[Congressional Record Volume 151, Number 14 (Thursday, February 10, 2005)]
[Senate]
[Pages S1271-S1272]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. WYDEN (for himself and Mr. Smith):
  S. 343. A bill to provide for qualified withdrawals from the Capital 
Construction Fund for fishermen leaving the industry and for the 
rollover of Capital Construction Funds to individual retirement plans, 
and for other purposes; to the Committee on Finance.
  Mr. WYDEN. Mr. President, I am pleased today to introduce the Capital 
Construction Fund Qualified Withdrawal Act of 2005. My friend and 
colleague, Senator Smith, joins me in introducing this important bill.
  In January of 2000, a fishery disaster was declared by the Secretary 
of Commerce for the West Coast groundfish fishery. Due to major 
declines in fish population, the Pacific Fisheries Management Council 
decreased groundfish catch quotas by 90 percent. Today, the groundfish 
fishery in Oregon and adjoining States in the Pacific Northwest

[[Page S1272]]

continues to face daunting challenges as a result of this disaster. 
Fishery income has dropped 55 percent and over a thousand fishers face 
bankruptcy. This legislation helps by reforming the Capital 
Construction Fund in a way that will ease the transition by 
groundfishers and other fishers in economic peril away from fishing.
  The Capital Construction Fund, CCF, Merchant Marine Act of 1936, 
amended 1969, 46 U.S.C. 1177, has been a way for fishers to accumulate 
funds, free from taxes, solely for the purpose of buying or refitting 
fishing vessels. It was conceived at a time when the Federal Government 
wanted to help capitalize and expand American fishing fleets. The 
program was a success: it led to a larger U.S. fishing fleet. However, 
fish populations declined and the U.S. commercial fishing fleet is now 
over-capitalized. The CCF's restrictions have not kept up with the 
times, and now it exacerbates some problems facing U.S. fisheries.
  Now is the time to help those fishers who wish to do so to leave the 
fleet.
  In Oregon, the amounts in CCF accounts range from $10,000 to over 
$200,000. This legislation changes current law to allow fishers to 
remove money from their CCF for purposes other than buying new vessels 
or upgrading current vessels, without losing up to 70 percent of their 
CCF funds in taxes and penalties. This legislation changes the CCF so 
fishers who want to opt out of fishing are not penalized for doing so.
  This bill takes a significant step towards making the commercial 
fishing industry sustainable by amending the CCF to allow non-fishing 
uses of investments. This bill amends the Merchant Marine Act of 1936 
and the Internal Revenue Code to allow funds currently in the CCF to be 
rolled over into an IRA or other type of retirement account, or to be 
used for the payment of an industry fee authorized by the fishery 
capacity reduction program, without adverse tax consequences to the 
account holders. This bill will also encourage innovation and 
conservation by allowing fishers to use funds deposited in a CCF to 
develop or purchase new gear that reduces bycatch.
  I look forward to working with my colleagues to pass this 
legislation.
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