[Federal Register Volume 75, Number 2 (Tuesday, January 5, 2010)]
[Rules and Regulations]
[Pages 554-604]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-30662]



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Part III





Department of Commerce





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National Oceanic and Atmospheric Administration



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15 CFR Part 902; 50 CFR Parts 300 and 679



Pacific Halibut Fisheries; Limited Access for Guided Sport Charter 
Vessels in Alaska; Final Rule

  Federal Register / Vol. 75 , No. 2 / Tuesday, January 5, 2010 / Rules 
and Regulations  

[[Page 554]]


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DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

15 CFR Part 902

50 CFR Parts 300 and 679

[Docket No. 080630798-91430-02]
RIN 0648-AW92


Pacific Halibut Fisheries; Limited Access for Guided Sport 
Charter Vessels in Alaska

AGENCY: National Marine Fisheries Service (NMFS), National Oceanic and 
Atmospheric Administration (NOAA), Commerce.

ACTION: Final rule.

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SUMMARY: NMFS issues regulations creating a limited access system for 
charter vessels in the guided sport fishery for Pacific halibut in 
waters of International Pacific Halibut Commission Regulatory Areas 2C 
(Southeast Alaska) and 3A (Central Gulf of Alaska). This limited access 
system limits the number of charter vessels that may participate in the 
guided sport fishery for halibut in these areas. NMFS will issue a 
charter halibut permit to a licensed charter fishing business owner 
based on his or her past participation in the charter halibut fishery 
and to a Community Quota Entity representing specific rural 
communities. 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. This action is necessary to achieve the approved halibut 
fishery management goals of the North Pacific Fishery Management 
Council. The intended effect is to curtail growth of fishing capacity 
in the guided sport fishery for halibut.

DATES: February 4, 2010, except for Sec.  300.66(b), (i), and (o), and 
Sec.  300.66(r) through (v), and Sec.  300.67(a), which will be 
effective on February 1, 2011.

ADDRESSES: Electronic copies of the Environmental Assessment (EA), 
Regulatory Impact Review (RIR), and Final Regulatory Flexibility 
Analysis (FRFA) (collectively, Analysis) prepared for this action may 
be obtained from http://www.Regulations.gov or from the Alaska Region, 
NMFS on the Alaska Region Web site at http://www.alaskafisheries.noaa.gov.
    Written comments regarding the burden-hour estimates or other 
aspects of the collection-of-information requirements contained in this 
proposed rule may be submitted by mail to NMFS, Alaska Region, P.O. Box 
21668, Juneau, AK, 99802-1668, Attn: Ellen Sebastian, Records Officer; 
in person at NMFS, Alaska Region, 709 West 9th Street, Room 420A, 
Juneau, AK; and by e-mail to [email protected] or fax to 202-
395-7285.

FOR FURTHER INFORMATION CONTACT: Rachel Baker, 907-586-7228.

SUPPLEMENTARY INFORMATION: The International Pacific Halibut Commission 
(IPHC) and National Marine Fisheries Service (NMFS) manage fishing for 
Pacific halibut (Hippoglossus stenolepis) through regulations 
established under authority of the Northern Pacific Halibut Act of 1982 
(Halibut Act). The IPHC promulgates regulations governing the Pacific 
halibut fishery under the Convention between the United States and 
Canada for the Preservation of the Halibut Fishery of the North Pacific 
Ocean and Bering Sea (Convention), signed at Ottawa, Ontario, on March 
2, 1953, as amended by a Protocol Amending the Convention (signed at 
Washington, DC, on March 29, 1979). Regulations developed by the IPHC 
are subject to approval by the Secretary of State with concurrence from 
the Secretary of Commerce (Secretary). After approval by the Secretary 
of State and the Secretary, the IPHC regulations are published in the 
Federal Register as annual management measures pursuant to 50 CFR 
300.62. The most recent IPHC regulations were published March 19, 2009, 
at 74 FR 11681. IPHC regulations affecting sport fishing for halibut 
and charter vessels in Areas 2C (Southeast Alaska) and 3A (Central Gulf 
of Alaska) may be found in sections 3, 25, and 28 (74 FR 11681, March 
19, 2009).
    The Halibut Act, at sections 773c(a) and (b), provides the 
Secretary with general responsibility to carry out the Convention and 
the Halibut Act. In adopting regulations that may be necessary to carry 
out the purposes and objectives of the Convention and the Halibut Act, 
the Secretary is directed to consult with the Secretary of the 
department in which the U.S. Coast Guard (USCG) is operating.
    The Halibut Act, at section 773c(c), also provides the North 
Pacific Fishery Management Council (Council) with authority to develop 
regulations, including limited access regulations, that are in addition 
to, and not in conflict with, approved IPHC regulations. Such Council-
developed regulations may be implemented by NMFS only after approval by 
the Secretary. The Council has exercised this authority most notably in 
the development of its Individual Fishing Quota (IFQ) Program, codified 
at 50 CFR part 679, and subsistence halibut fishery management 
measures, codified at 50 CFR 300.65. The Council also has been 
developing a regulatory program to manage the guided sport charter 
vessel fishery for halibut. This action is a step in the development of 
that regulatory program and has been approved by the Secretary pursuant 
to section 773c(c).

Background and Need for Action

    A comprehensive history of management of the guided sport fishery 
for halibut was presented in the proposed rule for this action 
published April 21, 2009 (74 FR 18178). This description focused on the 
history and rationale leading to the Council's development of limited 
access management for the charter vessel fishery and its recommendation 
of this limited access system in 2007. In brief, the principal concern 
was overcrowding of productive halibut grounds due to the growth of the 
charter vessel sector. The Council found that the charter vessel sector 
was the only halibut harvesting sector that was exhibiting growth in 
IPHC Areas 2C and 3A. Other harvesting sectors have specified catch 
limits that cause fishery closures when reached or are relatively 
stable over time. The Council recommended this limited access system to 
provide stability for the guided sport halibut fishery and decrease the 
need for regulatory adjustments affecting charter vessel anglers while 
the Council continues to develop a long-term policy of allocation 
between the commercial and charter vessel sectors.
    The Council adopted its limited access policy on March 31, 2007, 
and submitted it for review to the Secretary pursuant to section 
773c(c). By publishing this rule, NMFS announces Secretarial approval 
of this Council recommendation. A proposed rule for the recommended 
limited access system was published April 21, 2009 (74 FR 18178) 
soliciting public comments on the proposal until June 5, 2009. All 
comments received during this comment period are summarized and 
responded to below. Some changes from the proposed rule are made as a 
logical outgrowth from the proposed rule. These changes also are 
described below.
    Following is a summary description of the charter halibut limited 
access system and how it is designed to operate. A more thorough 
description of the action is presented in the preamble to the proposed 
rule published April 21, 2009 (74 FR 18178). Additional detail is 
presented in responses to comments below.

[[Page 555]]

Charter Halibut Limited Access System--Operational Aspects

General

    This action limits the entry of charter vessels into the guided 
sport fishery for halibut in waters of IPHC Regulatory Areas 2C 
(Southeast Alaska) and 3A (Central Gulf of Alaska). After the effective 
date of this rule (see DATES), any person operating a charter vessel 
engaged in halibut fishing in Areas 2C or 3A is required to have on 
board the vessel a charter halibut permit designated for that area. 
Qualifications for a charter halibut permit in each area are determined 
independently. A charter halibut permit can be either transferable or 
non-transferable depending on the qualifications of permit applicants. 
Each permit will have an angler endorsement that specifies the maximum 
number of anglers authorized to catch and retain halibut under the 
authority of the permit under which the vessel is operating. In 
addition, this action provides for two special permits--a community 
charter halibut permit and a military charter halibut permit.

Qualifications for Charter Halibut Permit

    To receive an initial allocation of a charter halibut permit, an 
applicant must demonstrate participation in the charter halibut fishery 
during an historic qualifying period and during a recent participation 
period. The historic qualifying period is the sport fishing season 
established by the IPHC in 2004 and 2005. The sport fishing season in 
both of those years was February 1 through December 31. Minimum 
participation criteria need be met in only one of these years--2004 or 
2005. The recent participation period is the sport fishing season 
established by the IPHC in 2008. This year was selected as the recent 
participation period because it is the most recent year for which NMFS 
has a complete record of saltwater charter vessel logbook data from the 
State of Alaska Department of Fish and Game (ADF&G).
    The minimum participation qualifications include documentation of 
at least five logbook fishing trips during one of the qualifying 
years--2004 or 2005--and at least five logbook fishing trips during 
2008. Meeting these minimum participation qualifications could qualify 
an applicant for a non-transferable charter halibut permit. The minimum 
participation qualifications for a transferable charter halibut permit 
include at least 15 logbook fishing trips during one of the qualifying 
years--2004 or 2005--and at least 15 logbook fishing trips during 2008.
    The basic unit of participation for receiving a charter halibut 
permit will be a logbook fishing trip. A ``logbook fishing trip'' is a 
bottomfish logbook fishing trip during the qualifying years, 2004 and 
2005, and as a halibut logbook fishing trip in 2008. A logbook fishing 
trip is an event that was reported to ADF&G in a logbook in accordance 
with the time limit required for reporting such a trip that was in 
effect at the time of the trip.

Number of Permits

    If an applicant for a charter halibut permit meets the minimum 
participation requirements during a qualifying year and the recent 
participation year, NMFS will determine how many permits the applicant 
will receive and how many of those, if any, will be transferable 
permits. If an applicant qualifies for any permits, NMFS will issue to 
the applicant the number of permits equal to (a) the applicant's total 
number of bottomfish logbook fishing trips in a qualifying year, 
divided by 5, or (b) the number of vessels that made those trips, 
whichever number is lower. The applicant will select which year in the 
qualifying period--2004 or 2005--NMFS will use in making this 
calculation.
    For example, an applicant in its selected qualifying year reported 
23 logbook trips using three vessels. One vessel made 16 trips, another 
vessel made five trips, and another vessel made only two trips. Under 
the rule, NMFS will calculate 23 / 5 = 4.6 which will be rounded down 
to four. But this number of permits will be limited by the number of 
vessels that made all the logbook trips in the applicant-selected year 
which was three. Hence, the applicant will be awarded three permits.

Transferable Permits

    After determining the total number of permits, NMFS will determine 
which permits are transferable and which are nontransferable. An 
applicant will receive a transferable permit for each vessel that made 
at least 15 trips in the applicant-selected year (2004 or 2005) and at 
least 15 trips in the recent participation year (2008). The same vessel 
must have made all the trips within a year; however, the same vessel 
did not have to be used in the qualifying year and the recent 
participation year. The rest of the applicant's permits, if any, will 
be non-transferable permits. Applicants that do not have the minimum of 
15 logbook fishing trips from the same vessel in each period but 
qualify for one or more permit(s) with a minimum of five logbook 
fishing trips, will receive only non-transferable permit(s). Hence, in 
the example above of an applicant with 23 logbook trips using three 
vessels, that applicant will receive three permits. Based on the 15-
trip minimum criterion, however, this applicant will receive only one 
transferable permit and the other two permits will be non-transferable.

Angler Endorsements

    Each charter halibut permit will have an angler endorsement number. 
The angler endorsement number on the permit is the maximum number of 
charter vessel anglers that may catch and retain halibut on board the 
vessel. The angler endorsement does not limit the number of passengers 
that an operator may carry, only the number that may catch and retain 
halibut. The angler endorsement will be equal to the highest number of 
anglers that the applicant reported on any logbook fishing trip in 2004 
or 2005, subject to a minimum endorsement of four.
    The term ``charter vessel angler'' is defined by this action to 
include all persons, paying or non-paying, who use the services of the 
charter vessel guide. The charter halibut permit, once issued with its 
angler endorsement, will limit the number of charter vessel anglers 
authorized to catch and retain halibut on the permitted vessel.
    A vessel operator will be able to stack permits to increase the 
number of charter vessel anglers on board. For example, if a vessel 
operator has two charter permits on board, one with an angler 
endorsement of four and one with an endorsement of six, then the vessel 
operator can have a maximum of 10 charter vessel anglers on board who 
are catching and retaining halibut if the operator is otherwise 
authorized to carry 10 passengers. If other provisions of law, such as 
safety regulations or for-hire operation regulations, prevent 10 
anglers from being on board the vessel, the charter halibut permits 
will not authorize the vessel operator to violate those provisions of 
law.

Initial Allocation Process

    Several basic standards are required to initially receive a charter 
halibut permit. These standards include (1) timely application for a 
permit, (2) documentation of participation in the charter vessel 
fishery during the qualifying and recent participation periods by ADF&G 
logbooks, and (3) ownership of a business that was licensed by the 
State of Alaska to conduct the guided sport fishing reported in the 
logbooks.

[[Page 556]]

    Timely application. To be an initial recipient of a charter halibut 
permit, an applicant must apply for the permit during the application 
period. An application period of no less than 60 days will be announced 
in the Federal Register. Applications submitted by mail, hand delivery, 
or facsimile will be accepted if postmarked, hand delivered, or 
received by fax no later than the last day of the application period. 
Electronic submissions other than facsimile will not be acceptable. A 
finite application period of reasonable length is necessary to resolve 
potential claims for permits by two or more persons for the same 
logbook fishing trip history. NMFS will not credit the same logbook 
fishing trip to more than one applicant and will not allow the 
participation history of one business owner to support issuance of a 
permit(s) to more than one applicant.
    Application forms will be available through ADF&G and NMFS offices 
and on the NMFS, Alaska Region, Web site at http://www.alaskafisheries.noaa.gov/. Electronic submission of the application 
will not be acceptable, however, because a signature on the application 
will be required. The application form will include a statement that, 
by signature, the applicant attests that legal requirements were met 
and all statements on the application are correct under penalty of 
perjury.
    Documentation of participation. The principal documentation 
necessary to prove qualifying participation in the charter halibut 
fishery will be limited to saltwater charter vessel logbooks issued by 
the ADF&G. There are several reasons for relying only on the ADF&G 
charter vessel logbook database. First, ADF&G has regulated saltwater 
charter fishing in the State of Alaska through registrations, licenses, 
and logbooks since 1998. These requirements apply to all charter 
fishing, including vessels targeting halibut. Second, ADF&G supplied 
aggregated charter vessel logbook data to the Council to assist it in 
its analysis of past participation in the charter halibut fishery in 
Areas 2C and 3A. Third, the Council relied on these data in part to 
make its decision to recommend limiting entry into this fishery and 
NMFS, in turn, has relied on the Council's Analysis of alternatives and 
on subsequent ADF&G charter vessel logbook data to approve this action.
    As stated above, the basic unit of participation for receiving a 
charter halibut permit will be a logbook fishing trip, which is a trip 
that was reported to ADF&G in a saltwater charter logbook in accordance 
with the time limit required for reporting such a trip that was in 
effect at the time of the trip. If a trip was not reported within those 
time limits, NMFS will not consider it a logbook fishing trip for 
purposes of a charter halibut permit application.
    NMFS will use the same method of counting logbook fishing trips 
that was used by the Council in developing its recommendation for this 
action. Each trip in a multi-trip day will count as one logbook fishing 
trip, and each day on a multi-day trip will count as one logbook 
fishing trip. For example, if an operator documented two trips in one 
day, NMFS will consider that as two logbook fishing trips. Another 
operator that documented a trip that lasted two days also will be 
considered to have made two logbook fishing trips. This accounting of 
trips deviates from the ADF&G method of counting logbook trips when 
fishing continues over multiple days. The same issue does not exist for 
half-day trips. Consistent with ADF&G logbook data and the Council's 
Analysis, NMFS will consider a half day trip as one trip.
    A halibut logbook fishing trip also can be a logbook fishing trip 
where the business owner, within ADF&G time limits, reported ``boat 
hours that the vessel engaged in bottomfish fishing.'' An applicant may 
use such a report as one way to document a halibut logbook fishing 
trip. The logbook data for ``boat hours'' that a business had to report 
in 2007 and 2008 was ``No. of Boat Hours Fished this Trip'' with 
bottomfish as a targeted species. ADF&G instructions for the 2007 and 
2008 logbooks state that bottomfish include halibut. Documentation of 
boat hours fishing for bottomfish would capture trips where charter 
vessel anglers were targeting halibut but did not catch any. Hence, 
this action defines a halibut logbook fishing trip as a logbook fishing 
trip in which the applicant reported the number of halibut kept or 
released or the boat hours that the vessel engaged in bottomfish 
fishing.
    Documentation of participation will be recorded in the official 
record of charter vessel participation in Areas 2C and 3A during the 
qualifying and recent participation years. The official record will be 
based on data from ADF&G and will link each logbook fishing trip to an 
ADF&G Business Owner License and to the person--individual, 
corporation, partnership, or other entity--that obtained the license. 
Thus, the official record will include information from ADF&G on the 
persons that obtained ADF&G Business Owner Licenses in the qualifying 
period and the recent participation period; the logbook fishing trips 
in those years that met the State of Alaska's legal requirements; the 
Business Owner License that authorized each logbook fishing trip; and 
the vessel that made each logbook fishing trip.
    NMFS will compare all timely applications to the official record. 
If an applicant submits a claim that is not consistent with the 
official record, NMFS will allow the applicant to submit documentation 
or further evidence in support of the claim during a 30-day evidentiary 
period. If NMFS accepts the applicant's documentation as sufficient to 
change the official record, NMFS will change the official record and 
issue charter halibut permit(s) accordingly. If NMFS does not agree 
that the further evidence supports the applicant's claim, NMFS will 
issue an initial administrative determination (IAD). The IAD will 
describe why NMFS is initially denying some or all of an applicant's 
claim and will provide instructions on how to appeal the IAD.
    An applicant may appeal the IAD to the Office of Administrative 
Appeals (OAA) pursuant to 50 CFR 679.43. NMFS will issue interim 
permits to applicants that filed timely applications and whose appeal 
is accepted by OAA. NMFS will limit interim permits on appeal to 
applicants who applied for charter halibut permits within the 
application period specified in the Federal Register. This means that 
an applicant that is denied a permit because its application was late 
would not receive an interim permit. All permits issued during an 
appeal will be interim, non-transferable permits. Until NMFS makes a 
final decision on the appeal, the permit holder will not be able to 
transfer any permits.
    Licensed business owners. Charter halibut permits will be issued to 
persons that were the ADF&G licensed business owners that met the 
minimum qualifications. The term ``person'' includes an individual, 
corporation, firm, or association (50 CFR 300.61). Hence, on successful 
application, NMFS will issue a charter halibut permit to the entity--
individual, corporation, partnership, or other entity--that held the 
ADF&G Business Owner License that authorized the logbook fishing trips 
that met the participation requirements. NMFS has no obligation to 
determine the owners of a corporation or members of a partnership that 
successfully applied for a permit. NMFS will follow the form of 
ownership--individual or otherwise--that the business used to obtain 
legal authorization from the State of Alaska for its past participation 
in the charter halibut fishery.
    Generally, the entity that applies for one or more charter halibut 
permits will be the same entity that held the ADF&G Business Owner 
License that authorized the trips that met the participation

[[Page 557]]

requirements in the qualifying period and in the recent participation 
period. The only exception to this requirement is if the entity that 
held these licenses is an individual who has died, or a non-individual 
entity, such as a corporation or partnership, that has dissolved.
    NMFS will not determine percentage of ownership of a dissolved 
partnership or corporation. If a dispute exists among former partners 
or shareholders as to how they should share ownership of a permit or 
permits, that dispute is properly resolved as a civil matter by a 
court.
    NMFS will apply a guiding principle in evaluating applications for 
charter halibut permits; the logbook fishing trip activity of one 
person that is used for permit qualification cannot lead to more than 
one person receiving a charter halibut permit. The only possible 
exception is when NMFS might award a permit to successors-in-interest 
to a dissolved entity. Even then, NMFS will not issue a permit to each 
successor-in-interest, but will issue the number of permits for which 
the dissolved entity qualified in the names of all successors-in-
interest. Subject to that exception, this guiding principle prohibits 
NMFS from crediting more than one applicant for the same logbook 
fishing trip, from crediting more than one applicant for logbook 
fishing trips made pursuant to the same ADF&G Business Owners License, 
and from issuing permits to more than one applicant for participation 
by one person in the charter halibut fishing business.
    Unavoidable circumstances. NMFS recognizes that certain unavoidable 
circumstances could have prevented an applicant from participating in 
either the qualifying period or recent participation period despite the 
applicant's intention. In developing a limited exception to allow for 
unavoidable circumstances, NMFS was guided in part by the unavoidable 
circumstance provisions in the License Limitation Program for 
groundfish and crab fisheries at 50 CFR 679.4(k). Basically, an 
applicant must demonstrate that--
     It participated during either the qualifying period or the 
recent participation period;
     It had a specific intent to participate in the period, 
either the qualifying period or the recent participation period, that 
the applicant missed;
     The circumstance that thwarted the intended participation 
was (a) unavoidable, (b) unique to the applicant, (c) unforeseen and 
unforeseeable;
     The applicant took all reasonable steps to overcome the 
problem; and
     The unavoidable circumstance actually occurred.
    The unavoidable circumstance exception will be limited to persons 
that will be excluded from the fishery entirely unless their 
unavoidable circumstance is recognized. The unavoidable circumstance 
exception is not intended to upgrade the number or type of permits an 
applicant could receive. For example, NMFS will not accept an 
unavoidable circumstance claim to upgrade a non-transferable permit to 
a transferable permit based on an anticipated 15 logbook trips in 2005 
that did not occur. NMFS intends a narrow interpretation of the 
unavoidable circumstance exception, and that, if an applicant can get 
any charter halibut permit based on the applicant's actual 
participation, then the applicant will be limited to that permit.
    This rule also recognizes a particular type of unavoidable 
circumstance, military service. The military exemption is designed to 
benefit persons that will otherwise be completely excluded from 
receiving any charter halibut permits despite their intention to meet 
the participation requirement during the qualifying period. If a 
military exemption applicant can receive any permits based on the 
applicant's actual participation in the qualifying period, the 
applicant will be limited to that number and type of permits and cannot 
use the military exemption. An applicant may not claim a military 
exemption to excuse lack of participation in the qualifying period and 
an unavoidable circumstance to excuse a lack of participation in the 
recent participation period. The successful military exemption 
applicant will receive one non-transferable permit with an angler 
endorsement of six unless the applicant can demonstrate that it likely 
would have met participation requirements for a transferable permit or 
a higher angler endorsement.

Transfers

    A person holding a transferable charter halibut permit may transfer 
the permit to another person (individual or non-individual entity) with 
certain limitations. Non-transferable charter halibut permits may not 
be transferred. Transferability of permits will allow limited new entry 
into the charter halibut fishery while preventing an uncontrolled 
expansion of the charter halibut fishery.
    NMFS expects consolidation in the charter halibut fishery as 
holders of non-transferable permits leave the fishery and as charter 
halibut operators acquire multiple permits by transfer. Excessive 
consolidation will be prevented by imposing an excessive share limit of 
five charter halibut permits.
    Two important exceptions to this excessive share limit, however, 
will allow a person to hold more than five permits. First, a person 
that is the initial recipient of more than five permits will be able to 
continue to hold all of the permits for which the person initially 
qualified. Such a person will be prevented from receiving transfers of 
additional permits. This exception will not apply if an individual 
permit holder dies or a corporate permit holder dissolves or changes 
its ownership by adding one or more new owner(s) or partner(s). In this 
event, NMFS will consider a successor-in-interest or a changed 
corporate structure to be a different entity from the one that was the 
initial recipient of the permits and the exception to the excessive 
share limit will not apply to the new entity. Upon notification of a 
change, NMFS would (1) invalidate transferable charter halibut permits 
held by the permit holder and provide notification that the permit 
holder must divest themselves of the permit; and (2) revoke non-
transferable charter halibut permits held by the permit holder.
    The second exception will allow a transfer that results in the 
person receiving the transfer holding more than five permits if the 
person meets the following three conditions:
     The existing permit holder that holds more than five 
permits under the first exception will be transferring all of the 
transferable permits that were initially issued;
     The existing permit holder will be transferring all 
assets--such as vessels owned by the business, lodges, and fishing 
equipment--of its charter vessel fishing business along with the 
permits; and
     The person that will receive the permits in excess of the 
excessive share limit does not hold any permits at the time of the 
proposed transfer.
    Although no citizenship standards will apply to the initial 
allocation of charter halibut permits, a person receiving a charter 
halibut permit by transfer must be a United States (U.S.) citizen. 
Issuance of charter halibut permits to non-U.S. citizens is not 
authorized by section 773c(c) of the Halibut Act. The Secretary, 
however, has general responsibility and authority to adopt regulations 
as may be necessary under section 773c(a) and (b) of the Halibut Act. 
Therefore, the Secretary is exercising this authority in not applying 
citizenship standards for the initial allocation of charter halibut 
permits. A

[[Page 558]]

transfer to an individual will be approved only if the individual is a 
U.S. citizen, and a transfer to a corporate entity will be approved 
only if it is a U.S. business with at least 75 percent U.S. citizen 
ownership of the business. This rule adopts the 75 percent U.S. 
ownership criterion for a U.S. business from the American Fisheries Act 
(111 Stat. 2681, Oct. 21, 1998), which is a key piece of Federal 
legislation designed to Americanize the fleet fishing off American 
waters.
    A nontransferable permit cannot be transferred from the name of the 
individual once the individual dies. A nontransferable permit cannot be 
transferred from a non-individual permit holder (a corporation, 
partnership, or other entity) if the non-individual permit holder 
dissolves or changes. This rule incorporates the definition of 
``change'' in a corporation or partnership from the IFQ program at 50 
CFR 679.42(j)(4)(i). This paragraph in the IFQ regulations defines ``a 
change'' for corporations, partnerships, or other non-individual entity 
to mean ``the addition of any new shareholder(s) or partner(s), except 
that a court appointed trustee to act on behalf of a shareholder or 
partner who becomes incapacitated is not a change in the corporation, 
partnership, association, or other non-individual entity.''
    These limitations on the transfer of charter halibut permits will 
be made effective by a requirement for NMFS approval for all transfers. 
No transfer of a permit will be effective unless it is first approved 
by NMFS. A transfer application provided by NMFS is required to be 
completed by the person transferring and the person receiving the 
transferred permit. Completion of the transfer application and 
examination of it by NMFS will assure that the excessive share and 
citizenship requirements of this rule are maintained, and that non-
transferable permits are dissolved on the death or change of the permit 
holder and will not be transferred to a new entity.

Special Permits

    Two types of special permits are provided by this action for 
limited guided sport fishing for halibut outside of the requirements 
for charter halibut permits. First, community charter halibut permits 
are intended to allow development of a charter vessel fishery in 
certain rural communities that do not have a developed charter vessel 
industry. Second, a military charter halibut permit will exempt from 
this limited access system charter vessels operated by the U.S. 
Military's Morale, Welfare and Recreation (MWR) programs for 
recreational use by service members.
    Community charter halibut permit. One or more community charter 
halibut permits may be issued to Community Quota Entities (CQEs) 
representing specified communities that do not currently have a fully 
developed charter halibut fleet. The CQE concept was developed by the 
Council originally to help rural communities become more involved in 
the commercial fisheries for halibut and sablefish (84 FR 23681, April 
30, 2004). CQEs are defined in existing regulations at 50 CFR 679.2.
    A CQE representing a community or communities in Area 2C can 
receive a maximum of four community charter halibut permits for each 
eligible community the CQE represents. A CQE representing a community 
or communities in Area 3A can receive a maximum of seven community 
charter halibut permits for each eligible community it represents. The 
larger number of community permits allowed in Area 3A reflects the 
larger resource base in that area. A community charter halibut permit 
will have an angler endorsement of six and will be non-transferable.
    In addition to community charter halibut permits, a CQE may acquire 
charter halibut permits by transfer. A unique excessive share limit 
will apply to each CQE in Area 2C of a maximum of four charter halibut 
permits for each eligible community the CQE represents in that area. 
The combined permit limit for a CQE in Area 2C is four community 
charter halibut permits plus four charter halibut permits for an 
overall limit of eight permits per eligible community. Similarly, the 
excessive share limit for a CQE in Area 3A is a combined permit limit 
of seven community charter halibut permits plus seven charter halibut 
permits for an overall limit of 14 permits per eligible community.
    A charter vessel fishing trip for halibut that is authorized by a 
community charter halibut permit is required to either begin or end 
within the community designated on the community charter halibut 
permit. This requirement will apply only to community charter halibut 
permits and not to any additional charter halibut permits that a CQE 
may acquire by transfer.
    The Council intended to limit the benefits of community charter 
halibut permits to rural communities that have an emerging but not a 
fully developed charter vessel fleet. Instead of listing in regulations 
the criteria used by the Council in selecting community eligibility, 
this rule simply specifies those communities in Areas 2C and 3A (see 
Table 21 to part 679) that meet the Council's criteria and will qualify 
for community charter halibut permits issued to CQE(s) representing 
them. To add or subtract a community from the proposed list will 
require separate Council action and a regulatory amendment.
    Military charter halibut permit. This action provides for special 
permits for charter vessels operated by any U.S. Military MWR program 
in Alaska. The only MWR program in Alaska that currently offers 
recreational charter halibut fishing to service members is the Seward 
Resort based at Fort Richardson in Anchorage, Alaska. To operate a 
charter vessel, the MWR program must obtain a military charter halibut 
permit by application to NMFS. Each military charter halibut permit 
will be non-transferable and valid only in the regulatory area 
designated on the permit. NMFS reserves the right to limit the number 
of these permits.

Consistency With Halibut Act

    As described at the beginning of this preamble, this action is 
authorized by the Halibut Act at section 773c. Section 773c(c) 
specifically authorizes the Council to develop and the Secretary to 
approve limited access regulations applicable to nationals or vessels 
of the United States or both. Such regulations are required by this 
section of the Halibut Act to be consistent with four basic standards. 
The following discussion summarizes these statutory standards and the 
rationale used by the Secretary in approving the Council's 
recommendation and this rule implementing a limited access system for 
charter vessels in the guided sport fishery for halibut in IPHC 
regulatory Areas 2C and 3A.
    Section 773c(c) of the Halibut Act requires limited access 
regulations to be--
     In addition to and not in conflict with regulations 
adopted by the IPHC;
     Non-discriminatory between residents of different States;
     Consistent with the limited entry criteria set forth in 16 
U.S.C 1853(b); and
     Fair and equitable to all fishermen, based on the rights 
and obligations in Federal law, reasonably calculated to promote 
conservation, and carried out in such a manner that no particular 
individual, corporation, or other entity acquires an excessive share of 
halibut fishing privileges.

No Conflict With IPHC Regulations

    Regulations governing halibut fisheries that are recommended by the 
IPHC are accepted or rejected on behalf

[[Page 559]]

of the United States by the Secretary of State, with the concurrence of 
the Secretary, pursuant to section 773b of the Halibut Act. Accepted 
IPHC regulations are published as annual management measures pursuant 
to 50 CFR 300.62. The current annual management measures were published 
in the Federal Register on March 19, 2009 (74 FR 11681). IPHC 
regulations affecting sport fishing for halibut and charter vessels in 
Areas 2C and 3A may be found in sections 3, 25, and 28 of the IPHC 
regulations (74 FR 11681, March 19, 2009).
    The IPHC regulations at section 3 of the annual management measures 
include definitions of terms, some of which are related to this action, 
such as ``charter vessel'' and ``sport fishing.'' This action removes a 
different definition of ``charter vessel'' from 50 CFR 300.61 that 
could have raised a conflict question. The definition of the term 
``charter vessel'' at 50 CFR 300.61 resulted from a final rule 
published September 24, 2008 (73 FR 54932), for purposes of a 
prohibition against using a charter vessel for subsistence fishing for 
halibut. This action integrates the definition into the prohibition 
language to which it directly applies at 50 CFR 300.66(i) to clarify 
that the definition does not apply universally. The universal 
definition of ``charter vessel'' will continue to be that used by the 
IPHC and appearing in the annual management measures. Hence, no 
conflict is found between this action and the IPHC regulations 
concerning this definition.
    The IPHC regulations at section 25 of the annual management 
measures specify the legal gear for sport fishing for halibut, specify 
which halibut count toward the daily bag limit, and prohibit possession 
of halibut on board a vessel while fishing in a closed area and when 
other fish or shellfish on board the vessel are intended for commercial 
use. Section 25 also prohibits halibut caught by sport fishing from 
being offered for sale, sold, traded, or bartered. Finally, section 25 
makes an operator of a charter vessel liable for any violation of the 
IPHC regulations by a passenger on board the vessel. Regulations in 
this action are in addition to, and not in conflict with, the IPHC 
regulations at section 25.
    The IPHC regulations at section 28 of the annual management 
measures establish sport fishing rules specific to Convention waters in 
and off of Alaska. Specifically, these regulations specify the sport 
fishing season, daily bag limit of halibut per person, the possession 
limit, and a prohibition against filleting halibut to support 
enforcement of the daily bag and possession limits. Exceptions to the 
filleting prohibition also are provided at section 28. Regulations in 
this action are in addition to, and not in conflict with, the IPHC 
regulations at section 28.

No Discrimination Between Residents of Different States

    Regulations in this action do not discriminate between residents of 
different states. All charter business owners are treated the same 
regardless of their residency with respect to their eligibility to 
receive an initial allocation of a charter halibut permit or a transfer 
of a charter halibut permit. Likewise, neither the community charter 
halibut permit nor the military charter halibut permit is restricted in 
terms of the State of residency of the person who will use the permit. 
Charter vessel anglers who receive sport fishing guide services from 
businesses affected by this rule also are not discriminated against in 
terms of the State of their residence. Such anglers will have the same 
opportunity to contract with businesses that possess charter halibut 
permits regardless of the location of the angler's residence.

Consistency With Limited Entry Criteria

    The limited entry criteria referred to in section 773c(c) of the 
Halibut Act appear at section 303(b)(6) of the Magnuson-Stevens Fishery 
Conservation and Management Act (Magnuson-Stevens Act, 16 U.S.C. 1801 
et seq.). These criteria appear under the heading of discretionary 
provisions for the Council and Secretary, and they read, and are 
discussed in turn, as follows:)

    (b) Discretionary provisions. [The Council or Secretary] with 
respect to any fishery, may--
    (6) Establish a limited access system for the fishery in order 
to achieve optimum yield if, in developing such a 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 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.

