-size-fits-all
approach; rather programs are designed to meet the specific needs and
goals of each fishery. Today there are 14 different catch share
programs managed by six different regional fishery management councils.
Many more are slated for consideration and action around the country,
including the West Coast Ground Fish Fishery region.
I urge you to continue your leadership in supporting fishermen and
fish by supporting the development and implementation of catch shares
in the Western region where it makes sense.
Thank you for your attention to this important matter. Your support
will go a long way toward improving fishing jobs and ensuring healthy
fisheries.
Sincerely,
Giovanni (John) Pennisi
F.V. Irene's Way
898 W. Franklin, Monterey, CA 93940
______
[A letter submitted for the record by Citizens for
Gloucester Harbor follows:]
CITIZENS FOR GLOUCESTER HARBOR
c/o M. Sunny Robinson
20 Harvard Street Gloucester, MA 01930 978-283-6049
March 18, 2010
Congresswoman Madeleine Z. Bordallo. Chairperson
The House Natural Resources Committee
Subcommittee on Insular Affairs, Oceans and Wildlife
Secretary of Commerce Gary Locke
U.S. Dept. of Commerce
1401 Constitution Avenue NW
Washington, D.C. 20230
Dear Congresswoman Bordallo and Secretary Locke,
On March 16, 2010, the Subcommittee on Insular Affairs, Oceans and
Wildlife held an Oversight Hearing on ``Catch Shares as a Management
Option: Criteria for Ensuring Success''. While we share many of the
concerns raised by Members of Congress and witnesses, we urge a second
hearing to cover problems in the Northeast fisheries sector management
program, which will begin on May P. This second hearing should review
the policies and practices of the National Marine Fisheries Service as
they have diverged egregiously from the intent of the Magnuson-Stevens
Act. Recent National Marine Fisheries Service (NMFS) actions in the
Northeast fisheries constitute an assault on the viability of local
fishing fleets, shore-side infrastructure, fishing communities, and
ultimately on the goals of long-term protection and restoration of
ocean ecosystems and fisheries.
Through this hearing, we are recommending clarification of the
sector management program and alterations in the setting of fishing
quotas/limits, on certain ``choke'' stocks, prior to May 1st. These
measures would simultaneously support long-term recovery of fish
stocks, sustainable fishing fleets, and economically viable fishing
communities. These measures are all within the authority and
jurisdiction of the Secretary of Commerce and do not require new
legislation.
A pattern of actions taken by NMFS in recent years has been
directed at the consolidation of fishing fleets, in the guise of
achieving greater economic efficiency in the pursuit of conservation
goals. This single-minded focus is driving small, locally owned and
operated boats out of business, and unless changes, are made will
eliminate the industry as we know it. Policies and activities that we
believe subvert the intent of the Magnuson-Stevens Act that need to be
examined include:
Passage last year of a sector management system, which
will be implemented on May 1st, despite great concerns about its
viability and necessity;
Frivolous and excessively punitive enforcement measures
(documented by the Department of Commerce Inspector General) that have
forced boat-owners out of fishing;
Inadequate and shifting science and models that have had
a history of underestimating fishing stocks;
Diversion of funds away from cooperative research;
Failure to conduct adequate research and/or failure to
properly utilize existing research results;
Overly strict limits on fishing that exceed what is
necessary for stock recovery;
Emphasis on shutting down entire fisheries once an
impractical rebuilding rate is missed for ANY ONE species in a mixed
species fishery, although it is clear, that in practice, all species do
not recover at the same rate.
In particular, the sector approach, as currently planned, will
inevitably lead to concentrated ownership. Larger vessels owned by
outside investors will displace the smaller local family fishing
businesses and local fisheries will be unable to compete. The effects
on local fishermen, employment and economic activity in local ports,
the safety of local fish stocks, and the long-term viability of ocean
fisheries and ecosystems will be devastating.
