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Feature Articles
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NMFS launches $10 million groundfish permit buyback
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This article is reprinted with permission of Commercial Fisheries News, the Northeast's fishing newspaper for over 30 years, ©2003 Compass Publications Inc. Commercial Fisheries News is published monthly; annual subscriptions are $21.95. To subscribe or request a sample issue: call (877) 263-4496; fax (207) 367-2490; e-mail (cfoster@fish-news.com); or click on the hot link.
GLOUCESTER, MA - Ready for round three? The National Marine Fisheries Service (NMFS) will be holding nine public information meetings in May to hear from fishermen about how it should structure and implement yet another voluntary groundfish "capacity reduction" program.
This time, however, NMFS is going to try to buy back some "latent" effort in the fishery -- not just "active" effort. And, unlike previous buybacks, the new program won't force successful bidders to scrap their boats or give up any nongroundfish permits.
Under an emergency supplemental appropriation to the Military Construction Appropriations Act for fiscal year 2001, Congress authorized $10 million to "support a voluntary fishing capacity reduction program in the Northeast multispecies fishery that permanently removes multispecies limited-access fishing permits."
NMFS has already carried out two other buybacks -- a pilot program in 1995 that took 11 vessels and all their permits out of the fishery, and then an "extended" program in 1998 that removed 68 more vessels from the fleet, for a grand total of 79 boats.
But a June 2000 report by the Government Accounting Office (GAO) criticized those programs.
"The New England buyback removed 79 vessels that accounted for 19% of the groundfish catch in that fishery," said the GAO. "However, 62 additional vessels have become active since the buyback because no steps were taken during the program to prevent previously inactive vessels from engaging in fishing."
According to the GAO, "These vessels have begun to erode the capacity reductions made by the buyback because they have replaced fishing capacity by as much as two-thirds of that purchased through the buyback."
Consequently, the GAO recommended that NMFS "design future buyback programs to restrict the use of unused permits ƒ."
In response, NMFS said it was structuring this new $10 million program to "encourage participation by permittees who are presently not active in the fishery and who comprise some portion of the finite capacity pool."
Latent effort
According to NMFS, the latent effort pool is big. Citing a report by the New England Fishery Management Council's Ad-hoc Capacity Committee, NMFS said that from 1994-1999:
- 199 vessels with valid multispecies permits in limited-access categories did not report any fishing activity in the Northeast region;
- 166 vessels with valid multispecies permits in limited-access categories that landed "other species" did not report any landings of the 10 regulated groundfish species;
- Of the 1,315 vessels that landed one or more pounds of any of the 10 regulated groundfish species, "many did not utilize their full allocations of days-at-sea";
- In 1998 alone, of the 154,286 allocated days-at-sea, only 51,880 days "were reported as being used"; and
- 85 limited-access multispecies permits are in a "confirmation of permit history status," meaning the permits exist but are currently not associated with any vessel because the vessel was scrapped, sank, or was sold out of the fishery. These permits can be put on new boats and reactivated at any time.
All told, NMFS said the "amount of effort available to multispecies permittees is still a cause for concern" to both the agency and the New England council.
"Reactivation of this latent effort or the shift of effort from other fisheries to multispecies fisheries could undermine the groundfish resource recovery," said NMFS.
The New England council is currently drafting Amendment 13 to the groundfish plan, which will further cut back on fishing effort. The council may include latent effort reduction proposals in the Amendment 13 public hearing document.
Hearings
Although NMFS has announced the availability of the $10 million, it still needs to design the program, which will be the focus of the public information meetings.
The meetings will be held May 8-17 from Ellsworth, ME to Toms River, NJ (see box for details).
During the meetings, NMFS will propose two methods for ranking bids that involve formulas different from those used in the 1996 and 1998 buybacks, where bids were weighted and ranked based on a vessel's recent multispecies revenues.