    Optimum yield. This term is defined in the Magnuson-Stevens Act at 
section 3(33) in terms of providing the greatest overall benefit to the 
Nation, and prescribed on the basis of maximum sustainable yield as 
reduced by any relevant economic, social, or ecological factor. Also, 
at section 301(a)(1), the Magnuson-Stevens Act states that conservation 
and management measures must prevent overfishing while achieving 
optimum yield. This is one of ten national standards established by the 
Magnuson-Stevens Act with which any fishery management plan (FMP) or 
regulation implementing an FMP must be consistent.
    The U.S. halibut fisheries are not managed under an FMP because the 
halibut fisheries are governed under the authority of the Halibut Act, 
not the Magnuson-Stevens Act. The Halibut Act does not require the U.S. 
halibut fisheries to be managed under an FMP. Therefore, specification 
of optimum yield for halibut is not required by statute and has not 
been determined. Nevertheless, the IPHC takes a conservative approach 
in setting the commercial fishery catch limits for the areas in and off 
Alaska while leaving economic and social balance questions to the 
Council. In essence, IPHC biologists determine a biologically 
acceptable level of harvest from all sources of halibut mortality, 
estimate the anticipated harvest from all non-commercial sources of 
fishing mortality, subtract the latter from the former, and set a 
commercial fishery catch limit based on the remainder. The overall 
harvest rate targeted by the IPHC is 20 percent of the exploitable 
biomass. The realized rate in recent years, however, has been 
substantially above the targeted harvest rate. Therefore, to the extent 
that the limited access system established by this rule can stabilize 
the halibut harvest by the charter halibut fishery, it will contribute 
to the achievement of the overall target harvest rate of halibut.
    Present participation. The Council took into account present 
participation in the charter halibut fisheries as it considered 
alternative participation criteria. The Council took its action to 
recommend this rule to the Secretary on March 31, 2007. At that time, 
the most recent information on participation in these fisheries was 
from 2004 and 2005 ADF&G saltwater charter vessel logbooks. Logbook 
data from participation in 2006 was not yet available for the Council's 
Analysis (see ADDRESSES). In addition, the ADF&G logbook data were not 
specific to charter vessel fishing trips targeting halibut, per se, but 
indicated ``bottomfish'' fishing instead. However, the predominate 
bottomfish targeted in Alaska saltwater sport fisheries is halibut. 
Hence, bottomfish was assumed to be a reasonable proxy for halibut 
fishing. Further, the Council chose to accept any ADF&G saltwater 
logbook entry indicating a bottomfish statistical area, rods, or boat 
hours as evidence of participation during 2004 and 2005. The

[[Page 560]]

Council was aware that this would result in a liberal estimate of 
participation in the charter halibut fisheries, but this decision was 
reasonably based on the best available information. With this 
understanding, the Council proceeded to consider alternative levels of 
participation, in terms of numbers of logbook fishing trips ranging 
from 1 to 20 trips or more, as an indication of participation during 
2004 and 2005.
    The Council has recommended, and the Secretary has approved, 
several other limited access systems before this action, and the 
Council knew that two or three years could pass before its 
recommendation for this limited access system was fully reviewed, 
approved, and implemented. In developing this limited access system, 
the Council addressed the potential of a rush of new entrants into the 
charter halibut fishery during the period of time the Council and the 
Secretary worked to develop and implement the system by specifying a 
minimum participation criterion in a recent participation period. The 
Council referred to this recent participation period as the ``year 
prior to implementation.'' In 2007, the year of Council action, the 
year prior to implementation was an unknown year in the future. In the 
proposed rule (April 21, 2009, 74 FR 18178), NMFS interpreted the 
``year prior to implementation'' for practical purposes to mean the 
most recent year for which participation data are available. The most 
recent year for which ADF&G saltwater log book data are available now 
is 2008. Therefore, the Council's original Analysis of participation 
patterns was supplemented with 2008 logbook data indicating 
participation in the most recent year. This is currently the best 
information available on present participation in the charter halibut 
fisheries in IPHC Areas 2C and 3A.
    The Council's policy recommendation to grant charter halibut 
permits based in part on participation in at least two years--one of 
the qualifying years, 2004 or 2005, and the recent participation year, 
2008--served several purposes. One was to comply with the Magnuson-
Stevens Act 303(b)(6) criteria of taking into account present and 
historical participation.
    The second purpose was to stabilize growth in the charter halibut 
fisheries, a long-term objective of this limited access system. Due to 
the length of time needed to develop a limited access policy, conduct 
analyses of alternative policies, consider public comments, review and 
approve (or disapprove) a Council recommendation, and (if approved) 
implement the recommendation with Federal regulations, the entry of new 
charter halibut fishing effort during this time could significantly 
change the halibut harvesting capacity from when the Council's policy 
decision was made in March 2007. Specifying minimum participation 
criteria in a recent participation year in addition to a qualifying 
year served the purpose of discouraging new entry into the affected 
charter halibut fisheries during the intervening years.
    The Council and the Secretary provided further public notice to 
discourage prospective new entry into the charter halibut fisheries 
when the Council acted to establish a control date of December 9, 2005. 
The Council determined that anyone entering the charter halibut fishery 
in and off Alaska after this date would not be assured of future access 
to that fishery if a limited access system of management was developed 
and implemented under authority of the Halibut Act. In addition to 
public announcement of this action at its meeting in December 2005, the 
Council also published this date in its December 2005 and February 2006 
newsletters (http://www.alaskafisheries.noaa.gov/npfmc/newsletters/newsletters.htm). The Secretary also published a notice of this date in 
the Federal Register on February 8, 2006 (71 FR 6442).
    The third purpose served by the Council's choice of present and 
historical participation years to qualify for an initial allocation of 
a charter halibut permit is to establish an objective and measurable 
indicator of dependence on the fishery. The Council reasoned in 
developing this and several other limited access systems that 
participation is a good indication of dependence on the fishery. 
Fishermen with a relatively greater participation in a fishery likely 
have a relatively greater dependence on the fishery for their 
livelihood than do other fishermen with relatively less participation. 
The difficult policy choice for the Council and Secretary is to 
determine where on the range, from little to large amount of 
participation, a decision should be made affecting future participation 
in the fishery. The Analysis of the potential effects of alternative 
decisions supports the ultimate policy choice (see ADDRESSES).
    For commercial fisheries, participation is often measured in pounds 
of the targeted fish species landed. Charter vessel businesses, 
however, primarily market a sport fishing experience rather than pounds 
of fish caught. Logbook fishing trips are a better measure of 
participation in the charter halibut fisheries than are pounds of 
halibut caught and retained. Hence, the Council used logbook fishing 
trips as a measure of participation in the charter halibut fisheries.
    Further, the Council determined the level of minimum participation 
in both years--the historical, 2004 or 2005, and present participation, 
2008--indicated a reasonable dependence on the charter halibut fishery. 
Using participation in a past and a recent year together demonstrates 
dependence on the fishery to a greater extent than using only one year 
of participation as a qualifying criterion. A charter halibut business 
with a record of at least minimal participation in both years likely 
participated also in the intervening years, and likely continues to 
participate now. Therefore, these are the businesses that the Council 
decided should receive an initial allocation of charter halibut 
permits. On the other hand, charter halibut businesses that 
participated only in the historical period but not in the recent 
participation period likely exited the charter halibut industry before 
the recent participation period and, therefore, are no longer dependent 
on the fishery. Conversely, charter halibut businesses that 
participated only in the recent period but not in the historical period 
likely entered the fishery after the control date. These businesses 
comprise a group of charter halibut participants that the Council and 
Secretary specifically discouraged from entry by announcing that their 
participation would not necessarily be recognized (71 FR 6442, February 
8, 2006).
    The Secretary has approved and adopted this rational basis for 
taking into account present participation.
    Historical fishing practices. The Analysis took into account 
historical fishing practices in and dependence on the charter halibut 
fisheries (see ADDRESSES). The Council examined the potential effects 
of several alternative minimum qualifying logbook trips during this 
period before making its recommendation. As explained above, the choice 
of minimum qualifying logbook trips during this historical 
participation period in combination with those during the recent 
participation period (2008) was critical to a determination of 
dependence on the charter halibut fishery. Those charter halibut 
businesses that met the minimum logbook trip criteria were determined 
to be sufficiently dependent on the charter halibut industry to warrant 
them receiving an initial allocation of one or more charter halibut

[[Page 561]]

permits. The Secretary has approved and adopted the Council's rational 
basis for taking into account historical fishing practices in and 
dependence on the charter halibut fisheries.
    Economics. The Council and the Secretary have taken into account 
the economics of the charter halibut fishery. The Analysis prepared by 
the Council and supplemented and approved by the Secretary includes a 
Regulatory Impact Review (RIR) and Final Regulatory Flexibility 
Analysis (FRFA) (see ADDRESSES). These documents respectively include 
analysis of potential costs and benefits and analysis of potential 
impacts on small entities as defined by the Regulatory Flexibility Act. 
This Analysis contains information describing the principal sectors 
that fish for halibut and incorporates earlier descriptions by 
reference. Each of the components of the preferred alternative is 
analyzed separately in the RIR. The impacts of the preferred 
alternative, and two other significant alternatives, on user industry 
and consumer groups in the commercial and charter halibut fisheries are 
compared in the RIR. A FRFA provides an analysis of the impacts of the 
preferred alternative on small entities. The Council accepted testimony 
from the public, much of which addressed economic concerns. NMFS has 
supplemented the Analysis, prepared for the Council's decision-making 
and to accompany the publication of the proposed rule, with an updated 
analysis of the impacts of the preferred alternative in light of 
specification of the recent participation period (see ADDRESSES). This 
information was not previously available. NMFS accepted and evaluated 
comments on the proposed rule, many of which raised economic issues. 
The summary of public comments and NMFS's responses to them may be 
found below.
    Capability to engage in other fisheries. The Council and the 
Secretary have taken into account the capability of vessels used in the 
guided sport fishery for halibut to engage in other fisheries. The 
Analysis prepared by the Council, supplemented and approved by the 
Secretary, includes a description of the affected fleet and industry. 
In brief, the charter halibut industry provides marine transportation 
and sport fishing guide services to anglers wishing to catch halibut. 
Charter vessel businesses provide these services also to anglers 
wishing to catch salmon, rockfish, lingcod, and other bottomfish. In 
addition, charter vessel businesses may provide marine transportation 
for bird watching, whale watching, and general sightseeing. Passengers 
using these services may be independent tourists, guests at lodges, or 
travelers on cruise ships. Charter vessel businesses may focus their 
business plan on sport anglers wishing to catch halibut, but other 
business plans are possible given the variety of reasons why an 
individual may want to engage the services of a charter vessel.
    Cultural and social framework. The Council and the Secretary have 
taken into account the cultural and social framework relevant to the 
charter halibut fishery and affected fishing communities. The Council 
received substantial public testimony during the early development of 
this rule which influenced the design of elements included for 
Secretarial consideration. The Secretary in turn has received public 
comments on cultural and socioeconomic aspects of this rule, has 
considered these comments and responded to them below. The Analysis of 
alternatives (see ADDRESSES) reflects this consideration by finding 
numerous communities with little charter vessel activity while a few 
communities have a well-established charter vessel industry, as 
indicated by the numbers of vessels that terminated charter vessel 
trips in coastal communities during the qualifying years. Hence, this 
action supports limited development of a charter halibut fishery in 
specific rural communities through a special community charter halibut 
permit program.
    Community charter halibut permits will be issued under this rule at 
no cost to CQEs representing communities that do not currently have a 
fully developed charter halibut fleet. The CQE provision was previously 
developed by the Council for the IFQ program to help certain rural 
communities become more involved in the commercial fisheries for 
halibut and sablefish. In this action, the CQE provision serves the 
same purpose for the development of the charter vessel industry based 
in any of 18 rural communities in Area 2C and 14 rural communities in 
Area 3A. The purpose and design of the CQE provision is more fully 
described in the proposed rule published April 21, 2009 (74 FR 18178).
    The Council also recommended, and the Secretary approved, another 
special permit for military recreation purposes. This took into account 
the existence of morale, welfare, and recreation (MWR) programs 
operated by the U.S. military and their importance to the recreational 
opportunities afforded to military services.
    The Council and Secretary also have taken into account unique 
social and cultural aspects of the charter halibut fishery by providing 
for certain hardships or unavoidable circumstances in qualifying for a 
charter halibut permit. The design and conditions for a charter halibut 
permit based on unavoidable circumstances are fully described in the 
proposed rule published April 21, 2009 (74 FR 18178).
    Fair and equitable distribution of access privileges. The Council 
and the Secretary have taken into account the fair and equitable 
distribution of access privileges to the halibut resource. Although 
this action may cause some restructuring within the charter vessel 
industry, no individual sport angler will be prevented from having 
access to the halibut resource for sport fishing. Sport fishermen 
wishing to fish for halibut on a charter vessel likely will be able to 
hire an operator or guide with a charter halibut permit as easily after 
the implementation of this rule as was done before that time.
    Further, persons wishing to enter the charter vessel industry will 
be able to do so. This rule does not prevent any person from entering 
the charter vessel industry or becoming an operator of a charter 
vessel. An operator or business with a halibut fishing clientele, but 
that does not qualify for an initial allocation of one or more charter 
halibut permits, would have to obtain a transferable charter halibut 
permit by transfer. Alternatively, a charter vessel business that had 
such minimal participation that it does not qualify for a charter 
halibut permit under the Council's qualification criteria could change 
its business model to one that does not involve fishing for halibut. 
Although this rule does not prevent most persons from entering the 
charter halibut fishery, those persons that receive an initial 
allocation of charter halibut permits will have a competitive advantage 
over those that will have to pay for transfer of these permits. The 
rationale for making a distinction between these two groups is to end 
the opportunities for unlimited growth in charter vessel operations 
that may fish for halibut by establishing a finite number of charter 
vessels authorized for guided sport halibut fishing based on the 
historical and present participation criteria outlined above. This 
action is intended to support the Council's approved policy of 
allocating the halibut resource among all fishing sectors and providing 
continued participation by those operations most dependent on the 
halibut resource.
    Other relevant considerations. The Council and the Secretary have 
taken into account other factors to allow limited additional 
participation in the charter halibut fisheries than would otherwise be 
allowed without certain

[[Page 562]]

exceptions to the qualifying criteria. First, an initial allocation of 
non-transferable charter halibut permits will be allocated to persons 
with a low level of participation. The minimum number of logbook 
fishing trips in one of the qualifying years--2004 or 2005--and in the 
recent participation year--2008--is five. Dependence on the halibut 
resource will be difficult to demonstrate for charter vessel businesses 
that made only 5 to 14 logbook fishing trips, relative to those 
businesses that made 15 or more trips. These low-participation charter 
businesses likely are small and operate part time, but together they 
supply a significant market for charter vessel anglers. Excluding the 
low-participation charter businesses from initial allocation of charter 
halibut permits could have constrained charter vessel angler 
opportunities. Allowing low-participation charter businesses to qualify 
for transferable charter halibut permits, however, would have created a 
large latent capacity to expand charter vessel angler opportunities. 
Hence, these low-participation charter businesses are allowed to 
qualify for non-transferable charter halibut permits to continue their 
current operations but not provide a source for significant expansion 
of charter halibut fishing in the future.
    Second, consideration of unavoidable circumstances is specifically 
recognized by the Council and the Secretary. Such circumstances must 
have been unique to a particular person, unforeseen and unavoidable, 
and must have prevented a potential participant in the charter halibut 
fishery from participation as intended during either the qualifying or 
recent participation years. This hardship provision allows for an 
appeals process that may result in the potential allocation of non-
transferable or transferable charter halibut permits that would 
otherwise be denied. A special military service hardship provision was 
included for a charter halibut permit applicant that meets the 
participation requirement during the recent participation period but 
not during the qualifying period due to U.S. military service.
    Finally, the Council and Secretary allowed an exemption for charter 
vessels operated by any U.S. Military MWR program in Alaska. A special 
non-transferable military charter halibut permit will be issued to a 
MWR program without regard for previous participation in the charter 
halibut fisheries. NMFS reserves the right to limit the number of these 
permits.

Fair and Equitable, Promotes Conservation, and Avoids Excessive Share

    The Halibut Act at 16 U.S.C. 773c(c) states the following:

    If it becomes necessary to allocate or assign halibut fishing 
privileges among various United States fishermen, such allocation 
shall be fair and equitable to all such fishermen, based upon the 
rights and obligations in Federal law, reasonably calculated to 
promote conservation, and carried out in such a manner that no 
particular individual, corporation, or other entity acquires an 
excessive share of halibut fishing privileges.

    The following discusses the consistency of this action with each of 
these three standards.
    Fair and equitable. The ``fair and equitable'' requirement in the 
Halibut Act quoted above is substantially the same as the ``fair and 
equitable'' requirement found at 16 U.S.C. 1851(a)(4), i.e., National 
Standard 4 of the Magnuson-Stevens Act. The only difference is the 
addition of the word ``halibut'' before ``fishing privileges'' in the 
provision in 16 U.S.C. 773c(c). Because of this similarity, the 
National Standard 4 guidelines promulgated by NMFS help to illustrate 
why this action, even though it is taken under the Halibut Act and not 
the Magnuson-Stevens Act, meets the statutory requirement. An 
allocation of fishing privileges should be rationally connected to the 
achievement of optimum yield or the furtherance of a legitimate fishery 
management objective under the guidelines to National Standard 4 (50 
CFR 600.325(c)(3)(i)(A)). The Council and NMFS have articulated a 
legitimate objective for this action, that is, to be a step toward 
establishing a comprehensive program of allocating the halibut resource 
among the various halibut fisheries (guided and unguided recreational, 
commercial, and subsistence). To accomplish this objective, the Council 
and NMFS found a need to stabilize growth in the charter halibut 
sector.
    Further, the guidelines to National Standard 4 acknowledge that 
inherent in an allocation is the advantaging of one group to the 
detriment of another. The motive for taking a particular allocation 
should be justified in terms of fishery management objectives; 
otherwise, the disadvantaged user groups or individuals will suffer 
without cause (50 CFR 600.325(c)(3)(i)(A)). The fishery management 
objective of this action has been articulated by the Council and NMFS, 
starting with the 1995 problem statement by the Council and continuing 
through this final rule (cf., history of charter vessel fishery 
management concerns and limited access development published on 
February 8, 2006 [71 FR 6442], and April 29, 2009 [74 FR 18178]). These 
statements demonstrate that the Council was concerned about 
overcrowding of productive halibut grounds due to the growth of the 
charter vessel sector and that expansion of this sector may affect 
``the Council's ability to maintain the stability, economic viability, 
and diversity of the halibut industry, the quality of the recreational 
experience, the access of subsistence users, and the socioeconomic 
well-being of the coastal communities dependent on the halibut 
resource.''
    Finally, the guidelines to National Standard 4 state that an 
allocation may impose a hardship on one group if it is outweighed by 
the total benefits received by another group or groups. ``An allocation 
need not preserve the status quo in the fishery to qualify as `fair and 
equitable,' if a restructuring of fishing privileges would maximize 
overall benefits'' (50 CFR 600.325(c)(3)(i)(B)). In this action, the 
Council and NMFS found that the total benefits to the charter halibut 
fishery will be increased relative to the status quo. The hardship of 
not qualifying for an initial allocation of a charter halibut permit 
will be borne by those who entered the charter halibut fishery after 
2005 despite the Council's control date notice that such persons would 
not be assured of future access to this fishery if a limited access 
system is implemented (71 FR 6442, February 8, 2006). Overall benefits 
of this rule, however, will accrue to those businesses in the charter 
halibut fishery that were established and participating during the 
qualifying and recent participation years.
    Promotes conservation. Although biological conservation of the 
halibut resource is not the principal purpose of this rule, it will 
promote conservation by fostering a more easily managed charter halibut 
fishery. When any fishery resource is fully subscribed among the 
various fishery sectors using it, the uncontrolled growth in one sector 
will disadvantage the other sectors. The Analysis (see ADDRESSES) 
indicates that the charter sector is the second largest (after the 
commercial fishery) of all the sectors using the halibut resource in 
the two IPHC regulatory areas to which this rule applies. Whereas 
growth of the commercial fishery sector is constrained by the IFQ 
program and catch limits stipulated by the IPHC, growth in the non-
commercial sectors is not similarly constrained. This presents no 
fishery management problem provided that all

[[Page 563]]

of the non-commercial sectors exhibit relatively static growth over 
time such that year-to-year assumptions about their harvest prove to be 
correct. The charter halibut fishery has grown in recent years, 
however, depending on the demand for halibut by charter vessel anglers. 
Although this rule is not designed primarily to limit the harvest by 
the charter halibut fisheries, it will make existing and future harvest 
restrictions more effective because conservation gains from individual 
harvest restrictions will not be eroded by unlimited growth in the 
fleet of charter vessels fishing for halibut. In this manner, this rule 
will contribute to the achievement of the overall target harvest rate 
of halibut established by the IPHC.
    Avoids excessive share. An excessive share of halibut fishing 
privilege is not defined in either the Halibut Act or in the National 
Standard 4 guidelines. The latter states simply that an allocation must 
deter any entity from acquiring an excessive share of fishing 
privileges, and avoid creating conditions that foster inordinate 
control by buyers and sellers (50 CFR 600.325(c)(3)(iii)).
    This rule sets an excessive share standard of five charter halibut 
permits. Existing businesses that initially qualify for more than five 
permits will be able to continue business at levels above this 
excessive share standard; however, they will be prevented from 
acquiring more permits than their initial allocation. Transfers of a 
permit or permits that will result in the person, business, or other 
entity receiving the permit(s) holding more than five permits will not 
be approved by NMFS with limited exception.
    Some consolidation of charter halibut permits may occur under this 
rule, but will be limited by the five-permit excessive share standard. 
Further, the number of businesses that are allowed an initial 
allocation of permits in excess of this standard will not increase. A 
10 percent ownership criterion will apply to prevent a corporation from 
exceeding the excessive share standard by owning or controlling 
subsidiary businesses each holding the maximum number of permits. The 
10 percent ownership criterion is the same as that used for 
implementing the American Fisheries Act and defined at 50 CFR 679.2. 
Under this definition, two entities are considered the same entity if 
one owns or controls 10 percent or more of the other. Hence, an 
excessive share of privileges to operate charter vessels fishing for 
halibut is prevented and the dominance of any businesses in the charter 
halibut fishery will not be allowed to increase any more than it is at 
the time of initial allocation of permits.

Comments and Responses

    This action was published as a proposed rule on April 21, 2009 (74 
FR 18178), and public comments on it were solicited until June 5, 2009. 
NMFS received 166 comment submissions containing 157 unique comments. 
These comments were reviewed, organized into seven topical categories, 
and responded to as follows:

Fairness and Legal Authority

    Comment 1: The proposed rule does not meet the National Standards 
for Fishery Conservation and Management as defined in the Magnuson-
Stevens Act (16 U.S.C. 1851(a)(4)).
    Response: This action is authorized by the Halibut Act at section 
773c, not the Magnuson-Stevens Act. Section 773c(c) of the Halibut Act 
provides the requirements that must be met by the Council and the 
Secretary when developing and implementing regulations for halibut. The 
Secretary has found this rule to be consistent with this requirement of 
the Halibut Act as explained above under the heading ``Consistency with 
Halibut Act.''
    Comment 2: The Halibut Act of 1982, (at section 773c(c)) states 
that rules shall be fair and equitable and they shall not discriminate 
among participants.
    Response: The Halibut Act at the section cited actually prohibits 
discrimination between residents of different States. This rule does 
not discriminate between residents of different States as the criteria 
for an initial allocation of charter halibut permits applies to all 
applicants regardless of the State in which they reside. This action 
complies with the requirements of the Halibut Act, as discussed in the 
``Consistency with Halibut Act'' section above.
    Comment 3: Several comments stated that the proposed rule is not 
fair and equitable because it requires applicants to demonstrate 
participation in the halibut charter fisheries in 2004 or 2005 
(historical participation period). The comments note that the 
historical participation requirement illegally discriminates against 
businesses that are currently in operation because:
     The proposed rule would impose ex post facto regulations, 
contrary to the Constitution of the United States;
     The Magnuson-Stevens Act at 16 U.S.C. 1853(b)(6) states 
that when implementing a limited entry program, present participation 
and historical practices must be considered. It does not say anything 
about historical participation on which NMFS is basing this rule;
     While obtaining all relevant licenses and permits to 
operate a charter business, there was no notification by the licensing 
agencies that rules were being made that would retroactively disallow 
charter operators from continuing to operate their businesses;
     Many small business owners will not have the right to 
appeal under the unavoidable circumstances provision as the proposed 
rule states that an applicant must demonstrate that it had a specific 
intent to participate in the qualifying period; and
     The proposed rule clearly shows the Council's intention to 
act favorably towards the charter vessels that operated during 2004 and 
2005 by excluding charter businesses that started operating between 
2006 and 2009.
    Response: This rule is not illegal or contrary to the U.S. 
Constitution. An ex post facto law is a law passed after the occurrence 
of an event or action which retrospectively changes the legal 
consequences of the event or action. That is not the case with this 
rule. This rule does not make charter halibut fishing that was legally 
performed after 2005 and before the effective date of this rule 
illegal, but instead establishes specific eligibility criteria for 
receiving a harvest privilege. Hence, this rule does not change the 
legal consequences of past participation in the charter halibut 
fishery. Persons who entered the fishery after 2005, however, had 
constructive notice, published February 8, 2006 (71 FR 6442), that they 
were not assured of future access to the charter halibut fishery if a 
management regime, such as the one implemented by this rule, were 
implemented.
    The Council and the Secretary considered historical practices in 
the charter halibut fisheries in Areas 2C and 3A by looking at the 
number of charter vessel businesses and vessels participating in these 
fisheries, the range in the number of logbook fishing trips made, and 
the number and distribution of communities in which these fishing trips 
terminated in 2004 and 2005. These factors are reasonable measures of 
dependence on the charter halibut fisheries. See also the discussion of 
historical fishing practices above under the heading ``Consistency with 
Halibut Act.''
    Prior to this rule, NMFS has not implemented any licensing 
requirements for operators of vessels with one or more charter anglers 
onboard. However, the Council has a long history of developing 
management measures for the charter halibut fishery, as described in 
the preamble to the

[[Page 564]]

proposed rule (74 FR 18178, April 21, 2009), and the control date 
notice published February 8, 2006 (71 FR 6442). Persons entering the 
charter halibut fishery for the first time after 2005 were on notice 
that their future access to that fishery was not assured.
    Regarding an appeal, all charter halibut permit applicants have a 
right to an appeal under Sec.  300.67(h)(6) of this rule. However, if a 
charter vessel business was not started until 2006 or later and cannot 
demonstrate that it intended to participate in prior years, it will not 
be able to meet the criteria for the unavoidable circumstance 
exception. See the response to Comment 109 for a discussion of the 
unavoidable circumstances exception to the charter halibut permit 
qualification requirements.
    The Council selected 2004 and 2005 as the qualifying years because 
those were the most recent years for which the Council had information 
on participation in the charter halibut fishery when it acted in early 
2007. The Council did not select a larger number of qualifying years 
because the normal entry and exit from the charter halibut fishery from 
year to year could result in more charter halibut permits than vessels 
participating in any one year with a qualifying period of too many 
years. The choice of combining minimum participation during a 
qualifying year and the recent participation year further serves the 
purpose of limiting charter halibut permits to those businesses that 
have demonstrated a long-term commitment to the charter halibut fishery 
and gives consideration to present participation and historical 
dependence, factors that must be considered pursuant to the Halibut 
Act.
    Before developing eligibility criteria for the charter halibut 
limited access system, the Council announced a control date of December 
9, 2005, to provide notice to any person contemplating entry into the 
charter halibut fishery after that date. A control date notice 
published in the Federal Register on February 8, 2006 (71 FR 6442), 
further indicated that future access to the charter halibut fishery was 
not necessarily assured to persons entering the fishery for the first 
time after that date.
    Comment 4: One commenter proposed changes to the moratorium to make 
it fair, equitable, and non-discriminatory. These changes included 
revising the charter halibut permit qualification criteria to require 
participation only in more recent years and making all charter halibut 
permits transferable to allow established businesses to grow by 
purchasing permits.
    Response: Although alternative programs might be found to be fair 
and equitable and non-discriminatory, as required by the Halibut Act, 
this rule was developed by the Council to meet its stated objectives. 
The Council intended to recognize historical and recent participation 
by granting permits to charter businesses that demonstrate consistent 
participation in and dependence on the charter halibut fisheries. The 
Council also recommended a higher participation requirement for 
transferable permits than for non-transferable permits to balance its 
objective to reduce fishing effort and its objective to minimize 
disruption to the charter fishing industry. The Council's recommended 
qualifying criteria for transferable charter halibut permits will allow 
businesses to grow by purchasing additional permits up to the excessive 
share limit of five charter halibut permits, which is consistent with 
the commenter's suggestion. NMFS finds that this rule meets the 
requirements of the Halibut Act (see discussion above under the heading 
``Consistency with Halibut Act'').
    Comment 5: The Council does not have the authority to ban charter 
businesses that began operating between 2006 and 2009 from operating a 
guided halibut fishing business, or to include rules that merely 
allocate the harvest level among users rather than reduce the harvest 
level as required by agency goals.
    Response: The Halibut Act, at section 773c(c), provides authority 
to the Council and the Secretary to ``develop regulations governing the 
United States portion of Convention waters, including limited access 
regulations, applicable to nationals or vessels of the United States or 
both'' The Halibut Act, at 16 U.S.C. 773c(a) and (b), also provides the 
Secretary with general responsibility to carry out the Convention, the 
Halibut Act, and to adopt such regulations as may be necessary. In 
reviewing this rule, the Secretary has found that the Council's 
recommendation for this limited access system is consistent with the 
Halibut Act (see the discussion above under the heading ``Consistency 
with Halibut Act'').
    Fishery management generally, and management of the halibut 
fisheries in particular, is not necessarily limited to the direct 
control of harvests. Allocation of fishing privileges also is 
specifically authorized by the Halibut Act if the regulations that 
allocate fishing privileges meet certain criteria. See the 
``Consistency with Halibut Act'' section above for further discussion 
of how this rule is consistent with all Halibut Act requirements.
    Comment 6: A limited access program on charter vessels is not a 
conservation measure to protect the halibut but an attempt to limit 
individuals from the resource. Since halibut is a resource that belongs 
to all citizens, it is only reasonable that they should have the first 
opportunity to harvest what is rightfully theirs. Charter operators 
afford citizens a reasonable opportunity to catch fish. The people 
should have the first opportunity to gather, and the remains of the 
annual surplus can then be opened to commercial harvesting. Citizens 
should not be limited from harvesting their resource until there is a 
conservation concern.
    Response: This rule is reasonably calculated to promote 
conservation as described above under the heading ``Consistency with 
Halibut Act.'' NMFS agrees that halibut are a public resource; however, 
the limited access system established by this rule does not limit 
individual anglers from opportunities to access the halibut resource. 
This rule limits the number of charter vessels in the guided sport 
fishery for halibut in only two of the 10 IPHC regulatory areas. The 
Analysis prepared for this action (see ADDRESSES) estimates that 
charter vessel capacity will be sufficient to meet the demand for the 
number of anglers who took guided charter vessel trips in 2008 in Areas 
2C and 3A (see also response to Comments 21 and 43).
    Although charter vessels provide an important means of access to 
the halibut resource, they are not the only way that the public can 
access the resource. The commercial fishery provides access to halibut 
to those who prefer to purchase it in grocery stores or restaurants. 
The subsistence fishery provides access to the halibut resource by 
those who qualify to conduct subsistence halibut fishing. Non-guided 
recreational fishing also is a source of public access to the halibut 
resource. This rule does not constrain or limit any of these other 
means of public access to the halibut resource. In fact, the catch 
limits specified annually for the commercial halibut fishery by the 
IPHC for areas in and off of Alaska are set after estimated harvests by 
all other non-commercial removals are subtracted from the constant 
exploitation yield (see discussion under ``Management of the Halibut 
Fisheries'' in the preamble to the proposed rule (74 FR 18178, April 
21, 2009).
    Comment 7: Commenter urged you to pass the proposed rule for the 
guided halibut fishery. All businesses need stable, predictable 
regulation to plan

[[Page 565]]

and prosper. To foster socioeconomic stability in our coastal 
communities and for the benefit of all Americans and the resource, I 
urge you to proceed forward now with implementation of a long-term, 
market-based solution that will put commercial setline and charter 
sectors on the same playing field with equitable rules.
    Response: NMFS agrees that this action establishing a limited 
access system for the charter halibut fisheries in Areas 2C and 3A will 
contribute to stabilizing these charter halibut fisheries and 
communities with charter vessel activity. NMFS supports long-term 
market based solutions to allocation problems, such as this program.
    Comment 8: The Council should develop an FMP for halibut and NMFS 
should explain the legal basis behind the absence of an FMP for 
halibut. An FMP would assist the Council in recognizing the differences 
among user groups and treating all user groups equally.
    Response: The legal basis for not having an FMP for Pacific halibut 
fisheries is that Pacific halibut fisheries are managed under the 
Halibut Act and the Halibut Act does not require the Council to develop 
an FMP. The comment correctly points out that section 773c(c) of the 
Halibut Act also provides authority to develop regulations to the 
regional fishery management councils, but that this is limited to 
regulations ``which are in addition to and not in conflict with 
regulations adopted by the [IPHC].'' Hence, the Halibut Act speaks only 
to the development of regulations, and not to the development of an 
FMP. NMFS agrees that the Halibut Act's reference to the limited entry 
criteria at 16 U.S.C. 1853(b)(6) applies to all halibut fishery 
regulations developed by the Council and approved by the Secretary 
under authority of the Halibut Act. These criteria are essential when 
contemplating any regulatory scheme that would allocate a fishery 
resource among competing users. However, an FMP is not required to make 
these criteria effective in the regulatory process.
    An FMP is not needed to recognize differences among user groups and 
to treat all those groups fairly and equitably. Regardless of an FMP, 
halibut fishery regulations must have a rational basis for their 
effects. In developing this rule, the Council and the Secretary 
provided a rational basis which in part is summarized as follows.
    First, this rule recognizes that, although there are communities 
with highly developed charter halibut fisheries, there are also 
communities with unrealized development potential and has provided for 
special community charter halibut permits. These special permits are 
intended for start-up charter vessel operations in communities that do 
not have highly developed charter fisheries and do not have the same 
participation criteria as transferable and non-transferable charter 
halibut permits. Hence, this rule recognizes variations in charter 
halibut fishing effort among communities and provides for communities 
with potential for charter industry growth.
    Second, this rule focuses on the guided charter halibut fisheries 
in Areas 2C and 3A instead of the non-guided sport fisheries in these 
areas because the harvests of the former have been persistently greater 
and growing over time relative to the latter. However, recreational 
anglers remain free to choose between guided and unguided sport 
fishing. See also the response to Comments 6, 21, and 43.
    Comment 9: Several comments noted that a limited entry program 
being promulgated under the Halibut Act must meet the section 303(b)(6) 
standards of the Magnuson-Stevens Act. To ensure that the standards are 
met, the comments recommended that NMFS explicitly address each 
standard and explain how each standard is met in the final rule.
    Response: NMFS agrees and addresses each standard as part of the 
discussion above under the heading ``Consistency with Halibut Act.''
    Comment 10: There is a commercial bias in the IPHC and the Council. 
The IPHC and Council have supported the commercial sector to the 
detriment of the charter fleet. This creates concerns about the 
impartiality of the Council and raises questions as to whether the 
Council is making decisions solely to benefit the commercial sector. 
The commercial sector has so many representatives on the Council that 
it is impossible for guided charter operators to get the Council to 
acknowledge their suggestions, comments, or proposals to work with the 
commercial sector. Only the commercial sector is in favor of the 
moratorium for the guided charter sector.
    Response: This action is being taken by NMFS based on a 
recommendation by the Council. Actions by the IPHC are evaluated and 
approved under a different process. The process for selecting Council 
members is set in statute and employs mechanisms to assure 
representation of the various States represented on the Council and 
fair and balanced apportionment to the extent practicable. The Council 
makes decisions through a public process, and in a manner that is 
consistent with the requirements of the relevant statutes. The Council 
has the authority to develop regulations to address allocation issues 
among different domestic sector users of halibut in and off the waters 
of Alaska, including the commercial and guided sport fisheries.
    This final rule does not unfairly favor the commercial sector. In 
December 2005 the Council appointed a Charter Halibut Stakeholder 
Committee to address alternatives for long-term management of the 
charter halibut fishery. The committee had representation from the 
sport guided, unguided, and commercial sectors. The Council recommended 
a charter halibut permit program that was based, in large part, on 
recommendations from the Charter Halibut Stakeholder Committee. 
Additionally, the draft EA/RIR/IRFA prepared for the charter halibut 
moratorium (see ADDRESSES was available for public review throughout 
program development and Council meetings are open to the public. The 
Council received oral and written testimony on the charter halibut 
moratorium. Some of the testimony in support of the charter halibut 
moratorium came from charter operators. Furthermore, NMFS reviewed the 
Council's recommendations for consistency with the Halibut Act, the 
Convention, and other applicable law and found the current program to 
be consistent with those requirements.
    Comment 11: An IFQ or quota for halibut charter fishing is not an 
appropriate management solution.
    Response: This rule does not implement an IFQ program for halibut 
charter fishing nor does it establish a quota allocation for the guided 
charter vessel sector or individual charter operators. This action 
establishes a limited access system that limits the number of persons 
engaged in the charter halibut fishery in Area 2C and Area 3A.
    Comment 12: The allocation of halibut between the commercial and 
charter sectors is not fair and equitable. The percentage allocation of 
the halibut guideline harvest level (GHL) to the recreational fisherman 
in Alaska is grossly unfair. If this percentage were increased there 
would not be a need for a limited charter fleet.
    Response: Adjustments to the GHL are outside the scope of this 
action. See the response to Comments 34 and 35. This rule is fair and 
equitable as required by the Halibut Act (see discussion above under 
heading ``Consistency with Halibut Act''). Also, harvest amounts by all 
sectors do not have to be equal for

[[Page 566]]

regulations to meet the fair and equitable standard.
    Comment 13: NMFS should limit commercial halibut catch instead of 
limiting the number of charter operators. According to the Council's 
problem statement, ``overcrowding of productive halibut grounds [is] 
due to the growth of the charter vessel sector.'' However, a majority 
of the productive halibut grounds in Areas 2C and 3A are currently open 
to commercial halibut harvesting. A 15 percent reduction in the 
commercial catch limit within 12 miles of shore could relieve the 
Council's concerns with overharvest. Instead of focusing on limiting 
the sport/charter industry, get the commercial boats that set miles of 
gear offshore where they belong and restrict the large IFQ longliners 
from fishing near coastal Alaska communities so they don't deplete 
near-shore halibut stocks that subsistence and sport users depend on.
    Response: This rule is intended to curtail growth of fishing 
capacity in the guided sport fishery for halibut, which is consistent 
with the Council's problem statement. Limited access systems are 
commonly used to limit the capacity of fishing fleets that are in need 
of management to meet conservation and socioeconomic objectives as 
determined by the Council.
    Further restrictions on the commercial halibut fishery are outside 
the scope of this action. The problem statement referenced in the 
comment refers to a problem statement adopted by the Council that 
guided its decision making during the 1995 through 2000 period. The 
statement was provided in the proposed rule for this action to 
demonstrate that the Council has discussed and considered the expansion 
of the guided sport charter vessel fishery for halibut since 1995. The 
problem statement adopted by the Council that led to this action can be 
found in the executive summary of the Analysis (ADDRESSES) and speaks 
to stabilizing the growth in the charter sector and addressing 
allocation issues; it does not mention overcrowding of productive 
halibut grounds.
    Comment 14: Several comments noted that this action is an 
allocation, and the Halibut Act requires that allocations of fishing 
privileges must be fair and equitable. The comments assert that the 
proposed rule would limit the number of halibut charter operators in 
order to benefit the commercial sector by reducing the amount of 
halibut taken by the charter sector. This is in direct conflict with 
the fair and equitable standard applicable to the allocation of fishing 
privileges.
    Response: NMFS agrees that this rule has an allocation effect which 
the Council and the Secretary see as necessary and which is authorized 
by the Halibut Act at section 773c(c). According to the proposed rule 
(at 74 FR 18178, April, 21, 2009), the intended effect of this rule is 
to ``curtail growth of fishing capacity in the guided sport fishery for 
halibut.'' NMFS does not expect growth curtailment to result in harvest 
curtailment, at least in the short term. Any reduction in the harvest 
by the charter halibut sector during the short term more likely will 
result from direct harvest controls, such as the daily bag limit 
reduction for charter vessel anglers in Area 2C this year (74 FR 21194, 
May 6, 2009). Hence, increasing the halibut harvest by the commercial 
setline fishery is not the intent or expected outcome of this rule.
    The Council's Charter Halibut Stakeholder Committee developed most 
elements of the charter vessel moratorium program and recommended it to 
Council. These elements were designed to respond to the Council's 
problem statement. The Council developed the program further after 
hearing public testimony on the subject. The Council subsequently 
recommended it to the Secretary under its Halibut Act authority to do 
so.
    Comment 15: Charter boats should be limited in Southeast Alaska. 
Too many vessels and operations are not owned by Alaskans and these 
operations grew quickly while fishing opportunities were available. 
This is particularly true for operations with six to 30 vessels (large 
operations) rather than small operations with one to three vessels. The 
large operations have no regard for the resource and hire help from 
down south and pay low wages. As most of their captains are from down 
south as well, and I question whether they are qualified to be guiding 
in a very unforgiving environment. Why are we rewarding this behavior 
by giving them ``forever'' rights and exclusivity to the fishery?
    Response: Sport fishing lodge operations with a large number of 
charter vessels are as legitimately in business as are operations with 
a small number of charter vessels. Both types of charter vessel 
operations provide a recreational service. The growth in operations 
referred to by the comment may have been associated with growth in 
tourism and cruise ship visits to Southeast Alaska; however, NMFS does 
not have information that identifies the specific reasons for growth in 
charter vessel operations.
    The assertion that many charter vessel operations are not owned by 
Alaskans or that some operations hire non-Alaska residents is not 
relevant to this final rule. The Halibut Act prohibits the Secretary 
from approving halibut regulations that discriminate between residents 
of different States. This rule applies to all applicants for charter 
halibut permits and permit holders, regardless of their place of 
residence. Wages paid to the staff of charter vessel operations and the 
required qualifications for operators of vessels with one or more 
charter anglers onboard are outside the scope of this action.
    Finally, this rule does not create permanent exclusive rights to 
operate in the charter halibut fishery. A permit is a privilege that 
can be revoked if the permit holder violates specified conditions of 
the law. In addition, holders of transferable charter halibut permits 
are expected to transfer some permits to new entrants to the charter 
halibut fisheries. NMFS expects that over time, transferable permits 
will migrate to those operators and areas where they will be most 
efficiently used. Non-transferable permits may be used by the business 
owner(s) to whom they are initially issued but may not be transferred 
to another business or operator. These permits will expire when an 
individual permit holder dies. If the permit holder is a non-individual 
entity, non-transferable permits issued to the business will expire 
when the business changes as defined in regulation at Sec.  
679.42(j)(4)(i).
    Comment 16: The proposed halibut charter moratorium is unfair to 
the charter boat captains and to the clients that spend money to come 
to Alaska and fish. The prices of charters have gone up significantly 
in the past two years because of high fuel prices. Now the government 
will collect money for the proposed halibut charter moratorium permit. 
I am a small operator trying to make a living taking people out 
fishing. The limited entry permit for halibut charter operators is just 
another way for the government to collect money.
    Response: This rule does not establish any fee on halibut charter 
businesses or operators to participate in the charter halibut 
moratorium program. Under this action applicants for a charter halibut 
permit are not required to submit a fee with their application nor will 
a fee be charged to issue or transfer a charter halibut permit. If such 
fees are charged in the future, they will be established by a separate 
regulatory action.
    This rule, however, does not affect the requirements for permits or 
other certifications by other State or Federal agencies that charter 
halibut businesses must obtain to operate in Areas 2C or

[[Page 567]]

3A and for which fees may be charged. NMFS does not have information to 
estimate the number of charter business owners that may purchase 
charter halibut permits, a private transaction. Also, NMFS does not 
have information to estimate the cost of such transactions, or the 
effect of those costs on the prices the charter operators will charge 
for their services (see also Section 2.8 of the Analysis at ADDRESSES).
    Comment 17: The moratorium is legally vulnerable.
    Response: As indicated above, NMFS finds this rule to be consistent 
with applicable law (see discussion above under the heading 
``Consistency with Halibut Act''). This rule was developed through a 
public process used by the Council and NMFS to formulate and implement 
fishery management policy. In doing so, the Council and NMFS heard from 
members of the public, including representatives of the charter vessel 
sector. Some members of the public were in favor of this action, others 
were not. NMFS respectfully understands that some charter business 
owners are opposed to this rule.
    Comment 18: The Analysis states on page 153, paragraph 2 that 
``[t]he moratorium is not expected to limit the number of halibut 
charter trips in the near future.'' Wasn't the ``growing number of 
charter fleets'' the main reason this moratorium was being pushed by 
the Council and NOAA?
    Response: As stated in the Analysis (see ADDRESSES), NMFS does not 
expect the limited access system established by this rule, by itself, 
to limit the growth in charter halibut trips, charter halibut harvest, 
or charter vessel anglers over the short term. Instead, this rule is 
expected to stabilize the charter halibut sector by curtailing the 
growth in numbers of charter vessels in Areas 2C and 3A and thereby 
improve the effectiveness of other management measures, now and in the 
future, to control the rate of halibut harvest.
    Comment 19: The Environmental Assessment/Regulatory Impact Review/
Initial Regulatory Flexibility Analysis (EA/RIR/IRFA) states on page 
58,

    ``It is possible that commercial IFQ halibut fishermen could 
also benefit, if the constraint slows the growth in charter catches 
in the future. However, given the excess capacity that is likely to 
exist in the fleet after implementation of the moratorium, this 
outcome is unlikely, all else equal.''