Especially in New England, it is the fish caught, only hours
before, by our small inshore day fishing boats for which our
restaurants and markets are famous that will be most greatly impacted.
An intentional destruction of this industry and replacement by large
industrial ships that stay further at sea for longer trips would result
in replacement of our fresh fishery with fish stored for days in ice or
brine or frozen at sea. The policy of increasing efficiency by
replacing small fishing businesses, both at sea and in small harbors
ashore by a few larger concentrated industrial operations in a few
large ports seems ill-advised in the present national economic and
under employment crisis and will not enhance the sustainability of
fishing stocks.
The history of economic rationalization, deregulation, and a
singular drive for ``efficiency'' has had unintended and disastrous
results in other economic sectors in the United States. The
deregulation and subsequent collapse of financial markets is the
foremost example of excessive reliance on free market ideology and
``efficiency.'' Similarly, in agriculture, the ideology of free-market
fundamentalism has led to devastated farming communities, unsafe and
unhealthy food supplies, and toxic pollution.
Properly designed sector management can restore ecosystems and
fisheries, protect local jobs, and secure safe and local food supplies,
but only if the approach is based on principles of community-based
management. As Dr. Elinor Ostrom (2009 Nobel Prize in Economics) and
others have demonstrated repeatedly around the world, community-based
management assures long-term sustainability of environmental, economic,
and social values.
If perceived as a catch share system, as opposed to a temporary
management measure, these goals will not be achieved. Therefore, we
believe they ought to only be seen as a temporary management measure.
We particularly call attention to the fact that the National Marine
Fisheries Service chose not to establish the sector approach according
to the policies and procedures set forth in section 303A of the
Magnuson-Stevens Act governing Limited Access Privilege Programs
(LAPPs). LAPP would have required a review of proposals that would have
been subiected to a very comprehensive and deliberate set of standards
and process, where the interests of all parts of the fisheries,
including fishermen, port communities, and other public interests and
benefits would have been reviewed. The deliberate decision by the North
East Fisheries Management Council (NERMC) to develop a comprehensive
fishery-wide Sector allocation and management system that is not based
on or consistent with MSA section 303(A) was largely based on ill-
advised advice provided to it by the NMFS Northeast Regional Office.
NOAA needs to recognize that potential sector contributions (PSC's)
should not be considered quota shares for the purposes of buying,
selling and trading with any mid-term or long-term value. Nevertheless,
because of confusion over the long-term status of PSC's, there is a
danger in artificially inflated permit values. Local fishermen may be
unable to pay higher prices for permits when they have to compete with
speculative outside investors who are misinformed about the duration of
the sector allocation,
In addition to the requested Congressional oversight hearing, we
urge the Secretary of Commerce to take the following actions, before
May 1st:
1. Issue a public notification stating that the non-LAPP status of
Amendment 16 Sector Allocations and individual PSCs means the fishery
is still open to allocation through a deliberate and free standing
allocation amendment process. The statement should also make clear that
PSCs are short term management currencies analogous to Days at Sea and
have no long-term economic value. PSCs do not have the same effect as
quota shares, unless NEFMC initiates a fully LAPP compliant amendment
in strict compliance with the LAPP requirements in the Magnuson-Stevens
Act.
2. Amend the sector management program by adding measures to
prevent excessive consolidation and outside investment. Such measures
should include: restrictions on the share of the sector that any
individual fishing boat owner may hold (in the Alaska halibut
fisheries, this share restriction is 1%); and a requirement that the
owner-operator ()Idle PSC be on the boat when actively fishing at sea.
3. Increase the Total Allowable Catch (TAC) limits, particularly
on species that would otherwise shut multi-species fisheries down
unnecessarily, but not to exceed levels considered ``overfishing''.
This increased flexibility would sustain the local fishing fleets
through the next few years of the rebuilding of sustainable stocks.
These actions are all within the discretion of the Secretary of
Commerce.
