[Federal Register Volume 60, Number 229 (Wednesday, November 29, 1995)]
[Rules and Regulations]
[Pages 61200-61209]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-29102]
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DEPARTMENT OF COMMERCE
National Oceanic and Atmospheric Administration
15 CFR Part 902
50 CFR Part 641
[Docket No. 950810206-5268-03; I.D. 071395A]
RIN 0648-AG29
Reef Fish Fishery of the Gulf of Mexico; Amendment 8
AGENCY: National Marine Fisheries Service (NMFS), National Oceanic and
Atmospheric Administration (NOAA), Commerce.
ACTION: Final rule.
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SUMMARY: NMFS issues this final rule to implement certain provisions of
Amendment 8 to the Fishery Management Plan for the Reef Fish Fishery of
the Gulf of Mexico (FMP). Amendment 8 initiates a limited entry program
for the commercial red snapper sector of the reef fish fishery in the
Gulf of Mexico. Initial participants in the limited entry program will
receive shares of the commercial quota of red snapper based on
specified criteria. The percentage shares of the commercial quota
equate to individual transferable quotas (ITQs). In addition, NMFS
clarifies the regulations regarding commercial permit requirements, and
informs the public of the approval by the Office of Management and
Budget (OMB) of the collection-of-information requirements contained in
this rule and publishes the OMB control numbers for those collections.
The intended effect of this rule is to manage the commercial red
snapper sector of the reef fish fishery to preserve its long-term
economic viability.
EFFECTIVE DATE: April 1, 1996; except that the amendments to 15 CFR
part 902 and 50 CFR 641.2, 641.7(s), 641.24(g), and the additions 50
CFR 641.7(ee) and 641.10 heading and paragraph (c), are effective
November 24, 1995.
ADDRESSES: Requests for copies of the final regulatory flexibility
analysis (FRFA) should be sent to Robert Sadler, Southeast Regional
Office, NMFS, 9721 Executive Center Drive N., St. Petersburg, FL 33702.
Comments regarding the collection-of-information requirements
contained in this rule should be sent to Edward E. Burgess, Southeast
Regional Office, NMFS, 9721 Executive Center Drive N., St. Petersburg,
FL 33702, and to the Office of Information and Regulatory Affairs, OMB,
Washington, DC 20503 (Attention: NOAA Desk Officer).
FOR FURTHER INFORMATION CONTACT: Robert Sadler, 813-570-5305.
SUPPLEMENTARY INFORMATION: The reef fish fishery of the Gulf of Mexico
is managed under the FMP. The FMP was prepared by the Gulf of Mexico
Fishery Management Council (Council) and is implemented through
regulations at 50 CFR part 641 under the authority of the Magnuson
Fishery Conservation and Management Act (Magnuson Act).
Based on a preliminary evaluation of Amendment 8 at the beginning
of formal agency review, NMFS disapproved three of its measures after
determining that they were inconsistent with the provisions of the
Magnuson Act and other applicable law. NMFS published a proposed rule
to implement the remaining measures of Amendment 8 and to clarify
existing regulations regarding commercial permit requirements (60 FR
44825, August 29, 1995). The rationale for the remaining measures of
Amendment 8 and for the clarification of existing regulations, as well
as the reasons for the disapproval of the three Amendment 8 measures at
the beginning of formal agency review, are contained in the preamble of
the proposed rule and are not repeated here. On October 13, 1995, NMFS
approved the remaining measures of Amendment 8; this final rule
implements those approved measures.
Comments and Responses
A minority report signed by three Council members was submitted
with Amendment 8. In addition, written comments during the comment
period were received from 34 entities, including individual
representatives of four commercial seafood associations (fishing
associations), two state government agencies, and 28 members of the
public. Seventeen of the comments supported the proposed rule and/or
Amendment 8, including 12 from persons holding red snapper endorsements
on their reef fish vessel permits. Sixteen of the comments opposed the
proposed rule and/or Amendment 8, including three from endorsement
holders. Three of the
[[Page 61201]]
comments opposing the proposed rule were identical in content. Specific
responses follow each comment, and are separated by general category.
Information Used in Amendment 8
Comment: The minority report claimed that an ITQ program is
unnecessary, because the fishery conditions that the program proposes
to correct do not actually exist. The report argues that both
recreational and commercial user groups have concluded that the
scientific stock assessment is flawed, because it is based on allegedly
erroneous information and that the stock is in the best condition they
can recall in their fishing experience. The report also stated that the
authors have no confidence in the reliability of the recreational
landings data collected under the Marine Recreational Fishery
Statistical Survey.