    If the Council is attempting to limit the fleets then how could 
this scenario be unlikely? If the Council is attempting to limit the 
fleets then why do they anticipate excess capacity in charter fleets 
after the implementation of the proposed rule? If this proposed rule is 
not expected to constrain harvests, why is it being proposed?
    Response: It is not possible to determine the optimal amount of 
capacity in the charter vessel sector with available data. The intended 
effect of this action is to curtail growth in capacity. Although 
limited entry on the number of vessels is a commonly used fishery 
management tool to limit capacity growth, it is an imprecise tool 
because individual operators can increase capacity to increase effort 
over historical levels. For example, charter vessels operating under 
this rule may increase the number of fishing trips they make, increase 
the average number of anglers they carry, or improve their ability to 
find halibut. All of these outcomes and others are possible under this 
limited access system, in which case the actual harvest of halibut by 
the charter vessel sector may actually increase over current levels.
    Limited entry provides a basis for the development of a long-term 
comprehensive effort limitation program for the charter halibut 
fishery, if it is determined that such a program is needed in the 
future. The RIR (at page 46) prepared for this action determined that 
limited entry could serve to better stabilize fishing effort than the 
status quo, because only permitted vessels would be capable of 
increased effort. Further, a reduction in fishing capacity will occur 
as non-transferable permits are eliminated as their holders leave the 
fishery.
    Comment 20: The Federal Government has a duty to not discriminate. 
The summary of costs and benefits table in the EA/RIR/IRFA presents the 
reasons why the Council chose Alternative 2. However, this table is 
extremely biased. For example, in columns 3 and 4, the table states, 
``Limiting the number of vessels that may operate would help limit 
competition. * * *'' Why limit competition, especially if that may lead 
to business failure for some operations?
    Response: NMFS has a duty to not discriminate based on 
constitutional and statutory rights. The response to Comment 2 
describes why this action is not discrimination against charter 
operators that do not receive a charter halibut permit on initial 
allocation.
    The quote from Table 42 on page 156 of the EA/RIR/IRFA (see 
ADDRESSES) presented in the comment is incomplete. The complete 
sentence reads, ``Limiting the number of vessels that may operate would 
help limit competition from new entrants in the fishery, but 
competition from existing permit holders is expected to keep businesses 
from earning above normal profits.'' The statement makes clear that 
although the charter halibut permit program will reduce competition 
from new entrants, the program is not expected to prevent competition 
within the charter halibut sector. As discussed in the response to 
Comments 21 and 43, NMFS anticipates that permit holders will have 
sufficient opportunities to ensure that capacity meets demand for 
halibut charters in Areas 2C and 3A.
    Comment 21: The rule unfairly restricts guided access to the 
resource while not considering unguided access. The Halibut Act 
requires that ``if it becomes necessary to allocate or assign halibut 
fishing privileges among various U.S. fishermen, such allocation shall 
be fair and equitable to all such fishermen.'' Many anglers require 
guided services for financial, health, safety, or other practical 
reasons. This restriction violates the ``fair and equitable'' 
provisions of the Halibut Act because guided recreational anglers are 
being restricted while there is no such limitation proposed for 
unguided recreational anglers.
    Response: This rule is consistent with the fair and equitable 
requirement of the Halibut Act (see discussion above under the heading 
``Consistency with Halibut Act''). The fair and equitable requirement 
of the Halibut Act does not require that different sectors of the 
halibut fisheries be managed using the same tools or restrictions. In 
Areas 2C and 3A, the charter halibut fishery is the second largest, in 
terms of volume of halibut, after the commercial setline fishery. The 
non-guided sport fishery has the third largest harvest in both areas. 
Of these three harvesting sectors, the charter halibut fishery has 
demonstrated growth in participation over time while the commercial and 
non-guided recreational sectors have declined or remained relatively 
steady. This information was in the Analysis (see ADDRESSES) considered 
by the Council and the Secretary when taking this action.
    This rule will not unreasonably restrict guided angler access to 
the halibut resource. NMFS estimates that 502 charter halibut permits 
will be issued to charter businesses operating in Area 2C, of which 347 
(or 69.1 percent) will be transferable, and 418 charter halibut permits 
will be issued to charter businesses operating in Area 3A, of which 319 
(or 76.3 percent) will be transferable. In Area 2C, the estimated total 
(for transferable and non-transferable permits combined) angler 
endorsements on all charter halibut permits is 3,028 of which 2,152 
will be associated with transferable permits. In Area 3A, the estimated 
total angler

[[Page 568]]

endorsement on all charter halibut permits is 3,577 of which 2,834 will 
be associated with transferable permits.
    Available data indicate that charter vessels in the guided sport 
fishery for halibut in 2008 averaged 36 trips per season in Area 2C and 
38 trips per season in Area 3A. Using all endorsements prior to the 
expiration of non-transferable permits, charter vessels under this rule 
would have to average 52 trips in Area 2C and 56 trips in Area 3A to 
supply the aggregate number of fishing trips supplied in 2008. This 
estimate does not include the potential supply from the community 
charter halibut permits and endorsements associated with the CQE 
program. In Area 2C, a potential total of 72 permits and 432 angler 
endorsements may be added, and in Area 3A, a potential total of 98 
permits and 588 angler endorsements may be added under the CQE program. 
These figures indicate that the charter halibut industry will be able 
to meet recent charter vessel angler demand levels with the number of 
permits expected to be issued under this rule. Hence, no restriction in 
guided angler access to the halibut resource is expected under this 
rule.
    Comment 22: Two of my charter vessel captains will come up a year 
short of the 2004-2005 qualification period. I truly feel my history in 
this business is long enough to warrant receiving a moratorium permit.
    Response: The limited access system established by this rule 
allocates charter halibut permits to the person that meets the 
eligibility requirements during the qualifying and recent participation 
years. If a sport fishing business meets the eligibility requirements, 
then it likely would receive one or more charter halibut permits and 
could continue to hire charter vessel captains as it has in the past. 
Hence, charter vessel captains who do not meet these requirements would 
not be eligible for an initial allocation of a charter halibut permit 
although the businesses that they worked for may be eligible for a 
permit(s). Nevertheless, persons not eligible for an initial allocation 
of a charter halibut permit(s), may be eligible to receive a transfer 
of a charter halibut permit from a person with a transferable permit.

Conservation

    Comment 23: The Alaska charter fleet has become overcapitalized in 
the last decade and is rapidly expanding. The fleet should not be 
allowed to grow and negatively impact current users and endanger the 
sustainability of the fishery by exceeding the GHL. Charter operators 
must become a part of the conservation effort and regulations limiting 
access are long overdue. NMFS should limit the number of participants 
in the commercial sport halibut industry and reduce the number of fish 
they catch. Too many charter businesses are competing for too few 
customers, which results in overcrowding, a lower quality Alaskan 
experience for travelers, and increased pressure on local halibut 
populations.
    Response: This rule limits the number of charter vessels that may 
participate in the charter halibut fishery and the number of charter 
vessel anglers that may catch and retain halibut on charter vessels. 
This rule is not intended, by itself, to reduce the charter harvest of 
halibut or the number of fish each angler may catch and retain.
    The IPHC takes into account halibut removals by all user groups in 
establishing the constant exploitation yield (CEY). Past increases in 
charter halibut harvests have created conservation and allocation 
concerns that the Council and NMFS have taken steps to address, but the 
halibut resource in Area 2C and 3A is being managed in a sustainable 
manner. NMFS does not have information to verify or refute the claims 
that charter businesses are competing for too few customers, that 
halibut fishing grounds are overcrowded, or that charter vessel anglers 
are experiencing low quality charter fishing trips. Finally, NMFS does 
not have scientific information to discern local depletion or attribute 
it to any particular user group.
    Comment 24: Near-shore depletion of halibut and gear conflicts have 
increased since the implementation of the IFQ program for commercial 
setline fishermen. Before the IFQ program, large commercial vessels 
fished farther from shore than they do today. Now, under the IFQ 
program, commercial fishermen do not have to go as far offshore to fish 
for halibut and there is always some form of gear in our near shore 
areas off Sitka. Protection of halibut would be improved with short 
specified open seasons for commercial halibut fishing. Charter fishing 
is not the problem.
    Response: Further restrictions on the commercial fishery would not 
achieve the objective of this action and are outside the scope of this 
rule. NMFS does not have sufficient scientific information to discern 
localized depletion of halibut or, if it exists, to attribute it to a 
particular user group in Area 2C or 3A.
    Comment 25: This rule has nothing to do with conservation or 
management of the resource and concerns allocation only. Page 18191 of 
the proposed rule states that, ``the NMFS Assistant Administrator has 
determined that this proposed rule is necessary for the conservation 
and management of the halibut fishery.'' The rule places no direct 
restrictions on guided anglers or their overall harvest, only limits on 
the number of boats available to transport guided anglers to the 
fishing grounds. The Environmental Assessment states, ``[t]he proposed 
action addresses access to the Pacific Halibut resource. There are no 
expected impacts on the halibut subsistence, personal use, or unguided 
sport fisheries because these takes are not limited and are not 
affected by any allocation decisions in other sectors * * * [t]here are 
no significant impacts on the halibut stock expected from the proposed 
action.'' National Standard 5 states that ``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.'' How does this action 
meet National Standard 5?
    Response: The National Standards in the Magnuson-Stevens Act 
(section 301) do not apply directly to this rule because it is 
authorized under the Halibut Act. Two connections exist between the 
Halibut Act and the Magnuson-Stevens Act, however. First, the Halibut 
Act references section 303(b)(6) of the Magnuson-Stevens Act, and 
second, the Halibut Act uses virtually the same language as National 
Standard 4 (section 301(a)(4)) of the Magnuson-Stevens Act. The 
language at National Standard 4 is particularly relevant to this 
comment in that it requires conservation and management measures that 
allocate or assign fishing privileges (as this action does) to be 
``reasonably calculated to promote conservation'' among other things. 
The discussion above under the heading ``Consistency with Halibut Act'' 
describes how this rule meets this conservation standard. In brief, 
this action is intended to stabilize the charter vessel industry, which 
will enhance the effectiveness of existing and potential future harvest 
restrictions. This will assist the IPHC to meet its overall harvest 
rate targets.
    The EA finds that the action will not have significant 
environmental impacts. The purpose of the EA is to determine whether 
the action will have a significant impact on the human environment, and 
whether an environmental impact statement is necessary. The Analysis 
for this action evaluated the environmental impacts of the action and 
found that it would not have a significant environmental

[[Page 569]]

impact. This conclusion is not inconsistent with the statement that 
this action is generally necessary for conservation and management 
purposes.
    Comment 26: NMFS inaccurately implies that this is a conservation 
measure in the proposed rule. It simply is not. American sportsmen and 
women have one of the best records when it comes to conservation. 
Reducing recreational angler access will not increase conservation or 
reduce the total allowable catch. Those available fish will only be 
reallocated and harvested by other sectors, primarily the commercial 
sector.
    Response: As discussed above under the heading ``Consistency with 
Halibut Act,'' this action is reasonably calculated to promote 
conservation, as required by the Halibut Act. Although biological 
conservation is not its principal purpose, the effectiveness of other 
biological conservation measures will be enhanced over time by this 
action. Conservation and allocation management measures often are 
inextricably linked. Hence, although the intent of this action is not 
to directly reduce the halibut harvest by charter vessel anglers in 
Areas 2C and 3A in the short term, it will enhance conservation of the 
halibut resource in the long term. Also see the response to Comments 21 
and 43.
    Comment 27: The proposal for the charter limited entry program has 
been written to specifically list numbers relating to the charter GHL 
yet leaves out that the longliners receive a larger amount of the 
halibut quota than charter and private anglers. These numbers would 
show the imbalance between the charter fleet and the commercial fleet 
and highlight that limiting the charter fleet is not about 
conservation.
    Response: The IPHC is generally responsible for the conservation of 
the halibut resource. In Area 2C, the IPHC preliminary estimate of the 
halibut harvest in 2008 was that the commercial setline fishery 
harvested 59 percent of the total removals by all sectors (IPHC 2009 
Annual Meeting ``bluebook'' Table 1). The second largest harvest in 
Area 2C in 2008 was made by the sport fishery (guided charter and non-
guided combined) at 30 percent of the total halibut removals. Of that 
30 percent, over half is harvested by charter vessel anglers. Hence, in 
Area 2C, about 89 percent of the total halibut removals can be 
attributed to the combined commercial and sport sectors. By comparison, 
in Area 3A, the commercial setline fishery for halibut in 2008 was 
estimated to harvest 70 percent and the combined sport fishery was 
estimated to harvest 16 percent of the total halibut removals. These 
fisheries account for about 86 percent of the total halibut removals in 
Area 3A. Hence, the regulatory burden justifiably falls mostly on the 
commercial and sport (charter vessel) harvesting sectors. The 
commercial setline sector has been managed under a limited access 
system since 1995. Although it is less than the commercial setline 
fishery, the combined sport harvest (comprised predominately by the 
charter vessel sector) is not trivial in Areas 2C and 3A.
    Comment 28: There is no mention of the amount of wastage and 
incidental bycatch of halibut caused by the commercial fleet. The issue 
of bycatch in the commercial setline fishery is important also because 
the numbers of yelloweye rockfish and lingcod that are pulled off a 
single commercial set significantly exceed the numbers taken by charter 
or private anglers, who are only allowed two per person.
    Response: The comment raises several different bycatch issues. One 
is the bycatch of rockfish and lingcod in the commercial setline 
fishery directed at halibut. The commercial setline fishery is managed 
under the IFQ program. Regulations implementing this program generally 
prohibit the discard of rockfish and Pacific cod when IFQ halibut or 
IFQ sablefish are on board the vessel (Sec.  679.7(f)(8)). These 
regulations create an incentive for commercial setline fishermen to 
avoid areas of high rockfish bycatch. Although bycatch of lingcod is 
not addressed by the IFQ regulations, a similar incentive exists unless 
an IFQ fisherman has a market for lingcod. Ideally the bycatch of these 
species should be adequately controlled by economic incentives. 
However, this issue is beyond the scope of this rule.
    The second issue raised is waste of halibut in the commercial 
setline fishery for halibut. The preliminary estimate of wastage in 
2008 in Areas 2C and 3A amounts to about two percent and three percent, 
respectively, of the total halibut removals in each area. Wasted 
halibut have no value to the commercial halibut fishery, which already 
has a strong economic incentive to minimize this source of halibut 
mortality.
    The third issue concerns the incidental removals of halibut in 
commercial fisheries targeting other species. The bycatch of halibut in 
Area 2C fisheries for other species is estimated to account for only 
three percent of the total removals from that area, and in Area 3A, 
bycatch was estimated to account for about nine percent of the total 
removals from that area.
    Comment 29: Four comments support the charter halibut moratorium, 
but suggest that further restrictions are needed to limit charter 
angler harvest in Southeast Alaska to address localized depletion.
    Response: NMFS notes the support for the charter halibut permit 
program. NMFS does not have sufficient scientific information to 
discern localized depletion of halibut or, if it exists, to attribute 
it to a particular user group in Area 2C or 3A. This rule is not 
designed primarily to limit the harvest by the charter halibut 
fisheries, but it will make existing and future harvest restrictions 
more effective because harvest restrictions in other regulations will 
not be eroded by unlimited growth in the fleet of charter vessels 
fishing for halibut. In this manner, this rule will contribute to the 
achievement of the overall target harvest rate of halibut established 
by the IPHC.
    Comment 30: I support limited access as it will help limit over-
fishing in the charter sector. The proposed limited entry program 
provides part of the sustainable management equation. As the proposed 
rule indicates, the charter sector has exceeded its guideline harvest 
level in Area 2C for the past 5 years and in Area 3A for the past 3 
years. Charter overharvest is contributing to resource declines at both 
the local and the area-wide level, yet charter operators object that 
their businesses will be unsustainable if conservation measures are 
implemented. This downward spiral can only result in resource depletion 
unless both capacity and effort are curtailed.
    Response: This action is not intended to limit charter angler 
harvest to the GHL in Areas 2C and 3A. By stabilizing growth in the 
charter industry, however, this rule will enable other harvest control 
regulations to be more effective.
    Comment 31: Charter sport fishing is a very effective form of 
commercial fishing. The charter sector continues to overfish its quota 
every year, which is hurting the stocks and is unfair to all halibut 
fishermen. It is irresponsible resource management to allow this 
fishery to continue to grow while the commercial setline fishery is 
limited. Southeast Alaska commercial setline halibut fishermen have 
seen quotas cut in half the past four years. The annual excessive 
harvest by the charter sector reduces future harvests of both the 
commercial setline fishery and of local residents doing sport or 
subsistence fishing for halibut to feed their families. The charter 
fishermen should acknowledge their responsibility for conservation. If 
both the commercial

[[Page 570]]

and charter fleets do not work together, the future of halibut fishing 
in Southeast Alaska is in jeopardy.
    Response: NMFS agrees that cooperation among all fishermen and 
management agencies is essential to assure sustainable fisheries. The 
charter industry does not have a catch limit quota as does the 
commercial setline industry. Instead, the GHL serves as a benchmark for 
monitoring the charter vessel fishery's harvests of Pacific halibut in 
Areas 2C and 3A. By itself, the GHL does not limit harvests by charter 
vessel anglers.
    This rule is designed to limit the number of charter vessels that 
may participate in the charter halibut fishery. Although this rule is 
not designed primarily to limit the harvest of the charter halibut 
fisheries, it will make existing and future harvest restrictions more 
effective because conservation gains from individual harvest 
restrictions will not be eroded by unlimited growth in the fleet of 
charter vessels fishing for halibut.
    Comment 32: The charter halibut fishermen are fishing during the 
summer for the most part, a time when the large female halibut (males 
seldom reach a size over 30 pounds) are in shallow water. Instead of 
harvesting a cross-section of the biomass as the commercial fleet does, 
the charter halibut fleet targets the large females that are the future 
of this resource. This causes great concern for the health of halibut 
stocks. The biologists have noted the truncated age class structure and 
lack of large females in the Southeast Alaska halibut stocks.
    Response: This comment presumes that large halibut generally are 
females that contribute disproportionately to the reproductive 
potential of the stock, and that harvest of these females will 
substantially decrease future juvenile halibut abundance. To test this 
presumption in 1999, the IPHC reviewed options for a maximum size limit 
of 60 inches (150 cm) in the commercial setline fishery and concluded, 
based on the research at the time, that preservation of large halibut 
in the setline fishery did not add substantial production to the stock. 
Applying the limit to the sport fishery would have an even smaller 
benefit (if any) because the sport fishery harvest is smaller than 
commercial harvest. Suggestions for a maximum size limit in both 
fisheries, commercial and sport, could be considered again by the IPHC 
but are beyond the scope of this rule.
    Comment 33: Virtually every fishery in Alaska is sustainably 
managed under a State ``limited entry'' program. All are viable and 
allow for new entrants as others choose to leave the fishery. Long term 
stability in these fisheries has been achieved since the inception of 
this management plan by Alaska in the 1970s, and world-class fisheries 
have resulted from the ability of fishery managers to exercise 
conservation measures through the State's limited entry program. It is 
inconceivable that any fishery can be efficiently or sustainably 
managed without all user groups exercising restraint to avoid over-
utilization of its resource. There are numerous examples worldwide of 
fisheries, which can be shown to exemplify the depletion of fish stocks 
because of over-harvesting practices.
    Response: NMFS acknowledges the comment and notes that limited 
entry has been used as a fishery management tool in Alaska since 1973. 
Pacific halibut fisheries, however, are not managed by the State of 
Alaska. The Halibut Act authorizes the Council, with respect to halibut 
fisheries in and off Alaska, to develop limited access regulations and 
for the Secretary to approve and implement them, as is done by this 
action.
    Comment 34: We oppose the proposed limited access system to cap the 
number of halibut charter boats and anglers. Instead, we support an 
increase in the GHL for the charter fleet in IPHC Areas 2C and 3A.
    Response: Changes to the GHL in Areas 2C and 3A are not within the 
scope of this action and would not achieve the objective of this rule. 
Changes to the GHL should be suggested to the Council for potential 
recommendation to the Secretary.
    Comment 35: The proposed rule indicates that the Council's policy 
is that the charter vessel fisheries should not exceed the GHLs; 
however, no constraints were initially recommended by the Council or 
imposed on the charter vessel fisheries for exceeding a GHL. 
Examination of the GHL final rule reveals that the GHL is advisory in 
nature, requiring no action by the Council, NMFS, or the Secretary 
other than its annual publication in the Federal Register. Since the 
GHL is not an allocation, there has never been analysis by NMFS or 
subsequent determination by the Secretary of the fairness and equity of 
the GHL as an allocation. Until an allocation has been set in 
compliance with the requirements of the Halibut Act, the limited access 
program described in the proposed rule is premature and contrary to the 
law.
    Response: The GHLs developed by the Council and approved by the 
Secretary represent an allocation policy. A final rule implementing 
that policy was published August 8, 2003 (68 FR 47256). The rule 
implementing the GHLs was determined to be consistent with the Halibut 
Act including its ``fair and equitable'' provision. The potential 
effects of this allocation policy were addressed in an analysis that 
supported that action.
    As explained in the preamble to the proposed rule (74 FR 18178, 
April 21, 2009) on page 18179, the Council's policy is that the charter 
halibut fisheries should not exceed the GHLs established for Areas 2C 
and 3A. However, the GHLs themselves do not limit the harvest of the 
charter halibut fishery. A separate regulatory action is necessary to 
impose such a harvest restriction. NMFS promulgated a harvest 
restriction on the charter halibut fishery in Area 2C most recently on 
May 6, 2009 (74 FR 21194). That action was determined to be consistent 
with the ``fair and equitable'' standard of the Halibut Act. Although 
not directly related to that harvest restriction, this rule also is 
determined to be consistent with the Halibut Act (see discussion above 
under heading ``Consistency with Halibut Act'').
    Comment 36: The claim in the proposed rule that the fishery CEY is 
the maximum catch for an area's directed commercial fixed gear fishery 
is false. The fishery CEY is not the maximum catch for an area's 
directed fishery. The fishery CEY is the basis for IPHC staff 
recommendations that result from application of a buffering algorithm 
known as ``Slow-Up Fast Down'' (SUFD) to the fishery CEY in a 
predictable fashion for each IPHC regulatory area. At the IPHC annual 
meeting, IPHC commissioners review staff recommendations as well as 
Conference Board and Processor Advisory Group recommendations. The 
commissioners then decide on catch limits, which rarely if ever equal 
the fishery CEY. SUFD also buffers any change in the fishery CEY, be it 
from a decrease in biomass or an increase in non-commercial removals, 
in both Slow-Up and Fast-Down years. The statement should be corrected 
in the final rule.
    Response: NMFS agrees with this explanation. The preamble to the 
proposed rule did not elaborate on the SUFD policy because it is an 
additional complexity to the IPHC process that is irrelevant to this 
limited access action. Moreover, the preamble to the proposed rule 
never stated that the fishery CEY was equal to the commercial catch 
limit. The principal message in that part of the proposed rule preamble 
was that the IPHC takes into account all non-commercial sources of 
halibut mortality in setting the catch limit for the commercial setline 
fishery. NMFS

[[Page 571]]

acknowledges that the SUFD policy technically is part of this 
fundamental process.

Economic Impacts

    Comment 37: This action seeks to limit the guided angler catch when 
it should be limiting the commercial catch. This rule limits guided 
angler catch, leaving commercial longliners with minimal limits.
    Response: This rule is not designed to limit the harvest of halibut 
by charter vessel anglers, but rather to curtail the growth of fishing 
capacity by the charter halibut fishery. Commercial harvests are 
heavily regulated by the IPHC and NMFS through the IFQ program. 
Commercial fishermen have made contributions to resource conservation 
and, for example, have had their catch limit cut by just over half in 
Area 2C between 2005 and 2009.
    Comment 38: Several comments expressed concerns about the impacts 
of the growth of the charter halibut fishery on Pelican, Petersburg, 
and Gustavus in Southeast Alaska (IPHC Area 2C). These comments 
indicated that growth of the guided sport fishery destabilized the 
local economy in various ways and in some cases expressed support for 
this limited entry program. Destabilizing impacts cited include 
localized depletion, use of community resources by lodges located 
outside city limits and thus beyond city taxation, displacement of 
local residents from dock facilities in the summer by heavy charter 
vessel activity, sliming of docks, and environmental concerns as guided 
operations began to operate in Glacier Bay National Park in May through 
September. These concerns included habituating the bears and sea lions 
and endangering the food source of the killer whale resident 
population.
    Response: Charter industry harvest levels have remained well above 
the GHL in Area 2C. NMFS acknowledges that the growth of the charter 
halibut fishery since the late 1990s has led to changes, competition 
with other resource user groups, and social tension in Southeast Alaska 
communities. This action does not address all of these concerns. The 
purpose of this action is to stabilize the charter halibut fishery by 
limiting the future growth in numbers of charter vessels that may 
participate in the fishery. NMFS notes, however, that the charter 
halibut fishery is a legitimate resource user that provides economic 
benefits to Alaskan coastal communities and to the Nation. Further, 
this program will not by itself limit the number of charter vessel 
anglers that may use sport fishing guide services or their harvest of 
halibut. Instead, this program will define and limit the number of 
charter operators. Potential future regulations to address the issues 
raised by this comment will be easier to implement because of this 
program.
    Comment 39: My community has a community quota entity program and 
is entitled to use it under the final rule but does not have the 
financial resources to use it effectively.
    Response: Specified Area 2C communities may receive up to four 
community charter halibut permits per community and specified Area 3A 
communities may receive up to seven permits per community issued to 
CQEs at no cost. Some costs are likely, however, in establishing and 
administering CQEs. Growth of a charter halibut fishery beyond the CQE 
permits provided by this rule, however, would require the purchase of 
transferable charter halibut permits. When NMFS originally authorized 
CQEs to acquire commercial halibut or sablefish quota share under the 
IFQ program, the State of Alaska responded by modifying its fisheries 
loan programs to provide financing for the purchase of halibut and 
sablefish quota share by CQEs. The State may adapt this program for 
loans to allow CQEs to acquire charter halibut permits. Also, CQEs 
eligible to receive community charter halibut permits may consider 
joint venture arrangements with private sector partners to share the 
costs of forming and operating a CQE.
    Comment 40: For many years there has been significant discussion 
and motions regarding charter IFQs, moratoriums, limited entry 
programs, etc. These discussions and motions, in some cases passed and 
rescinded, have caused confusion in the charter halibut industry. This 
confusion has likely caused charter operators to hold on to businesses 
that they would have retired from or would have sold long ago. This 
affected the natural management of charter operations and is a factor 
that you have not considered.
    Response: The Council and NMFS considered speculative participation 
in the charter vessel industry when developing this rule. Uncertainty 
about the intent of the Council and uncertainty about the potential 
criteria may have led some individuals to participate in the fishery at 
levels that they hoped would qualify them for a future permit, when 
they might otherwise not have operated. This type of speculative 
activity could have led to increased effort levels in the guided sport 
fishery. The publication of a control date of December 9, 2005 (71 FR 
6442, February 8, 2006), was intended to discourage such speculative 
behavior. The use of minimum participation thresholds to qualify for 
permits and for transferable permits should further reduce the control 
of permits by speculative operators.
    The Council subsequently developed and recommended this limited 
access system using 2005 as the last year in which at least minimal 
participation in the charter halibut fishery will qualify a person for 
a charter halibut permit. The Council took over a year to develop this 
program and listened to substantial public testimony. Anyone entering 
the charter halibut fishery during this time should have been well 
aware of the speculative risk of doing so.
    Comment 41: There has been a steady decline in the number of 
halibut charter vessels in Valdez. For example, in 1995 there were 
approximately 35 halibut charter boats operating out of Valdez. Last 
summer there were fewer than 20. This is not due to the lack of 
customers, but to the long distances we are being forced to travel to 
find quality halibut fishing grounds for our clients, and the cost to 
operate a vessel under these circumstances. The proposed moratorium 
will cripple the economy for seasonal businesses that rely on tourists 
and locals alike to come to Valdez and go fishing. If anything you 
should make provisions to allow a small expansion of charter vessels in 
Valdez. Similarly, another comment stated that aside from the CQE 
provision, some growth, particularly in places like Kodiak, Yakutat, 
and Whittier, should be allowed.
    Response: Valdez, Kodiak, Yakutat, and Whittier, Alaska, are in 
IPHC Area 3A. A charter halibut permit endorsed for Area 3A may be used 
anywhere within that area. This rule allows for market-based responses 
to changing fishing conditions in different parts of Area 3A. As 
halibut fishing conditions or business conditions fluctuate, holders of 
Area 3A charter halibut permits could enter or leave the charter 
halibut fishery based in any Area 3A community. Hence, no special 
allowance for expansion of the charter halibut business is necessary as 
this rule will not inhibit such expansion. NMFS expects also that 
holders of charter halibut permits will shift their operations to the 
communities where the demand for guided angling is greatest and can be 
served most profitably.
    Comment 42: The proposed action will suppress private enterprise 
and competition, creating monopoly power that will trigger anti-trust 
laws. The Council, dominated by commercial fisheries interests, is 
privatizing a public resource by prohibiting free enterprise and 
allowing selected individuals or

[[Page 572]]

companies to own a part of the public resource to which they are not 
entitled.
    Response: A monopoly is exclusive control of a commodity or service 
in a particular market that makes possible the manipulation of prices. 
This action does not create a monopoly in the charter vessel industry. 
NMFS estimates that about 231 businesses will qualify for charter 
halibut permits in Area 2C and 296 businesses will qualify for charter 
halibut permits in Area 3A. These qualifying businesses likely will 
receive a total of about 502 transferable and non-transferable permits 
in Area 2C and 418 transferable and non-transferable permits in Area 
3A. With this number of businesses competing to provide sport fishing 
guide services for halibut fishing in each area, none is likely to be 
able to control the market for these services or manipulate prices. 
Further, this rule has an excessive share provision that prevents any 
one business or individual from acquiring more than five permits by 
transfer (see discussion above under the heading ``Consistency with 
Halibut Act''). Although more than five permits may be initially 
allocated to a business, consolidation within the charter halibut 
fishery will be no more than it was during the qualifying and recent 
participation years. Thus NMFS expects that the charter industries in 
Areas 2C and 3A will be competitive, and no anti-trust issues are 
expected.
    This rule does not privatize the halibut resource. A charter 
halibut permit creates no right, title, or interest in any halibut 
before the halibut is harvested by a charter vessel angler on the 
vessel for which the operator holds a permit. A charter halibut permit 
confers no right of compensation to the holder of the permit if it is 
revoked, limited, or modified. A charter halibut permit is considered a 
grant of permission to the holder of the permit to engage in the 
charter halibut fishery by allowing charter vessel anglers on the 
vessel operated by the permit holder to catch and retain halibut. 
Anglers may continue accessing the halibut resource through non-guided 
sport fishing which is not affected by this rule.
    This action does not interfere with free enterprise. It provides 
use privileges that, with respect to transferable charter halibut 
permits, create a climate for the effective functioning of a free 
enterprise market for sport fishing guide services. Markets function 
well when they are founded on clearly defined rules that explain the 
nature of the privileges each market participant has to the scarce 
resources needed to operate their businesses. This rule creates permits 
that will provide fishing privileges and provide the charter halibut 
fishery stability necessary for effective conservation and management 
of the halibut resource.
    Comment 43: This action will limit the number of guided charter 
operations and the ability of this industry to meet the demand for 
guided charter fishing. The limit on supply of guided angling 
opportunities will mean that fewer persons will be able to take 
advantage of guided services and that the cost of these services will 
increase. This will reduce the benefits to anglers and prompt some 
anglers, who would otherwise have used guide services, to substitute 
less attractive guided or non-guided fishing activity. Reduced guided 
angler activity will have adverse economic impacts on the guided 
industry and on regions of Alaska where guides are based. There will be 
fewer jobs and less income, and this will hurt local businesses that 
depend on revenue generated by charter operations.
    Response: Although the number of vessels with charter halibut 
permits operating under this rule is limited, their passenger carrying 
capacity exceeds current 2008 levels of participation. The numbers of 
charter halibut permits and associated endorsements issued under this 
rule create significant opportunities for charter halibut operations to 
expand their capacity to meet existing and higher levels of angler 
demand for guided halibut fishing.
    Opportunities likely exist for operators to increase the number of 
anglers they carry under this rule. NMFS expects that, if charter 
vessel angler demand warrants, operators will increase investments in 
their fishing vessels to increase their fishing efficiency, the average 
number of clients they carry (subject to the endorsement and other 
licensing restrictions), and the number of days each season that their 
vessels operate.
    The Analysis (see ADDRESSES) indicates that the number of permits 
issued under this rule will allow permitted vessels to meet 2008 levels 
of charter trips by increasing the average number of trips they make in 
Area 2C from 36 to 52, and in Area 3A from 38 to 56. These levels of 
increased activity are within the capacity of the charter halibut fleet 
that will have permits under this rule. Further increases in numbers of 
trips also are possible. Members of the charter vessel industry 
indicated in public testimony to the Council that the charter fishing 
season lasts for about 100 days. Many of these trips would be half day 
trips so that multiple trips might be made per day. Even after assuming 
for days off due to bad weather and mechanical breakdown, it is likely 
that the number of days fished could double. Hence, it is not apparent 
that this rule will result in constraining operations of charter 
vessels with charter halibut permits or in constraining guided angling 
opportunities (see also response to Comment 21).
    As discussed in the Analysis, NMFS expects, over a wide range of 
demand conditions, that increasing the number of passengers in a trip, 
or increasing the number of trips in a season, can be done at 
relatively constant incremental cost. This suggests that charter 
halibut permits under this rule can meet demand without price 
increases.
    Comment 44: Halibut are a common property resource and everyone is 
entitled to make a living off a resource that belongs to no one person 
or group. Management is necessary but it should not stifle capitalism. 
This limited entry program is solely about taking more away from the 
general public who have a right to this resource. Guided angler caught 
halibut are worth five times as much to the State and fisherman as a 
commercial fish. Management should seek to maximize the value of the 
fish.
    Response: NMFS agrees that the Pacific halibut resource in Areas 2C 
and 3A is a common property resource. As such, all resource users 
should be benefitted by fishery management policies implemented by 
NMFS. This action does not change the allocation of halibut between 
sport or commercial users. The U.S. Government is authorized to 
regulate access to this resource consistent with the Halibut Act and 
other applicable law. This action creates a limited set of access 
rights or privileges for a resource that cannot support unlimited 
access. Any citizen of the United States will be free to enter the 
guided angling business in Alaska and to guide charter vessel anglers 
in harvesting halibut by purchasing the relevant permits. NMFS 
estimates that about 231 charter vessel businesses will qualify for 
charter halibut permits in Area 2C and about 296 charter vessel 
businesses will qualify for charter halibut permits in Area 3A. Many of 
these businesses will qualify for transferable charter halibut permits, 
and a robust market for these permits is expected to develop. 
Therefore, this rule is not likely to stifle capitalism.
    The public's access to the halibut resource is not diminished by 
this rule. The general public may access this resource as it does now 
through purchases of halibut in commercial markets (e.g., grocery 
stores, restaurants), and through non-guided and guided sport fishing. 
The intent of

