[Federal Register Volume 85, Number 46 (Monday, March 9, 2020)]
[Proposed Rules]
[Pages 13618-13621]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-04686]


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DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

50 CFR Part 679

[Docket No.: 200303-0070]
RIN 0648-BJ40


Fisheries of the Exclusive Economic Zone Off Alaska; Adjust the 
North Pacific Observer Program Fee

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

ACTION: Proposed rule; request for comments.

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SUMMARY: NMFS proposes regulations to adjust the North Pacific Observer 
Program fee. This proposed rule is intended to increase funds available 
to support observer and EM deployment in the partial coverage category 
of the Observer Program and increase the likelihood of meeting desired 
monitoring objectives. This proposed rule is intended to promote the 
goals and objectives of the IFQ Program, the Magnuson-Stevens Fishery 
Conservation and Management Act, the Northern Pacific Halibut Act of 
1982, and other applicable law.

DATES: Submit comments on or before April 8, 2020.

ADDRESSES: You may submit comments, identified by docket number NOAA-
NMFS-2019-0136, either of the following methods:
     Electronic Submission: Submit all electronic public 
comments via the Federal eRulemaking Portal. Go to www.regulations.gov/#!docketDetail;D=NOAA-NMFS-2019-0136, click the ``Comment Now!'' icon, 
complete the required fields, and enter or attach your comments.
     Mail: Submit written comments to Glenn Merrill, Assistant 
Regional Administrator, Sustainable Fisheries Division, Alaska Region 
NMFS, Attn: Records Office. Mail comments to P.O. Box 21668, Juneau, AK 
99802-1668.
    Instructions: Comments sent by any other method, to any other 
address or individual, or received after the end of the comment period, 
may not be considered by NMFS. All comments received are a part of the 
public record and will generally be posted for public viewing on 
www.regulations.gov without change. All personal identifying 
information (e.g., name, address), confidential business information, 
or otherwise sensitive information submitted voluntarily by the sender 
will be publicly accessible. NMFS will accept anonymous comments (enter 
``N/A'' in the required fields if you wish to remain anonymous).
    Electronic copies of the Environmental Assessment/Regulatory Impact 
Review (referred to as the ``Analysis'') prepared for this proposed 
rule are available from http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Alicia M Miller, 907-586-7228 or 
[email protected].

SUPPLEMENTARY INFORMATION:

Authority for Action

    NMFS manages the groundfish fisheries in the exclusive economic 
zone off Alaska under the Fishery Management Plan (FMP) for Groundfish 
of the Gulf of Alaska (GOA) and under the FMP for Groundfish of the 
Bering Sea and Aleutian Islands Management Area (BSAI). The North 
Pacific Fishery Management Council (Council) prepared the FMPs under 
the authority of the Magnuson-Stevens Fishery Conservation and 
Management Act (Magnuson-Stevens Act), 16 U.S.C. 1801 et seq. 
Regulations governing U.S. fisheries and implementing the FMPs appear 
at 50 CFR parts 600 and 679.
    The International Pacific Halibut Commission (IPHC) and NMFS manage 
fishing for Pacific halibut (Hippoglossus stenolepis) through 
regulations established under the authority of the Northern Pacific 
Halibut Act of 1982 (Halibut Act). The IPHC promulgates regulations 
governing the halibut fishery under the Convention between the United 
States and Canada for the Preservation of the Halibut Fishery of the 
Northern 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). The IPHC's 
regulations are subject to approval by the Secretary of State with the 
concurrence of the Secretary. The Halibut Act, at sections 773c (a) and 
(b), provides the Secretary with general responsibility to carry out 
the Convention and the Halibut Act. The Halibut Act, at section 
773c(c), also provides the Council with authority to develop 
regulations that are in addition to, and not in conflict with, approved 
IPHC regulations. Throughout this preamble the term halibut is used for 
Pacific halibut.

Background

    NMFS proposes regulations to adjust the North Pacific Observer 
Program (Observer Program) fee percentage. This proposed rule is 
intended to increase funds available to support observer and EM 
deployment in the partial coverage category of the Observer Program and 
increase the likelihood of meeting monitoring objectives. The following 
sections describe the Observer Program, the landings subject to the 
observer fee, and the need for this action.