We thank you for your attention to these requests and look forward
to hearing I) when an additional hearing to address these matters will
take place and 2) what actions the Secretary of Commerce has taken.
Yours truly,
CITIZENS FOR GLOUCESTER HARBOR
Peter Anastas, Writer
Ann Banks, Board Member, Gloucester Maritime Heritage Center
Damon Cummings, PhD, Naval Architect
Henry Ferrini, Documentary Filmmaker
Jeanne Gallo, PhD, Social Ethics
Helen Garland, UN Representative of the World Forum of Fisherpeople
Jay Gustaferro, Lobster-man, Former Gloucester City Councilor
Marcia Hart, RN
Ann Molloy, Neptune's Harvest Organic Fish Fertilizer Company
Valerie Nelson, PhD, Economics
Steve Parkes, Coordinator, Cape Ann Fresh Catch--Community Supported
Fishery
M. Sunny Robinson, RN
Angela Sanfilippo, Gloucester Fishermen's Wives Association
______
[A letter and resolution submitted for the record by The
Honorable Jerome M. Selby, Borough Mayor, Kodiak Island
Borough, follows:]
Kodiak Island Borough
Office of the Borough Mayor
710 Mill Bay Road
Kodiak, Alaska 99615
Phone (907) 486-9310 Fax (907) 486-9391
April 19,2010
To: 111th U.S. House Committee on Natural Resources
Subcommittee on Insular Affairs, Oceans and Wildlife
187 Ford House Office Building (Oceans and Wildlife)
Tel: (202) 226-0200 Fax: (202) 225-1542
The Kodiak Island Borough is home for one of the largest fishing
fleets in the United States and the port of Kodiak has been one of the
top three fishing ports in the United States for the past 30 years. Our
economic base is fishing. Because of the damage we have experienced to
our economy and people from the two catch share programs that have been
implemented in Kodiak, we have serious concerns about the new Catch
Shares policy that is being developed.
This new policy should place a strong emphasis on using the lessons
learned about negative impact on jobs and communities' economies to
minimize these negative impacts in the future. Before any new policy
goes forward, we would recommend that hearings be held in the largest
fishing ports in New England, the Gulf Coast, the West Coast, and
Alaska to allow direct input from the people and communities where
lives and economies will be directly impacted.
The Kodiak Island Borough previously adopted the enclosed
Resolution No. FY2007-12 which identifies the framework that should be
used in future fisheries policy. We are very interested in helping to
develop future fisheries policy.
Thank you for the opportunity to comment. We stand ready to help.
Sincerely,
Jerome M. Selby
Borough Mayor
Kodiak Island Borough,
______
KODIAK ISLAND BOROUGH RESOLUTION NO. FY2007-12
A RESOLUTION OF THE KODIAK ISLAND BOROUGH ASSEMBLY PROVIDING FURTHER
COMMENTS TO THE NORTH PACIFIC FISHERY MANAGEMENT COUNCIL ON GULF OF
ALASKA RATIONALIZATION
WHEREAS, the harvesting and processing sectors of the Kodiak
fishing community are substantially engaged in and substantially
dependent upon Gulf of Alaska groundfish fisheries; and
WHEREAS, Kodiak's economic and social health is intimately
dependent upon the community's sustained participation in all aspects
of the Gulf groundfish fisheries; and
WHEREAS, the Kodiak Island Borough has made substantial investments
in support of and in reliance upon the Gulf groundfish fishery, such as
water system improvement and expansion and port and harbor improvements
and expansion; and
WHEREAS, the North Pacific Fishery Management Council has developed
a suite of fishery allocation alternatives for the Gulf of Alaska
groundfish fisheries, and is working toward adoption of a preferred
alternative for implementation; and
WHEREAS, allocating exclusive harvesting and/or processing
privileges promotes consolidation in the fishing fleet and the
processor sector, which can improve efficiency, but which can also
result In skippers, crew members and processing workers bearing costs
of consolidation without fully sharing in the related benefits; and
WHEREAS, while fishery rationalization may create opportunities and
incentives to produce more and higher value products, it also changes