[[Page 573]]

this rule is to stabilize the growth of charter vessel operations in 
the guided sport fishery for halibut. Relative to the present, this 
rule will not diminish charter vessel angler opportunity in the 
foreseeable future. Instead, it is designed to restrict the entry of 
additional charter halibut operations.
    Comment 45: The analysis in the EA/RIR/IRFA is inadequate. There is 
no information about the adverse impacts this action will impose on a 
large percentage of the operations in the fleet. It does not include 
information about operations that entered the business in the years 
from 2006 to 2009. The IRFA does not provide adequate information on 
the impact to operations that will not receive permits under this rule. 
It should include information on lost revenue or expenses to all 
entities involved. Not allowing small businesses starting after 2005 to 
compete in the fishery is inconsistent with the Regulatory Flexibility 
Act.
    Response: The Analysis (see ADDRESSES) estimates numbers of 
operations affected by this action, and examines the costs and benefits 
of the action accruing to different sectors. Much of the Analysis is 
qualitative, reflecting the limited information that exists on the 
charter vessel business generally and on the angler demand.
    The Council's recommendation to the Secretary looked primarily at 
charter vessel businesses that were active during the qualifying years 
of 2004 and 2005. These were the participants that the Council sought 
to confirm in their business patterns when it made its decision to 
recommend this action in 2007. An ``Active'' charter business was 
determined to be one that made at least five logbook trips in at least 
one of the two qualifying years and at least five logbook trips in the 
recent participation year (2008). This two-tier qualification 
requirement was designed to assure that limited access permits were 
allocated to historically active charter businesses that were still 
active when the program was implemented. The five-logbook-trip minimum 
was chosen in part because it is a relatively low standard of activity. 
A charter vessel business with less than five logbook trips in a year 
is not likely in most instances to generate a significant annual 
income. The Council's Analysis that was made available to the public 
for review with the proposed rule (74 FR 18178, April 21, 2009) did not 
consider the effect of the participation requirement in 2008 because 
that year had not yet occurred at the time of Council action. However, 
the Council was aware that the numbers of businesses receiving permits 
under this rule would be no more than those that were active in 2004 or 
2005, and likely would be somewhat less as some firms active in 2004 
and 2005 left the charter business during 2006 and 2007.
    The Council and Secretary reasonably assumed that the number of 
businesses that would enter the fishery during 2006 through 2009 would 
be small. Such businesses contemplating entry into the charter halibut 
fishery during those years should have been aware of the control date 
of December 9, 2005, set by the Council and published by the Secretary 
on February 8, 2006 (71 FR 6442). Being put on notice of potentially 
not qualifying for initial allocation of charter halibut permit(s), 
businesses entering the fishery after the control date should have 
structured their operations on the assumption that they may be in the 
charter halibut business temporarily. Alternatively, these businesses 
could have planned on purchasing one or more transferable charter 
halibut permits after they were issued. Other than assuming this 
outcome, no basis existed for estimating the number of businesses that 
would make a post-control date entry decision.
    More recently, NMFS has prepared a supplementary analysis, with 
estimates of the number of businesses that are expected to qualify for 
charter halibut permits based on the 2004 and 2005 qualifying years and 
the recent participation year of 2008. The RIR and RFA analyses have 
been updated to reflect this new information (see ADDRESSES). In 
summary, the updated analyses indicate that about 231 businesses are 
expected to qualify for charter halibut permits in Area 2C and about 
296 are expected to qualify in Area 3A. An estimated 115 businesses 
were active (i.e., at least five logbook trips) in Area 2C in 2008 but 
not during either of the qualifying years indicating that these 
businesses may have entered the charter halibut fishery during the 
period 2006 through 2008. The comparable estimate of new entry 
businesses in Area 3A is 111.
    Comment 46: Will the government offer a compensation package of 
vocational retraining, financial aid, or other compensation to guided 
charter operators who will not be able to continue in this business? 
This compensation may be appropriate since these persons will no longer 
be able to honor private agreements with clients, and will lose the 
value of vessels purchased for the fishery.
    Response: No compensation is planned or provided in this rule for 
persons that do not qualify for a charter halibut permit. No legitimate 
investment-backed expectations exist for businesses that profit from 
free access to a public fishery resource.
    Comment 47: By designating certain permits as non-transferable, the 
proposed rule seeks to create a second class of charter operators who 
can operate but cannot transfer their permit. No analysis has been made 
of the losses involved in selling surplus charter halibut fishing 
assets without a permit. A regulation designed solely to benefit the 
commercial sector to the disadvantage of a small number of charter 
operators is unconscionable. This classification of charter permit 
holders does not meet the requirements of the Halibut Act and should be 
removed from the rule.
    Response: As discussed under the heading ``Consistency with Halibut 
Act,'' this rule was determined to meet the requirements of the Halibut 
Act. The purpose and rational basis of this rule are described above 
and in the preamble of the proposed rule published April 21, 2009 (75 
FR 18178).
    The non-transferable permits provision of this rule provides a 
temporal buffer to reduce the overall impact of this rule on persons 
that demonstrated relatively low levels of activity. Qualifying 
businesses will be issued transferable permits for vessels that made 15 
or more logbook trips in one of the qualifying period years and in 
2008. Participation in the charter halibut fishery during these years 
at between five and 15 logbook trips indicates a relatively low level 
of participation in the guided charter business. However, these 
businesses will qualify for non-transferable charter halibut permit(s). 
Businesses that receive an initial allocation of non-transferable 
permits will be able to continue their charter halibut operations as 
they previously had done, or may increase their participation in the 
charter halibut fishery by acquiring additional permits by transfer.
    Holding non-transferable permits does not destroy the total value 
of business assets. A person or business with non-transferable permits 
may transfer ownership of vessels, fishing equipment, and real estate 
associated with the business to other persons that wish to enter the 
business and acquire charter halibut permits by transfer. 
Alternatively, the assets of a charter business could have value to 
persons that do not need charter halibut permits because their business 
plan does not involve the harvest of halibut. A business issued non-
transferable permits may also purchase transferable permits.
    Comment 48: If this proposal is approved it will set a precedent 
and

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could potentially affect thousands in the charter industry. I have been 
told by NMFS that there are no other charter limited entry programs 
currently in effect in the United States.
    Response: This rule does not establish the first limited entry 
management of charter vessels. A moratorium for charter vessels and 
headboats operating in Federal waters of the Gulf of Mexico was 
effective beginning on June 16, 2003 (67 FR 43558, June 28, 2002).
    Comment 49: I believe that this limited entry program is going to 
be a ``free'' government retirement package for many who have just held 
on for this permit and will immediately sell it. Their business will 
become more valuable overnight while other businesses will not. To 
illustrate this point, the State of Alaska issued a Legislative Resolve 
No. 5 in 1983 that stated ``a share system could result in the 
concentration of ownership of the fishery resource in the hands of a 
few fishermen,'' that it ``could encourage speculation and the making 
of exorbitant profits at the expense of Alaska fishermen,'' and that it 
``could tend to eliminate competition among halibut fishermen.'' The 
State Constitution does not support a limitation on charter vessels.
    Response: Some persons may have participated in the charter halibut 
fishery before 2005, solely in a speculative effort to acquire permits 
should a limited entry program with transferable permits be adopted. 
Speculative entry is a common concern when limited entry programs are 
under consideration. The Council addressed this concern in two ways. 
First, to discourage speculative entry during program development, the 
Council adopted a control date of December 9, 2005, at the start of its 
deliberations. Announcement of this control date by the Council and 
Secretary (71 FR 6442, February 8, 2006) notified the public that 
anyone entering the charter sport fishery for halibut after the control 
date would not be assured of future access to the fishery if a 
management regime that limits the number of participants is developed 
and implemented. The Council continued to publicize this control date 
through the development of this rule.
    Secondly, the Council adopted a minimum participation standard for 
initial allocation of charter halibut permits. A qualifying business 
may receive a transferable permit only if the business has a record of 
making at least 15 logbook trips in one year of the 2004-2005 
qualifying period, and in 2008. The reasons that each person has for 
participating in the guided sport fishery are highly subjective, and 
NMFS does not have information available to discriminate among resource 
users on the basis of their reasons for participation.
    This rule is being implemented under the authority of the Halibut 
Act, not the Alaska Constitution. Legislative resolutions by the Alaska 
legislature are not legally binding on this action. However, allowing 
excessive shares of halibut fishing privileges to be acquired is 
prohibited by the Halibut Act. The excessive share provision in this 
rule that limits persons to five permits (with some exceptions) assures 
that excessive consolidation will not occur and competition among 
operators will remain.
    Comment 50: The proposed rule states the intended effect of this 
program is to curtail growth of fishing capacity in the guided sport 
fishery for halibut. This rule will not only curtail growth, it will 
eliminate it without compensation. Based on the qualifying criteria, 
the immediate effect will reduce the fleet size by an estimated 10 
percent now, and over time as non-transferable permits are retired, an 
additional 15 percent of the current fleet will cease to exist. This 
does not include the ``private agreement'' and ``same vessel'' clauses 
that will eliminate even more vessels. Although there may be enough 
capacity in the fleet to meet current demand, with such a large 
reduction during peak periods anglers in the future may not be able to 
find an available charter.
    Response: NMFS has supplemented the Council's earlier analyses 
using new information on charter halibut participation levels in 2008, 
the recent participation year (see Section 2.8 of the Analysis at 
ADDRESSES). The supplementary analysis takes into account the 
anticipated effect of the recent participation year reducing the number 
of charter halibut permits issued below a number based solely on 
participation in the qualifying years of 2004 and 2005.
    Based on the earlier analysis and its supplement, the charter 
halibut industry will have sufficient capacity to meet existing angler 
demand and to meet some increases in that demand (see responses to 
Comments 21 and 43).
    Comment 51: The proposed control date for qualifying for the 
limited entry halibut charter vessels is December 9, 2005. I 
respectfully request the control date be moved up until at least 2008 
so companies that started after 2005 can qualify for a permit. If our 
company is unable to obtain a limited entry halibut permit for our 
charter vessel, our lodge would be forced to go out of business. 
Presently we have employees, vendors, and tourists from around the 
world and that would all be adversely affected if we were forced to 
close. Local, State, and Federal governments would also be adversely 
affected due to the loss of revenue from utilities fees, fuel taxes, 
payroll taxes, bed taxes, various license fees, and of course payroll 
taxes. With the present economic conditions, a number of charter 
fishing boat and lodge operators will be forced out of business this 
year regardless of the limited entry proposal. The 2004-2005 qualifying 
period is not only damaging to the economy, but is also extremely 
damaging to the charter businesses that have started operating since 
2006. All charter operations already vested in the industry should 
remain in business.
    Response: The control date, December 9, 2005, was recommended by 
the Council and published by NMFS in the Federal Register on February 
8, 2006 (71 FR 6442). The purpose of the control date announcement was 
to announce that anyone entering the charter sport fishery for halibut 
in and off Alaska after the control date will not be assured of future 
access to that fishery if a management regime that limits the number of 
participants is developed and implemented. The Council and NMFS intent 
in making the control date announcement was to discourage speculative 
entry into the charter halibut fishery while potential entry or access 
control rules were being developed by the Council and, if approved, 
implemented by the Secretary.
    The notification of a control date does not compel the Council or 
the Secretary to use that date. In this case, the Council used the date 
in part by recommending a two-year qualifying period that ran through 
the end of 2005. The Secretary has approved the Council's recommended 
charter halibut moratorium recommendation which includes this 
qualifying period. The comment actually is seeking a new, more recent 
qualifying period. This cannot be done under the approved policy of 
2004 and 2005 as the qualifying period without revising the entire 
Council recommendation. A more recent qualifying period would be a 
significant change to the recommended charter halibut moratorium policy 
and this rule. NMFS has determined that such a significant change is 
not warranted and the approved policy and this rule are consistent with 
the Halibut Act and other applicable law.

Moratorium Elements

    Comment 52: If limited entry is adopted, the permits should not be 
allowed to be sold when they are no

[[Page 575]]

longer used. A lottery should be held and the winner would then have 
the same opportunity as the first person.
    Response: This rule does not include a lottery to distribute 
charter halibut permits when they are no longer used or on a periodic 
basis. Such a lottery would be a substantial change from the policy 
recommended by the Council and approved by the Secretary. However, this 
suggestion could be made to the Council for its consideration as an 
amendment to this rule in the future. This rule implements the 
Council's original recommendation to establish a market-based system 
for permit transfers. The Council and Secretary determined that this 
would be more reasonable and efficient than to have a continual permit-
application and permit-award process by the government.
    Comment 53: I recommend that a permit be used for five years before 
it can be sold. This would keep people from hanging on so they can get 
a permit to sell. This would thin out the crowd and a new business 
would be forced to use the permit before it gains any value. Any 
charter business that is over five years old would be exempt.
    Response: The proposal to require some use of a charter halibut 
permit before transferring would inhibit the exit and entry of charter 
halibut businesses and could increase costs of doing so. Requiring some 
permit use before transfer also would add administrative costs to this 
program. However, this suggestion could be made to the Council for its 
consideration as an amendment to this rule in the future.
    Comment 54: Several comments requested clarification of how NMFS 
will determine the number of transferable moratorium permits each 
charter business will receive if they operated different vessels in the 
qualification period and the recent participation period. Many charter 
operators have replaced older vessels with newer ones for safety or 
other business reasons. The proposed rule provided that an applicant 
would receive a transferable permit for each vessel that made at least 
15 trips in the applicant selected year and at least 15 trips in the 
recent participation year. However, the proposed regulatory text would 
require these minimum number of logbook trips to be made on the ``same 
vessel.'' It would be inconsistent with Council intent for NMFS to 
require that the same vessel be used in both the qualifying and recent 
participation periods. The Council did not intend to exclude a charter 
operator from the moratorium for upgrading or replacing a vessel for 
safety reasons as long as it did not increase capacity. Requiring the 
same vessel to be used in the qualifying period and the recent 
participation period also could result in these businesses not meeting 
the qualifications for a moratorium permit. In the final rule, NMFS 
should provide clarifying language for this statement and in the 
proposed regulations.
    Response: NMFS agrees that the ``same vessel'' language in the 
proposed rule at Sec.  300.67(b)(2)(ii) and (iii) should be clarified. 
NMFS has added text to Sec.  300.67(b)(2)(iii) stating that the vessel 
used to meet the 15-trip criterion during the recent participation 
period (2008) need not be the same vessel used to meet the 15-trip 
criterion during the qualifying period (2004 or 2005) (see discussion 
below under ``Changes from the Proposed Rule''). NMFS agrees that the 
Council did not intend to disadvantage charter businesses for upgrading 
or replacing vessels.
    The same vessel does not need to be used in both years--a 
qualifying year and the recent participation year--to meet the fishing 
trip criteria for a transferable charter halibut permit. However, the 
minimum 15-trip criterion in at least one of the qualifying years had 
to be met by a single vessel and the 15-trip criterion in 2008 had to 
be met by a single vessel (either the same or different vessel as used 
in 2004 or 2005). Upgrading a vessel, whether for safety or other 
reasons, will not prevent a person from qualifying for a transferable 
permit under this rule if the 15-trip criteria are met.
    NMFS will rely on the ADF&G Saltwater Logbook record of fishing 
trips by each charter vessel to determine the qualifications for 
transferable or non-transferable charter halibut permits during the 
qualifying and recent participation period years. A major breakdown of 
a charter vessel within one of those years could prevent a business 
from qualifying for a transferable or non-transferable permit. Such 
cases may be appealed pursuant to 50 CFR 679.43.
    Comment 55: What if a business replaced a vessel between 2004 and 
2005? Does the applicant still have the ability to choose its ``best 
year'' in the qualifying period if it used different vessels in the 
qualifying period and the recent participation period?
    Response: Yes. The Council used the term ``best year,'' but the 
proposed rule used the term ``applicant-selected year.'' NMFS 
determined that the applicant should choose between 2004 or 2005 for 
purposes of determining the applicant's number of transferable or non-
transferable permits.
    Comment 56: The proposed rule regarding non-transferable and 
transferable permits uses the phrase ``same vessel'' for transferable 
permits, but not for non-transferable permits. What is the reason for 
this?
    Response: The Council specified a higher standard of participation 
for charter businesses to qualify for a transferable permit. This 
standard requires that a charter business demonstrate its participation 
in the charter halibut fishery by operating a vessel that made at least 
15 bottomfish logbook trips in a qualifying year and a (potentially 
different) vessel that made at least 15 halibut logbook trips in the 
recent participation year. This ``same vessel'' standard is not 
required, however, to meet the minimum logbook fishing trips criterion 
needed for a non-transferable permit. For example, a charter halibut 
business that used five separate vessels that made one logbook trip 
each in 2005 and again in 2008, will qualify for one non-transferable 
charter halibut permit. A different charter halibut business that used 
three separate vessels that made five logbook trips each in 2005 and 
again in 2008 (totaling 15 trips in each year), will not qualify for 
one transferable charter halibut permit because at least 15 logbooks 
the trips were not made on the same vessel in 2005 and another single 
vessel in 2008. This business will qualify, however, for three non-
transferable charter halibut permits. Meeting the ``same vessel'' 
standard for a transferable permit demonstrates a higher level of 
participation in the charter halibut fishery than is required for a 
non-transferable permit, which appropriately reflects the higher value 
of a transferable permit.
    Comment 57: Will NMFS still look at both qualifying years (2004 and 
2005) for the angler endorsement number if the applicant used different 
vessels in the qualification period and the recent participation 
period?
    Response: Yes. This rule stipulates that a charter halibut permit 
will be endorsed for the highest number of charter vessel anglers 
reported on any logbook fishing trip in the qualifying period, except 
as provided at 50 CFR 300.67(e). The qualifying period is the sport 
fishing season in 2004 and 2005. Hence, the angler endorsement is 
determined regardless of the recent participation period (2008). Using 
a vessel in 2008 that is different from the one used in one or both of 
the qualifying years will have no effect on the angler endorsement 
determination.
    Comment 58: All permits should be transferable.

[[Page 576]]

    Response: NMFS disagrees. The two-tiered qualification criteria is 
designed to allow a business with relatively less participation in the 
charter halibut fishery to continue its operation while reducing 
potential harvesting capacity over time by not allowing that permit to 
be transferred to another entity. On the other hand, a business with 
relatively more participation in the charter halibut fishery is 
allocated a transferable permit that allows new charter halibut 
businesses to enter the fishery by allowing the market for charter 
halibut permits to allocate access to the fishery in the future.
    This policy reflects the intent of the Council and Secretary to 
balance the objective to reduce fishing capacity in the charter halibut 
fishery and its objective to minimize disruption to the charter fishing 
industry. If only transferable permits were initially allocated based 
on a relatively high minimum number of logbook fishing trips, the 
sudden reduction of charter halibut operations would be too disruptive 
to the industry. On the other hand, if only transferable permits were 
initially allocated based on a relatively low minimum number of logbook 
fishing trips, then little or no reduction in fishing capacity would be 
realized. Over time, as the non-transferable permits exit the fishery, 
only transferable permits will remain.
    Comment 59: Eligibility considerations should be established for 
those who may be interested in purchasing a transferable permit after 
the limited entry program is established. This would be compatible with 
the seven factors in section 303(b)(6) of the Magnuson-Stevens Act, 
which the Secretary must consider in approving a limited entry program. 
These seven points could be used to establish ``eligibility criteria'' 
for receiving a transferred permit. The criteria could give priority to 
those who have committed themselves to the industry and may have a 
history in running or crewing on vessels for charter businesses. This 
group of people often gets lost in resource rationalization programs; 
this needs to be avoided as new rationalization plans develop. The 
criteria can also be tailored to help tie owners and operators to the 
Alaskan community they are based in, improve local economics for the 
industry, and still provide fair and equitable access based on 
intentional rather than passive participation that comes with absentee 
ownership.
    Response: This rule establishes some criteria to qualify for 
receiving a transferred charter halibut permit. These criteria are 
listed at Sec.  300.67(i)(2) of this rule. In brief, the criteria 
require U.S. citizenship (or 75 percent U.S. ownership of a business); 
a complete transfer application; a determination that the transfer will 
not cause the person receiving the permit(s) to exceed the excessive 
share limitation (unless an exception applies); the parties to the 
transfer do not owe NMFS any fines, civil penalties, or any other 
payments; and the transfer is not inconsistent with any sanctions. This 
rule includes no Alaska residency requirement because the Halibut Act 
prohibits discrimination between residents of different States. The 
Council could consider further criteria for transferring permits to 
achieve socioeconomic objectives in future actions.
    Comment 60: The April 25, 2008, EA/RIR/IRFA analyzed 1, 5, 10, 15, 
and 20 minimum logbook trips but suggests that a five logbook-trip 
minimum requirement would allow up to 35 more vessels to operate in 
Area 2C over 2005 levels. Although it is unknown how many of these 
vessels would meet the recent participation requirement, this permit 
qualification criterion may not immediately meet the NMFS stated 
objective to ``limit the number of participating charter vessels.'' 
Moreover, with no limit on the number of trips a permitted business can 
take within a season once permitted, permitting those businesses that 
meet the minimum criteria of five logbook trips during the qualifying 
period and five logbook trips during the recent participation period 
will likely allow for increased fishing capacity given increasing 
client demand. We request that NMFS implement the option for a minimum 
of 10 logbook trips for permit qualification in lieu of the five 
logbook trip minimum.
    Another commenter suggested that 30 to 50 days of logged halibut 
trips would be a more appropriate requirement.
    Response: The design of the limited access system established by 
this rule will likely reduce the number of vessels in the charter 
halibut fleet relative to the fleet size in 2005, despite the 
relatively low participation standard of five logbook trips for a non-
transferable permit. Table 46 in Section 2.8 of the Analysis (see 
ADDRESSES) indicates that 646 vessels participated in the charter 
halibut fisheries in Area 2C during 2005. Under this rule, a total of 
502 charter halibut permits are expected to be issued for vessels in 
Area 2C. This represents a decrease in the potential charter halibut 
fleet size in Area 2C of about 22 percent. Comparable estimates for 
Area 3A are that 564 vessels participated in the charter halibut 
fisheries during 2005, and a total of 418 charter halibut permits are 
expected to be issued under this rule. This represents a decrease in 
the potential charter halibut fleet size in Area 3A of about 26 
percent. A higher participation standard would reduce the fleet too 
fast and be too disruptive to these fisheries.
    Comment 61: Leaving paid skippers out of the permitting issuance is 
wrong. An independent contractor who has operated vessels in all the 
proposed qualifying years for more than 50 days should qualify for a 
permit.
    Response: The proposed rule for this action (74 FR 18178, April 21, 
2009) described the rationale for limiting eligibility to receive a 
charter halibut permit to charter business owners that were licensed by 
the State of Alaska. In brief, eligibility for charter halibut permits 
is limited to the holder of an ADF&G business owner license because 
information on participation in the charter vessel fishery is organized 
by this license. Also, paid charter vessel skippers or guides will 
continue to be in the same position they were in before this rule by 
being able to hire their services to charter businesses.
    Comment 62: The charter halibut moratorium provisions for small 
communities will not benefit some of these businesses due to the 
complexity of the provisions and the qualifying requirements. The 
comment offered alternative community qualifying criteria and suggested 
that NMFS remove the requirement for communities to form a Community 
Quota Entity to qualify for a community charter halibut permit.
    Response: NMFS appreciates alternative suggestions to promote 
charter vessel businesses that operate in rural communities. However, 
the proposed community provisions in the proposed rule are unchanged in 
the final rule. This rule meets the intent of removing a new economic 
barrier for small isolated communities with undeveloped or 
underdeveloped charter industry to participate in the charter halibut 
fishery.
    The rationale that governed the development of the community 
provisions is one of balance. The Council and the Secretary are 
attempting to balance the economic development interests of rural 
communities with the overall intent of this action to curtail growth of 
fishing capacity in the charter halibut fishery. A more lenient policy 
could allow too many charter businesses to enter the fishery and a more 
restrictive policy could allow too few. If the Council's approved 
community policy needs to be adjusted in the future, it can entertain 
proposals to do so and make regulatory

[[Page 577]]

amendment recommendations to the Secretary.
    Comment 63: My concern is fairness related to urban and rural 
businesses in deciding who receives a transferable permit. A rural 
charter business faces much more difficulty in maintaining and 
operating a business than their urban counterpart. The rule for 
participation in the charter halibut fishery should be revised to allow 
for transferable permits to be issued to rural charter businesses.
    Response: This rule is not revised based on this comment. This rule 
allows a market-based system of allocating access to the fishery after 
the initial allocation of permits. With the exception of community 
charter halibut permits, transferable and non-transferable charter 
halibut permits may be used anywhere within the IPHC area for which 
they are designated. Insufficient information exists to distinguish 
between rural and non-rural charter businesses for purposes of 
transferable permit qualifying criteria. Hence, these criteria are the 
same for rural and non-rural charter businesses.
    Comment 64: I strongly oppose this proposal and ask that you reject 
it or restructure it to include anyone that was licensed during the 
qualifying period. I am a crab fisherman and a charter boat owner and 
captain with a very large investment, both in money and time, in my 
business. The business is my livelihood. I do not take enough halibut 
charters in the year to qualify under the proposed rule. I take people 
out for a variety of things, including guided fishing, and I will lose 
business without the ability to offer halibut fishing. I need both crab 
and halibut charter incomes or my business will fail.
    Response: The minimum participation number of logbook trips was the 
second lowest participation standard considered by the Council and the 
Secretary. Participation in the charter halibut fishery at lower levels 
is not indicative of a significant commitment to this fishery, and 
including participants at lower levels would run counter to the 
objectives of this rule. Businesses that do not qualify for an initial 
allocation of a charter halibut permit may choose to alter their 
charter vessel business plan to focus on other species, acquire a 
transferable permit to expand operation in the charter halibut fishery, 
or leave the charter industry to focus on other commercial fisheries or 
ventures. Alternatively, the business could seek a special community 
charter halibut permit.
    Comment 65: The eligibility years are unfair and reward certain 
people. I would qualify for the moratorium but I do not think it is 
right.
    Response: NMFS has determined that this rule is fair and equitable 
as discussed above under the heading ``Consistency with Halibut Act.''
    Comment 66: I am in favor of limited entry with the 2004 and 2005 
qualifying years, but opposed to the recent participation period. That 
is why I bought my business. My two sons have completed the required 
time to get their captain's licenses and are working toward the day 
they can take over the business. All my planning and their hard work 
will come to naught if this plan is adopted. Please reject the 2008 
qualifying date and keep with the original 2004 and 2005 dates, so we 
can maintain our business and support the community.
    Response: The Council chose the qualifying period and recent 
participation period in consideration of historical dependence and 
recent participation in the charter fishery, two factors that the 
Council and Secretary must take into account pursuant to the Halibut 
Act. Demonstrating at least minimal participation during both periods 
is critical to the design of this limited access system. Persons not 
eligible to be an initial recipient of a charter halibut permit may 
obtain permit(s) through transfer.
    Comment 67: Two comments questioned the description of the charter 
halibut permit program in the proposed rule as a moratorium. The 
comments cite several instances where Council language refers to its 
action as a moratorium and in one case refers to it as an interim 
measure of stability in the guided sport halibut sector during the 
step-wise process toward a long-term solution. Why, if the Council 
submitted a moratorium to be published as an interim solution, is the 
Secretary proposing a permanent program in its proposed rule?
    Response: The proposed rule (74 FR 18178, April 21, 2009) at page 
18182 speaks to this point. In essence, a moratorium on entry into a 
fishery limits entry into that fishery. Hence, a moratorium is a 
limited access system in which permits are initially limited to those 
participants that meet specified criteria. This rule implements such a 
limited access system and it will remain in effect until it is changed 
or replaced through subsequent Council and Secretarial action. Such 
subsequent action may involve refinements to this limited access system 
or it may remove or replace this limited access system with a different 
limited access system. The Council has indicated that this rule is an 
important step toward a comprehensive scheme to allocate the halibut 
resource among users of the resource. It is intended to have a 
stabilizing effect on the charter halibut industry while a 
comprehensive system is developed and implemented that will work in 
concert with other management measures.
    Comment 68: This program should have a sunset clause. The proposed 
rule should not be passed or should have the control date changed to a 
sunset clause. Also, logbooks were changed in 2006 to allow for the 
collection of data specific to halibut. This will help capture the 
necessary data to keep the Council and NMFS informed regarding charter 
fleets and harvest levels.
    Response: A date for ending this limited access system--commonly 
called a sunset date--was never contemplated by the Council or 
Secretary because the system is perceived as necessary now and in the 
future. Changes to the system, including removing it, are possible 
through the development of a separate regulatory recommendation by the 
Council for the Secretary to review. A control date was published by 
the Council and the Secretary on February 8, 2006 (71 FR 6442). The 
control date notice announced to the public that no person was assured 
of future access to the charter halibut fishery if that person entered 
the fishery after December 9, 2005. A control date and a sunset date 
are not the same. The former signals the start of a potential limited 
access system, and the latter refers to a future expiration date for a 
regulation or program. This rule is not intended to end at a 
predetermined date. Instead, it is designed to be a step toward 
establishing a comprehensive program of allocating the halibut resource 
among resource users.
    NMFS is aware of the change in logbook reporting required by ADF&G. 
This is explained in the preamble to the proposed rule (74 FR 18178, 
April 21, 2009) on page 18185. In 2004 and 2005, ADF&G required charter 
businesses to report bottomfish effort for each logbook trip. ADF&G 
further instructed logbook users that bottomfish fishing effort 
included effort targeting halibut.
    Comment 69: Limits should be based on fleet size per community and 
limit fleet size generally for Area 2C. In Gustavus, nine seasons ago 
there were 19 operating charter boats; now there are 24. While our 
growth has been very small over 10 years, other areas have increased 
significantly. Some areas within Area 2C may need to be capped, whereas 
other areas should have a maximum capacity ceiling for halibut guide 
boats. Another concern is

[[Page 578]]

absentee ownership. Many of the charter business owners do not even 
fish. A community-based cap would prevent more people like this, or new 
people, from overwhelming specific communities.
    Response: With the exception of the community charter halibut 
permits, the Council did not specify how many permits should be 
allocated to individual communities. Permit limits for specific 
communities would be more complex and more expensive to administer than 
this rule because it contemplates a separate limited access system for 
each community. However, such proposals could be made to the Council.
    Comment 70: The ``recent participation period'' should be fixed as 
either 2007 or 2008. Another comment suggested that 2007 should be used 
for the recent participation period because the nationwide economic 
downturn caused a number of cancellations in 2008 and recorded logbook 
trips fell over 50 percent for that year.
    Response: This rule establishes 2008 as the recent participation 
period, or recent participation year, for purposes of qualifying for a 
charter halibut permit. The purpose of this requirement, along with the 
qualification years of 2004 and 2005, is to ensure that both historical 
dependence and recent participation are recognized, two factors that 
must be taken into account under the Halibut Act. The approved Council 
recommendation contemplated that either 2007 or 2008 could be the 
recent participation year, but refers to the ``year prior to 
implementation.'' NMFS interpreted this phrase to mean the most recent 
year for which a full year of logbook fishing trip data are available, 
and therefore established 2008 as the recent participation year.
    Comment 71: I support the proposed regulations. The tremendous 
growth of the guided sport charter industry over the past decade has 
put serious pressure on fish stocks. I would like to see more reduction 
in permits than proposed but allowing special consideration for lodge 
operators who have a larger investment and contribute more to the 
economy. Perhaps a buy-back program makes sense for reducing the total 
outstanding permits or increasing the minimum number of trips in the 
qualifying years.
    Response: This action stabilizes the guided charter fleet by 
capping the number of separate vessels that may be operated. The 
Council recommended the use of non-transferable permits to reduce the 
numbers of charter halibut permits over time. NMFS estimates that 502 
permits will initially be issued in Area 2C, and that this will 
eventually decline to 347 permits as non-transferable permits expire. 
An additional 72 permits may be issued to CQE groups in Area 2C. In 
Area 3A, an initial 418 permits should decline to 319 as non-
transferable permits expire. An additional 98 permits may be issued for 
CQEs in Area 3A.
    The Council's use of non-transferable permits was meant to lead to 
the withdrawal from the fleet of operations that had only minimal 
participation without imposing a serious burden on their traditional 
operations in the short run. Allowing non-transferable permits to 
expire over time will prevent these operations from increasing 
participation in the long run. This rule accommodates the special needs 
of lodge operations by (a) issuing permits to businesses, (b) allowing 
them to hold multiple permits up to the five-permit excessive share 
limit, (c) allowing businesses to hold initially allocated permits in 
excess of the excessive share limit, and (d) allowing businesses to 
hire guides and vessel operators to use the permits.
    This rule lays the groundwork for future management measures, which 
might include buyback, individual quotas, or further measures to modify 
the numbers of permits. Such proposals should be made to the Council. 
After Council development and analysis of such proposals, changes may 
be recommended to the Secretary for a separate regulatory amendment.
    Comment 72: A commenter has noted an apparent conflict between text 
in the preamble to the rule stating that charter halibut permits would 
not be awarded to persons who purchased a charter fishing business that 
met some or all of the participation requirements but who themselves 
did not meet that participation requirement, and text stating that NMFS 
would have no obligation to determine the owners of a corporation or 
members of a partnership that successfully applied for a permit. The 
commenter points out that a person could have bought a business after 
the 2004-2005 qualifying period, and before the 2008 recent 
participation period. Without checking business ownership, it would be 
impossible to know if the business owners were the same in both 
periods.
    Response: This apparent conflict is due to confusing a business 
with its owners. The initial allocation of permits is to businesses, 
and the criterion for a continuous business is not the continuity of 
the owners but the continuity of the business. The term ``person'' has 
been previously defined in Sec.  300.61 to include an individual, 
corporation, firm, or association. This rule makes clear that NMFS will 
not recognize agreements that allow two businesses to match their 
logbook history to qualify for one or more charter halibut permits. For 
example, charter business ``A'' may have the necessary logbook trips 
for the qualifying period but not the recent participation period and 
charter business ``B'' may have the necessary logbook trips for the 
recent participation period but not the qualifying period. Charter 
business ``A'' agrees to sell its logbook history to charter business 
``B.'' NMFS will not recognize this agreement. In this case, neither 
business will qualify for a charter halibut permit.
    NMFS will issue a charter halibut permit to the person or entity--
individual, corporation, firm, or association--that held the ADF&G 
Business Owner License that authorized the logbook fishing trips that 
met the participation requirements in both participation periods, 
qualifying and recent. NMFS does not intend to determine the individual 
owners of charter vessel businesses in part to avoid dividing permits 
among the owners or partners of dissolved corporations or partnerships. 
See also the response to Comment 105.
    Comment 73: It would be very helpful for full-time residents of 
rural communities (the same that qualify for subsistence) to be able to 
get a non-transferable permit to run one boat for halibut if they 
captained a boat during the qualifying years. Most of the commercial 
fishermen would support this as they are opposed to the bigger charter 
operators, not the one-boat local operators. It would be very good for 
the small town economies, and it would provide opportunities in towns 
where opportunities are scarce.
    Response: This rule includes provisions to assist the development 
of the charter halibut fishery in small rural communities (see Sec.  
300.67(k)). In addition, some charter halibut permits are transferable, 
and persons in rural areas will be able to acquire them in the market 
if it makes economic sense for the permits to migrate to those areas. 
If the Council determines that rural communities need further 
assistance to develop small scale charter halibut fisheries, it could 
develop a regulatory amendment to recommend to the Secretary.
    Comment 74: Our industry is facing very uncertain times and the 
stocks of halibut have been declining. Controlling growth of the 
charter industry is critical for both the health of the halibut biomass 
and all users of the resource. NMFS needs to make provisions for these 
permits to be eligible for financing

[[Page 579]]

through the NMFS Financial Services Loan Division. This important rule 
has been a long time coming.
    Response: NMFS Financial Services Division does not have the 
statutory authority to make loans for this purpose. Congressional 
action would be necessary to provide this authority.
    Comment 75: Is it possible to assign a cost recovery fee to each 
limited access permit to recover enforcement costs and will that be a 
part of this program?
    Response: Cost recovery is not authorized for this program as it is 
not a limited access privilege program or a community development quota 
program as defined by the Magnuson-Stevens Act. A limited access 
privilege is a Federal permit issued as part of a limited access system 
to harvest a specific quantity of fish. A charter halibut permit is a 
Federal permit issued as part of a limited access system but it does 
not provide a privilege to harvest a specific quantity of halibut. 
Hence a cost recovery fee for charter halibut permits is not authorized 
under section 304(d)(2) of the Magnuson-Stevens Act.
    Comment 76: Although the Analysis states that the Council intended 
to curtail the growth of the charter sector, the ``recent 
participation'' and ``same vessel'' clauses of the rule will 
effectively eliminate 40 percent of current operators. Moreover, the 
Council intention to curtail the growth seems to be inconsistent with 
the provision to provide for 192 new CQE permits. The Analysis states 
that it is the purpose of this action to place a moratorium on ``new'' 
entry; however, this action actually limits any entry since 2005.
    Response: ``New'' in this context refers to entry into the charter 
halibut fishery in Areas 2C or 3A after December 2005 (see response to 
Comments 40 and 45 concerning the control date). Hence, this action 
limits entry to operations that were active in the fishery during the 
qualifying period and that continued to operate with at least minimal 
logbook fishing trips in 2008. This potential outcome was published in 
the Federal Register on February 8, 2006 (71 FR 6442), and in the 
Council newsletter and other media. This notice specifically stated 
that anyone entering the charter halibut fishery after the control date 
of December 9, 2005, will not be assured of future access to that 
fishery if a limited access system is established that limits 
participation in the fishery.
    The ``recent participation'' requirement is an important element in 
this rule as it serves to initially allocate charter halibut permits to 
businesses that were participating in the fishery during the historical 
qualifying years and are still participating during the most recent 
year for which NMFS has complete logbook information. This also 
demonstrates that the Council and Secretary have taken into account 
present participation as required by the Magnuson-Stevens Act section 
303(b)(6). The ``same vessel'' requirement is clarified in response to 
Comments 54 and 56 and by the change in this rule from the proposed 
rule (see ``Changes from the Proposed Rule'' below).
    This rule may allow up to 72 community charter halibut permits to 
be issued to CQEs representing communities in Area 2C and up to 98 in 
Area 3A, for a total of 170. These are the maximum number of community 
charter halibut permits allowed under this rule and they may not all be 
issued.
    Comment 77: It is difficult to comment on the proposed rule because 
it is confusing and ambiguous in several places. The proposed rule has 
many stated objectives depending on the agency providing information. 
The Analysis (at page 2) states that the purpose and need for action is 
due to the reallocation of halibut harvest to the charter sector from 
the commercial sector. Since 1997, the commercial sector has been 
trying to protect their fisheries by submitting different proposals 
from quota share programs to limited entry programs. This proposal 
begins with an inaccurate statement and continues with inaccuracies 
throughout including the data used for this proposal.
    Response: The problem statement on page 3 of the Analysis (see 
ADDRESSES), describes the evolution of the issue and then succinctly 
states the problem:

    ``To address the potential rush of new entrants into the charter 
fishery, the Council is considering establishing a moratorium on the 
charter sector. The moratorium is to provide an interim measure of 
stability in the guided sport halibut sector during the step-wise 
process toward a long-term solution. In doing so, however, the 
Council is also concerned with maintaining access to the halibut 
charter fishery by small, rural, coastal communities. To address 
this, the Council is considering establishing a separate program to 
allow these communities to enter the halibut charter fishery.''