Observer Program

    Fishery managers use information collected by observers or 
electronic monitoring (EM) systems to monitor fishing quotas, manage 
catch and bycatch, and document fishery

[[Page 13619]]

interactions with protected resources, such as marine mammals and 
seabirds. Scientists use this information for fish stock assessments 
and marine ecosystem research. Over the past several decades, NMFS has 
required the deployment of observers onboard vessels and at shoreside 
and other fish processors to ensure high-quality fishery data necessary 
for the conservation and management of fisheries. Section 3.2 of the 
Analysis detail the use of data gathered through observer and EM 
systems.
    In 2012, the Observer Program was extensively restructured to add a 
funding and deployment system for observer coverage and amend existing 
observer coverage requirements for vessels and processing plants (77 FR 
70061, November 21, 2012). This funding and deployment system allows 
NMFS to determine when and where to deploy observers according to 
management and conservation needs, with funds provided through a system 
of fees. In 2017, NMFS implemented regulations to integrate electronic 
monitoring (EM) into the Observer Program (82 FR 36991, August 8, 
2017). Regulations at 50 CFR 679 subpart E implementing the Observer 
Program, require the deployment of NMFS-certified observers or EM.
    The Observer Program includes two observer coverage categories--the 
partial coverage category and the full coverage category (defined in 
regulation at Sec.  679.51). All groundfish and halibut vessels and 
fish processors subject to observer coverage are included in one of 
these two categories. Throughout this proposed rule, the term 
``processor'' refers to shoreside processors, stationary floating 
processors, and catcher/processors.
    The partial coverage category includes vessels and processors that 
are not required to have an observer or EM at all times and the full 
coverage category includes vessels and processors required to have all 
of their fishing and processing activity observed. Vessels and 
processors in the full coverage category arrange and pay for observer 
services directly from a permitted observer provider, in what is 
commonly known as a ``pay-as-you-go'' deployment method. Observer 
coverage and EM for the partial coverage category are funded through a 
system of fees based on the ex-vessel value of groundfish and Pacific 
halibut. This fee is authorized under section 313 of the Magnuson-
Stevens Act.
    Section 313 of the Magnuson-Stevens Act (16 U.S.C. 1862) authorizes 
the Council, in consultation with NMFS, to prepare a fishery research 
plan that includes stationing observers to collect data necessary for 
the conservation, management, and scientific understanding of the 
fisheries under the Council's jurisdiction, including the halibut 
fishery. Section 313(d) of the Magnuson-Stevens Act authorized creation 
of the North Pacific Fishery Observer Fund within the U.S. Treasury. 
NMFS uses its authority under section 313 of the Magnuson-Steven Act to 
fund deploying observers and EM on vessels and processors in the 
partial coverage category. Section 313 of the Magnuson-Stevens Act 
authorizes NMFS to assess a fee up to 2 percent of the unprocessed ex-
vessel value of the fisheries under the jurisdiction of the Council, 
including the halibut fishery.
    Each year since the Observer Program was restructured, NMFS 
develops an Annual Deployment Plan (ADP) to describe how observers and 
EM will be deployed in the partial coverage category for the upcoming 
calendar year and prepares an annual report. The annual report 
evaluates the performance of observer deployment in the full coverage 
category according to the regulatory coverage requirements and 
performance in partial coverage category according to the prior year's 
ADP implementation. NMFS and the Council created the ADP process to 
provide flexibility in the deployment of observers, specifically in the 
partial coverage category, and EM to gather reliable data for 
estimation of catch in the groundfish and halibut fisheries off Alaska. 
The ADP process ensures that the best available information is used to 
evaluate deployment, including scientific review and Council input, and 
to annually determine deployment methods. During the development of the 
ADP, NMFS consults with the Council to determine how to apportion fee 
revenues between observer and EM deployment and to specify selection 
rates for each. Observer and EM selection rates for a given year are 
dependent on the available budget generated from the observer fee and 
supplemental funds and the decisions about how to apportion the fees to 
different selection pools and the anticipated fishing effort in each 
selection pool. Additional information about the Observer Program is 
available in Section 3 of the Analysis.