Response: The NMFS stock assessment has undergone extensive peer
review and was found by the Southeast Fisheries Science Center (Center)
to be based on the best available scientific information. The Center
also reviewed Amendment 8 and concluded that the amendment is based on
the best available scientific information. The stock assessment does
indicate some recovery of the red snapper stock condition during the
period under Federal management; however, the assessment also indicates
that the stock is still overfished and that continuing harvest
restrictions are required for the FMP's long-term stock rebuilding
program.
NMFS agrees, however, with the need to continually update the stock
assessment database used in formulating management decisions.
Appropriate updates to the database will be made as data become
available.
Comment: A fishing association representative noted that the
Council's Scientific and Statistical Committee (SSC) previously had
voted for no new regulatory actions (i.e., discontinuance of the
current red snapper permit endorsement program at the end of 1995 and
no ITQ program beginning in 1996) based on the lack of a feasibility
study at that time. The commenter questioned the need for an ITQ
program after noting the SSC position. The commenter did acknowledge
that the SSC had subsequently concluded that sufficient evaluation had
been completed for the Council to select one of the identified
management program alternatives (i.e., ITQs, license limitations, or no
new regulatory action).
Response: NMFS does not dispute the comment, but notes that the SSC
vote for no regulatory action was based on an earlier version of
Amendment 8.
Comment: The minority report and one commenter stated that the
erroneous information created an unfair and inequitable commercial/
recreational allocation ratio of 51/49 for red snapper. These
commenters also objected to the FMP's provision that requires closure
of the annual commercial fishery for the rest of the fishing year once
the annual commercial quota is projected to be met, while potentially
allowing recreational fishermen to exceed their allocation. The
commenters claim that this penalizes the commercial sector to the
benefit of the recreational sector and stated that Amendment 8 would
continue this inequitable distribution of the allocation, particularly
when the stock is recovered and total allowable catch (TAC) may safely
be increased.
Response: The FMP provides for a commercial/recreational allocation
ratio of 51/49 for red snapper, and has a requirement that the
commercial sector be closed for the remainder of the year once the
annual commercial quota is met or is projected to be met. These
measures were found to be fair and equitable and consistent with the
national standards based on the best available information, as
originally set forth in Amendment 1. These provisions are not modified
under Amendment 8 or its implementing regulations. Changes to either
the allocation ratio or closure provision, therefore, are not actions
within the scope of Amendment 8 and would require an additional FMP
amendment.
Comment: One of the commenters stated that Amendment 8 violates
National Standard 2, since NMFS did not use available social
assessments, and the Council and NMFS did not adequately consider the
``human factor,'' or social and economic effects.
Response: NMFS does not agree. The Council conducted extensive
analyses and used all available data sources in developing Amendment 8,
including the most current landings data, economic, social, and
biological information. Amendment 8 includes a social impact
assessment, and also references extensive Council deliberations on
avoiding social impacts.
Comment: The minority report also stated that the ITQ program is
based on the NMFS concept that such a program will improve the economic
conditions of the industry.
Response: The Council selected ITQs as the preferred option,
principally because it should result in the largest increase in net
economic benefits, achieve optimum yield (OY), and address many of the
major problems in the fishery. In particular, the approved measures of
the Amendment 8 ITQ program are expected to resolve the problems of a
harvest capability that is larger than necessary to produce the
commercial quota in an economically efficient manner. The ITQ program
also is expected to resolve the problems associated with the derby
fishery, including depressed prices, fishing in dangerous weather
conditions, and increased total costs of production. In approving
Amendment 8, NMFS agreed with the Council's rationale and objectives
for the ITQ program.
Historical Captains
Comment: A representative of a commercial fishing association
expressed concern regarding historical captains being included as
initial shareholders. The commenter recommended that only persons who
qualified for red snapper permit endorsements should be initial
recipients of ITQ shares and noted that vessel owners provide the
vessels and have the principal legal responsibility for their
operation.