    The Analysis accurately points to a de facto allocation of the 
halibut resource over the years from the commercial fishery to the 
charter fishery as the charter fishery expanded its activity. The 
Analysis states that the Council began to consider methods to cap the 
growth of charter halibut harvests in 1993. The historical information 
presented in the Analysis is accurate. Further, the Analysis 
incorporates the best scientific information available.
    Comment 78: I am in favor of limited access for the charter fishery 
for halibut similar to the commercial program. I am a small stakeholder 
in both fisheries and have seen my small commercial IFQ for halibut cut 
in half from its original allocated poundage. My only concern is that I 
will not have enough years in the charter business to qualify for an 
allocation. I would like to see a provision in the new regulations that 
would allow a commercial fisherman to use his allocation as a charter 
fisherman.
    Response: This rule makes no connection between the commercial IFQ 
halibut fishery and the charter halibut fishery. A charter halibut 
permit under this rule does not specify an amount of halibut that may 
be harvested as does an IFQ permit. The Council has adopted a new 
recommendation for a catch sharing plan that contains a proposal for a 
limited transfer of IFQ halibut to a charter halibut permit holder. A 
future proposed rule may be developed that will describe this proposal.
    Comment 79: Is the definition of a ``halibut logbook fishing trip'' 
in the proposed rule consistent with the Council motion? Footnote 8 in 
the motion specifies that, for the year prior to implementation, 
evidence of participation includes ``actual halibut statistical area, 
rods, or boat hours.'' We presume that this means that a bottomfish 
statistical area or bottomfish boat-hours must be reported along with 
at least one halibut kept or released for that boat-trip. The 
definition of a halibut logbook fishing trip in the proposed rule, 
however, appears to exclude the requirement that a bottomfish 
statistical area be reported if bottomfish boat-hours are not reported. 
It is common for vessels targeting salmon to catch halibut. Charter 
operators targeting salmon were instructed in 2007 and 2008 to report 
the statistical area and boat-hours under the salmon target category. 
Therefore, the proposed definition of ``halibut logbook fishing trip'' 
might include some unknown number of trips without bottomfish effort as 
long as at least one halibut was reported kept or released. This 
suggests that the Council's intent was that the boat had to have 
reported a bottomfish statistical area or bottomfish boat-hours along 
with any halibut kept or released as evidence of participation.
    Response: Credit for participation in 2008 (the recent 
participation year) depends on the number of halibut logbook fishing 
trips in that year. A

[[Page 580]]

halibut logbook fishing trip will be a trip for which a business owner 
reported, within ADF&G time limits, the number of halibut kept or 
released, the number of boat hours that the vessel engaged in 
bottomfish fishing, or the statistical area(s) where the halibut 
fishing occurred. Footnote 8 in the Council's motion explains that 
evidence of participation includes ``[a]ctual halibut statistical 
areas, rods, or boat hours as reported in ADF&G logbooks * * *.''
    The Council's motion uses the conjunction ``or'' indicating that 
actual halibut statistical areas and boat hours are alternative ways to 
meet this requirement. This parallels the use of the word ``or'' in the 
paragraph on ``Evidence of participation.'' This rule uses the same 
construction in the definition of ``halibut logbook fishing trip'' at 
Sec.  300.67(f)(3) and specifies that any one of the pieces of 
information--the number of halibut kept, the number of halibut 
released, the boat hours that the vessel engaged in bottomfish fishing, 
or the statistical area(s) where halibut fishing occurred--would be 
sufficient.
    The Council's motion language may lead to some businesses 
qualifying for charter halibut permits because their charter vessels 
anglers caught halibut incidentally to salmon catches. The 2008 logbook 
did not include information on the number of rods, but did include 
information on the number of halibut kept and released, and NMFS used 
this information along with the statistical area and boat hours 
information. NMFS interprets the Council's reference to boat hours as a 
reference to bottomfish target boat hours. While the number of rods 
might have been included in the definition of halibut logbook fishing 
trip to be consistent with the Council's motion, it would not make 
sense because that data field was not included in 2008 logbooks.
    Comment 80: The definition of a charter vessel angler is in 
conflict with the definition of sport fishing guide services, since a 
non-paying angler included in the first definition is not receiving 
``assistance for compensation.'' This definition should be replaced 
with ``charter vessel client'' and not include non-paying anglers. 
Also, the definition of charter vessel operator should be changed to 
specify that the operator is in ``physical control of the vessel'' in 
order to distinguish this from other types of control (e.g., 
financial).
    Response: No change is made to the definition of charter vessel 
angler or sport fishing guide services. NMFS intends the definition of 
``charter vessel angler'' at Sec.  300.61 of this rule to include non-
paying anglers. The definition of ``sport fishing guide services'' is 
not limited to situations where charter vessel anglers are directly 
compensating someone for services. If someone is compensated in any 
manner by any person to provide sport fishing assistance, then that 
person is providing sport fishing guide services according to this 
definition. NMFS acknowledges the need to clarify the proposed 
definition of charter vessel operator. See discussion below under the 
heading ``Changes from the Proposed Rule.''
    Comment 81: Revise Sec.  300.66(b) ``Fish for halibut except in 
accordance * * *'' to read ``Catch and retain halibut except in 
accordance * * *.'' This change is suggested to ensure that limited 
entry permit requirement prohibitions are not applied to vessels that 
may incidentally catch, but not retain, halibut. Likewise, most of the 
bulleted descriptions of prohibitions on page 18190 of the proposed 
rule refer to vessels fishing for halibut, when in fact these 
prohibitions are only in effect for vessels with anglers catching and 
retaining halibut. It is virtually impossible to define a vessel or 
angler that is ``fishing for halibut'' because the gear and fishing 
technique used for halibut are similar to that used for other 
bottomfish species.
    Response: No change is made. The prohibition at Sec.  300.66(b) 
previously read, ``fish for halibut except * * *.'' The only change 
proposed in the proposed rule published April 21, 2009 (74 FR 18178), 
and made final by this rule is to add a reference to Sec.  300.67. The 
phrase ``fish for halibut'' existed previously and was not proposed. It 
is used deliberately, so that the prohibition will apply to vessels 
fishing for halibut. Vessels fishing for halibut may not be successful, 
but if they are successful, they may not retain the halibut unless 
authorized to do so.
    Only one of the prohibitions on page 18190 of the proposed rule 
refers to ``fishing for halibut.'' This bulleted point is actually more 
general than the corresponding changes to regulations in Sec.  300.66. 
Most of the prohibitions in the regulatory text at Sec.  300.66 refer 
to vessels ``with one or more charter vessel anglers on board catching 
and retaining halibut.''
    Comment 82: The requirement to have a logbook on board is not 
consistent with current ADF&G regulations, nor is it necessary to 
enforce logbook reporting. ADF&G regulations and instructions do not 
currently require that the logbook be carried on board the vessel, only 
that it be completed before offloading any fish (or clients, if no fish 
kept), or if operating a trailer boat, that it be completed before 
offloading any fish and departing the launch site. This is because some 
guides that operate small skiffs keep the logbook in the vehicle 
pulling the boat trailer to protect the logbook from the elements. This 
prohibition should be revised to say: ``Operate a vessel in Area 2C or 
Area 3A with one or more charter vessel clients on board that are 
catching and retaining halibut without completing a State of Alaska 
Department of Fish and Game saltwater charter logbook that specifies 
the following * * *.''
    Response: The saltwater charter logbook needs to be onboard the 
charter vessel during a fishing trip, similar to the commercial IPHC 
logbook requirements. NOAA Office of Law Enforcement and USCG 
enforcement personnel depend on being able to review the logs while the 
vessel is engaged in fishing. The optimum time to enforce charter 
halibut regulations is either at sea during the fishing trip or 
dockside when the fishing trip is terminating. Effective enforcement is 
compromised if the logbook is not available to an authorized officer 
during these encounters. A logbook may be kept in a dry bag or dry 
container to protect it from the weather or sea spray while onboard a 
small open boat. NMFS acknowledges that ADF&G regulations and 
instructions do not currently require that the ADF&G saltwater charter 
logbook be carried on board the vessel. As this erroneous information 
was not in the proposed regulatory text, no change is made in this 
rule.
    Comment 83: All references to ``licensed business owners'' or 
``business owner licenses'' during the qualifying years (2004-2005) 
should be replaced with ``registered or licensed business owner'' or 
``business owner license or registration.'' There was no business 
license in 2004, only a business registration.
    Response: NMFS acknowledges the need for this correction. See 
discussion below under the heading ``Changes from the Proposed Rule.''
    Comment 84: The final rule needs to clarify if there will be an 
annual permitting process. Page 18192 of the proposed rule states that 
there would be a start of the program application process and then no 
additional application would be required. In the next paragraph it 
states NMFS would require additional reports only when the structure of 
the business owning the permit changes or the permit is transferred. 
The executive summary of the Analysis, on page xxv, under business 
ownership information, states that persons would need to annually 
disclose affiliation and ownership through an application and affidavit 
to

[[Page 581]]

NMFS and that enforcement of this provision would require NMFS to have 
the authority to suspend a permit until the business provides the 
necessary annual documentation.
    Response: The proposed rule is correct; no change is made in this 
rule. This rule at Sec.  300.67(h) provides for a single application 
period for an initial allocation of charter halibut permit(s). The 
permit(s) will not expire annually. A charter halibut permit will cease 
to be valid, as stated at Sec.  300.67(j)(3), if the permit holder is 
an individual and the individual dies, or if the permit holder is a 
non-individual entity and the entity dissolves or changes as defined at 
Sec.  300.67(j)(5). NMFS must be notified within 30 days of the death 
of an individual who holds a transferable or non-transferable permit. 
For a non-individual entity, NMFS must be notified within 15 days of 
the effective date of a change as required at Sec.  300.67(j)(5)(ii). A 
``change'' is defined at Sec.  300.67(j)(5). The purpose of this 
requirement is to monitor and enforce the expiration of non-
transferable permits and the excessive share limit and its exceptions 
under Sec.  300.67(j). NMFS determined that an annual statement of 
ownership or affiliation is not necessary and would save administrative 
costs for affected business and NMFS. Most other limited access systems 
administered by NMFS for Alaska fisheries do not require annual permit 
applications. Compliance with the notification requirement when there 
is a ``change'' in the status of the permit holder as defined at Sec.  
300.67(j)(5) should be sufficient to monitor and enforce the excessive 
share limit and its exceptions under Sec.  300.67(j).
    Comment 85: Absentee ownership of access privileges has been 
identified by Congress as a significant threat to fishery dependent 
communities. However, this rule seeks only to discourage, not prohibit, 
leasing. If implemented as written, this program will allow limited 
entry permit holders to divest themselves of all aspects of a charter 
business except the permit, then lease owned permits to active charter 
boat operators. Entities with no working connection to the charter 
industry and fishery dependent communities will be authorized to draw 
rents from the resource. The prospect of permit leasing raises concerns 
about the impact on transferable permit prices, the potential for 
permit concentration with individual owners, the potential for permits 
to become concentrated in ports with the greatest number of summer 
visitors (exacerbating identified fishing ground congestion and 
localized depletion in those areas), undercutting commitment to 
stewardship often associated with the receipt of a permit in a limited 
access program. The impacts of leasing on communities and the resource 
have not been adequately addressed. Various proposals were made for 
reducing the potential for leasing, including requiring (except in 
limited circumstances) permit holders to be on board when permit-
authorized fishing takes place, limiting leasing operations by 
geographic area, limiting pure leasing without full investment in the 
capital or operations of the business, and requiring the charter permit 
holder to be present in the Alaska community where the charters 
originate.
    Response: This rule does not have an explicit prohibition against 
leasing, although the Council recommended one, for the reasons 
discussed in the proposed rule (74 FR 18178, April 21, 2009) at page 
18191. The charter industry has a variety of business models, and the 
way some of these business models function is substantially similar to 
a lease between the permit holder and the vessel operator. For example, 
the owner of a charter business or of a business such as a wilderness 
lodge, that also provides charter services, employs hired skippers and 
guides to operate one or more vessels. The charter business may or may 
not own the vessels. The rules governing the identification of 
qualified businesses and the number of permits they would receive did 
not require vessel ownership by the qualified business. Operations by 
these businesses may be difficult to distinguish from leasing. There is 
no bright line between how these types of businesses operate and what 
would be considered leasing arrangements. For this reason, enforcement 
of a prohibition on leasing would be difficult, time consuming, and 
costly. NMFS determined that the benefits derived from a leasing 
prohibition did not justify the costs of enforcement and the disruption 
to existing business operations.
    Comment 86: Several comments requested clarification on what an 
angler endorsement authorizes. Specifically, does it apply only to the 
number of halibut clients (presumably paying but not non-paying halibut 
fishermen) and does not govern the total number of people on board?
    Response: Each charter halibut permit will have an angler 
endorsement number. The angler endorsement number on the permit is the 
maximum number of charter vessel anglers that may catch and retain 
halibut on board the vessel authorized by the permit (see 50 CFR 
300.66(s) and (t)). The angler endorsement does not limit the number of 
passengers that an operator may carry, only the number that may catch 
and retain halibut. The term ``charter vessel angler'' is defined in 
this rule (50 CFR 300.61) to include all persons, paying or non-paying, 
who use the services of the charter vessel guide. The charter halibut 
permit, once issued with its angler endorsement, would limit the number 
of charter vessels anglers who can catch and retain halibut on the 
permitted vessel.
    Comment 87: The proposed rule is not clear about how angler 
endorsements will be determined for an applicant who qualifies for more 
than one permit. Does that applicant receive an endorsement for the 
highest number of anglers in any one logbook for all of their vessels 
being issued to that applicant or is each vessel permit issued an 
angler endorsement based on its own individual history?
    Response: Charter halibut permits under this rule are issued to 
individuals or businesses which held ADF&G Business Owner Licenses (or 
registration) that authorized logbook fishing trips during the 
qualifying and recent participation periods. Hence, this rule is 
oriented toward the charter vessel activity of a qualifying business 
rather than the activity of specific vessels. The regulatory text at 50 
CFR 300.67(e) states simply that, ``a charter halibut permit will be 
endorsed for the highest number of charter vessel anglers reported on 
any logbook fishing trip in the qualifying period'' (except as provided 
at 50 CFR 300.67(e)(1) and (2)). Therefore, a qualifying charter vessel 
business will receive charter halibut permit(s) with an angler 
endorsement based on the highest number of charter vessel anglers 
reported by that business on any logbook trip in the qualifying period 
regardless of the number of vessels involved. The same endorsement will 
apply to all permits initially issued to the qualifying business. As 
explained in the preamble of the proposed rule (74 FR 18178, April 21, 
2009) at page 18184, this action is designed to limit the number of 
charter vessels participating in the charter halibut fishery, not to 
prevent all expansion of fishing effort. Of course, any such expansion 
would be constrained by safety, USCG licensing, and other regulations 
that limit the number of anglers that may be on board a vessel.
    Comment 88: Angler endorsements should be based on the year chosen 
by the applicant for determining the number of permits. This might work 
out as more permits and less anglers per boat, or they might choose to 
go with less permits but the permit would have

[[Page 582]]

a higher angler endorsement. They should not receive the highest 
endorsement value unless earned within the same year or you add 
additional latent capacity to the program that is not necessary.
    Response: This rule implements the Council's recommendation with 
regard to angler endorsements. Other more constraining alternatives are 
possible and may be necessary in the future. Proposals for such 
alternatives could be made to, and developed by, the Council for 
recommendation to the Secretary.
    Comment 89: Under the section ``Angler endorsement on permits'' the 
proposed rule states ``that the angler endorsement number on an 
applicant's permits would be the highest number of clients that the 
applicant reported on any logbook fishing trip in 2004 or 2005, subject 
to minimum endorsement of four.'' In some cases charter owners, 
including myself, have upgraded our vessels after the ``applicant 
selected year'' from traditional four angler configurations to more 
environmentally efficient six or more angler configurations. We should 
not be penalized for investing in and upgrading our equipment to be 
more environmentally friendly, safer, more cost effective, and remain 
competitive in our industry. I suggest grandfathering consideration be 
given to such situations, especially for those of us that have been in 
this business for a decade or more.
    Response: The Council's motion was meant to reflect the fleet 
composition and practices as they were in the qualifying period (2004 
and 2005). The recent participation year was meant to screen out 
operations that had not continued to be active in recent years and is 
not included to reflect capacity upgrades since the qualifying period. 
As a result, permit endorsements reflect business activity levels in 
2004 and 2005. The endorsement provisions are relatively liberal, 
reflecting the highest number of clients included on a trip taken by a 
qualifying business during the two year qualifying period. This 
endorsement is applied to all the permits received by the qualifying 
business. To the extent that a qualifying business does not receive 
charter halibut permits with endorsements that match its increased 
carrying capacity, the business could enter the permit market and 
obtain by transfer one or more permits with the appropriate number of 
endorsements, or ``stack'' two or more permits on a vessel.
    Comment 90: The angler endorsement system is cumbersome and 
inflexible. Special identification cards equal to the number of angler 
endorsements should be issued to each halibut charter permit holder. 
The permit holder may fish, lease, or sell any or all of the angler 
endorsements. The proper number of angler endorsement cards must be on 
the vessels when engaged in the catching and retention of halibut equal 
to halibut anglers. All angler endorsements will have the proper 
identifying information, and this information will be entered into the 
ADF&G logbooks. The maximum number of angler endorsements per permit 
should be capped at six and the minimum at one. Allowing halibut 
charter permit holders to buy and sell individual angler endorsements 
will provide flexibility and a more affordable means for new entrants 
into the fisheries. The present proposal allows only for the buying or 
stacking of four, five, or six angler endorsements with a halibut 
charter permit. The buying and selling of angler endorsement cards will 
be similar to the process of buying and selling transferable halibut 
charter permits and can only be engaged in by entities that presently 
own halibut charter permits.
    Response: This is not the approach to endorsements recommended by 
the Council and implemented by this rule. Alternative approaches to 
angler endorsements are possible. Proposals for such alternatives could 
be made to, and developed by, the Council for recommendation to the 
Secretary.
    Comment 91: The types of permits proposed in the moratorium are 
unacceptable. The six-person and four-person permits will only allow 
operators to take six or four charter anglers, depending upon which 
permit is granted. Our vessel is certified for four to six anglers, and 
the number of anglers we carry varies by trip. We cannot run a 
profitable business with this restriction.
    Response: The angler endorsement represents the maximum number of 
anglers that may catch and retain halibut. This rule does not require 
that the number of charter vessel anglers on a vessel operating under a 
charter halibut permit exactly equal the angler endorsement on the 
permit.
    Comment 92: The proposed rule uses the term ``angler'' rather than 
``client,'' and states, ``The term `angler' includes all persons, 
paying or non-paying, who use the services of the charter vessel 
guide.'' This is problematic for two reasons.
    First, in 2004 and 2005 the ADF&G logbook required charter 
operators to report only the number of ``clients and crew that 
fished.'' Anglers that fished from a charter vessel without 
compensating the operator (comps) were not, and currently are not, 
considered ``clients'' or ``guided anglers'' because the operator was 
not compensated for services. Limiting charters to a number of anglers 
(including non-paying) equal to the number of paying clients in the 
past is inconsistent.
    Second, the proposed definition of ``charter vessel angler'' is not 
consistent with the proposed definition of ``sport fishing guide 
services.'' This is because the definition of ``charter vessel angler'' 
includes non-paying anglers that use the services of a charter vessel 
guide. The definition of a charter vessel guide includes a person that 
``provides sport fishing guide services'' and the definition of ``sport 
fishing guide services'' requires that assistance is provided ``for 
compensation.'' Therefore, a non-paying angler cannot be using the 
services of a charter vessel guide if that angler is not providing 
compensation.
    NMFS should consider defining charter clients as anglers that 
receive assistance for compensation (including any compensation, not 
just ``paying'' clients). There should also be a distinction between 
charter clients and anglers that fish on private boats but share the 
cost of bait and fuel with the owner, as this is a common practice.
    Response: The comment is correct that logbooks from 2004 and 2005 
did not explicitly request information on non-paying anglers or 
``comps.'' Reporting in this period is likely to have differed among 
businesses, with some including non-paying anglers under the heading of 
``comps'' and others not. The Council recommendation was for the number 
of endorsements to be the highest number of reported anglers on any 
trip conducted by the guide business in 2004 and 2005. In some 
instances, the number of endorsements may be lower than they would have 
been if the trip with the most anglers had included comps, and the 
operator had not reported comps under the client heading.
    A charter vessel angler includes the non-paying anglers that use 
sport fishing guide services. The definition of ``sport fishing guide 
services'' at 50 CFR 300.61 does not require each angler to be 
individually compensating the person providing sport fishing assistance 
for this definition to be applicable. This definition applies if there 
is any compensation from any source for assistance to a person who is 
sport fishing. Hence, no conflict exists between this definition and 
the definition for charter vessel angler.
    NMFS agrees that a distinction exists between a charter vessel 
angler and a non-guided angler. The former uses the

[[Page 583]]

services of a charter vessel guide (pursuant to the definitions at 50 
CFR 300.61) and the latter does not. Several friends in a boat sport 
fishing for halibut and sharing the costs of bait, fuel, or other 
supplies are not charter vessel anglers unless one of them is providing 
sport fishing guide services.
    Comment 93: The proposed rule talks about stacking permits. There 
is no mention of not being able to split a permit between boats. This 
would best fit our business plan as most operators may only need one or 
two more endorsements to add to a permit with four endorsements. (In 
Southeast Alaska, the maximum number of lines fishing per vessel is 
six.)
    Response: Stacking permits in this action means having more than 
one permit on a charter vessel to use the total number of angler 
endorsements. For example, an operator could hold two charter halibut 
permits, one with an endorsement of four and another with an 
endorsement of six. Both of these permits combined, or ``stacked,'' 
would authorize this operator to have up to 10 charter vessel anglers 
on board the vessel, unless this number of passengers is prohibited by 
USCG licensing or other safety rules or regulations. This rule does not 
provide for splitting permits as this would potentially multiply the 
number of permits initially allocated contrary to the intent of this 
rule.
    Comment 94: NMFS should issue permits only to charter businesses 
which have been in full compliance with the law. NMFS should require 
charter businesses to show proof of enrollment in a random drug testing 
program (as required by the USCG) in the qualifying as well as recent 
participation years, and proof of paying city sales tax in these years.
    Response: Enforcement of drug testing and sales tax rules is beyond 
the scope of this action.
    Comment 95: Why is Area 3A being treated the same as Area 2C? The 
proposed rule states that ``the Council recommended no change in 
management of the charter vessel fishery in Area 3A because that 
fishery appeared stable.''
    Also, a comparison of the number of active vessels and the level of 
harvest shows cases where the number of vessels appears to be inversely 
related to the level of harvest. The proposed rule states that ``the 
intended effect is to curtail growth of fishing capacity in the guided 
sport fishery for halibut'' and that ``open access in the charter 
vessel fleet has resulted in virtual unlimited increases in charter 
harvests.'' The vessel and harvest data cited refute this.
    Response: The first quote in the comment is from the preamble to 
the proposed rule published April 21, 2009 (74 FR 18178) in the third 
column on page 18180 in a discussion of Council actions in 2007 with 
respect to the GHL. In fact, the quoted sentence has additional text 
the reads, ``* * * appeared stable at about its GHL.'' In developing 
and implementing this rule, the Council and Secretary determined that 
applying a limited access system in Area 2C only would quickly result 
in excessive charter capacity in the adjacent Area 3A. Hence, applying 
this limited access system to both areas at the same time avoids a 
disjointed step-wise approach which would be more disruptive to the 
charter industry than this rule. While, the highest growth rate in the 
charter halibut fishery has been observed in Area 2C, the charter 
halibut fishery also has exhibited growth between 1999 and 2007 in Area 
3A. Elements of this rule accommodate different circumstances in Area 
2C and 3A. Large lodges with multiple permits are more common in Area 
2C. This rule accommodates this by allowing businesses to hold multiple 
permits, meeting lodge owners' needs. Large party boats are more common 
in Area 3A. This rule accommodates this by allowing stacking of permits 
and angler endorsements that vary on permits.
    The long-term trend in halibut harvests by the charter vessel 
sector does not refute the quoted statements. The trend in charter 
halibut fishery harvests between 2003 and 2007 in Area 3A is one of 
slow but steadily increasing halibut harvests from 2,724,000 pounds 
(1,235.6 mt) in 2002 to 4,002,000 pounds (1,815.3 mt) in 2007. A slight 
decline in the charter halibut harvest in 2006 is not significant.
    Comment 96: Community charter halibut permits are inconsistent with 
the purpose of this program. Issuing permits to communities is also 
unfair to persons who recently participated in the fishery but will not 
qualify for a permit under the program.
    Response: The Council recommended using the CQE program to help 
develop the charter vessel sector in certain rural communities. The 
Council balanced the objectives of stabilizing the guided charter 
sector and its rural development objectives. There will be constraints 
on CQE permits; they will be anchored in the rural communities. The 
Council has consistently included the objective of providing for the 
development of rural communities through the use of fishery resources. 
This is consistent with requirements of the Halibut Act. The Bering Sea 
Community Development Quota Program and the IFQ CQE programs are 
similar examples. All of these programs involve tradeoffs between rural 
communities and other user groups.
    The community charter halibut permits will be issued to CQEs, not 
directly to businesses. It is possible that, under agreement with the 
CQEs that hold community charter halibut permits, some of these permits 
will be used by businesses that entered the charter halibut fishery 
after 2005 and do not otherwise qualify for an initial allocation of 
charter halibut permit(s).
    Also, acquiring a transferable charter halibut permit through the 
market, contracting with another business that holds a charter halibut 
permit, arranging to use a community charter halibut permit, or 
changing the business plan to avoid targeting halibut are all 
alternatives for a person that does not qualify for an initial 
allocation of a charter halibut permit.
    Comment 97: The CQE program would allow expansion of the guided 
charter fleet and undercut the stabilization objectives of the program. 
Limits should be placed on the community permit program including: (a) 
No more than four permits be allowed in a community; (b) charter boats 
should be required to begin and end their trips in the community 
designated on the permit; (c) community eligibility should be based on 
whether or not 10 charter vessels terminated trips in the community in 
the qualifying years, not on whether or not 10 charter businesses did; 
(d) impose a recency qualification requirement on CQE groups (10 
charter vessel businesses terminate charter trips in the year prior to 
implementation).
    Response: While other management schemes can be envisioned, the 
Council indicated that stability in the charter halibut fishery was one 
of the principal objectives of this action. The Council also sought to 
support rural development objectives similar to those addressed in 
other Council programs. Although community charter halibut permits may 
allow for some increased effort, this rule also is designed to reduce 
overall effort over time. The elements that provide for such reduction 
in effort include minimum participation criteria to receive an initial 
allocation of a charter halibut permit, and the reduction in effort as 
non-transferable permits expire. With respect to the specific 
proposals:
    (a) No more than four community charter halibut permits per 
eligible community are permitted in Area 2C, while seven are permitted 
in Area 3A. The larger number of permits permitted

[[Page 584]]

in Area 3A reflects the larger resource base available in that area.
    (b) This rule requires all charter vessel fishing trips authorized 
by a community charter halibut permit begin or end within the 
boundaries of the community designated on the permit. This is meant to 
ensure that charter vessel anglers on the vessel have an opportunity to 
use the goods and services available in the community.
    (c) The approved Council recommendation clearly states that 
eligible communities are those ``in which 10 or fewer active charter 
businesses terminated trips'' in each of the qualifying years (2004 and 
2005). Regardless of this condition, this rule specifically names the 
eligible communities.
    (d) The approved Council recommendation does not include a recent 
participation requirement for community charter halibut permits. Such a 
requirement would be a substantive change to the proposed rule and will 
require a separate Council action and regulatory amendment to this 
rule.
    Comment 98: The Organized Village of Kake Council would like to see 
the Kake area be left open for local six-pack charter boats that would 
like to enter into the guided sport halibut fishery. Although the 
amount of sport charters in Kake is limited, the dozen that enrolled in 
the six-pack license class this past winter indicates an interest in 
guided sport halibut in our small town and should be given a chance to 
enter. We have witnessed the large number of charter businesses in the 
larger cities and can see that they need to be limited, but to shut 
down all of Southeast Alaska, including rural areas, to a limited 
license on sport halibut fisheries is too extensive and favors larger 
communities over rural villages. NOAA should study Kake to see what we 
are doing to develop a sustainable economy, which includes developing 
six pack charter boats that will help sustain the two or three lodges 
that we have in our community.
    Response: This rule has a special provision for rural communities 
like Kake through its CQE program. Kake is specifically listed in this 
rule as an Area 2C community that is eligible to receive community 
charter halibut permits (50 CFR 300.67(k)(2)(i)). As such, a CQE 
representing Kake can receive a maximum of four community charter 
halibut permits at no charge and can acquire a maximum of four 
additional charter halibut permits through the market for transferable 
charter halibut permits. Hence, a CQE representing Kake can hold a 
maximum of eight permits. Individual businesses in Kake are not limited 
by this provision from acquiring additional charter halibut permits.
    Comment 99: The CQE-eligible communities within the Gulf of Alaska 
would have preferred, under optimal conditions, an open access system. 
Given the current conditions which render an open access management 
system completely inappropriate, the measures provided for CQE 
communities in the proposed rule are fair and equitable. It has been 
previously demonstrated that the Halibut and Sablefish IFQ program 
disadvantaged these 42 communities. The resulting Amendment 66 to the 
Halibut and Sablefish Program created the CQE program and made CQEs 
eligible to purchase halibut and sablefish quota share. The proposed 
community charter halibut permit will help to provide much needed 
economic opportunity to the eligible CQE communities.
    Response: NMFS acknowledges the support for the CQE program.
    Comment 100: Special permits for U.S. Military Morale, Welfare, and 
Recreation vessels should be limited to the number of vessels that were 
operated by the military for morale, welfare, and recreational purposes 
during the qualification periods. Also, the vessels authorized by these 
permits should allow participation only to active military personnel 
and their immediate family. The stakeholder committee was provided 
information that indicated that an extensive list of qualified people 
go on military morale vessels including YMCA members, guests, and a 
wide variety of others that did not have anything to do with active 
military personnel and their immediate family.
    Response: This rule is designed, based on Council recommendation, 
to have a minimal effect on a Moral, Welfare and Recreation Program of 
the U.S. Armed Services. A special military charter halibut permit 
issued to such a program is non-transferable and restricted to the 
regulatory area designated on the permit. NMFS is aware of only one of 
these programs in Alaska currently offering recreational charter 
halibut fishing to service members. If it is determined that additional 
restrictions are needed on the use of military charter halibut permits, 
NMFS can issue a rule with those restrictions.
    Comment 101: The commenter supports the prohibition on operating a 
charter vessel in Area 2C and Area 3A during a single charter vessel 
trip.
    Response: NMFS acknowledges the support.
    Comment 102: The commenter supports the excessive share limit 
section as written. This issue was debated and the Council recommended 
that larger businesses retain their grandfather rights if the business 
is sold with all assets and permits. NMFS did a good job of writing 
this section to provide the balance that was recommended by the 
stakeholder committee and chosen by the Council as the preferred 
alternative.
    Response: NMFS acknowledges the support.
    Comment 103: The proposed rule ``grandfathers'' current 
participants that qualify for more than five permits to receive and 
operate more than five permits while restricting all other entities to 
five. Grandfathering in this manner has become an accepted practice in 
Alaska's quota share programs; however, other programs do not allow the 
grandfather rights (i.e., access privileges in excess of the excessive 
share cap defined for the fishery) to be sold in total as is proposed 
in this rule. Allowing grandfathering to continue after a business is 
sold raises serious social equity issues. While a case can be made for 
allowing large operations to continue to operate above the cap for a 
given amount of time, providing the opportunity for those licenses to 
all be sold to one entity perpetuates the inequity. We recommend that 
NMFS modify the proposed regulations to restrict purchasers of halibut 
guided sport limited entry permits to the defined excessive share limit 
of five permits.
    At a minimum we strongly recommend that NMFS remove the requirement 
that transfer of more than five permits be contingent upon the transfer 
of all assets, including lodges, vessels, and other assets. This 
provision will inflate the overall value of businesses holding more 
than five permits, providing them with a windfall. There is simply no 
need for NMFS to tie all business assets to the transfer of more than 
five permits; this is a market decision between buyer and seller, and 
is outside of NMFS's purview. This provision does not seem to be 
administratively feasible or appropriate.
    Response: The approved Council recommendation specifically provides 
for a conditional exception to the excessive share limit of five 
charter halibut permits. This provision, commonly called the 
``grandfather'' provision, applies only to an initial recipient of 
charter halibut permits that initially qualifies for more than five 
permits. The Secretary has approved

[[Page 585]]

this recommendation and it is implemented in this rule.
    One condition to this grandfather provision is that it applies as 
long as the initial recipient of more than five charter halibut permits 
continues to exist as it does at the time it is initially issued the 
permits. If the initial recipient is an individual and dies, then the 
exception stops and the individual's successor-in-interest may not hold 
more than five permits. If the initial recipient is a non-individual 
corporate entity that dissolves or changes, then the exception also 
stops and the new or changed entity may not hold more than five 
permits. This rule refers to 50 CFR 679.42(j)(4)(i) for the meaning of 
``change'' for a non-individual entity.
    The other condition allows grandfathered permits in excess of the 
five-permit limit to be transferred to a new person (i.e., individual 
or non-individual entity) without application of the five-permit limit 
providing, among other things, that the person transferring its 
grandfathered permits also is transferring its entire charter vessel 
fishing business, including all assets of that business, to the person 
designated to receive the permits. The language of the Council 
recommendation stated that ``grandfathered permits that are sold in 
total when a business owner sells his entire business/fleet maintain 
that grandfathered status.'' This rule implements this language by 
stating that ``NMFS may approve a permit transfer application that 
would result in the person that would receive the transferred permit(s) 
holding more than five (5) * * * permits if * * * [t]he person 
transferring its permits also is transferring its entire charter vessel 
fishing business, including all assets of that business, to the 
designated person that would receive the transferred permits'' (50 CFR 
300.67(j)(6)).
    These exceptions are designed to balance the need to apply the 
excessive share limit to the charter halibut fishery in these areas 
with the need to recognize that some charter vessel businesses will 
qualify for more than five permits and should be allowed to continue 
business with the same number of charter vessels for which they 
initially qualified. The Council and Secretary intend, however, to have 
more charter vessel businesses comply with the excessive share limit 
over time than may do so at the time of initial allocation of permits. 
As charter businesses change, exit, and enter the charter halibut 
fishery over time, the number of businesses holding grandfathered 
permits should decrease relative to the number that received them at 
initial allocation. This outcome is encouraged to the extent that costs 
of transferring grandfathered permits are increased by the ``all 
assets'' requirement at 50 CFR 300.67(j)(6)(iv).
    NMFS will require applicants for transfers of charter halibut 
permits in excess of the excessive share limit to attest that (1) the 
existing permit holder that holds more than five permits will be 
transferring all of the transferable permits that were initially issued 
together, (2) the current permit holder will be transferring all assets 
of its charter vessel fishing business along with the permits, and (3) 
the person that will receive the permits in excess of the excessive 
share limit does not hold any permits at the time of the proposed 
transfer. NMFS also will require applicants to submit a copy of the 
charter vessel fishing business sale contract with the application for 
transfer of charter halibut permits. The comment is correct that NMFS 
does not define or describe all of the assets that will have to be 
included in the sale of a charter vessel fishing business because each 
sale will be unique. NMFS may require additional documentation of the 
items included in the sale of the business.
    Comment 104: The excessive share limit section in the proposed rule 
limits any charter owner from growing beyond five vessels or its 
current size. We understand the desire to limit consolidation of 
permits to only a few owners; however, this provision is overly 
restrictive. Further it would prevent a permit holder from selling to 
another entity that has any permits thus limiting market value. An 
alternative needs to be developed.
    Response: An excessive share limit to prevent excessive 
consolidation under a limited access system is a requirement of the 
Halibut Act (see discussion above under the heading ``Consistency with 
Halibut Act''). Determining what is excessive is a public policy 
judgment of the Council that is based on the current structure of the 
charter halibut fishery. Alternative excessive share limits should be 
suggested to the Council for development and potential recommendation 
to the Secretary. Also, permit holders would be prevented from 
receiving permits by transfer only if the transfer would result in that 
person holding more than five permits.
    Comment 105: Several comments stated that charter businesses had 
been purchased between the qualifying period (2004 or 2005) and the 
recent participation period (2008). Page 18182 of the proposed rule (74 
FR 18178) states that ``[c]harter halibut permits would not be awarded 
to persons who purchased a charter fishing business that met some or 
all of the participation requirements but who themselves do not meet 
the participation requirements.'' The proposed rule specifies that NMFS 
would not recognize private business purchase agreements when issuing 
permits because the Council did not recommend it.
    The comments disagree with the proposal to not recognize private 
business purchase agreements when issuing permits, stating that they 
purchased charter businesses that had sufficient participation in the 
qualifying period and continued to operate the business in the recent 
participation period. Some comments specified that their business 
purchases included the fishing history of the business's vessels, 
rights to any limited entry program benefits, and in some cases, the 
purchasers have taken possession of the business's logbooks from the 
qualifying period. One comment requested analysis of the impacts of 
either including or excluding a number of potential initial recipients 
due to private agreements to transfer participation history with a 
business. Another commenter stated that he consulted a lawyer when 
drafting the contract of sale to prevent problems with the transfer of 
the future limited entry permit and any future IFQs and notified NOAA 
General Counsel of the sale. Another commenter stated a belief that the 
Council intended for persons that purchased rights and operating 
histories and met other application criteria (e.g., operated the year 
prior to implementation) to be eligible for permits. One comment 
suggested that NMFS should change the rule to specify that if a charter 
operation met the minimum qualifications in 2004 or 2005 but was sold 
after 2005 and kept the same name, that charter company will qualify 
for a permit if it met the minimum requirements in the recent 
participation period. The comment suggests that NMFS establish an 
appeal process to address this issue if the rule is not changed.
    Response: NMFS did not propose to recognize private agreements for 
several reasons that were stated in the proposed rule preamble. 
Prominent among these was that the Council did not recommend this 
policy. The Council has expressed its intent to recognize private 
agreements that transfer participation history in the establishment of 
other limited access systems, but not for this action. Because the 
Council did not recommend to recognize private agreements for this 
action, NMFS did not include such a provision in the rule implementing 
this program.
    Notwithstanding the narrative in the proposed rule (74 FR 18178, 
April 21,