Landings Subject to the Fee

    Since January 1, 2013, an observer fee equal to 1.25 percent of the 
fishery ex-vessel value has been assessed on all landings accruing 
against a Federal total allowable catch (TAC) for groundfish or a 
commercial halibut quota made by vessels that are subject to Federal 
regulations and not included in the full coverage category. A fee is 
only assessed on landings of groundfish from vessels designated on a 
Federal Fisheries Permit or from vessels landing individual fishing 
quota (IFQ) or Western Alaska community development quota (CDQ) halibut 
or IFQ sablefish. Within the subset of vessels subject to the observer 
fee, only landings accruing against an IFQ allocation or a Federal TAC 
for groundfish are included in the fee assessment. Regulations at Sec.  
679.55(c) describe which landings are subject to the observer fee 
assessment.
    The intent of the Council and NMFS is for vessel owners to split 
the fee liability 50-50 with the processor or registered buyer. While 
the intent is that vessels and processors are each responsible for 
their portion of the ex-vessel value fee, the owner of a processor is 
responsible for collecting the fee, including the vessel's portion of 
the fee, at the time of landing and remitting the full fee amount to 
NMFS.
    Annually, NMFS publishes in the Federal Register, a notice of the 
standard ex-vessel prices for groundfish and halibut for the 
calculation of the observer fee under the Observer Program (84 FR 
68409, December 16, 2019). Each year the notice provides information to 
vessel owners, processors, registered buyers, and other participants 
about the standard ex-vessel prices that will be used to calculate the 
observer fee assessed against landings of groundfish and halibut. NMFS 
sends invoices to processors and registered buyers subject to the fee 
by January 15 of each year for the previous year's fee liabilities. 
Fees are due to NMFS on or before February 15.

Need for This Action

    The annual process of establishing observer coverage and EM 
selection rates in the partial coverage category using the Observer 
Program Annual Report and Draft ADP is a well-designed and flexible 
process. This annual process produces a statistically reliable sampling 
plan for the collection of scientifically robust data at any level of 
observer coverage and allows for annual consideration of policy-driven 
monitoring objectives identified through the Council process (Section 
3.3 of the Analysis). Due to higher than expected observer deployment 
costs since 2013, and diminishing availability of supplemental Federal 
funding and declining fee revenues, additional funding is necessary to 
deploy observers and EM at coverage rates adequate to meet the 
Council's and NMFS' monitoring objectives in future years. In

[[Page 13620]]

October 2019, the Council unanimously recommended to increase the 
observer fee to 1.65 percent. Additional information about funding and 
coverage rates afforded since 2013 is included in Section 3.4 of the 
Analysis for this action.