Response: Initial shareholders in the ITQ system include vessel
owners or operators, depending on whose earned income qualified for the
reef fish permit, and historical captains. The Council concluded that
the unique status of historical captains as independent contractors who
operated vessels under share agreements warranted their inclusion as
initial shareholders. Unlike earned income qualifying operators,
however, the initial share of a historical captain is divided with the
vessel owner, based on the terms of the share agreement. NMFS finds no
basis for disapproval of the Council's allocation of initial shares to
historical captains.
Additional Issues Related to National Standards
Comment: The minority report and three of the commenters claimed
that the ITQ system was unfair and inequitable because initially
entitled fishery participants would be allocated excessive shares or
because allocated shares would not be issued to all historical
participants or in appropriate allocation ratios. One of the commenters
stated that the ITQ system was unfair and inequitable, but did not
provide specific rationale as the basis for this comment.
Response: Amendment 8 addresses the allocation issues raised by
these comments. For example, Amendment 8 lists the factors that the
Council took into account in establishing the ITQ system to limit
access to the fishery and to achieve optimum yield (OY)
[[Page 61202]]
including: Present participation in the fishery; historical fishing
practices in, and dependence on, the fishery; the economics of the
fishery; the capability of fishing vessels used in the fishery to
engage in other fisheries; and the cultural and social framework
relevant to the fishery.
The ITQ system provides for issuance of initial shares that more
closely track the actual harvest during the qualifying years than the
current endorsement system. For example, the endorsement provisions
established a trip limit of 2,000 lb (907 kg) for fishermen with
endorsements on their permits (i.e., caught at least 5,000 lb (2,268
kg) in any 2 of the 3 years between 1990-1992). Vessels without an
endorsement were limited to a 200 lb (91 kg) trip limit. In effect, the
endorsement system provided only two levels of harvest based on
applicants meeting a minimum threshold. Persons who landed
substantively more than the threshold were not provided a larger trip
limit than those who landed only 5,000 lb (2,268 kg). This system
resulted in inequities, as stated in several of the comments.
In contrast, the initial ITQ shares to be issued under Amendment 8
will correspond to the actual harvests accepted by NMFS under Amendment
9 during the qualifying period for shares. Moreover, the overall
benefits of the ITQ system to the economic integrity of the fishery are
expected to accrue over time. For example, the allowance for ITQ share
transfers to any U.S. citizen or permanent resident alien starting
October 1, 1997, will provide access to those ineligible for an initial
share. This should result in significantly increased flexibility
regarding who may participate in the fishery.
Amendment 8 explicitly reflects the requirements of NMFS'
Guidelines for Fishery Management Plans; Subpart B--National Standards
(National Standard Guidelines) regarding the application of National
Standard 4 (allocation of fishing privileges) (see 50 CFR
602.14(c)(3)(i)). Specifically, Amendment 8 states that to be ``fair
and equitable,'' an allocation should be rationally connected with the
achievement of OY or with the furtherance of an FMP objective;
otherwise, the inherent advantaging of one group to the detriment of
another would be without adequate justification. Also, Amendment 8
indicates that an allocation of fishing privileges may impose hardship
on one group if this hardship is outweighed by the total benefits
received by another group. Although the ITQ program will not prevent
any person who is a U.S. citizen or permanent resident alien from
entering the red snapper fishery, those persons who receive an initial
allocation of harvesting privileges (initial shares) will have a
competitive advantage over subsequent participants by not having to pay
for those privileges. Any such competitive advantage would be
constrained by the mandatory 4-year evaluation period, which the
Council believes was necessary to minimize windfall profit and
speculation.
According to the National Standard Guidelines, an allocation of
fishing privileges must be designed to avoid creating conditions that
foster the acquisition by any person of an inordinate share of fishing
privileges or control by buyers and sellers that would not otherwise
exist (see 50 CFR 602.14(c)(3)(iii)). Although the National Standard
Guidelines do not specifically define an ``excessive share,'' they
imply conditions of monopoly or oligopoly. The Council does not believe
that a monopoly will occur and expects that owners/operators will
remain the dominant entities in the fishery. Therefore, the Council
recommended no limit on ownership of ITQ shares. It is anticipated that
this will not lead to overall market control of the fishery. Also, the
Council can recommend, and NMFS approve and implement, a different
allocation scheme by FMP amendment at any time if it meets the
requirements of the Magnuson Fishery Conservation and Management Act
and other applicable law.
NMFS acknowledges the Amendment 8 discussion of these allocation
issues and agrees with the Council that the ITQ program is consistent
with National Standard 4 requirements that allocations of fishing
privileges be fair and equitable and be carried out in such manner that
no particular individual, corporation, or other entity acquires an
excessive share.