[[Page 586]]

2009) preamble on page 18182, the proposed rule also makes clear on 
page 18186 that NMFS will issue a charter halibut permit to the entity 
that held the ADF&G Business Owner License that authorized the logbook 
fishing trips that met the participation requirements. Further, the 
proposed rule at page 18186, states that NMFS will follow the form of 
ownership that the business used to obtain legal authorization from the 
State of Alaska for its past participation in the charter halibut 
fishery. NMFS will not determine the owners of a corporate entity or 
the members of a partnership that held the appropriate license. An 
applicant that receives an initial administrative determination finding 
that the applicant does not qualify for a permit may appeal that 
determination as specified in this rule at 50 CFR 300.67(h)(6) and 
described in the proposed rule on page 18186 and 18195.
    Comment 106: The criteria for a permit should be based on currently 
licensed guides' total catch records. Do not allow any newcomers to 
qualify for charter halibut permits but grandfather current charter 
operators into the program.
    Response: The Council could have chosen alternative qualifying 
criteria for demonstrating participation in the charter halibut 
fishery. The Council noted in its problem statement that it had 
previously considered other options including awarding quota share 
based on catch records. In this action, however, the Council selected 
2004 and 2005 as the qualifying period which is consistent with the 
problem statement and the Halibut Act as described above under the 
heading ``Consistency with Halibut Act.'' Anyone who started a charter 
halibut fishing business after the December 9, 2005, control date (71 
FR 6442, February 8, 2006) was on notice that they may not qualify for 
participation under a future moratorium on new entry or other limited 
access program.
    Comment 107: Magnuson Stevens 1853(b)(6)(A) requires that a limited 
access system take into account present participation in the fishery. 
With 2004 or 2005 being the qualifying years for participation in the 
proposed limited access fishery and 2009 being the year of 
promulgation, we are looking at data that is four to five years old 
being used to establish who gets a permit. In Alliance Against IFQs v 
Brown, while upholding the agency decision, the Ninth Circuit held 
that, the three-year delay ``pushed the limits of reasonableness,'' but 
did not constitute arbitrary and capricious agency action. Reliance on 
data four to five years old may exceed the limits referenced by the 
Court. If NMFS chooses to press forward with the rule, it should drop 
the qualifying year requirement and consider only the year prior to 
implementation.
    Response: As discussed above under the heading ``Consistency with 
Halibut Act,'' the Council is required to consider present 
participation in the fishery and historical fishing practices in, and 
dependence on, the fishery when developing a limited access system. The 
charter halibut permit program is consistent with this requirement. The 
Council intended to require active participation in the qualifying 
period (historical) and the recent participation period (present) 
because it determined a business that participated in both periods 
demonstrates an acceptable level of dependence on the charter halibut 
fishery.
    Comment 108: If qualification for a charter halibut permit is based 
on the 2004 and 2005 logbooks, many charter captains will be adversely 
affected. Although some may have the funds to buy the limited entry 
permits they need to keep operating, I am not likely to be able to 
afford to buy any permits.
    Response: At the beginning of the development of this rule, the 
Council announced a control date of December 9, 2005, to alert 
potential businesses of the possibility of a limited access system for 
the charter halibut fishery. This announcement was made by a Federal 
Register notice published February 8, 2006 (71 FR 6442). This notice 
informed any business entering the charter halibut fishery in Areas 2C 
and 3A after 2005 that they were not be assured of future access to the 
fishery if a limited access system was developed and implemented.
    Comment 109: Two separate comments noted that their participation 
in the charter halibut fishery during the qualifying period was 
prevented because of problems with vessels.
    Response: The Council recognized that certain unavoidable 
circumstances could prevent a permit applicant from participating in 
either the qualifying period or recent participation period. The 
preamble to the proposed rule (74 FR 18178, April 21, 2009) on page 
18187 contains a detailed description of the unavoidable circumstances 
exception to the qualification requirements. To qualify for the 
unavoidable circumstances exception in the charter halibut permit 
program, an applicant must demonstrate that (1) it participated in 
either the qualifying period or the recent participation period, (2) it 
had a specific intent to participate in the period the applicant 
missed, (3) the circumstance that thwarted participation was 
unavoidable, unique to the applicant, and unforeseen and unforeseeable, 
(4) the applicant took all reasonable steps to overcome the problem, 
and (5) the unavoidable circumstance actually occurred. Permit 
applicants that are initially denied a charter halibut permit may make 
an unavoidable circumstances appeal through the NOAA Office of 
Administrative Appeals.
    Comment 110: Please rewrite the rule to include regular active duty 
soldiers. Under the proposed rule, those who volunteered for active 
military duty in 2004 and 2005 do not qualify for the military 
exemption, unlike those called up from the reserves. The proposed rule 
states that volunteers will not qualify for a charter halibut permit 
since they chose to serve this country instead of staying home and 
fishing. As stated under Military Exemptions: ``This exemption would 
not apply to persons in the regular armed forces. The rationale for not 
including persons in the regular armed forces is that a person's 
decision to enlist in the regular armed services is a voluntary career 
choice and is not unavoidable.''
    In the Council motion, the military exemption in footnote 10 reads: 
``The military exemption refers to an individual who was assigned to 
active military duty during 2004 or 2005, who qualifies as `active' 
during the year prior to implementation, and who demonstrated an intent 
to participate in the charter fishery in Area 2C or 3A (prior to the 
qualifying period).'' What is NMFS's interpretation of ``active duty''? 
As stated above, it does not address active duty or reserve components 
specifically.
    Response: NMFS agrees that it misinterpreted the Council's motion. 
Regulatory text at 50 CFR 300.67(g)(3)(i) is changed in this rule to 
add ``active U.S. military'' to active service in the National Guard or 
military reserve (see discussion below under the heading ``Changes from 
the Proposed Rule''). The approved Council recommendation, as correctly 
quoted in the comment, does not limit ``active military duty'' to 
service in the National Guard or military reserve. The proposed rule 
misinterpreted this phrase to apply only to the National Guard or 
military reserve due to experience with a different exception for 
service in the National Guard or military reserve that applies to the 
IFQ fisheries for halibut and sablefish (73 FR 28733, May 19, 2008). In 
this rule, however, active military duty is functionally the same 
regardless of what military unit a person is assigned. NMFS understands 
that

[[Page 587]]

enlistment in a regular branch of the U.S. military is not necessarily 
a career choice due to the fact that enlistment periods are short 
relative to a typical career of 20 or 30 years.
    Comment 111: The halibut stocks would be better protected if the 
qualifying years (2004 and 2005) were moved back at least one year.
    Response: NMFS determined that the halibut stocks are adequately 
protected under this rule. The selection of the qualifying years 
involved consideration of participation in the charter halibut fishery 
as required by the Halibut Act.
    Comment 112: Two comments noted that representatives of the charter 
industry took part in developing the charter halibut permit program and 
held different views on its rationale.
    Response: The history of management of the charter halibut fishery 
generally, and limited access management, in particular, was summarized 
in the preamble to the proposed rule (74 FR 18178, April 21, 2009) on 
pages 18179 to 18182. That summary references the Council's charter 
halibut stakeholder committee. Although this committee made specific 
recommendations to the Council regarding the elements and options under 
consideration, the Council's development of this rule also was 
influenced by its problem statement, analysis of alternatives (see 
ADDRESSES), and extensive public testimony.
    Comment 113: We support the criteria for awarding permits and 
anticipate that most charter operators in our area will qualify under 
the number of vessels. This should effectively reduce fleet size and 
fishing capacity from current levels for charter businesses that have 
overcapitalized in recent years. Charter operators will still be able 
to lease additional vessels beyond those for which they receive permits 
under the limited access program or will eventually procure additional 
permits.
    Response: NMFS acknowledges the support for this rule.

Other Management Measures

    Comment 114: The charter industry should support scientific 
research on the halibut resource. This scientific research can be 
funded in part by a percentage of charter businesses' earnings going to 
the halibut and salmon commissions for the studies that are necessary 
to sustain these stocks. There is enough room in the fishery for the 
commercial and charter businesses to exist. Let's work together to 
assure that this natural resource will remain abundant forever. We all 
want healthy abundant stocks.
    Response: This rule does not establish a fee on the distribution or 
use of charter halibut permits, nor does it establish cost recovery 
fees for holding charter halibut permits. Cost recovery fees are not 
authorized for this rule because charter halibut permits do not 
allocate a percentage of the total allowable catch to each permit 
holder.
    Comment 115: Does paragraph 300.66(i) of the proposed rule mean 
only the vessel owner and immediate family can use the vessel for 
subsistence fishing, or does it mean the vessel owner or immediate 
family must be onboard, and any other individual is allowed as long as 
he or she has a subsistence permit? We are strongly against the former 
interpretation, as it restricts the use of our vessel when we are not 
chartering.
    Response: The prohibition at 50 CFR 300.66(i) was established by 
the rule published September 24, 2008, at 73 FR 54932. This paragraph 
is amended in this rule to include a unique definition of the term 
``charter vessel'' that pertains only to this prohibition. This 
prohibition was developed by the Council in 2004 to allow an individual 
who holds a subsistence halibut registration certificate (SHARC) and 
also owns a charter vessel to use the vessel for subsistence fishing 
for halibut. This can be done only if the vessel's owner of record and 
his/her immediate family are on board and each individual engaging in 
subsistence fishing on board the charter vessel holds a SHARC. Hence, 
the prohibition at 50 CFR 300.66(i) prohibits any person other than the 
charter vessel's owner of record and immediate family from being on 
board a charter vessel if anyone on board the vessel is engaged in 
subsistence fishing for halibut.
    Subsistence halibut regulations, published April 15, 2003 (68 FR 
18145), prohibited retention of any subsistence halibut that were 
harvested using a charter vessel. The Council and Secretary 
subsequently authorized an exception for individuals who owned a 
charter vessel and also held a SHARC to use the vessel for their 
harvest of subsistence halibut. The exception does not apply if anyone 
other than the owner and his/her immediate family is on board the 
vessel. This rule simply adds a unique definition of ``charter vessel'' 
for purposes of this prohibition.
    Comment 116: Subsistence and commercial halibut participation 
rights should be changed. Subsistence use should be based on need, not 
where you live. A return to the old two hook subsistence gear would be 
nice, as would having to adhere to sport fishing regulations on daily 
limits. There is no need for allowing one individual to take 15 or 30 
halibut a day just because he or she lives in a ``rural'' community. 
Also, since the implementation of the IFQ program for commercial 
halibut fisheries, there has been an increase in commercial fishing 
gear in areas that traditionally were free of this gear.
    Response: This rule does not make any changes to fishery management 
regulations for the subsistence or commercial setline fisheries. 
Suggestions for such changes should be directed to the Council for 
recommendation to the Secretary.
    Comment 117: Ban all charter fishing in the area for all time.
    Response: Prohibiting the charter halibut fishery was not 
considered as an option or alterative to this rule. Guided sport 
fishing for halibut is a legitimate use of the Pacific halibut resource 
and the second largest fishery (after the commercial setline fishery) 
for halibut in Areas 2C and 3A. Prohibiting the charter halibut fishery 
in these areas would severely diminish economic benefits to Alaska and 
other States. Moreover, prohibiting the charter halibut fishery would 
not achieve the objectives of this action.
    Comment 118: I disagree with the limited entry program. Could NMFS 
allow only Alaska residents to fish for halibut and keep the money with 
Alaskans?
    Response: The Halibut Act prohibits discrimination between 
residents of different States when making allocations of the halibut 
resource. Regulations established by this action apply to all permit 
holders, regardless of their business location or place of residence.
    Comment 119: Why limit charter operations? Why not also limit sport 
fishing permits and commercial operating permits for halibut fishing? 
When limits are placed on halibut for all entities involved, there are 
fewer boats on the water and fewer fish removed, and everyone is 
subject to the same rules.
    Response: Additional restrictions on the commercial setline and 
unguided sport fisheries for halibut are outside the scope of this 
action. The commercial setline fishery for halibut already operates 
under a limited access system. Since its implementation in 1995, the 
IFQ program for commercial setline fishery for halibut and sablefish 
limits entry to quota share and IFQ permit holders. A market for the 
distribution of these permits has developed just as is expected for 
charter halibut permits. In addition, the commercial setline fishery 
has taken large reductions in its catch limits in recent years.

[[Page 588]]

    The unguided sport fishery for halibut is different from either the 
commercial setline fishery or the commercial charter halibut fishery. 
Participation and harvest levels have remained relatively steady in the 
unguided sport fishery for over 10 years (1995 to 2007) and amount to 
roughly seven percent of total halibut removals. By comparison, the 
harvest and participation levels in the guided sport sector have 
increased over the same period and amount to roughly 14 percent of 
total removals. This growth in estimated halibut removals by the 
charter halibut fishery prompted action by the Council and NMFS. For 
now, the IPHC regulations governing unguided sport fishing for halibut 
appear to be sufficient for managing this relatively small fishery.
    Comment 120: The moratorium ignores the rapid and recent growth of 
the unguided recreational fishery and growth in the subsistence 
fishery. State of Alaska annual harvest estimates show that unguided 
halibut harvest in Area 2C increased from 122,562 pounds in 2006 to 
1.131 million pounds in 2007. The commercial catch limit is set by 
subtracting all other removals from the total CEY (constant 
exploitation yield); therefore, an allocation decision should not be 
made without taking into consideration the present participation in not 
only the commercial quota share and guided recreational fisheries but 
also the unguided recreational fisheries.
    Response: Actually, the ADF&G annual harvest estimates indicate 
that the unguided fishery in Area 2C harvested about 723,000 pounds 
(328.0 mt) in 2006, 1,131,000 pounds (513.0 mt) in 2007, and 1,265,000 
pounds (573.8 mt) in 2008. These estimates are point estimates at the 
midpoint of a range of possibilities. For example, the 95 percent 
confidence interval for the estimated harvest by the private unguided 
sport fishery in 2007 ranges between 987,000 pounds (447.7 mt) and 
1,274,000 pounds (577.9 mt). In addition, a growth trend is not 
apparent in the long-term harvest estimates of the unguided sport 
fishery. For example, over the 10-year period 1997 through 2006, the 
ADF&G estimated unguided sport harvest of halibut ranged from a low of 
723,000 pounds (328.0 mt) in 2001 and 2006 to a high of 1,187,000 
pounds (538.4 mt) in 2004. The average estimated unguided sport harvest 
of halibut over this period was 922,400 pounds (418.4 mt). With this 
perspective, the single year estimate of 1,131,000 pounds (513.0 mt) in 
2007 does not appear to be a significant increase. The Council 
considered the unguided recreational fishery harvest levels when it 
developed this rule (see Table 3 of the EA/RIR/IRFA prepared for this 
action [see ADDRESSES]). It did not recommend any restrictions on the 
unguided sport harvest of halibut because that did not appear to be 
necessary from the relatively stable long-term trend in estimated 
harvests by this sector. If this trend changes in the future, the 
Council or the IPHC may consider further restrictions on the unguided 
sport harvest of halibut in Areas 2C and 3A.
    Comment 121: Some rural Southeast Alaska communities are heavily 
dependent on commercial and subsistence fishing. Residents in rural 
Southeast Alaska, where there is no store and transportation in and out 
is by boat or seaplane service, must live off the surrounding land and 
seas. The moratorium must be limited to the guided sport charter sector 
only. Any extension to subsistence users would be an added hardship on 
the local economy already suffering from regulations that have 
unforeseen long-term effects on rural fishing towns.
    Response: This rule directly affects only the charter halibut 
fisheries in Areas 2C and 3A. No changes are made by this action to 
restrict commercial setline fishing or subsistence halibut fishing 
opportunity.
    Comment 122: I support the idea of limiting the number of 
participants in the charter halibut fleet. However, as an operator who 
runs trips that do not return to port for 7 to 10 days at a time, 
compliance with some rules is difficult. These include the requirement 
to save carcasses, not being able to skin halibut, not being able to 
freeze halibut on board, and having different size limits for a second 
halibut. Implementing such complicated rules should be avoided in the 
future, and the needs of operations that do not return to port each day 
should be considered.
    Response: NMFS acknowledges the support for this rule. No 
restrictions exist on freezing sport-caught halibut on board a vessel. 
The comment is referring to an allowance under ADF&G regulations that 
discounts sport-caught fish preserved for human consumption from any 
daily bag limit that may apply to that fish. These ADF&G regulations do 
not apply to sport-caught halibut, however. All halibut on board a 
vessel are counted toward the daily bag and possession limits that 
apply in the regulatory area in which the vessel is operating. Hence, 
sport-caught halibut possessed onboard a vessel must not be filleted, 
mutilated, or otherwise disfigured in any manner. An exception allows 
cutting halibut into two dorsal pieces, two ventral pieces, and two 
cheek pieces, with skin on all pieces (see section 28(2) of the annual 
management measures published March 19, 2009 (74 FR 11681)). If charter 
operators and sport fishermen have freezers on their vessels large 
enough to accommodate such pieces of halibut, no regulation prohibits 
them from being frozen.
    A requirement to save halibut carcasses is not included in this 
rule and is not currently in effect. The requirement that limits the 
extent to which sport-caught halibut may be cut and to leave the skin 
on is necessary to enforce the existing daily bag and possession 
limits. Because this regulation is needed to enforce other 
restrictions, it is not designed to discriminate against any particular 
charter vessel business model or sector of the industry. The current 
configuration of the charter sector fleet was considered by the Council 
and the Secretary when this rule was developed and implemented.
    Comment 123: I support limited access as it will help limit over 
fishing in the charter sector. Also, I believe that NMFS and the 
Council should continue to pursue an IFQ program for halibut charter 
operators. Commercial setline fishermen understand that lower quotas 
are due to stress on the stocks, but it is hard to see the commercial 
quota lowered due to continued pressure on the stocks by commercial 
sport charter operators who have consistently exceeded their harvest 
guidelines. The only fair way to resolve this is to develop an IFQ 
system for the charter fleet. This is the only way to protect the 
resource for all users--commercial, subsistence, and guided and 
unguided sport fishermen--and minimize conflicts between the sectors.
    Response: NMFS acknowledges the support for this rule. The preamble 
to the proposed rule for this action (74 FR 18178, April 21, 2009) and 
the notice for the December 9, 2005, control date for the guided sport 
fishery for halibut (71 FR 6442, February 8, 2006) describe the 
development of a charter vessel IFQ program and the reasons why it was 
not implemented. The Council may revisit this type of limited access 
system in the future. If so, the Council will develop regulations for 
such a system and recommend them to the Secretary as a separate action.
    Comment 124: I do not support establishing an IFQ program for the 
charter halibut fishery in IPHC Areas 2C and 3A.
    Response: This action does not implement an IFQ program for the 
charter halibut fishery. The preamble to the proposed rule for this 
action (74 FR 18178, April 21, 2009) and the notice for

[[Page 589]]

the December 9, 2005, control date for the guided sport fishery for 
halibut (71 FR 6442, February 8, 2006) describe the development of a 
charter vessel IFQ program and the reasons why it was not implemented 
at that time.
    Comment 125: I support the one-halibut daily bag limit to protect 
the halibut resource. It is very frustrating to watch the Area 2C 
halibut charter industry consistently over fish its GHL every year 
while the commercial setline fishermen must quit fishing when their 
quota is met. The same requirement should be placed on the charter 
sector. Please keep the one-halibut daily bag limit in place.
    Response: The one-halibut daily bag limit that was implemented in 
2009 on charter vessel anglers in Area 2C (74 FR 21194, May 6, 2009) is 
designed to keep the overall harvest of charter vessel anglers in Area 
2C close to the GHL for that area. That action is different from this 
rule.
    Comment 126: I generally support the necessity to conserve the 
halibut fishery. However, my concern is to the impact on the sports 
fisherman and the guided sport charter vessel as a small entity in a 
vast industry. The one-fish bag limit in Area 2C will virtually end 
charter fishing for halibut and reduce the guided angler harvest to the 
lowest level in the last 10 years.
    Please reconsider not only the stated intent to ``* * * limit the 
harvest of Pacific halibut by guided sport charter vessel anglers * * 
*'' but reassess this action's impact to the non-resident fisherman and 
the industry that provides this service. There are other means to 
accomplish conservation objectives without targeting or destabilizing 
one halibut fishery in favor of another.
    Response: This comment appears to be a reaction to the final rule 
published on May 6, 2009 (74 FR 21194). That action reduced the daily 
bag limit of halibut for charter vessel anglers from two halibut per 
day to one halibut per day. This rule to establish a limited access 
system for the charter halibut fishery in Areas 2C and 3A does not 
affect the earlier one-halibut bag limit rule.
    Comment 127: I believe the goal of the Council is to put the 
charter operations out of business. The Council is considering an 
option of having the tourist buy the second fish from the commercial 
side. If IFQs are being sold at $25 per pound, my guests will have to 
pay $2,500 for a 100-pound fish.
    Response: The objective of this rule is not to put charter vessel 
operations out of business. NMFS has estimated that about 527 charter 
vessel businesses (231 in Area 2C and 296 in Area 3A) will qualify for 
initial allocation of charter halibut permits under this rule. Those 
businesses that do not qualify for initially allocated permits may 
acquire them by transfer. The option the comment refers to is a 
component of the Catch Sharing Plan adopted by the Council in October 
2008. A proposed rule that would implement the Catch Sharing Plan, if 
it is approved, will be published by NMFS for public comment.
    Comment 128: One comment suggested that if NMFS intends to limit 
recreational removals of halibut, it should establish a fair and 
equitable baseline allocation for the recreational sector, establish a 
near real-time recreational harvest accounting method, and implement 
harvest control measures for recreational harvest effort to ensure that 
the recreational sector does not exceed its allocation.
    Response: The intended effect of this rule is to curtail growth of 
fishing capacity in the guided sport fishery for halibut, not to 
directly limit recreational removals of halibut. The suggestions 
provided in the comment are beyond the scope of this action. These 
suggestions could be made to the Council, IPHC, or ADF&G with respect 
to timely estimation of recreational harvests.
    Comment 129: Supply and demand will limit the charter fleet. If a 
charter service cannot compete, it will and should be forced out by 
market forces. When the economy, tourism, weather, or other factors 
impact businesses, operations will close; consequently, there will be 
fewer people fishing and fewer fish caught. Those who work hard will 
likely survive and those who do not will fail; it does not matter how 
long they have been chartering. This is a service industry and 
businesses will generally succeed or fail based on their service.
    Response: NMFS agrees that charter vessel operations provide a 
service and that they operate in a competitive market. However, NMFS 
disagrees that supply and demand alone will sufficiently control 
harvesting capacity in the charter halibut fleet to the desired levels. 
Experience in Area 2C demonstrates that under profitable price and cost 
considerations, excessive capacity will occur in the fishery. This is 
due primarily to the fact that access to the fish is free in an open 
access fishery.
    Comment 130: The Analysis stated that for enforcement the number of 
harvested halibut on the vessel should not exceed the client 
endorsement through the ``gifting'' of skipper and crew fish. For this 
reason, retention of halibut by skipper and crew needs to be 
eliminated. The final rule should include a permanent prohibition 
against retention of halibut by skipper and crew for 3A and 2C (if 
necessary) as part of this action. A prohibition on skipper and crew 
retaining halibut was enacted in 2009 in the one-fish bag limit for 
Area 2C.
    Response: NMFS will enforce the daily bag limit for sport-caught 
halibut based on the area being fished and whether the anglers are 
charter vessel anglers or non-guided anglers. For example, under 
current regulations, the daily bag limit for charter vessel anglers in 
Area 2C is one halibut per day (50 CFR 300.65(d)(2)), while non-guided 
anglers in that area and all anglers in Area 3A may catch and retain 
two halibut per day (section 28(1)(b) of the annual management measures 
published March 19, 2009, at 74 FR 11681). Under this rule and current 
bag limit regulations, a charter vessel with three charter vessel 
anglers on board in Area 2C will be limited to three halibut per day, 
regardless of whether the charter halibut permit on board the vessel 
was endorsed for a larger number of anglers.
    Currently, the guide and crew on a charter vessel in Area 2C are 
prohibited from catching and retaining halibut during a charter fishing 
trip, and the number of lines used to fish for halibut are limited to 
the number of charter vessel anglers on board or six, whichever is less 
(50 CFR 300.65(d)(2)). In 2009, and in several previous years, ADF&G 
also prohibited skipper and crew retention of all fish and limited the 
number of rods to the number of (paying) charter vessel anglers onboard 
in Area 3A (Emergency Order No. 2-R-3-03-09). The Council could 
recommend to the Secretary that the same guide/crew and line limit 
applied currently in Area 2C also apply in Area 3A. That change is 
outside the scope of this action.
    Comment 131: The final rule should limit the number of rods a 
charter vessel may fish to the number of angler endorsements on the 
charter halibut permit. This should be added to the rule so that a 
charter vessel could not fish extra rods if the number of passengers on 
board exceeds the number of angler endorsements. It would also prevent 
fishing by skipper and crew fishing under the claim that they are 
fishing for another species.
    Response: Current NMFS regulations (at 50 CFR 300.65(d)(2)(iii)) 
already limit the number of lines used to fish for halibut in Area 2C 
to six or the number of charter vessel anglers on board,

[[Page 590]]

whichever is less. This action limits the number of charter vessel 
anglers catching and retaining halibut to the angler endorsement 
specified on the charter halibut permit.
    Comment 132: Localized moratoria within local area management plan 
(LAMP) areas could also be implemented to achieve sustainable halibut 
harvests without having to limit halibut charter operators.
    Response: One LAMP currently exists for Sitka Sound and no others 
are being considered. Although alternative means may be found that 
would achieve the objectives of this rule, the Council and NMFS found 
that this limited access system best fit the Council's objectives and 
is consistent with the requirements of the Halibut Act.
    Comment 133: A 100-pound fish limit for the charter fisherman will 
do little to protect the spawning population of halibut. It would be a 
waste of time to put a limit on the sport fish size and not the size of 
fish caught in the commercial fishery.
    Response: No weight limit exists on fish caught by charter vessel 
anglers in either Area 2C or 3A. This rule does not establish a weight 
limit on halibut harvested by charter vessel anglers in these areas. 
The comment is irrelevant to this rule.
    Comment 134: Several comments suggested that NMFS should implement 
harvest restrictions instead of the limited access system. Suggestions 
included (1) a one halibut per day rule with an annual limit of four to 
six fish for charter anglers, (2) regulations similar to Oregon's one 
fish per day, minimum size 32 inches, and the first fish you catch over 
32 inches is your limit for the day, (3) limit the size of halibut to a 
number of inches or to a weight under 100 pounds, and (4) a slot limit.
    Response: This rule does not impose additional catch limit 
restrictions because the objective of this action is to curtail growth 
in the capacity of the charter halibut fishery, not to control charter 
angler harvest. None of the suggested alternatives would achieve the 
objective of this action and are outside the scope of this rule.
    Comment 135: A moratorium by itself will not stabilize the charter 
vessel industry. The charter industry does not need in-season closures 
or a one-fish limit. A larger GHL with a moratorium would work, 
however, as it would guarantee an amount of fish that could be caught. 
That would help create a stable business plan.
    As I understand the moratorium, each charter boat will be given a 
permit which is good for the highest number of trips that were taken in 
2004 or 2005, multiplied by the most people that were taken fishing on 
that boat. Issuing permits for trips would not work because you cannot 
always fill the seats. It would be preferable if the permits were 
issued with a yearly amount of fish that can be retained. Each permit 
should be issued with the number of fish stamped on it. There would be 
no need to renew the permits yearly; they could be permanent, with a 
transferable option. The permit should not be limited to the type of 
boat that it is issued to. If a person runs a six pack boat and wanted 
to run a larger boat and take more fishermen per trip, then it should 
be allowed to do that, as long as it stays within the overall fish 
issued for that permit.
    There would be concerns about tracking the amount of fish caught 
per boat to make sure no one is cheating. The best thing may be to 
eliminate logbooks and issue punch cards. They could be generic with a 
line on them for the captain to write the date that fish were caught, 
and once they are punched, they become void. The punch cards could be 
thrown out the following day. When you are out of punch cards, you are 
done for the year.
    Response: Under this rule, charter halibut permits will be issued 
to qualifying businesses, not to individual vessels. Each charter 
halibut permit will have an angler endorsement number specifying the 
largest number of charter vessel anglers that may be catching and 
retaining halibut on a vessel carrying the permit. The angler 
endorsement number on the permit will be based on the highest number of 
charter vessel anglers that the applicant reported on any logbook 
fishing trip in 2004 or 2005, subject to a minimum endorsement of four. 
The number of halibut that may be retained by charter vessel anglers is 
limited by the daily bag limits in regulation for the area in which the 
vessel is operating, not by the charter halibut permit. In-season 
closures of the charter halibut fishery were not proposed and are not 
implemented by this rule. A charter halibut permit will not limit the 
permit holder to any number of fishing trips, and does not limit the 
type of charter vessel on which the permit is used. A one-halibut daily 
bag limit for charter vessel anglers in Area 2C was effective on June 
5, 2009 (74 FR 21194, May 6, 2009), and is not affected by this action.
    Comment 136: Two comments raised safety concerns. One stated that 
guides have to meet high standards, have local experience and 
knowledge, and have a good safety record. Unguided (either outfitted or 
completely independent sport fishing) sport fishing is less safe. 
Therefore this action may lead to increased levels of injury and 
possibly death among recreational anglers. Magnuson-Stevens Act 
National Standard 10, which requires that conservation and management 
measures promote the safety of human life at sea to the extent 
practicable, should not be ignored.
    The other comment recalled the safety comment that NMFS responded 
to in the final rule establishing the Area 2C one-halibut daily bag 
limit (Comment 124 on page 21222 published May 6, 2009 at 74 FR 21194). 
In its response, NMFS claimed to be unable to confirm when the last 
charter fatality in Alaskan saltwater occurred. NMFS should contact 
USCG Alaska and ask them specifically for this information. The 
information is available and it is the responsibility of NMFS to secure 
it from the USCG, especially when the issue in question is safety.
    Response: This rule will not create new safety risks. The number of 
charter halibut permits that NMFS expects to issue under this rule, and 
the numbers of associated endorsements, create significant 
opportunities for operators to meet existing levels of angler demand 
for guided halibut fishing, as well as expanded demand. Although 
National Standard 10 does not apply to this rule because it is 
authorized under the Halibut Act, not the Magnuson-Stevens Act, 
promoting the safety of human life at sea is a good standard for all 
fishery regulations. This rule adheres to this standard by not creating 
new safety risks and by stabilizing the charter halibut fishery. In its 
analysis of the potential effects of this rule the Council and NMFS 
found no safety concern.

Data Quality

    Comment 137: Logbooks are not a good source of information for 
issuing charter halibut permits. The government has no way to verify 
the accuracy of a logbook. The IRS should do an extensive audit to see 
if the money reported to the IRS matches what was put in the logbook. 
If the business is legitimate, then they could receive a valuable 
limited entry permit.
    Response: Charter halibut permits allocated under this rule will be 
based solely on logbook fishing trips; not the amount of halibut 
reported as harvested in the logbooks. The Council chose to rely on the 
fishing trip data in ADF&G Saltwater Charter Logbooks as the best 
available source of information on participation in the charter 
fishery. NMFS expects that the logbook trip information recorded is 
reasonably accurate for purposes of this action.

[[Page 591]]

    Comment 138: A non-resident but frequent visitor to Southeast 
Alaska expressed concern that more halibut regulations would be 
necessary. The commenter encouraged implementation of a solid 
regulatory foundation based on good science that would provide healthy 
halibut populations for future generations. The commenter wanted to see 
only regulations that are necessary to ensure a healthy population for 
the years to come and to rest on a solid foundation of good science.
    Response: NMFS agrees that fishery management policy and the 
regulations implementing that policy should be based on the best 
scientific information available. This rule is not designed to directly 
control the biological condition of the halibut population. To the 
extent that this rule will stabilize the fishing capacity of the 
charter halibut fishery, it may indirectly enhance the effectiveness of 
other regulations that are designed to control halibut harvests and 
thereby support conservation of the stock.
    Comment 139: Halibut is a finite resource and needs to be managed 
very carefully using the most accurate data possible. I strongly 
support a halibut charter limited entry program for the guided charter 
sector.
    Response: NMFS agrees that the best scientific information 
available should be used in fishery management and acknowledges support 
for this rule.
    Comment 140: The reason stated for the moratorium is to curtail 
growth of a particular industry. However, there is insufficient 
information to prove that by passing this moratorium the desired 
outcome will be achieved. We can only assume the desired outcome (based 
on this statement) is fewer charter fleet vessels. But other statements 
by NMFS indicate that the permits available to the charter industry 
will allow for continued growth. Further, any charter vessels removed 
from the fleet will be replaced by unguided vessels. This proposed rule 
does not support the desired outcome. It only succeeds in putting 
charter operations out of business, and placing more financial burden 
on the economy of all Southeast Alaska communities and on individual 
families that rely on charter industry businesses and jobs. It also 
places unguided, unsafe, non-certified drivers on boats in the same 
area. Any client visiting one of the many charter resorts can use his 
or her sport fishing license to fish for halibut, but instead of hiring 
a safe, trained, USCG-licensed captain to operate the boat, he or she 
can rent the same boat from the same charter resorts and go to the same 
spot and fish for the same fish. How does allowing this behavior 
address the objectives of this action?
    Response: The intended effect of this rule is to curtail growth of 
fishing capacity in the guided sport fishery for halibut. This rule 
does not directly control the harvest of halibut nor does it reduce 
this harvest. Under this rule, NMFS will issue charter halibut permits 
to sport fishing businesses that were authorized by ADF&G to conduct 
logbook fishing trips. The number of logbook fishing trips that will be 
conducted by these qualifying businesses under this rule will be 
roughly the same as those taken in recent years immediately prior to 
this rule. These businesses will be able to grow to meet potentially 
increased charter vessel angler demand in the future by increasing 
their average number of trips per season, increasing the average number 
of anglers carried on each trip, and other operational efficiencies. 
Charter halibut fishing opportunity will be enhanced under this rule 
through the community charter halibut permits. Hence, NMFS does not 
expect a shortage of charter halibut fishing opportunities. Sport 
fishermen may freely choose whether to use a charter vessel or a 
unguided vessel to fish for halibut. See also responses to Comments 21 
and 136.
    Comment 141: The data used to establish permit criteria is based on 
secondhand data with no level of accuracy. The catch record system in 
place does not have a recorded weight for the species being reviewed. 
If the intent is to better manage the halibut fishery, reporting a 
certified scale weight in the round should be required in the 
bottomfish logbooks. This would assist in having the best scientific 
information for making management decisions.
    Response: NMFS agrees that fishery management should be based on 
the best scientific information available. However, the intended effect 
of this rule is to curtail growth of fishing capacity in the guided 
sport fishery for halibut. This rule does not directly control the 
harvest of halibut. Therefore, highly precise and accurate estimates of 
the weight of each halibut harvested by charter vessel anglers are not 
necessary. Charter halibut permits will be allocated under this rule 
based on the participation of businesses in the charter halibut fishery 
using logbook fishing trips as evidence of participation. The numbers 
of halibut harvested in the past or their weight will have no bearing 
on the initial distribution of charter halibut permits. The ADF&G 
saltwater charter logbook data for the qualifying period (2004 and 
2005) and the recent participation period (2008) are the best available 
information for purposes of this rule.
    Comment 142: The proposed rule discriminates against any charter 
operation that began operating between 2006 and 2009. The RIR does not 
contain any numbers on charters from 2006 to 2009. The data in the 
Secretarial Review Draft EA/RIR/IRFA only demonstrate activity from the 
charter fleets from 1999 to 2005.
    Response: The Council announced a control date of December 9, 2005. 
NMFS published that control date in the Federal Register on February 8, 
2006 (71 FR 6442). The purpose of this control date announcement was to 
provide notice to persons entering the charter halibut fishery after 
the control date that they would not be assured of future access to the 
charter halibut fishery if a limited access system were developed and 
implemented. Because the Council decided to develop this limited access 
system based on the control date, it did not give participation credit 
to charter businesses that entered after that date as eligible. 
Moreover, when the Council finally decided to recommend its charter 
halibut moratorium to the Secretary on March 31, 2007, the most recent 
information on participation in the charter halibut fishery was from 
2005. Saltwater charter logbook data for 2006 through the present was 
not available at that time. Since the Secretarial Review Draft EA/RIR/
IRFA was made available for public comment, NMFS has supplemented the 
Analysis using ADF&G logbook data from 2008. This updated Analysis is 
contained within the final EA/RIR/FRFA (see ADDRESSES) and that 
information was considered when NMFS approved this action and published 
this rule.
    Comment 143: There exists neither proper analysis identifying the 
number of vessels excluded nor a remedy for those that have made 
substantial investments.
    Response: NMFS recently supplemented the Analysis using ADF&G 
logbook data from 2008. This updated Analysis is contained within the 
final EA/RIR/FRFA (see ADDRESSES). This rule does not compensate 
charter businesses that do not qualify for any charter halibut permits. 
One reason compensation is not necessary is that the control date 
announcement (71 FR 6442, February 8, 2006) provided notice to 
businesses about the risk of entering the charter halibut fishery after 
the control date. Another reason compensation is not provided is that 
businesses have value even without charter permits. Charter vessel 
assets