Proposed Action

    This action would increase the observer fee specified at Sec.  
679.55(f) from 1.25 percent to 1.65 percent of the ex-vessel value of 
landings subject to the fee. A 1.65 percent fee would increase fee 
revenues to support observer and EM deployment at rates that would be 
more likely to meet the Council's and NMFS' monitoring objectives than 
the revenues from the current 1.25 percent fee. As described in Section 
3.2 of this Analysis, Observer and EM data are an integral component of 
management for all fisheries in the partial coverage category. Data 
collected by observers is fundamental to fisheries management off 
Alaska and the Observer Program is critical to collecting important 
information for NMFS, the Council, and stakeholders.
    In recommending this adjustment to the observer fee, the Council 
recognized the diminishing availability of supplemental Federal funding 
and fee revenues as well as higher than expected costs for observer and 
EM deployment since implementation of the Observer Program on January 
1, 2013. As described in Section 4.5 of the Analysis, NMFS can manage 
the fisheries at low levels of observer coverage, but in an uncertain 
climate with substantive changes in fishery catch limits in recent 
years, the Council and NMFS recognize the importance of fisheries 
monitoring and maintaining the Observer Program.
    The monitoring objectives for the Observer Program include 
maintaining and improving data quality and utility for scientific and 
management purposes while fairly distributing the burden of monitoring 
and minimizing the impacts to vessel operations (see Section 3.3 of the 
Analysis for additional detail). According to Section 4.2 of the 
Analysis, a 1.65 percent fee would have resulted in $4.4 to $5.8 
million in fee revenues annually (2013 through 2018) compared to the 
estimated $3.3 to $4.4 million in fee revenues generated by the 1.25 
percent fee. Section 4.2 of the Analysis notes that it is difficult to 
reliably project the amount of revenue that will be provided from a fee 
on an annual basis due to uncertainty about future TAC or halibut quota 
limits, ex-vessel prices, or fishing effort. However, Section 5.6 of 
the Analysis describes that increasing the fee increases the likelihood 
that monitoring objectives can continue to be met. Sections 4.2.1 and 
Appendix D provide additional detail on the range of potential 
revenues, and possible gaps in the types of data that may occur at 
various levels of fees.
    The Council considered two alternatives that would increase the 
observer fee from the current 1.25 percent up to 2 percent (the maximum 
fee authorized by section 313 of the Magnuson-Stevens Act). The two 
alternatives differed in how the fee would be distributed across the 
fisheries (i.e., trawl, hook-and-line, pot, and jig gear). Alternative 
2 would have increased the fee equally on all fisheries. Alternative 3 
would have allowed different fee percentages to be established for the 
different fisheries subject to the observer fee. The Council 
recommended and NMFS proposes increasing the fee equally on all 
fisheries (Alternative 2) to maintain consistency with the current 
method for assessing costs on fishery participants, because it was not 
clear what specific data collection need would be better met by having 
differential fees among fisheries, and the lack of a clear rationale to 
establish a greater fee on one fishery than another.
    The Council recommended and NMFS proposes an observer fee of 1.65 
percent to balance the concerns raised by the affected industry about 
the costs of operation if the fee were to increase to the maximum of 2 
percent, or an amount close to 2 percent, with the need to increase fee 
revenues to meet monitoring objectives. Public testimony at the Council 
noted that increasing fees up to the maximum amount would be likely to 
impose substantial additional costs during a period of decreasing 
revenues in various fisheries (e.g., halibut). Section 5.6 of the 
Analysis notes that fees lower than 1.65 percent would be unlikely to 
provide the revenue to meet the Council's monitoring objectives. The 
Council's recommendation and NMFS' proposal for a 1.65 percent fee 
would balance concerns about increased costs with the need to increase 
revenue in order to meet monitoring objectives.
    The proposed fee adjustment would not modify other aspects of the 
fee collection process, the responsibility to pay the fee, the ADP 
process, or other aspects of the Observer Program regulations and 
management. Adjusting the observer fee to 1.65 percent would improve 
the fiscal stability of an industry-funded monitoring program and 
balances the need to increase funding for observer and EM deployment 
with the economic burden imposed on affected fishery participants. 
Along with adjusting the observer fee, the Council supports continuing 
efforts to further explore efficiencies that may provide for more cost 
effective or efficient deployment of observers with existing funding, 
while still meeting the needs for reliable and unbiased data.

Classification

    Pursuant to section 304(b)(1)(A) of the Magnuson-Stevens Act, the 
NMFS Assistant Administrator has determined that this proposed rule is 
consistent with the Fishery Management Plan (FMP) for Groundfish of the 
Gulf of Alaska (GOA) and the FMP for Groundfish of the Bering Sea and 
Aleutian Islands Management Area (BSAI), other provisions of the 
Magnuson-Stevens Fishery and Conservation Act, and other applicable 
law, subject to further consideration after public comment.
    This proposed rule has been determined to be not significant for 
purposes of Executive Order 12866.
    This proposed rule is not an Executive Order 13771 regulatory 
action because this rule is not significant under Executive Order 
12866.

Regulatory Impact Review (RIR)

    An RIR was prepared to examine the costs and benefits of the 
alternatives analyzed. The RIR considers quantitative and qualitative 
measures. A copy of this analysis is available from NMFS (see 
ADDRESSES). The Council recommended and NMFS proposes these regulations 
based on those measures that maximize net benefits to the Nation. 
Specific aspects of the RIR are discussed below in the initial 
regulatory flexibility analysis (IRFA) section.

Initial Regulatory Flexibility Analysis (IRFA)

    This IRFA was prepared for this proposed rule, as required by 
section 603 of the Regulatory Flexibility Act (RFA). This IRFA 
describes the economic impact this proposed rule, if adopted, would 
have on small entities. A description of the action, why it is being 
considered, and the legal basis for this action are contained at the 
beginning of this section in the preamble and in the SUMMARY section of 
the preamble.