Revenues won't matter in the new program since NMFS isn't trying to take boats off the water. Instead, the new formula will consider the "potential fishing capacity of the permitted vessel as a factor in the value of the permit."
NMFS already has a vessel "baseline" on file for every limited-access Northeast multispecies permit, except for a few history permits. The four factors making up each vessel baseline are: length overall (LOA); gross registered tonnage (GRT); net tonnage (NT); and horsepower (HP).
No matter which bid method is adopted in the end, NMFS said the vessel baseline "will be an important factor in the ranking."
Two options
Under the first proposed bid calculation method, NMFS said it could develop a formula where a vessel's capacity to catch multispecies was weighted by its days-at-sea allocations and plugged into a mathematical program.
This estimate of harvest capacity -- even for inactive vessels -- could be sized up against the capacity of "similarly configured vessels that are actively working in the fishery."
The formula might consider: the four vessel baseline characteristics; vessel age; crew size; and other vessel and operations characteristics.
"Bids would then be scored by dividing the vessel's estimated capacity by the bid, and the highest scoring permits would be selected in descending order," said NMFS in its April 3 Federal Register notice announcing the public meetings.
Under the second proposed bid ranking method, NMFS said it could develop a different formula that also focused on the LOA, GRT, NT, and HP baseline characteristics, but each parameter could be weighted by fishing capacity importance.
"For example, the formula might use a greater factor by which to multiply HP than it would for GRT because HP is a more important element in determining a vessel's fishing capacity," said NMFS. "The formula could also include a weighting factor for days-at-sea or type of permit (such as hook gear vs. gillnet or trawl)."
Upgrading factor
Since vessels are allowed to upgrade LOA, GRT, and/or NT by up to 10% once in the life of the permit and HP by 20% once as well, NMFS is considering using the permitted vessel baseline plus the authorized upgrade capacity available to the vessel "as the parameters for the capacity evaluations."
That means, for example, if a 100 HP vessel hasn't upgraded yet, it's capacity in the formula would be considered at 120 HP.
NMFS is seeking comments on this upgrading concept, the bidding formulas, brand new alternative formulas, and all other provisions of the program through oral and written comments. The comment deadline is May 25.
Once again, the program is purely voluntary. In an April 5 letter to permit holders, NMFS said it is trying to develop a program "to compensate holders of multispecies limited-access permits in exchange for the voluntary surrender" of their groundfish permits.
For more information, attend a public meeting or call or e-mail NMFS's Jack Terrill at (978) 281-9136, Jack.Terrill@NOAA.GOV, or Dan Morris at (978) 281-9237, Daniel.Morris@NOAA.GOV.
Public information meetings
The National Marine Fisheries Service (NMFS) will be holding nine public information meetings on its proposed $10 million Northeast multispecies fishing capacity reduction program. All hearings begin at 7 pm. For directions, call the phone numbers attached to the meeting locations listed below.
- May 8 -- Gloucester, MA
NMFS Northeast Regional Office, One Blackburn Dr., (978) 281-9136;
- May 9 -- Portland, ME
Holiday Inn by the Bay, 88 Spring St., (207) 775-2311;
- May 10 -- Plymouth, MA
John Carver Inn, 25 Summer St., (508) 746-7100;
- May 10 -- Ellsworth, ME
White Birches Motel, US Rte. 1, (207) 667-3621;
- May 15 -- Portsmouth, NH
Comfort Inn, Rte. 1, (603) 433-3338;
- May 15 -- Riverhead, NY
Ramada Inn East, 1830 Rte. 25, (631) 369-2200;
- May 16 -- New Bedford, MA
New Bedford Inn, 500 Hathaway Rd., (508) 997-1231;
- May 17 -- Toms River, NJ
Holiday Inn, 290 Rte. 37E, (732) 244-4000;
- May 17 -- Narragansett, RI
University of Rhode Island Coastal Institute, Graduate School of Oceanography, Corless Auditorium, South Ferry Rd., (401) 874-6110.
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