[[Page 592]]

may be used in fishing for species other than halibut or for other 
endeavors. Also, a market for transferable charter halibut permits is 
expected to emerge under this rule that will allow acquisition of 
permit(s).
    Comment 144: The proposed rule is based on inadequate or projected 
data. IPHC clearly acknowledges the lack of recent accurate data to 
determine the harvest levels for sport fishing. It has recently posted 
comments from its 2009 annual meeting stating that it will work with 
sport representatives to review Alaska sport regulations and determine 
if changes are necessary and will work with ADF&G and NMFS staff to 
provide clearer documentation of the Alaska sport regulations. They 
noted support for clearer data collection for accuracy and timely 
accounting and have recommended lowering the harvest rate in Area 2, 
which will permit rebuilding of the exploitable biomass in this area.
    Response: This rule relies on ADF&G saltwater charter logbook data 
to determine participation in the charter halibut fishery during the 
qualifying period (2004 and 2005) and recent participation period 
(2008), which was determined by the Council and NMFS to be the best 
available information on which to base the qualifying criteria. This 
participation is determined by numbers of logbook fishing trips; not by 
numbers or weight of halibut harvested. The IPHC projected sport 
harvest estimates are not pertinent to this rule. However, NMFS 
supports improved accuracy and timeliness of recreational harvest 
estimates of halibut and all other species.
    Comment 145: Several comments contend that the Council's previous 
attempts at developing limited access for the charter halibut fishery 
failed due to poor data. The Secretarial Review Draft EA/RIR/IRFA 
indicates that other Council attempts at curtailing charter halibut 
vessels were rejected primarily due to the lack of adequate data for 
individual charter businesses. The proposed rule also provides a 
lengthy history of the Council's consideration of limited entry for 
charter vessels indicating that its 1997 control date and 2001 charter 
IFQ program failed because of poor data. Those data have not changed in 
respect to this proposal; the Council has used the same inaccurate data 
throughout this process. The data used to create the GHL is between 5 
and 15 years old. It is impossible to address the present participation 
in the fishery and to determine the dependence on and the economics of 
the fishery using old data.
    Response: The history of the Council's work to develop a limited 
access system for the charter halibut fishery is described in the 
proposed rule (74 FR 18178, April 21, 2009) beginning on page 18181. 
The Council's earlier attempts, especially that to develop an IFQ 
program for the charter halibut fishery relied heavily on charter 
logbook data to determine the historical harvest of halibut by 
individual operators. In contrast, this rule is based on logbook 
fishing trips--not pounds of halibut harvested--as a measure of 
participation in the charter halibut fishery.
    The evidence of a logbook fishing trip is not so rigorous that 
highly accurate reporting is essential. For example, during the 
qualifying period, an ADF&G saltwater charter logbook that shows the 
statistical areas where bottomfish fishing occurred, or boat hours that 
the vessel engaged in bottomfish fishing, or the number of rods used 
from the vessel in bottomfish fishing, will serve as evidence of a 
bottomfish logbook fishing trip. Using the ADF&G saltwater charter 
logbook as the basis for this information is the best available 
information for purposes of this rule and is consistent with the 
historical and present participation requirements of the Halibut Act.
    Comment 146: Several comments concerned the fact that halibut, as a 
species, were not required to be reported by ADF&G in logbooks during 
2004 and 2005. Some confusion resulted about whether and how to report 
halibut harvested on charter vessel trips. ADF&G stopped having halibut 
harvest recorded in the logbooks after the 2001 season; therefore, 
halibut harvest was not recorded during 2004 and 2005. Many charter 
operators recorded ``bottomfishing'' information when conducting 
halibut charters and others recorded the ADF&G area fished, the number 
of rods used, and the number of hours fished for my halibut charter 
trips after 2001. There was no ADF&G record of harvest. Many charter 
operators did not record any halibut fishing activity because there was 
no place in the logbook to record it. When the ADF&G was asked how to 
handle halibut charter trips, some charter operators were told by ADF&G 
personnel that they did not have to record halibut charter trips. 
Consequently, for those operators who conducted halibut charters during 
the qualifying time but did not record them in the ADF&G logbooks, NMFS 
should consider alternative qualifying documentation such as personal 
log books, fishing license records, and affidavits from clients.
    Response: As discussed in the preamble to the proposed rule (74 FR 
18178, April 21, 2009) on page 18185, the basic unit of participation 
for purposes of this rule is a logbook fishing trip. During the 
qualifying period of 2004 and 2005, participation will be measured by 
bottomfish logbook fishing trips because ADF&G did not require halibut 
kept or released to be reported as a distinct species. Halibut were 
considered to be bottomfish during that period. ADF&G attached 
instructions to each logbook that stated that bottomfish fishing effort 
included effort targeting halibut. Reporting of any one of three types 
of bottomfish effort data would qualify a trip as a bottomfish logbook 
trip for purposes of this rule.
    In 2006, ADF&G changed its required logbook report to specify 
halibut data for each logbook fishing trip. If a business owner did not 
comply with specified reporting requirements, then the fishing trip 
will not be counted as either a bottomfish logbook fishing trip during 
the qualifying period or a halibut logbook fishing trip during the 
recent participation period for purposes of this rule. Regardless of 
what any particular ADF&G personnel may say to an operator, each 
operator or business is responsible for complying with applicable 
Federal halibut fishery regulations and ADF&G reporting requirements.
    Comment 147: NMFS should consider implementing or being prepared to 
implement its own logbook program for halibut to gather the information 
needed to manage the fishery and for development of any long term 
management programs. The Alaska State Legislature had legislation in 
front of it to repeal the sunset date in the current guide licensing 
program, which is the authorizing legislation for the logbook program, 
and at the last minute what passed extended the sunset date for one 
year to January 1, 2010. Another piece of legislation was introduced 
that again will extend the sunset date for only one year; therefore we 
are concerned about the advisability of relying on the State logbook 
program.
    Response: The NMFS, IPHC, and Council have relied, and continue to 
rely, on ADF&G to collect recreational fishing information regarding 
halibut. This information is essential to the management policies and 
regulations developed respectively by the IPHC and Council. The 
Paperwork Reduction Act of 1995 (Pub. L. 104-13) requires Federal 
agencies to minimize the paperwork burden on individuals and small 
businesses, to minimize the cost to the Federal government of 
information collection, and to strengthen the partnership between 
Federal and State governments by minimizing the burden and maximizing 
the utility of data collection. ADF&G has

[[Page 593]]

a sport fishing data collection program, staff, and infrastructure to 
collect recreational fishing data. The Alaska Region, NMFS, by 
comparison does not have a sport fisheries division and data collection 
system. Establishing a system to monitor the sport harvest of one 
species would be costly.
    Comment 148: NMFS lacks sufficient information to establish a 
moratorium because there was no accurate logbook data on charter 
halibut harvests by charter vessels in 2004 and 2005.
    Response: The limited access system established by this rule does 
not rely on an accurate accounting of halibut harvests by charter 
vessel anglers during 2004 and 2005. During those years, ADF&G did not 
require charter vessel business to report the number of halibut that 
were kept or released. Instead, businesses were required to report 
bottomfish effort for each logbook fishing trip. ADF&G attached 
instructions to each logbook stating that bottomfish fishing effort 
included effort targeting halibut. Hence, the bottomfish logbook 
fishing trip data are sufficiently accurate as evidence of 
participation in the fishery for purposes of this rule. See also 
responses to Comments 145 and 146.
    Comment 149: A couple of comments expressed concern about the sport 
halibut harvest estimates based on the mail survey conducted by ADF&G. 
One comment noted the time lag in the survey that delayed estimates of 
harvests in one year until close to the end of the following year. The 
other comment noted that data published on the Council's Web site did 
not match ADF&G records, and that the mail survey conducted by ADF&G in 
2007 had less than 50 percent of the survey forms returned. When 
determining any action on a proposed rule in regard to the harvest 
levels, all data must be accurate.
    Response: The annual estimate of recreational halibut harvests is 
based on the statewide harvest survey, a mail survey conducted by ADF&G 
to assess the harvest of all species of fish taken from freshwater and 
saltwater in sport fishing. It provides a reasonably accurate estimate 
of these sport harvests and is especially useful for revealing long-
term trends. This rule, however, does not rely on the statewide harvest 
survey data. The limited access system established by this rule is 
based on participation in the charter halibut fisheries during certain 
years as indicated by logbook fishing trips. The statewide harvest 
survey does not rely on a high percent of survey returns to produce 
reasonably accurate and precise estimates of sport fishing harvests. 
Moreover, these surveys are not being used to establish the limited 
access system under this rule. Because the intended effect of this rule 
is to curtail growth of fishing capacity in the guided sport fishery 
for halibut in Areas 2C and 3A, the exact number of halibut harvested 
in any one area in any one year is of less concern than the growth 
trend in harvests and fishing capacity over time.
    Comment 150: The Council and NMFS have completely failed to gather 
or evaluate data relative to the charter sector. The Council states 
that the need for implementing a moratorium is to manage the fisheries 
within the GHL policy, which the commenter asserts is unfair and 
outdated. Despite the Council failing to present economic data 
supporting its supposition, NOAA Web site data clearly show increases 
in quota share equity and ex-vessel value between 300 percent and 400 
percent statewide and within areas. This massive increase in 
profitability does not lend credence to the need for wiping out the 
charter sector.
    Response: NMFS estimates that a total of 527 charter businesses 
will qualify for an initial allocation of either a transferable or non-
transferable charter halibut permit. The Analysis (see ADDRESSES) 
indicates this number of businesses is sufficient to accommodate market 
demand for guided sport fishing for halibut. This rule is designed to 
curtail growth of fishing capacity in the charter halibut fishery as 
intended by the Council and based on its problem statement. The GHL 
policy implemented in 2003 (68 FR 47256, August 8, 2003) was designed 
to establish an amount of halibut harvest by the charter halibut sector 
that will be monitored annually. The purpose of the GHL is different 
from this rule.

Other Issues

    Comment 151: The public received insufficient information about the 
moratorium and its impact on recently started charter halibut 
businesses. Uncertainty over whether or when a fishery is going to be 
managed under a limited access system adversely affects business 
activity. Investment-backed expectations need to be protected. Council 
control dates and final action twice before (April 1997 and April 2001) 
but neither of these rules were signed into law. This is probably why 
charter businesses started in later years.
    Response: A control date notice is not by itself a Federal rule. 
The control date notice published in advance of this action on February 
8, 2006 (71 FR 6442), stated that it did not commit the Council or the 
Secretary to any particular management regime or criteria for entry to 
the charter halibut fishery. All previous control date notices also 
have language to this effect. Similarly, the public is not required by 
a control date notice to invest or not invest in a fishing business 
that may be affected by the development and implementation of a limited 
access rule in the future. That decision is left to the business owner. 
The primary purpose of a control date notice is to give notice to 
persons contemplating an investment in a business that may be affected 
by a future limited access system that such a system may be developed 
and implemented. Affected persons can then incorporate the risk of 
potentially not receiving an initial allocation of permit(s) into their 
investment decision making. Risk-averse persons may decide to delay 
their investment pending potential regulatory changes; risk-taking 
persons may not let this information affect their investment decisions. 
In either case, the control date notice provides the public with 
information that a limited access system may be developed for a fishery 
and, if so, that entering the fishery after the control date may not 
lead to an initial allocation of a limited access permit.
    Comment 152: Use of the government Web site to submit comments is 
too complicated. It was difficult to find and I required 30 minutes of 
assistance from a very patient NOAA employee on the phone to navigate 
to this URL to provide comments.
    Response: The Web site, ``Regulations.gov'' is a Federal government 
Web site serving many agencies. Currently the Web site is operating 
successfully, and NMFS has received thousands of letters of comment 
through it. A person experiencing problems with Regulations.gov should 
contact Regulations.gov directly. In addition, help can be provided by 
contacting the individual listed under the preamble heading FOR FURTHER 
INFORMATION CONTACT and comments may be submitted by mail, fax, or hand 
delivery if the electronic alternative proves too difficult.
    Comment 153: The current Administration fully supports recreational 
fishing and its benefits to the Nation, and calls for efforts to 
allocate a fair percentage of managed coastal fisheries to sport 
fishing.
    Response: NMFS acknowledges that sport fishing in general and 
guided sport fishing in particular generates substantial economic 
benefits for the Nation. This action addresses the problem identified 
by the Council in its problem statement and has been

[[Page 594]]

determined to be fair and equitable as required by the Halibut Act (see 
discussion above under the heading ``Consistency with Halibut Act'').
    Comment 154: This action violates Executive Order 12962. The 
primary intent of the E.O. is ``to provide for increased recreational 
fishing opportunities nationwide.'' Reducing and eliminating access to 
a public resource is not consistent with the language contained in E.O. 
12962.
    Response: This final rule is consistent with E.O. 12962. This 
action limits the number of charter vessels that may carry anglers 
catching and retaining halibut in Areas 2C and 3A. This action does not 
reduce or eliminate charter vessel angler access to the Pacific halibut 
resource. Under this rule, an estimated 502 charter halibut permits 
will be issued in Area 2C and 418 permits will be issued in Area 3A. 
Each permit will have an angler endorsement that specifies the maximum 
number of charter vessel anglers that may be harvesting halibut on the 
vessel. Multiplying the average angler endorsement level in each area 
by the number of permits expected in the area yields an estimate of the 
total number of charter vessel anglers that may be served on any day. 
For Area 2C this estimate is 3,028 anglers and for 3A it is 3,577 
anglers. In other words, this rule will allow a total of 6,605 charter 
vessel anglers to have access to the halibut resource on any day. To 
the extent that some charter vessel operations, particularly in Area 
2C, offer half-day trips, this estimate is conservative. In addition, 
this estimate of charter vessel angler opportunity does not include the 
potential additional community charter halibut permits that may be 
available to CQEs.
    Another way of judging whether charter vessel angler opportunity 
for access to the resource is constrained under this rule is to compare 
the average number of logbook fishing trips per vessel per season in 
2008 with the average number of trips per vessel per season that will 
be needed under this rule to serve the same number of charter vessel 
anglers that fished in 2008. Charter halibut vessels in Area 2C 
averaged 36 trips per season in 2008. Based on the total number of 
permits expected to be initially issued under this rule, charter 
vessels will need to make 52 trips in Area 2C to serve the same number 
of charter vessel anglers that fished in 2008. In Area 3A, charter 
vessels took an average of 38 trips during the season in 2008. Under 
this rule, the same number of anglers could be served by 56 trips. 
Based on a practical halibut fishing season of 100 days, opportunity 
exists for permitted charter vessels under this rule to increase their 
average number of trips per season in response to increased angler 
demand. Hence, this action is not expected to reduce or eliminate 
charter vessel angler access to the halibut resource in Alaska, as 
suggested by the comment.
    Comment 155: Several comments expressed general support for the 
limited access system for the charter halibut fishery and urged 
implementation of it as soon as possible. One comment asserted that the 
administrative record proves a long history of trying to address the 
unchecked growth of the halibut charter industry and that the charter 
community has unfortunately resisted these efforts as proven by their 
litigation efforts to challenge regulatory limits. Another comment 
expressed the view that guided sport charter operations are commercial 
endeavors with substantial and growing impacts on halibut populations 
that Federal managers have for too long failed to control. Continued 
growth of the charter fleet is especially damaging because it occurs 
without effective means to accurately account for the catch and without 
an effective enforcement mechanism to hold the fleet within its GHL. 
Limited access may improve the ability of the charter sector to 
maintain a two-fish bag limit without excessive pressure on the 
resource and other user groups. Another comment stated that the rapid 
growth of the charter boat industry and its catch of halibut in these 
areas is out of control and not sustainable and that NMFS should 
implement this moratorium in Areas 2C and 3A because the halibut 
stocks, particularly in Area 2C, are in desperate need of rebuilding. 
This view was expressed also by a recreational angler who wrote that 
this is an important step toward controlling the continued over 
utilization of the near shore resource and that this step to limit the 
number of halibut charters is long overdue. The angler strongly urged 
the Secretary of Commerce to approve the charter halibut moratorium and 
to implement it as soon as possible.
    Other comments from participants in the charter vessel and 
commercial setline sectors indicated that the program will be a first 
step in developing a long-term solution to ongoing conservation 
concerns and allocation disputes between the two sectors. The comments 
indicated that the program will stabilize the fishery and provide a 
foundation for additional market-based management programs such as 
individual quotas. The charter halibut permit program fairly balances 
past and current participation, limits new entry to businesses that buy 
permits from persons exiting in the fishery, and provides appropriate 
opportunities for small coastal communities to enter the charter vessel 
fishery through community charter halibut permits. The program also 
establishes appropriate standards for transferable versus non-
transferable permits. The commenters supported the rule because it will 
in their view ultimately curtail fishing capacity growth in the charter 
vessel sector.
    Response: NMFS acknowledges the support for this rule. Stakeholders 
from all halibut user groups have provided useful information during 
the Council development and rulemaking process for this action. 
Although litigation can slow this process, plaintiffs have the right to 
challenge government rules. This fosters the development of robust 
rulemaking that ultimately benefits all participants in the fishery 
management process.
    With regard to accounting for sport harvests of halibut, the best 
available information on the recreational harvest of halibut is derived 
from ADF&G sport fishing data sources including the Statewide Harvest 
Survey of sport fishermen, the Saltwater Sport Fishing Charter Logbook, 
and creel census surveys. NMFS finds that the recreational harvest 
estimates provided by ADF&G from these data sources are reasonably 
accurate.
    This rule is not designed to directly limit the amount of halibut 
harvested in the charter halibut fishery, nor is it designed to limit 
the sport harvest of halibut in localized areas. Scientific information 
does not exist that would discern localized depletion at a scale 
smaller than an IPHC area or attribute it to a particular gear group 
within Area 2C or Area 3A. The purpose of this action is to curtail 
growth of fishing capacity in the charter halibut fishery. By 
stabilizing the number of vessels participating in this fishery, other 
regulations that restrict the harvest of charter vessel anglers may 
have improved effectiveness.
    Comment 156: As a halibut charter operator, I have been adversely 
affected by the publicity and rumors of reduced halibut harvests and 
draconian measures such as a one-fish bag limit that confuse 
recreational anglers about their opportunities to access to the halibut 
resource. The limited access system may help alleviate some of this 
uncertainty for business owners. The length of time the Council and 
NMFS have taken to get to this point has made it difficult for those in 
the fishery to make business decisions. Unfortunately, there has been 
significant charter

[[Page 595]]

turnover and new businesses have started or existing businesses have 
expanded. Support for the program is declining because many of these 
new businesses say they will not qualify for the program.
    Response: NMFS acknowledges the time that has transpired between 
the Council action to adopt the charter halibut moratorium and 
Secretarial action to promulgate this rule. During this time, NMFS also 
implemented a one-halibut daily bag limit for charter vessel anglers in 
Area 2C (74 FR 21194, May 6, 2009). Limited access systems including 
this one typically are complicated to implement. NMFS acknowledges also 
that the entry and exit rate of charter vessel fishing businesses may 
be high relative to other businesses. Publication of the December 9, 
2005, control date (71 FR 6442; February 8, 2006), however, announced 
that persons entering the charter halibut fishery after the control 
date will not be assured of future access to the fishery if a limited 
access system is implemented. With the intended stability that this 
rule will bring to the charter halibut fishery, confusion among 
recreational anglers should dissipate.
    Comment 157: Halibut charter fishery participation rules should be 
simple, easy to implement, and easy to enforce. I like the idea of a 
limited number of permits awarded to established fishing guides on a 
seniority basis. Limiting the number of boats fishing seems like a 
straightforward way to control the harvest of halibut taken by sports 
charter.
    Response: This action is intended to curtail growth of fishing 
capacity in the guided sport fishery for halibut. This action, by 
itself, is not designed to limit the number of charter vessel anglers 
who may use sport fishing guide services or their harvest of halibut. 
However, by stabilizing the number of vessels participating in this 
fishery, the effectiveness of other regulations that limit the harvest 
of halibut by charter vessel anglers may be improved.

Changes From the Proposed Rule

    This action was proposed and public comments were solicited for 45 
days beginning on April 21, 2009 (74 FR 18178), and ending June 5, 
2009. By the end of the comment period 166 public submissions were 
received. All comments received by the comment ending date are 
summarized and responded to above under the heading ``comments and 
responses.'' The following 24 changes are made from the proposed rule 
in this final rule.
    1. In Sec.  300.61, a reference to Sec.  300.65(d) is added to the 
definition of charter vessel angler. On June 5, 2009, NMFS implemented 
regulations limiting charter vessel anglers in Area 2C to catching and 
retaining one halibut per day (May 6, 2009, 73 FR 21194). These 
regulations added a definition of charter vessel angler to Sec.  300.61 
for purposes of Sec.  300.65(d). The proposed rule to implement a 
charter halibut permit program (April 21, 2009, 74 FR 18178), proposed 
a revision to the definition of charter vessel angler that 
inadvertently excluded the reference to Sec.  300.65(d). To maintain 
the current definition of charter vessel angler in Sec.  300.61, the 
reference to Sec.  300.65(d) is added in this final rule.
    2. In Sec.  300.61, the definition of charter vessel operator is 
not revised. The current definition of charter vessel operator is for 
purposes of Sec.  300.65(d), and the proposed rule would have applied 
the definition for purposes of Sec.  300.67 in addition to Sec.  
300.65(d). On further examination of the proposed rule text, NMFS 
determined that the definition of charter vessel operator is not needed 
for purposes of Sec.  300.67. This final rule, at Sec. Sec.  300.66 and 
300.67 (see changes 3, 6, and 9 from the proposed rule), references the 
definition of operator in Sec.  300.2. Operator means, with respect to 
any vessel, the master or other individual aboard and in charge of that 
vessel. This definition is consistent with the intended definition of 
charter vessel operator in the proposed rule. This change is also 
consistent with the suggestion in Comment 80 to clarify the proposed 
definition of charter vessel operator.
    3. In Sec.  300.61, the definition of crew member is revised. This 
final rule changes the reference to ``charter vessel operator'' from 
the proposed rule to ``operator of a vessel with one or more charter 
vessel anglers on board''. This change reflects NMFS's determination to 
replace charter vessel operator with operator, as defined in Sec.  
300.2, for purposes of Sec.  300.67. This determination is described in 
change 2 from the proposed rule.
    4. In Sec.  300.61, a definition of ``valid'' is added to clarify 
its meaning with respect to a charter halibut permit. For purposes of 
Sec. Sec.  300.66 and 300.67, a valid charter halibut permit is the 
permit currently in effect.
    5. In Sec.  300.66(p), text is added to clarify that a person is 
prohibited from submitting inaccurate information to an authorized 
officer as defined in Sec.  300.2. The paragraph at Sec.  300.66(p) 
currently prohibits a person from failing to submit or submitting 
inaccurate information on any report, license, catch card, application 
or statement required under Sec.  300.65. The proposed rule for this 
action proposed to apply this prohibition to Sec. Sec.  300.65 and 
300.67. The change in Sec.  300.66(p) from the proposed to final rule 
clarifies that persons are also prohibited from submitting inaccurate 
information to an authorized officer.
    6. In Sec.  300.66, the word ``operate'' is changed to ``be an 
operator of'' in paragraphs (r), (s), (t), (u), and (v). This change 
from the proposed rule is made to ensure consistency with the 
definition of operator in Sec.  300.2, as described in change 2 from 
the proposed rule.
    7. In Sec.  300.66(r) and Sec.  300.67(a)(1), the word ``original'' 
is added before ``valid charter halibut permit''. This addition 
clarifies that an operator of a vessel with one or more charter vessel 
anglers catching and retaining Pacific halibut on board must have on 
board an original valid charter halibut permit. A copy or facsimile of 
a valid charter halibut permit would not meet the requirements of 
Sec. Sec.  300.66 and 300.67.
    8. In Sec.  300.66, paragraph (w) is not included in the final 
rule. On further examination of the proposed rule text, NMFS determined 
that regulations in Sec.  300.67 regarding crew member compliance would 
be unnecessarily redundant. The prohibition on crew members catching 
and retaining halibut during a charter fishing trip at Sec.  
300.65(d)(ii) is not changed with this final rule.
    9. In Sec.  300.67(a)(1), general permit requirements, ``charter 
vessel operator'' is changed to ``operator''. This change is made for 
consistency with the definition of operator in Sec.  300.2, as 
described in change 2 from the proposed rule.
    10. In Sec.  300.67(a)(1), text is added at the end of the 
paragraph to clarify that a charter halibut permit holder must insure 
that the operator of the permitted vessel complies with all 
requirements of Sec. Sec.  300.65 and 300.67.
    11. In Sec.  300.67(a)(1) and (a)(3), text is added to clarify that 
the angler endorsement on a charter vessel permit(s) must be equal to 
or greater than the number of charter vessel anglers who are catching 
and retaining halibut. In paragraph (a)(1) the phrase ``at least'' is 
added to the last phrase of the sentence to read, ``* * * endorsed for 
at least the number of charter vessel anglers who are catching and 
retaining Pacific halibut.'' The language of the proposed rule, without 
the ``at least'' phrase, implied that a charter halibut permit 
endorsement had to be equal to the number of charter vessel anglers on 
board. This implied meaning was not intended. For the same reason, in 
paragraph (a)(3), the phrase ``up to'' is substituted for the word 
``only'' to

[[Page 596]]

clarify that the angler endorsement does not require a charter vessel 
to have the maximum number of anglers on board to make the charter 
halibut permit valid. Rather, the number of charter vessel anglers on 
board a charter vessel must not exceed the angler endorsement on its 
permit. These clarifying words also respond in part to a question 
raised in Comment 86.
    12. In Sec.  300.67, paragraphs (b) and (d), are revised to clarify 
the order of determining whether an applicant for one or more charter 
halibut permits is eligible for any permits, and if so, how many, and 
whether any will be designated as transferable. The organization of 
paragraph (b) may have confused qualifying criteria for a transferable 
permit with the determination of how many permits could qualify for a 
transferable designation and whether the same logbook fishing trips 
that qualified an applicant for a transferable permit(s) could be used 
also to qualify for a non-transferable permit(s). The revised 
paragraphs also better reflect the explanation in the preamble to the 
proposed rule than did the proposed rule regulatory text in paragraphs 
(b) and (d). The revised paragraphs make no substantive changes in the 
qualifying criteria, but rather reorganize the proposed rule text of 
these paragraphs to make clear the following sequence. First, to 
qualify for any type of permit--non-transferable or transferable--an 
applicant must apply within the application period and meet the logbook 
fishing trip requirements described in paragraph (b)(1). Second, if the 
applicant meets the standards described in paragraph (b), then the 
number of permits will be determined as described in paragraph (c), 
which is unchanged from the proposed rule. Finally, the designation of 
one or more of the permits as transferable will require meeting the 
standards described in paragraph (d).
    13. In Sec.  300.67(b)(2)(ii) (previously paragraph (b)(5)(ii) in 
the proposed rule), a minor technical edit is made to remove the word 
``the'' and to change the word ``owners'' to its singular form 
``owner.'' These minor changes correct an editorial oversight in the 
proposed rule and make the word ``owner'' in its singular form 
consistent throughout the regulatory text.
    14. In Sec.  300.67(b), a new paragraph (3) is added to clarify 
that the term ``ADF&G Business Owner License'' includes an ``ADF&G 
business owner registration.'' The latter term was used by ADF&G in 
2004; however, the former term was used in 2005 and 2008. The term 
``ADF&G Business Owner License'' also includes ``sport fish business 
owner license,'' ``sport fish business license,'' and ``ADF&G business 
license.'' The proposed rule (at page 18185) discussed the various 
terms used to describe this authority from the State of Alaska, ADF&G, 
granted as a registration or license that authorized every charter 
vessel fishing trip. Although discussed in the proposed rule preamble, 
this clarification did not appear in the proposed rule text. This 
oversight was pointed out in Comment 83.
    15. In Sec.  300.67(d)(1)(iii), a sentence is added to clarify that 
the vessel used to qualify for a transferable permit during one of the 
qualifying years (2004 or 2005) does not have to be the same vessel 
used to qualify during the recent participation year (2008). The 
proposed rule regulatory text at paragraph (b)(2)(ii) and (iii) stated 
that qualifying for a transferable permit would require meeting the 
minimum of 15 logbook fishing trips with the same vessel in each year 
(qualifying and recent participation year). This text could be 
interpreted to mean that the logbook trips had to have been made on the 
same vessel in both years (See Comments 54 through 57). This is not the 
intended interpretation. What is intended, as clarified in this change, 
is that the minimum 15 bottomfish logbook fishing trips had to have 
been made from the same vessel in either 2004 or 2005. Also, the 
minimum 15 halibut logbook fishing trips during 2008 had to have been 
made from the same vessel during that year, but the vessel used in 2008 
is not required to be the same vessel that was used in either 2004 or 
2005.
    16. In Sec.  300.67(d), paragraph (d)(2) is added for consistency 
with the qualifications for a transferable permit described in the 
preceding paragraph (d)(1) (previously paragraph (b)(2) in the proposed 
rule), the preamble to the proposed rule, and the Analysis. The 
proposed rule language suggested that the number of transferable 
permits would be equal to the number of vessels that met the minimum 
logbook trip criterion of 15 during only the applicant-selected year of 
the qualifying period. NMFS found several inconsistencies between this 
language and other statements in the proposed rule and in the Analysis. 
First, a permit designation of transferable requires that the 15-trip 
minimum criteria be met in one year of the qualifying period and in the 
recent participation year. Second, the preamble to the proposed rule at 
page 18183 states that the minimum participation criteria in both years 
would be taken into account in designating a charter halibut permit as 
transferable. Finally, in the Analysis (ADDRESSES) section 2.5.5 makes 
clear that the Council intended that the number of permits designated 
transferable would be controlled by the lesser of the number of vessels 
that met the 15-trip minimum criteria in one year of the qualifying 
period or the number of vessels that met the 15-trip minimum criteria 
in the recent participation year.
    17. In Sec.  300.67(f)(3), the information element, ``the 
statistical area(s) where bottomfish fishing occurred,'' is added to 
correct an oversight of not including this information element in the 
proposed rule. The proposed rule preamble, on page 18185, discussed the 
various information elements that would be required as evidence of a 
halibut logbook fishing trip during the recent participation period 
(2008). The proposed rule proposed a definition of ``halibut logbook 
fishing trip'' to include information about the number of halibut kept 
or released or the number of boat hours that the vessel engaged in 
bottomfish fishing. The 2008 ADF&G saltwater sport fishing charter trip 
logbook required the recording of the primary ADF&G statistical area 
fished when boat hours fished for bottomfish were recorded. Hence, 
reporting the statistical area(s) where bottomfish fishing occurred as 
optional evidence of participation is consistent the 2008 logbook 
reporting procedures. Adding statistical area(s) also is consistent 
with the logbook fishing trip information elements in Sec.  
300.67(f)(2) and with the evidence of participation recommendation by 
the Council (Issue 9 in the March 31, 2007, motion adopted by the 
Council). The number of rods used from the vessel in bottomfish fishing 
is not included in Sec.  300.67(f)(3) because it was not required to be 
reported in 2008 logbooks. Moreover, any guided bottomfish fishing in 
2008 should have been reported in terms of boat hours and bottomfish 
statistical area, which would be the requisite evidence of 
participation.
    18. In Sec.  300.67(f)(7), the year ``2008'' is substituted for the 
proposed rule place holder text that read, ``[insert the recent 
participation year].'' As explained in the proposed rule on page 18182 
of the proposed rule, specifying the year that would be the recent 
participation period was held pending a NMFS determination of the most 
recent year for which ADF&G charter logbook data would be available. In 
adopting its charter halibut moratorium recommendation to the 
Secretary, the Council contemplated that the recent participation 
period or ``year prior to implementation'' would be either 2007 or 
2008. Based on the availability of

[[Page 597]]

logbook data, NMFS has determined that 2008 is the recent participation 
period.
    19. In Sec.  300.67(g), language is added at the beginning to 
clarify certain limitations on the use of the unavoidable circumstance 
exception. These limitations were discussed in the preamble to the 
proposed rule (74 FR 18178, April 21, 2009) on page 18188, but were 
omitted from the regulatory text by oversight. The new regulatory text 
makes clear, first, that unavoidable circumstance claims must be made 
on appeal pursuant to Sec.  300.67(h)(6). Second, the new text 
clarifies that the Office of Administrative Appeals will not accept an 
unavoidable circumstance claim unless the person making the claim would 
be excluded from the charter halibut fishery entirely unless their 
unavoidable circumstance was recognized. Finally, the new text 
clarifies that unavoidable circumstance claims to increase the number 
of permits issued or to change a non-transferable permit into a 
transferable permit will not be accepted.
    20. In Sec.  300.67(g)(3)(i), language is added to clarify that 
proof of active military service during the 2004 and 2005 qualifying 
period will qualify an applicant for the unavoidable circumstance, 
military service provision. This provision will not be limited only to 
service in the National Guard or military reserve as indicated in the 
proposed rule. This change is being made in response to Comment 110. 
The comment correctly noted that in adopting its charter halibut 
moratorium recommendation to the Secretary, the Council intended that 
the military exemption apply to an individual who was assigned to 
active military duty during 2004 or 2005. The proposed rule text 
interpreted the Council's recommendation too narrowly in limiting the 
military service provision to service only in the National Guard or 
military reserve. Hence, the final rule text is revised to accurately 
reflect the Council's approved recommendation. In addition, a new 
paragraph (g)(3)(iii) is added to clarify that the criteria to be used 
in determining the number and type (transferable or non-transferable) 
of charter halibut permit(s) initially allocated under this military 
service provision is in paragraph (g)(2)(v)(B), immediately preceding 
paragraph (g)(3). The proposed rule presumed that NMFS will be guided 
by the criteria in paragraph (g)(2)(v)(B), but the added text makes 
this explicit. Finally, the added text makes clear that all permits 
issued under this military service provision will receive angler 
endorsements of six by cross reference to paragraph (e)(2).
    21. In Sec.  300.67(h)(3), language is added to authorize NMFS to 
issue non-transferable interim permit(s) for undisputed permit claims. 
On further examination of the proposed regulatory text, NMFS determined 
that without this explicit authority, a dispute over any one permit 
would prevent issuing any charter halibut permit(s) for which an 
applicant appeared to qualify. For example, an applicant may claim 
three charter halibut permits; however, the official charter halibut 
record support issuing only two permits. The proposed rule regulatory 
text at Sec.  300.67(h) suggests that NMFS may not issue any permits to 
the applicant until after the 30-day evidentiary period, an IAD is 
issued, and OAA accepts the applicant's appeal regarding the third 
disputed permit. In this example, the applicant may eventually win the 
appeal for the third disputed permit, but lose an entire fishing season 
waiting for the disputed claim to be resolved. This change from the 
proposed rule will allow NMFS to issue interim permits for undisputed 
permit claims, allowing an applicant to continue charter halibut 
operations while disputed permit claims are processed and adjudicated.
    22. In Sec.  300.67(i)(1), a reference to paragraph (b)(2) in the 
proposed rule is changed to paragraph (d)(2) in the final rule. This 
change is necessary to update a reference to regulatory text in Sec.  
300.67(b) in the proposed rule, which is revised in this final rule as 
described in changes 12 and 16.
    23. In Sec.  300.67(k)(4), the maximum permit limitations on a CQE 
is clarified by removing the word ``following'' and instead referring 
specifically to the maximum number of charter halibut and community 
charter halibut permits specified in paragraphs (k)(4)(i) and 
(k)(4)(ii).
    24. In Sec.  679.2, the definition of ``community quota entity 
(CQE)'' is revised by removing the parenthetical phrase ``for purposes 
of the IFQ program.'' After further examination of the proposed rule 
text, NMFS determined that this phrase could cause confusion by 
suggesting that the CQE definition applies only to the IFQ program. 
This rule establishes another potential purpose for a CQE, which is to 
hold community charter halibut permits. This expanded role for CQEs 
that represent communities identified in this rule does not require a 
substantive change to the CQE definition. This clarification is 
consistent with the proposed rule that thoroughly described the 
potential role for CQEs in the charter halibut fishery.