Number and Description of Small Entities Regulated by This Proposed 
Rule

    This proposed rule directly regulates the owners (permit holders) 
of fish processors required to pay the observer

[[Page 13621]]

fee. A shoreside processor or stationary floating processor primarily 
involved in seafood processing is classified as a small business if it 
is independently owned and operated, is not dominant in its field of 
operation (including its affiliates), and has combined annual 
employment, counting all individuals employed on a full-time, part-
time, or other basis, not in excess of 750 employees for all its 
affiliated operations worldwide. Reliable information is not available 
on ownership affiliations between individual processing operations or 
employment for the fish processors directly regulated by this proposed 
rule. Therefore, NMFS assumes that all of the processors directly 
regulated by this action could be small. Section 5.7 of the Analysis 
identifies 50 shorebased processors and 14 floating processors that 
received partial coverage deliveries subject to the observer fee in 
2018 (the most recent year of available ownership and permit data).
    The proposed rule also directly regulates the owners (permit 
holders) of catcher/processors required to pay the observer fee, and 
directly affects the owners (permit holders) of catcher vessels that 
harvest fish subject to the observer fee. Under the RFA, businesses 
classified as primarily engaged in commercial fishing are considered 
small entities if they have combined annual gross receipts (revenues) 
not in excess of $11.0 million for all affiliated operations worldwide, 
regardless of the type of fishing operation--i.e., finfish or shellfish 
(81 FR 4469; January 26, 2016). If a vessel has a known affiliation 
with other vessels--through a business ownership or through a 
cooperative--the vessel's gross receipts are measured against the small 
entity threshold based on the total gross revenues of all affiliated 
vessels. Because public information on business ownership is 
incomplete, this analysis only considers affiliation in the form of 
membership in a fishing cooperative. Gross revenues for catcher vessels 
that participated in fishing cooperatives under the Central Gulf of 
Alaska Rockfish Program, the Bering Sea American Fisheries Act pollock 
fishery, or the Crab Rationalization Program were combined for purposes 
of identifying small entities directly affected by this proposed rule.
    In 2018, 997 vessels participated in fisheries in the partial 
coverage category. Section 4.5.3.2 in the EA notes that the number of 
catcher/processors eligible for partial coverage when fishing off 
Alaska is currently estimated to be between six and 10. Of the total of 
997 vessels in partial coverage in 2018, 982 are classified as small 
entities (four were catcher/processors and the rest catcher vessels). 
Of those 982 vessels, by gear type, 827 vessels fished hook-and-line 
gear, 87 fished pot gear, 30 fished trawl gear, and 22 fished jig gear.

Description of Significant Alternatives That Minimize Adverse Impacts 
on Small Entities

    The Council and NMFS considered three alternatives. Alternative 1, 
the no action Alternative, would maintain the current level of the fee 
at 1.25 percent of the ex-vessel value of the fish landings subject to 
the fee. Alternative 2 would raise the fee up to 2 percent, equally 
across all fisheries included in the program (i.e., gear types). 
Alternative 3 would raise the fee up to 2 percent, but be implemented 
differentially across the fisheries included in the program (i.e., gear 
types). This proposed rule would increase the observer fee to 1.65 
percent of ex-vessel value for all landings subject to the observer 
fee. The status quo and some of the fee levels considered under 
Alternatives 2 and 3 would have implemented a fee percentage lower than 
the proposed rule for some or all directed regulated or directly 
affected small entities. However, the Council recommendation to 
increase the observer fee is necessary to increase fee revenues to 
deploy observers and electronic monitoring at coverage rates adequate 
to meet the Council's and NMFS' monitoring objectives in future years. 
In addition, the Council recommended and NMFS agrees that a single 
observer fee percentage should continue to be applied equally to the 
ex-vessel value of all of the landed catch subject to the observer fee.

Duplicate, Overlapping, or Conflicting Federal Rules

    No duplication, overlap, or conflict between this proposed action 
and existing Federal rules has been identified.

Recordkeeping, Reporting, and Other Compliance Requirements

    This proposed rule does not contain recordkeeping, reporting, or 
other compliance requirements.

List of Subjects in 50 CFR Part 679

    Alaska, Fisheries, Reporting and recordkeeping requirements.

    Dated: March 3, 2020.
Samuel D. Rauch III,
Deputy Assistant Administrator for Regulatory Programs, National Marine 
Fisheries Service.

    For the reasons set out in the preamble, 50 CFR part 679 is 
proposed to be amended as follows:

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

0
1. The authority citation for 50 CFR 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; Pub. L. 111-281.

0
2. In Sec.  679.55, revise paragraph (f) to read as follows:


Sec.  679.55   Observer fees.

* * * * *
    (f) Observer fee percentage. The observer fee percentage is 1.25 
percent through December 31, 2020. Beginning January 1, 2021, the 
observer fee percentage is 1.65 percent.
* * * * *
[FR Doc. 2020-04686 Filed 3-6-20; 8:45 am]
 BILLING CODE 3510-22-P