the distribution of fishery revenues among participants with resulting
disruptive effects on the communities in which they live; and
WHEREAS, by awarding harvesting and/or processing privileges,
fishery allocations make possible orderly harvesting and processing,
but it also facilitates the migration of landings to communities with
infrastructure advantages (such as road system access) and creates
barriers to entry for later generations of fishery participants; and
WHEREAS, as a result, it is essential that the potential adverse
affects of Gulf groundfish rationalization be identified and analyzed
and that adjustments be made to mitigate the potential adverse effects
of Gulf groundfish rationalization on Kodiak prior to any program
implementation;
WHEREAS, it is the Kodiak Island Borough's intent that a full, and
frank exchange of information and opinions concerning Gulf groundfish
rationalization take place among the constituencies of the Borough that
would be most directly affected by such program, if adopted; and to the
extent possible, to encourage the development of consensus among these
constituencies concerning the preferred elements and options of such
program; and Kodiak Island Borough, Alaska Resolution No. FY2007-12
WHEREAS, the City of Kodiak and the Kodiak Island Borough joined
together to appoint a Gulf of Alaska Groundfish Rationalization Task
Force to provide a forum for the full, and frank exchange of
information and opinions concerning Gulf groundfish rationalization and
an opportunity for the development of consensus on preferred elements
and options of a Gulf groundfish rationalization program, should it
move forward; and
WHEREAS, while the Task Force is continuing to work, they have
recently provided the Borough Assembly with a number of recommendations
that the Borough Assembly is actively endorsing;
NOW, THEREFORE, BE IT RESOLVED, BY THE ASSEMBLY OF THE KODIAK
ISLAND BOROUGH THAT the North Pacific Fishery Management Council
(NPFMC) suspend action on Gulf of Alaska groundfish rationalization
until, at least, such time as the NPFMC has conducted its 18 month
review of the Bering Sea crab rationalization program and the public
has had an opportunity to evaluate and comment on the impacts of crab
rationalization and to evaluate the NPFMC's adjustments (if any) to the
crab rationalization program;
BE IT FURTHER RESOLVED THAT THE ASSEMBLY OF THE KODIAK ISLAND
BOROUGH requests that the NPFMC take the following Gulf groundfish
management actions as soon as possible, notwithstanding the NPFMC's
suspension of any further action on Gulf groundfish rationalization:
1. Initiate a discussion paper on an allocation of Gulf Pacific
cod to ensure that it is fair and equitable participation among gear
groups and all fishermen.
2. Initiate a discussion paper on phase-out of the offshore sector
in the Gulf of Alaska.
3. Initiate a discussion paper on identifying and removing latent
licenses from the Gulf groundfish sectors that are subject to the
License Limitation Program.
BE IT FURTHER RESOLVED THAT THE ASSEMBLY OF THE KODIAK ISLAND
BOROUGH requests that the NPFMC is hereby requested to take the
following actions in connection with its development of a Gulf of
Alaska groundfish rationalization program:
1. Complete the Council's review of the Bering Sea crab
rationalization program to enable the public to evaluate and comment on
the impacts of crab rationalization and to enable the Council to make
appropriate adjustments to the Gulf rationalization program in
response,
2. Thoroughly analyze each alternative being considered by the
Council before eliminating any of the alternatives, to provide the
public with the opportunity to compare the effects of the various
alternatives on harvesters (including skippers and crew members),
processors (including workers), fishing support services, and Gulf
fishing communities.
3. Include limits on harvesting consolidation through vessel use
caps that apply without exemption, and that are calculated to sustain
skipper and crew employment opportunities and compensation.