Classification

    Regulations governing the U.S. fisheries for Pacific halibut are 
developed by the International Pacific Halibut Commission (IPHC), the 
Pacific Fishery Management Council, the North Pacific Fishery 
Management Council (Council), and the Secretary of Commerce. Section 5 
of the Northern Pacific Halibut Act of 1982 (Halibut Act, 16 U.S.C. 
773c) provides the Secretary of Commerce with the general 
responsibility to carry out the Convention between Canada and the 
United States for the management of Pacific halibut, including the 
authority to adopt regulations as may be necessary to carry out the 
purposes and objectives of the Convention and Halibut Act. This final 
rule is consistent with the Secretary of Commerce's authority under the 
Halibut Act.
    This final rule has been determined to be not significant for 
purposes of Executive Order 12866.
    A FRFA was prepared that describes the economic impact that this 
action has on small entities. The RIR/FRFA prepared for this final rule 
is available from NMFS (see ADDRESSES). The FRFA for this action 
explains the need for, and objectives of, the rule, summarizes the 
public comments on the initial regulatory flexibility analysis and 
agency responses, describes and estimates the number of small entities 
to which the rule will apply, describes projected reporting, 
recordkeeping and other compliance requirements of the rule, and 
describes the steps the agency has taken to minimize the significant 
economic impact on small entities, including a statement of the 
factual, policy, and legal reasons for selecting the alternative 
adopted in the final rule and why each one of the other significant 
alternatives to the rule considered by the agency that affect the 
impact on small entities was rejected.
    The need for and objectives of this action; a summary of the 
comments and responses; a description of the action, its purpose, and 
its legal basis; and a statement of the factual, policy, and legal 
reasons for selecting the alternative embodied in this action are 
described elsewhere in this preamble and are not repeated here.
    The proposed rule was published in the Federal Register on April 
21, 2009 (74 FR 18178). An Initial Regulatory Flexibility Analysis 
(IRFA) was prepared and described in the classification section of the 
preamble to the rule. The public comment period ended on June 5, 2009. 
NMFS received 166 communications containing 157 separate comments. 
Comments 45 and

[[Page 598]]

143 address the IRFA. Comments 39-41, 43, 45-47, 51, and 143 address 
the economic impact of the rule on small entities.
    Two classes of entities are directly regulated by this action: (1) 
guided charter businesses active in IPHC Areas 2C and 3A, and (2) CQE-
qualified communities and CQE groups formed by those communities in 
Areas 2C and 3A. Almost all of the guided charter businesses are 
believed to be small entities. This conclusion is based on a Small 
Business Administration (SBA) threshold of $7.0 million in gross 
revenues on an annual basis for facilities offering recreational 
services, including guided fishing services (NAICS 713990). The largest 
of these entities, which are lodges, may be considered large entities 
under SBA standards, but that cannot be confirmed. The 32 communities 
in Area 2C and 3A directly regulated as part of this action would be 
considered small entities under the SBA definitions because they have 
populations under 50,000 persons.
    Under this action, NMFS will issue permits to an estimated 231 
businesses in Area 2C and to 296 businesses in Area 3A. In Area 2C, 173 
of the guided businesses that show evidence of bottomfish fishing in 
2008 will not qualify to receive an Area 2C guided charter permit under 
the limited entry program. In Area 3A, 154 of the guided businesses 
that show evidence of bottomfish fishing in 2008 will not qualify to 
receive an Area 3A guided charter permit.
    Businesses that do not qualify to receive a charter halibut permit 
do not meet activity thresholds during the qualifying period (2004-
2005) or do not meet the 2008 thresholds in the recency provisions of 
the Council's motion.
    This action seeks to help 32 small, remote communities in Areas 2C 
and 3A develop charter businesses by mitigating the economic barrier 
associated with purchasing a charter halibut permit and creating a 
number of non-transferable permits that can be held only by the non-
profit entity representing the eligible community.
    Under this action, 18 qualifying Area 2C communities are eligible 
to each receive up to four community halibut charter permits per 
community at no cost; 14 Area 3A communities are eligible to each 
receive up to seven community halibut charter permits per community at 
no cost. Guided halibut fishing trips made with these permits must 
either begin or end within the boundaries of the eligible community 
designated on the permit. In addition, each of these community CQE 
programs will be able to buy additional transferable permits equal in 
number to its allocation of community halibut charter permits. This 
authority to acquire by transfer additional transferable charter 
halibut permits makes it possible for CQEs representing eligible 
communities to hold a maximum of eight permits per community in Area 2C 
or a maximum of 14 permits per community in Area 3A. These potential 
permit numbers are different from the excessive share limits imposed on 
other entities (a five-permit limit unless initially allocated more).
    Of the directly regulated entities, only currently active guided 
charter operations that will not receive a permit to continue to 
participate in this fishery will suffer significant adverse economic 
impacts. These operations must enter the market for transferable 
charter halibut permits to remain active in the charter halibut 
fishery.
    Permit applications must be submitted prior to the start of the 
program. The application will require information about the business 
applying for the permit, including the ownership structure of the 
business (U.S. citizenship papers for individuals) and information on 
the charter activities of the business. After submitting the initial 
permit application, additional applications will be required only for 
transfer of permits. NMFS will require additional reports when the 
structure of the business holding the permit changes or the permit is 
transferred. The initial application for a charter permit could take an 
estimated two hours to complete, depending on the amount of additional 
information the applicant needs to provide. The application for 
transfer of a charter permit is estimated to take two hours to 
complete, based on previous experience with the groundfish License 
Limitation Program.
    Persons applying for a community charter permit or a military 
charter halibut permit must submit applications for these special 
permits. In addition, CQEs representing communities eligible to receive 
community charter halibut permits will be required to identify the 
person that will use the permit. The application for a community 
charter halibut permit or a military charter halibut permit is 
estimated to take two hours to complete. In all cases, basic reading 
and writing skills are required to complete the application forms.
    The Council and NMFS have taken several steps to minimize the 
burden on directly regulated small entities. The Council published 
information about the control date frequently during its deliberations. 
The Council adopted this control date at its December 2005 meeting. In 
April 2006, it received a recommendation from its Charter Halibut 
Stakeholder Committee that it initiate an analysis of an entry 
moratorium using the December 9, 2005, control date. At its April 2006 
meeting it requested staff to prepare an analysis of moratorium options 
based on the December 9, 2005, control date. The Council received a 
discussion paper from staff, based on this control date in December 
2006. It adopted a preliminary preferred alternative based on this 
control date in February 2007, and it recommended a limited access 
system that included this control date in April 2007. Newsletters for 
each of these Council meetings contained information on the Council 
action and mentioned this control date. NMFS published a notice in the 
Federal Register in February 2006 stating that the Council had adopted 
this control date (71 FR 6442, February 8, 2006) and the Council 
devoted a paragraph to this notice in its February 2006 newsletter.
    This action creates a class of non-transferable permits to ease the 
transition from an open access fishery for a large class of businesses 
participating at relatively low levels of activity. Thus, any business 
that reported more than five logbook trips in the qualifying and in the 
recent participation period, but that had no vessel with at least 15 
trips in one of the two years, 2004 or 2005, and in 2008, will receive 
non-transferable permits. These permits will allow that operation to 
continue its activity until the operator leaves the fishery, at which 
time they will expire. Thus, a transitional mechanism is provided for 
many operations that otherwise would have been forced to withdraw from 
the fishery immediately.
    The Council and NMFS created transferable permits to allow the 
market to reallocate permits among recipients. This makes it possible 
for businesses that were active in 2008 but not during the qualifying 
period to continue their activity by purchasing permits.
    The Council has created a class of community halibut charter 
permits. These will be issued without charge to qualifying communities. 
If qualified communities in Area 2C take full advantage of this 
program, an additional 72 permits may be issued for guided charter 
vessels. If qualified communities in Area 3A take full advantage, an 
additional 98 permits may be available. These permits were created to 
provide development opportunities for rural communities, but they 
should offer opportunities for businesses that do not receive 
transferable or non-transferable permits, and that are willing to enter 
a

[[Page 599]]

joint venture with a qualified community to utilize these permits.
    The Council and Secretary considered a no-action alternative, but 
this was rejected because it would not accomplish the objective of this 
action, which is to stabilize the businesses in this fishery by 
controlling entry, while providing opportunities for rural community 
development. The Council also considered an option that only required a 
single landing in 2008 to meet the recency requirement. This option was 
rejected because this action was originally taken to stabilize the 
businesses in the charter halibut fishery with respect to active 
participants in 2004 and 2005. The recency requirement was adopted 
because the Council was aware that implementation would take several 
years, and it wanted to limit qualifying businesses to those businesses 
active during the qualification period and still active close to the 
time the program was implemented. Therefore, the Council elected to 
require the same level of participation in the qualification period and 
in the recency period.

Paperwork Reduction Act Collections of Information

    This rule contains a collection-of-information requirement subject 
to the Paperwork Reduction Act (PRA) and which has been approved by OMB 
under control number 0648-0592. Public reporting burden estimates per 
response for these requirements are two hours for charter halibut 
permit application, two hours for community charter halibut permit 
application, two hours for military charter halibut permit application, 
two hours for transfer of a charter halibut permit, and four hours for 
appeal of permit denial. These estimates include the time for reviewing 
instructions, searching existing data sources, gathering and 
maintaining the data needed, and completing and reviewing the 
collection-of-information. Send comments regarding this burden 
estimate, or any other aspect of this data collection, including 
suggestions for reducing the burden, to NMFS (see ADDRESSES) and by e-
mail to [email protected], or fax to 202-395-7285.
    Notwithstanding any other provision of the law, no person is 
required to respond to, nor shall any person be subject to a penalty 
for failure to comply with, a collection of information subject to the 
requirements of the PRA, unless that collection of information displays 
a currently valid OMB Control Number.

List of Subjects

15 CFR Part 902

    Recordkeeping and reporting requirements.

50 CFR Part 300

    Fisheries, Fishing, Reporting and recordkeeping requirements, 
Treaties.

50 CFR Part 679

    Alaska, Fisheries.

    Dated: December 18, 2009.
John Oliver,
Deputy Assistant Administrator for Operations, National Marine 
Fisheries Service.


0
For the reasons set out in the preamble, NMFS amends 15 CFR Chapter IX, 
and 50 CFR Chapters III and VI as follows:

15 CFR Chapter IX

PART 902--NOAA INFORMATION COLLECTION REQUIREMENTS UNDER THE 
PAPERWORK REDUCTION ACT: OMB CONTROL NUMBERS

0
1. The authority citation for part 902 continues to read as follows:

    Authority: 44 U.S.C. 3501 et seq.

0
2. In Sec.  902.1, in the table in paragraph (b), under the entry ``50 
CFR'', add entries for ``300.67(h), (i), (k), and (l)'', in 
alphanumeric order to read as follows:


Sec.  902.1  OMB control numbers assigned pursuant to the Paperwork 
Reduction Act.

* * * * *
    (b) * * *

------------------------------------------------------------------------
                                                   Current OMB control
   CFR part or section where the information       number (all numbers
       collection requirement is located            begin with 0648-)
------------------------------------------------------------------------
 
                                * * * * *
50 CFR
 
                                * * * * *
300.67(h), (i), (k), and (l)...................                    -0592
 
                                * * * * *
------------------------------------------------------------------------

50 CFR Chapter III

PART 300--INTERNATIONAL FISHERIES REGULATIONS

Subpart E--Pacific Halibut Fisheries

0
3. The authority citation for part 300, subpart E continues to read as 
follows:

    Authority: 16 U.S.C. 773-773k.


0
4. In Sec.  300.61, definitions are amended by:
0
A. Removing the definition for ``Charter vessel''.
0
B. Revising definitions for ``Charter vessel angler'', ``Charter vessel 
fishing trip'', ``Charter vessel guide'', ``Crew member'', and ``Sport 
fishing guide services''.
0
C. Adding definitions for ``Charter halibut permit'', ``Community 
charter halibut permit'', ``Military charter halibut permit'', and 
``Valid'' in alphabetical order.
    The revisions and additions read as follows:


Sec.  300.61  Definitions.

* * * * *
    Charter halibut permit means a permit issued by the National Marine 
Fisheries Service pursuant to Sec.  300.67.
    Charter vessel angler, for purposes of Sec. Sec.  300.65(d), 
300.66, and 300.67, means a person, paying or non-paying, using the 
services of a charter vessel guide.
    Charter vessel fishing trip, for purposes of Sec. Sec.  300.65(d), 
300.66, and 300.67, means the time period between the first deployment 
of fishing gear into the water from a vessel after any charter vessel 
angler is onboard and the offloading of one or more charter vessel 
anglers or any halibut from that vessel.
    Charter vessel guide, for purposes of Sec. Sec.  300.65(d), 300.66 
and 300.67, means a person who holds an annual sport guide license 
issued by the Alaska Department of Fish and Game, or a person who 
provides sport fishing guide services.
* * * * *
    Community charter halibut permit means a permit issued by NMFS to a 
Community Quota Entity pursuant to Sec.  300.67.
    Crew member, for purposes of Sec. Sec.  300.65(d), and 300.67, 
means an assistant, deckhand, or similar person who works directly 
under the supervision of, and on the same vessel as, a charter vessel 
guide or operator of a vessel with one or more charter vessel anglers 
on board.
* * * * *
    Military charter halibut permit means a permit issued by NMFS to a 
United States Military Morale, Welfare and Recreation Program pursuant 
to Sec.  300.67.
* * * * *
    Sport fishing guide services, for purposes of Sec. Sec.  300.65(d) 
and 300.67, means assistance, for compensation, to a person who is 
sport fishing, to take or attempt to take fish by being onboard a 
vessel with such person during any part of a charter vessel fishing 
trip. Sport fishing guide services do not include services provided by 
a crew member.
* * * * *

[[Page 600]]

    Valid, with respect to a charter halibut permit for purposes of 
Sec. Sec.  300.66 and 300.67, means the charter halibut permit that is 
currently in effect.
* * * * *

0
5. In Sec.  300.66, revise paragraphs (b), (i), (o), and (p), and add 
paragraphs (r), (s), (t), (u), and (v) to read as follows:


Sec.  300.66  Prohibitions.

* * * * *
    (b) Fish for halibut except in accordance with the catch sharing 
plans and domestic management measures implemented under Sec. Sec.  
300.63, 300.65, and 300.67.
* * * * *
    (i) Fish for subsistence halibut from a charter vessel or retain 
subsistence halibut onboard a charter vessel if anyone other than the 
owner of record, as indicated on the State of Alaska vessel 
registration, or the owner's immediate family is aboard the charter 
vessel and unless each person engaging in subsistence fishing onboard 
the charter vessel holds a subsistence halibut registration certificate 
in the person's name pursuant to Sec.  300.65(i) and complies with the 
gear and harvest restrictions found at Sec.  300.65(h). For purposes of 
this paragraph (i), the term ``charter vessel'' means a vessel that is 
registered, or that should be registered, as a sport fishing guide 
vessel with the Alaska Department of Fish and Game.
* * * * *
    (o) Fail to comply with the requirements of Sec. Sec.  300.65 and 
300.67.
    (p) Fail to submit or submit inaccurate information on any report, 
license, catch card, application, or statement required or submitted 
under Sec. Sec.  300.65 and 300.67, or submit inaccurate information to 
an authorized officer.
* * * * *
    (r) Be an operator of a vessel with one or more charter vessel 
anglers on board that are catching and retaining halibut without an 
original valid charter halibut permit for the regulatory area in which 
the vessel is operating.
    (s) Be an operator of a vessel with more charter vessel anglers on 
board catching and retaining halibut than the total angler endorsement 
number specified on the charter halibut permit or permits on board the 
vessel.
    (t) Be an operator of a vessel with more charter vessel anglers on 
board catching and retaining halibut than the angler endorsement number 
specified on the community charter halibut permit or permits on board 
the vessel.
    (u) Be an operator of a vessel in Area 2C and Area 3A during one 
charter vessel fishing trip.
    (v) Be an operator of a vessel in Area 2C or Area 3A with one or 
more charter vessel anglers on board that are catching and retaining 
halibut without having on board the vessel a State of Alaska Department 
of Fish and Game Saltwater Charter Logbook that specifies the 
following:
    (1) The person named on the charter halibut permit or permits being 
used on board the vessel;
    (2) The charter halibut permit or permits number(s) being used on 
board the vessel; and
    (3) The name and State issued boat registration (AK number) or U.S. 
Coast Guard documentation number of the vessel.

0
6. Add Sec.  300.67 to subpart E to read as follows:


Sec.  300.67  Charter halibut limited access program.

    This section establishes limitations on using a vessel on which 
charter vessel anglers catch and retain Pacific halibut in 
International Pacific Halibut Commission (IPHC) regulatory areas 2C and 
3A.
    (a) General permit requirements. (1) In addition to other 
applicable permit and licensing requirements, any operator of a vessel 
with one or more charter vessel anglers catching and retaining Pacific 
halibut on board a vessel must have on board the vessel an original 
valid charter halibut permit or permits endorsed for the regulatory 
area in which the vessel is operating and endorsed for at least the 
number of charter vessel anglers who are catching and retaining Pacific 
halibut. Each charter halibut permit holder must insure that the 
operator of the permitted vessel complies with all requirements of 
Sec. Sec.  300.65 and 300.67.
    (2) Area endorsement. A charter halibut permit is valid only in the 
International Pacific Halibut Commission regulatory area for which it 
is endorsed. Regulatory areas are defined in the annual management 
measures published pursuant to Sec.  300.62.
    (3) Charter vessel angler endorsement. A charter halibut permit is 
valid for up to the maximum number of charter vessel anglers for which 
the charter halibut permit is endorsed.
    (b) Qualifications for a charter halibut permit. A charter halibut 
permit for IPHC regulatory area 2C must be based on meeting 
participation requirements in area 2C. A charter halibut permit for 
IPHC regulatory area 3A must be based on meeting participation 
requirements in area 3A. Qualifications for a charter halibut permit in 
each area must be determined separately and must not be combined.
    (1) NMFS will issue a charter halibut permit to a person who meets 
the following requirements:
    (i) The person applies for a charter halibut permit within the 
application period specified in the Federal Register and completes the 
application process pursuant to paragraph (h) of this section.
    (ii) The person is the individual or non-individual entity to which 
the State of Alaska Department of Fish and Game (ADF&G) issued the 
ADF&G Business Owner Licenses that authorized logbook fishing trips 
that meet the minimum participation requirements described in 
paragraphs (b)(1)(ii)(A) and (b)(1)(ii)(B) of this section for one or 
more charter halibut permits, unless the person is applying as a 
successor-in-interest.
    (A) Reported five (5) bottomfish logbook fishing trips or more 
during one year of the qualifying period; and
    (B) Reported five (5) halibut logbook fishing trips or more during 
the recent participation period.
    (iii) If the person is applying as a successor-in-interest to the 
person to which ADF&G issued the Business Owner Licenses that 
authorized logbook fishing trips that meet the participation 
requirements described in paragraphs (b)(1)(ii) of this section for one 
or more charter halibut permits, NMFS will require the following 
written documentation:
    (A) If the applicant is applying on behalf of a deceased 
individual, the applicant must document that the individual is 
deceased, that the applicant is the personal representative of the 
deceased's estate appointed by a court, and that the applicant 
specifies who, pursuant to the applicant's personal representative 
duties, should receive the permit(s) for which application is made; or
    (B) If the applicant is applying as a successor-in-interest to an 
entity that is not an individual, the applicant must document that the 
entity has been dissolved and that the applicant is the successor-in-
interest to the dissolved entity.
    (iv) If more than one applicant claims that they are the successor-
in-interest to a dissolved entity, NMFS will award the permit or 
permits for which the dissolved entity qualified in the name(s) of the 
applicants that submitted a timely application and proved that they are 
a successor-in-interest to the dissolved entity.
    (2) Notwithstanding any other provision in this subpart, and except 
as provided in paragraph (b)(1)(iv) of this section,

[[Page 601]]

    (i) One logbook fishing trip shall not be credited to more than one 
applicant;
    (ii) One logbook fishing trip made pursuant to one ADF&G Business 
Owner License shall not be credited to more than one applicant; and
    (iii) Participation by one charter halibut fishing business shall 
not be allowed to support issuance of permits to more than one 
applicant.
    (3) For purposes of this section, the term ``ADF&G Business 
Owner(s) License(s)'' includes a ``business registration,'' ``sport 
fish business owner license,'' ``sport fish business license,'' and 
``ADF&G business license''.
    (c) Number of charter halibut permits. An applicant that meets the 
participation requirements in paragraph (b) of this section will be 
issued the number of charter halibut permits equal to the lesser of the 
number of permits determined by paragraphs (c)(1) or (c)(2) of this 
section as follows:
    (1) The total number of bottomfish logbook fishing trips made 
pursuant to the applicant's ADF&G Business License in the applicant-
selected year divided by five, and rounded down to a whole number; or
    (2) The number of vessels that made the bottomfish logbook fishing 
trips in the applicant-selected year.
    (d) Designation of transferability. Each permit issued to an 
applicant under paragraph (c) of this section will be designated as 
transferable or non-transferable.
    (1) Minimum participation criteria for a transferable permit are 
described in paragraphs (d)(1)(i) and (d)(1)(ii) of this section as 
follows:
    (i) Reported fifteen (15) bottomfish logbook fishing trips or more 
from the same vessel during one year of the qualifying period; and
    (ii) Reported fifteen (15) halibut logbook fishing trips or more 
from the same vessel during the recent participation period.
    (iii) The vessel used during the recent participation period is not 
required to be the same vessel used during the qualifying period.
    (2) The number of transferable charter halibut permits issued to an 
applicant will be equal to the lesser of the number of vessels that met 
the minimum transferable permit qualifications described in paragraphs 
(d)(1)(i) or (d)(1)(ii) of this section.
    (e) Angler endorsement. A charter halibut permit will be endorsed 
for the highest number of charter vessel anglers reported on any 
logbook fishing trip in the qualifying period except that:
    (1) The angler endorsement number will be four (4) if the highest 
number of charter vessel anglers reported on any logbook fishing trip 
in the qualifying period is less than four (4) or no charter vessel 
anglers were reported on any of the applicant's logbook fishing trips 
in the applicant-selected year; and
    (2) The angler endorsement number will be six (6) on a charter 
halibut permit issued pursuant to military service under paragraph 
(g)(3) of this section.
    (f) For purposes of this section, the following terms are defined 
as follows:
    (1) Applicant-selected year means the year in the qualifying 
period, 2004 or 2005, selected by the applicant for NMFS to use in 
determining the applicant's number of transferable and nontransferable 
permits.
    (2) Bottomfish logbook fishing trip means a logbook fishing trip in 
the qualifying period that was reported to the State of Alaska in a 
Saltwater Charter Logbook with one of the following pieces of 
information: The statistical area(s) where bottomfish fishing occurred, 
the boat hours that the vessel engaged in bottomfish fishing, or the 
number of rods used from the vessel in bottomfish fishing.
    (3) Halibut logbook fishing trip means a logbook fishing trip in 
the recent participation period that was reported to the State of 
Alaska in a Saltwater Charter Logbook within the time limit for 
reporting the trip in effect at the time of the trip with one of the 
following pieces of information: The number of halibut that was kept, 
the number of halibut that was released, the statistical area(s) where 
bottomfish fishing occurred, or the boat hours that the vessel engaged 
in bottomfish fishing.
    (4) Logbook fishing trip means a bottomfish logbook fishing trip or 
a halibut logbook fishing trip that was reported as a trip to the State 
of Alaska in a Saltwater Charter Logbook within the time limits for 
reporting the trip in effect at the time of the trip, except that for 
multi-day trips, the number of trips will be equal to the number of 
days of the multi-day trip, e.g., a two day trip will be counted as two 
trips.
    (5) Official charter halibut record means the information prepared 
by NMFS on participation in charter halibut fishing in Area 2C and Area 
3A that NMFS will use to implement the Charter Halibut Limited Access 
Program and evaluate applications for charter halibut permits.
    (6) Qualifying period means the sport fishing season established by 
the International Pacific Halibut Commission (February 1 through 
December 31) in 2004 and 2005.
    (7) Recent participation period means the sport fishing season 
established by the International Pacific Halibut Commission (February 1 
through December 31) in 2008.
    (g) Unavoidable circumstance. Unavoidable circumstance claims must 
be made pursuant to paragraph (h)(6) of this section, and will be 
limited to persons who would be excluded from the charter halibut 
fishery entirely unless their unavoidable circumstance is recognized. 
This unavoidable circumstance provision cannot be used to upgrade the 
number of permits issued or to change a non-transferable permit to a 
transferable permit, and is limited to the following circumstances.
    (1) Recent participation period. An applicant for a charter halibut 
permit that meets the participation requirement for the qualifying 
period, but does not meet the participation requirement for the recent 
participation period, may receive one or more charter halibut permits 
if the applicant proves paragraphs (g)(1)(i) through (iv) of this 
section as follows:
    (i) The applicant had a specific intent to operate a charter 
halibut fishing business in the recent participation period;
    (ii) The applicant's specific intent was thwarted by a circumstance 
that was:
    (A) Unavoidable;
    (B) Unique to the owner of the charter halibut fishing business; 
and
    (C) Unforeseen and reasonably unforeseeable by the owner of the 
charter halibut fishing business;
    (iii) The circumstance that prevented the applicant from operating 
a charter halibut fishing business actually occurred; and
    (iv) The applicant took all reasonable steps to overcome the 
circumstance that prevented the applicant from operating a charter 
halibut fishing business in the recent participation period.
    (v) If the applicant proves the foregoing (see paragraphs (g)(1)(i) 
through (iv) of this section), the applicant will receive the number of 
transferable and non-transferable permits and the angler endorsements 
on these permits that result from the application of criteria in 
paragraphs (b), (c), (d), (e), and (f) of this section.
    (2) Qualifying period. An applicant for a charter halibut permit 
that meets the participation requirement for the recent participation 
period but does not meet the participation requirement for the 
qualifying period, may receive one or more permits if the applicant 
proves paragraphs (g)(2)(i) through (iv) of this section as follows:
    (i) The applicant had a specific intent to operate a charter 
halibut fishing business in at least one year of the qualifying period;

[[Page 602]]

    (ii) The applicant's specific intent was thwarted by a circumstance 
that was:
    (A) Unavoidable;
    (B) Unique to the owner of the charter halibut fishing business; 
and
    (C) Unforeseen and reasonably unforeseeable by the owner of the 
charter halibut fishing business;
    (iii) The circumstance that prevented the applicant from operating 
a charter halibut fishing business actually occurred; and
    (iv) The applicant took all reasonable steps to overcome the 
circumstance that prevented the applicant from operating a charter 
halibut fishing business in at least one year of the qualifying period.
    (v) If the applicant proves the foregoing (see paragraphs (g)(2)(i) 
through (iv) of this section), the applicant will receive either:
    (A) One non-transferable permit with an angler endorsement of four 
(4); or
    (B) The number of transferable and non-transferable permits, and 
the angler endorsement on those permits, that result from the logbook 
fishing trips that the applicant proves likely would have taken by the 
applicant but for the circumstance that thwarted the applicant's 
specific intent to operate a charter halibut fishing business in one 
year of the qualifying period and the applicant did not participate 
during the other year of the qualifying period.
    (3) Military service. An applicant for a charter halibut permit 
that meets the participation requirement in the recent participation 
period, but does not meet the participation requirement for the 
qualifying period, may receive one or more permits if the applicant 
proves the following:
    (i) The applicant was ordered to report for active duty military 
service as a member of a branch of the U.S. military, National Guard, 
or military reserve during the qualifying period; and
    (ii) The applicant had a specific intent to operate a charter 
halibut fishing business that was thwarted by the applicant's order to 
report for military service.
    (iii) The number of transferable and non-transferable charter 
halibut permit(s) that an applicant may receive under paragraph (g)(3) 
of this section will be based on the criteria in paragraph (g)(2)(v)(B) 
of this section. Angler endorsements on all such charter halibut 
permits will be pursuant to paragraph (e)(2) of this section.
    (h) Application for a charter halibut permit. (1) An application 
period of no less than 60 days will be specified by notice in the 
Federal Register during which any person may apply for a charter 
halibut permit. Any application that is submitted by mail and 
postmarked, or submitted by hand delivery or facsimile, after the last 
day of the application period will be denied. Electronic submission 
other than by facsimile will be denied. Applications must be submitted 
to the address given in the Federal Register notice of the application 
period.
    (2) Charter halibut permit. To be complete, a charter halibut 
permit application must be signed and dated by the applicant, and the 
applicant must attest that, to the best of the applicant's knowledge, 
all statements in the application are true and the applicant complied 
with all legal requirements for logbook fishing trips in the qualifying 
period and recent participation period that were reported under the 
applicant's ADF&G Business Owner Licenses. An application for a charter 
halibut permit will be made available by NMFS. Completed applications 
may be submitted by mail, hand delivery, or facsimile at any time 
during the application period announced in the Federal Register notice 
of the application period described at paragraph (h)(1) of this 
section.
    (3) Application procedure. NMFS will create the official charter 
halibut record and will accept all application claims that are 
consistent with the official charter halibut record. If an applicant's 
claim is not consistent with the official charter halibut record, NMFS 
will issue non-transferable interim permit(s) for all undisputed permit 
claims, and will respond to the applicant by letter specifying a 30-day 
evidentiary period during which the applicant may provide additional 
information or argument to support the applicant's claim for disputed 
permit(s). Limits on the 30-day evidentiary period are as follows:
    (i) An applicant shall be limited to one 30-day evidentiary period; 
and
    (ii) Additional information received after the 30-day evidentiary 
period has expired will not be considered for purposes of the initial 
administrative determination.
    (4) After NMFS evaluates the additional information submitted by 
the applicant during the 30-day evidentiary period, it will take one of 
the following two actions.
    (i) If NMFS determines that the applicant has met its burden of 
proving that the official charter halibut record is incorrect, NMFS 
will amend the official charter halibut record and use the official 
charter halibut record, as amended, to determine whether the applicant 
is eligible to receive one or more charter halibut permits, the nature 
of those permits and the angler and area endorsements on those permits; 
or
    (ii) If NMFS determines that the applicant has not met its burden 
of proving that the official charter halibut record is incorrect, NMFS 
will notify the applicant by an initial administration determination, 
pursuant to paragraph (h)(5) of this section.
    (5) Initial Administration Determination (IAD). NMFS will send an 
IAD to the applicant following the expiration of the 30-day evidentiary 
period if NMFS determines that the applicant has not met its burden of 
proving that the official charter halibut record is incorrect or that 
other reasons exist to initially deny the application. The IAD will 
indicate the deficiencies in the application and the deficiencies with 
the information submitted by the applicant in support of its claim.
    (6) Appeal. An applicant that receives an IAD may appeal to the 
Office of Administrative Appeals (OAA) pursuant to Sec.  679.43 of this 
title.
    (i) If the applicant does not apply for a charter halibut permit 
within the application period specified in the Federal Register, the 
applicant will not receive any interim permits pending final agency 
action on the application.
    (ii) If the applicant applies for a permit within the specified 
application period and OAA accepts the applicant's appeal, the 
applicant will receive the number and kind of interim permits which are 
not in dispute, according to the information in the official charter 
halibut record.
    (iii) If the applicant applies for a permit within the specified 
application period and OAA accepts the applicant's appeal, but 
according to the information in the official charter halibut record, 
the applicant would not be issued any permits, the applicant will 
receive one interim permit with an angler endorsement of four (4).
    (iv) All interim permits will be non-transferable and will expire 
when NMFS takes final agency action on the application.
    (i) Transfer of a charter halibut permit--(1) General. A transfer 
of a charter halibut permit is valid only if it is approved by NMFS. 
NMFS will approve a transfer of a charter halibut permit if the permit 
to be transferred is a transferable permit issued under paragraph 
(d)(2) of this section, if a complete transfer application is 
submitted, and if the transfer application meets the standards for 
approval in paragraph (i)(2) of this section.
    (2) Standards for approval of transfers. NMFS will transfer a 
transferable charter halibut permit to a person designated by the 
charter halibut

[[Page 603]]

permit holder if, at the time of the transfer the following standards 
are met:
    (i) The person designated to receive the transferred permit is a 
U.S. citizen or a U.S. business with a minimum of 75 percent U.S. 
ownership;
    (ii) The parties to the transfer do not owe NMFS any fines, civil 
penalties or any other payments;
    (iii) The transfer is not inconsistent with any sanctions resulting 
from Federal fishing violations;
    (iv) The transfer will not cause the designated recipient of the 
permit to exceed the permit limit at paragraph (j) of this section, 
unless an exception to that limit applies;
    (v) A transfer application is completed and approved by NMFS; and
    (vi) The transfer does not violate any other provision in this 
part.
    (3) For purposes of paragraph (i)(2) of this section, a U.S. 
business with a minimum of 75 percent U.S. ownership means a 
corporation, partnership, association, trust, joint venture, limited 
liability company, limited liability partnership, or any other entity 
where at least 75 percent of the interest in such entity, at each tier 
of ownership of such entity and in the aggregate, is owned and 
controlled by citizens of the United States.
    (4) Application to transfer a charter halibut permit. To be 
complete, a charter halibut permit transfer application must have 
notarized and dated signatures of the applicants, and the applicants 
must attest that, to the best of the applicants' knowledge, all 
statements in the application are true. An application to transfer a 
charter halibut permit will be made available by NMFS. Completed 
transfer applications may be submitted by mail or hand delivery at any 
time to the addresses listed on the application. Electronic or 
facsimile deliveries will not be accepted.
    (5) Denied transfer applications. If NMFS does not approve a 
charter halibut permit transfer application, NMFS will inform the 
applicant of the basis for its disapproval.
    (6) Transfer due to court order, operation of law or as part of a 
security agreement. NMFS will transfer a charter halibut permit based 
on a court order, operation of law or a security agreement, if NMFS 
determines that a transfer application is complete and the transfer 
will not violate an eligibility criterion for transfers.
    (j) Charter halibut permit limitations--(1) General. A person may 
not own, hold, or control more than five (5) charter halibut permits 
except as provided by paragraph (j)(4) of this section. NMFS will not 
approve a transfer application that would result in the applicant that 
would receive the transferred permit holding more than five (5) charter 
halibut permits except as provided by paragraph (j)(6) of this section.
    (2) Ten percent ownership criterion. In determining whether two or 
more persons are the same person for purposes of paragraph (j)(1) of 
this section, NMFS will apply the definition of an ``affiliation for 
the purpose of defining AFA entities'' at Sec.  679.2 of this title.
    (3) A permit will cease to be a valid permit if the permit holder 
is:
    (i) An individual and the individual dies; or
    (ii) A non-individual (e.g., corporation or partnership) and 
dissolves or changes as defined at paragraph (j)(5) of this section.
    (iii) A transferable permit may be made valid by transfer to an 
eligible recipient.
    (4) Exception for initial recipients of permits. Notwithstanding 
the limitation at paragraph (j)(1) of this section, NMFS may issue more 
than five (5) charter halibut permits to an initial recipient that 
meets the requirements described in paragraphs (b), (d), and (e) of 
this section for more than five (5) charter halibut permits, subject to 
the following limitations:
    (i) This exception applies only to an initial recipient as the 
recipient exists at the time that it is initially issued the permits;
    (ii) If an initial recipient of transferable permit(s) who is an 
individual dies, the individual's successor-in-interest may not hold 
more than five (5) charter halibut permits;
    (iii) If an initial recipient permit holder that is a non-
individual, such as a corporation or a partnership, dissolves or 
changes, NMFS will consider the new entity a new permit holder and the 
new permit holder may not hold more than five (5) charter halibut 
permits.
    (5) For purposes of this paragraph (j), a ``change'' means:
    (i) For an individual, the individual has died, in which case NMFS 
must be notified within 30 days of the individual's death; and
    (ii) For a non-individual entity, the same as defined at Sec.  
679.42(j)(4)(i) of this title, in which case the permit holder must 
notify NMFS within 15 days of the effective date of the change as 
required at Sec.  679.42(j)(5) of this title.
    (6) Exception for transfer of permits. Notwithstanding the 
limitation at paragraph (j)(1) of this section, NMFS may approve a 
permit transfer application that would result in the person that would 
receive the transferred permit(s) holding more than five (5) 
transferable charter halibut permits if the parties to the transfer 
meet the following conditions:
    (i) The designated person that would receive the transferred 
permits does not hold any charter halibut permits;
    (ii) All permits that would be transferred are transferable 
permits;
    (iii) The permits that would be transferred are all of the 
transferable permits that were awarded to an initial recipient who 
exceeded the permit limitation of five (5) permits; and
    (iv) The person transferring its permits also is transferring its 
entire charter vessel fishing business, including all the assets of 
that business, to the designated person that would receive the 
transferred permits.
    (k) Community charter halibut permit--(1) General. A Community 
Quota Entity (CQE), as defined in Sec.  679.2 of this title, 
representing an eligible community listed in paragraph (k)(2) of this 
section, may receive one or more community charter halibut permits. A 
community charter halibut permit issued to a CQE will be designated for 
area 2C or area 3A, will be non-transferable, and will have an angler 
endorsement of six (6).
    (2) Eligible communities. Each community charter halibut permit 
issued to a CQE under paragraph (k)(1) of this section will specify the 
name of an eligible community on the permit. Only the following 
communities are eligible to receive community charter halibut permits:
    (i) For Area 2C: Angoon, Coffman Cove, Edna Bay, Hollis, Hoonah, 
Hydaburg, Kake, Kassan, Klawock, Metlakatla, Meyers Chuck, Pelican, 
Point Baker, Port Alexander, Port Protection, Tenakee, Thorne Bay, 
Whale Pass.
    (ii) For Area 3A: Akhiok, Chenega Bay, Halibut Cove, Karluk, Larsen 
Bay, Nanwalek, Old Harbor, Ouzinkie, Port Graham, Port Lyons, Seldovia, 
Tatitlek, Tyonek, Yakutat.
    (3) Limitations. The maximum number of community charter halibut 
permits that may be issued to a CQE for each eligible community the CQE 
represents is as follows:
    (i) A CQE representing an eligible community or communities in 
regulatory area 2C may receive a maximum of four (4) community charter 
halibut permits per eligible community designated for Area 2C.
    (ii) A CQE representing an eligible community or communities in 
regulatory area 3A may receive a maximum of seven (7) community charter 
halibut permits per eligible community designated for Area 3A.

[[Page 604]]

    (4) NMFS will not approve a transfer that will cause a CQE 
representing a community or communities to hold more than the total 
number of permits described in paragraphs (k)(4)(i) and (k)(4)(ii) of 
this section, per community, including community charter halibut 
permits granted to the CQE under this paragraph (k) and any charter 
halibut permits acquired by the CQE by transfer under paragraph (i) of 
this section.
    (i) The maximum number of charter halibut and community charter 
halibut permits that may be held by a CQE per community represented by 
the CQE in regulatory area 2C is eight (8).
    (ii) The maximum number of charter halibut and community charter 
halibut permits that may be held by a CQE per community represented by 
the CQE in regulatory area 3A is fourteen (14).
    (5) Limitation on use of permits. The following limitations apply 
to community charter halibut permits issued to a CQE under paragraph 
(k)(1) of this section.
    (i) Every charter vessel fishing trip authorized by such a permit 
and on which halibut are caught and retained must begin or end at a 
location(s) specified on the application for a community charter 
halibut permit and that is within the boundaries of the eligible 
community designated on the permit. The geographic boundaries of the 
eligible community will be those defined by the United States Census 
Bureau.
    (ii) Community charter halibut permits may be used only within the 
regulatory area for which they are designated to catch and retain 
halibut.
    (6) Application procedure. To be complete, a community charter 
halibut permit application must be signed and dated by the applicant, 
and the applicant must attest that, to the best of the applicants' 
knowledge, all statements in the application are true and complete. An 
application for a community charter halibut permit will be made 
available by NMFS and may be submitted by mail, hand delivery, or 
facsimile at any time to the address(s) listed on the application. 
Electronic deliveries other than facsimile will not be accepted.
    (l) Military charter halibut permit. NMFS will issue a military 
charter halibut permit without an angler endorsement to an applicant 
provided that the applicant is a Morale, Welfare and Recreation Program 
of the United States Armed Services.
    (1) Limitations. A military charter halibut permit is non-
transferable and may be used only in the regulatory area (2C or 3A) 
designated on the permit.
    (2) Application procedure. An applicant may apply for a military 
charter halibut permit at any time. To be complete, a military charter 
halibut permit application must be signed and dated by the applicant, 
and the applicant must attest that, to the best of the applicants' 
knowledge, all statements in the application are true and complete. An 
application for a military charter halibut permit will be made 
available by NMFS and may be submitted by mail, hand delivery, or 
facsimile at any time to the address(s) listed on the application. 
Electronic deliveries other than facsimile will not be accepted.

50 CFR Chapter VI

PART 679--FISHERIES OF THE EXCLUSIVE ECONOMIC ZONE OFF ALASKA

0
7. The authority citation for part 679 continues to read as follows:

    Authority: 16 U.S.C. 773 et seq.; 1801 et seq.; 3631 et seq.; 
Pub. L. 108-447.


0
8. In Sec.  679.2, revise the introductory text for the definition of 
``community quota entity (CQE)'' to read as follows:


Sec.  679.2  Definitions.

* * * * *
    Community quota entity (CQE) means a non-profit organization that:
* * * * *
[FR Doc. E9-30662 Filed 1-4-10; 8:45 am]
BILLING CODE 3510-22-P