4. Develop and bring forward for consideration an additional
alternative which includes no processor shares, linkages or privileges
of any kind. For alternatives already being considered, include
measures to maintain a diverse, competitive processing market, by
providing a substantial pool of groundfish privileges for each sector
that can be harvested without penalty and are not subject to processor
linkage or processor closed classdelivery requirements. This should
include phasing out of the off shore processing sector. Kodiak Island
Borough, Alaska Resolution No. FY2007-12
5. If processing privileges are included, limit consolidation of
such privileges through processor and facility use caps.
6. Designate Federal harvesting privileges by region to reflect
landing patterns similar to those occurring prior to program adoption,
and require that fish harvested under such privileges be landed in
their designated region.
7. Include a reasonable groundfish allocation which may be
harvested and processed without holding any Federal or State dedicated
access privilege, subject to restrictions that the State of Alaska may
deem necessary to maintain the entry level character of such
allocation.
8. Include a community fisheries quota program that provides an
opportunity for small Gulf coastal communities to enhance their
residents' participation in the Gulf groundfish fishery, under the
conditions that the allocation to such program does not disrupt other
Gulf of Alaska fishery dependent communities by displacing their
fishermen, is required to be harvested by residents of the eligible
communities, and requires that harvests made under such program be
delivered on shore within the region of their allocation.
9. Include a community purchase program that provides Gulf coastal
communities with the opportunity to maintain participation by their
residents in the Gulf groundfish fishery by acquiring harvesting
privileges for use by their residents, under the conditions that the
Kodiak Island communities are eligible communities, and such program
includes reasonable limits on the amount of harvesting privileges that
any single eligible community may hold.
ADOPTED BY THE ASSEMBLY OF THE KODIAK ISLAND BOROUGH
THIS NINTH DAY OF NOVEMBER 2006
KODIAK ISLAND BOROUGH
Jerome M. Selby, Borough Mayor
ATTEST:
Nova M. Javier, CMC, Borough Clerk
______
[A letter submitted for the record by Capt. David Walker
follows:]
April 14, 2010
The Honorable Alan B. Mollohan
Chairman
Subcommittee on Commerce, Justice, Science & Related Agencies
Committee on Appropriations
H-310 U.S. Capitol
Washington, DC 20515
The Honorable Frank R. Wolf
Ranking Member
Subcommittee on Commerce, Justice, Science & Related Agencies
Committee on Appropriations
1016 Longworth H.O.B.
Washington, DC 20515
Dear Chairman Mollohan and Ranking Member Wolf:
Thank you for the opportunity to submit testimony in support of the
President's Fiscal Year 2011 National Marine Fisheries Service (NMFS)
budget request for the National Marine Fisheries Service, and
specifically the $54 million request for its National Catch Share
Program (NCSP). The Administration's requested funding for a NCSP is
critical to developing and implementing catch share programs that have
been under development, including the implementation of an IFQ for the
grouper fishery in the Gulf of Mexico.
Commercial fishermen, like me living in the Gulf region of the
United States, have greatly benefited from the implementation of
Individual Fishing Quota programs (IFQs), a catch share fishery
management program, which have helped end overfishing while preventing
and even reversing the collapse of fisheries. I urge you to support the
Administration's requested funding for NMFS.
I would like to provide the Committee with some real world insights
on how a catch share program can help to both improve the economics of
a fishery and facilitate the conservation of the resource. Red snapper
fishermen in the Gulf of Mexico have for many years faced depleted
stocks and an uncertain future. It was a rather stable fishery until
the 1970s and 1980s, when demand for fish began increasing as the
technology to catch fish was improving. When regulators stepped in to
establish catch limits, fishermen began racing against one another to
catch as much fish as possible before the limit was hit and fishing was
shut down for the year. This ``derby'' style system resulted in large
discards of dead red snapper, a decrease in fish prices, higher
operating costs and dangerous fishing conditions, as fishermen risked
their lives and boats in dangerous weather.
To address the situation, the Gulf of Mexico Fishery Management
Council began discussing management alternatives to rebuild and restore
the fishery, and in 2007, the Council adopted an IFQ program, which had
broad support from the commercial sector. Under IFQs, each fisherman is
allotted a share of the total catch and is held individually
accountable for adhering to that limit. Fishermen are able to fish
throughout the year when it is good for business. Closures are not
needed to effectively manage the fishery. Further, as commercial
fishermen, we are able to deliver high-quality fish to market when
consumer demand increases and the weather is suitable for fishing.
Under an IFQ program, fishermen can lease or sell shares if they are
unable to fish for any reason. Best of all, with an IFQ program, fish
are not wasted but retained and counted against the individual quotas.
Under previous rules, fishermen were forced to throw fish overboard to
comply with management directives.
The red snapper IFQ has empowered Gulf of Mexico commercial
fishermen to be stewards of the resource and to run efficient
operations and minimize the waste of fish. Furthermore, we have the
ability to carefully target and market red snapper to earn more money
with less fish. IFQs hold commercial fishermen accountable for their
allocation and the health of the stock, and provide fishermen with an
economic stake in the fishery.
An August 2009 report from NMFS Southeast Region stated that ``two
years after initial implementation of the red snapper IFQ program,
progress has been made toward achieving [the] program's objectives ...
[which] include mitigating derby fishing conditions and reducing
overcapacity.'' \1\ The IFQ's benefits are ``numerous'' and ``include
increasing flexibility for fishing operations; providing cost-effective
and enforceable management of the fishery; reducing bycatch;
eliminating quota overages; improving safety at sea; and optimizing net
social, economic, and biological benefits from the fishery,'' according
to the report. Importantly, since the end of 2006, the average exvessel
value of red snapper has nearly doubled.
---------------------------------------------------------------------------
\1\ 2008 Gulf of Mexico Red Snapper Individual Fishing Quota Annual
Report, August 17, 2009. Southeast Region, National Marine Fisheries
Service.
---------------------------------------------------------------------------
The commercial red snapper fishery was open for an average of 88
days--about one-quarter of the year--prior to the implementation of the
IFQ program. During this period, fishermen were limited to either 200-
pound or 2,000-pound trip limits and 10-day fishery openings per month.
Under the IFQ, fishermen are not constrained by fishery closures or
trip limits; a fisherman is limited instead to his annual allocation or
red snapper that he can catch throughout the year. Subsequently, the
NMFS report states that ``the IFQ program has lead to greater
efficiency for many red snapper IFQ program participants.''
NMFS also cites the biological benefits resulting from the IFQ
program, noting that in the first two years of the IFQ program
``reported [commercial] landings have been below quotas.'' During the
17 years of management prior to implementation of the IFQ, the
commercial quota was exceeded nine times. Similarly, NMFS found that
the ratio of landed to discarded fish has increased three to four times
since 2007.
Commercial catch share programs such as the red snapper IFQs in the
Gulf of Mexico support good jobs in the seafood industry and throughout
the broader economy. Catch share management results in more stable
employment for fishermen, as well as their suppliers and buyers,
lasting for longer periods of time. This stability is important to
providing an economic environment that helps to sustain the long-term
viability of communities that depend on the fishing industry.
The IFQ program currently in place for commercially-caught red
snapper in the Gulf of Mexico has been extremely successful, as it
allows fishermen to lower operating expenses, increases the price paid
at the dock, and meets high conservation standards, which has improved
both economic performance and safety at sea. A recovering fishery is
good for commercial, recreational and other fishing interests. Catch
share programs can only be successful with appropriate federal funding
for NMFS to properly design and implement catch share programs that
work for the fishermen, the resource and the region and the community.
I respectfully urge the Committee to support the Administration's
budget request for NMFS, and specifically the $54 million requested for
the NCSP. This funding is crucial to addressing the difficult fishery
management problems facing the nation. It is also important to the
development and implementation of the Gulf of Mexico reef fish IFQ.
Sincerely,
Capt. David Walker