Effects of ITQ System on Red Snapper Resource Status
Comment: The minority report states that the ITQ system does not
promote conservation. One commenter opposed the ITQ system indicating
that it may contribute to overfishing. Another commenter stated that he
would benefit from a relatively high ITQ share, but that he opposed the
ITQ system because possible unlawful and unreported landings (landings
without ITQ coupons) would result in exceeding the red snapper annual
quota because these landings would go unrecorded. He argued that these
circumstances would cause overfishing of the red snapper resource and
undermine the long-term rebuilding of this overfished species.
Response: NMFS disagrees with these comments. The current red
snapper management program provision for an automatic commercial
fishery closure once the commercial quota is met was intended to ensure
that the quota is not exceeded, thereby ensuring the recovery of the
overfished red snapper resource under its rebuilding program. However,
red snapper discarded during closed fishery periods are not counted
against the commercial quota; some of these closed fishery periods have
been considerably long such as the one that occurred after the April
15, 1995, fishery closure. Since the ITQ program is expected to
minimize closed fishery periods, it should correspondingly reduce
unaccounted for incidental catch mortality of red snapper. Reducing the
magnitude of this fishing morality during fishery closures is expected
to allow a larger proportion of the red snapper harvested to be
retained and counted against the commercial quota that occurs
currently. Accordingly, the ITQ program should both reduce the total
fishing mortality of red snapper as well as provide a more accurate
estimate of it. The slower-paced fishery that is anticipated under the
ITQ program will be easier for NMFS to monitor, particularly with fewer
fishermen operating over a longer season. Also, ITQ program
participants will have an interest in ensuring the continued viability
of the fishery and the ITQ program, and are expected to assist in
reported illegal activities or under-reporting. Overall, these ITQ
program results should significantly enhance conservation benefits.
Industry Opinions on Amendment 8
Comment: Two representatives of fishing associations noted that
most public comments at the Council meetings opposed ITQs. One of these
commenters noted the various votes of the Council's Red Snapper and
Reef Fish Advisory Panels against ITQs. The minority report and one
fishing association representative stated that the majority of the red
snapper industry opposes Amendment 8. They argued that approval of
Amendment 8 and its implementing rule is inconsistent with what they
perceive to be NMFS' policy that no proposed ITQ program would be
implemented over industry objections.
Response: NMFS disagrees with these comments and believes that a
majority of the fishing industry participants supports the ITQ program.
As with any controversial action, some commenters opposed Amendment 8.
However, the ITQ system appears to be supported by a majority of the
fishery participants as providing for better red snapper fishery
[[Page 61203]]
management including ensuring more reliable monitoring of catches with
regards to quotas, avoiding increasingly short fishing seasons and low
ex-vessel prices, and improving the enforceability of the management
measures. Public commenters that expressed an opinion at area hearings
held by the Council in December 1994 supported, in general, the ITQ
program (23 in favor, 19 opposed). A stronger majority opinion (15 in
favor, 9 opposed) was evidenced at the hearings by commenters who hold
a red snapper endorsement on their reef fish vessel permit and who have
caught the bulk of the commercial harvest since 1993, when the
endorsement provisions were implemented. More recent indications of
industry views on the Amendment 8 ITQ program were reflected in the
public comments received on the proposed rule that supported the
program by a slight margin (17-16), with a much larger margin of
support (12 to 3) among commenters with a red snapper endorsement on
their reef fish vessel permit. Public support for the ITQ program is
expected to increase as more participants become familiar with it and
with the benefits to the fishery expected to result from its
implementation. Those benefits are expected to accrue over time.
Finally, NMFS has not issued a policy regarding the approval and
implementation of limited entry programs, including ITQ systems, except
for guidance to the Regional Fishery Management Councils contained in
the National Standard Guidelines at 50 CFR part 602 regarding the
consistency of management measures assigning fishing privileges with
National Standard 4. However, NMFS has indicated to the Councils that
it is their responsibility to develop and recommend controlled access
systems only if there is considerable support from the industries
involved. NMFS believes that the controlled access system under
Amendment 8 does have this considerable support from the affected
industries.
Enforcement Issues
Comment: The minority report and five of the comments cited
enforcement concerns. These comments stated that, with current NMFS
enforcement capability and recent budget cuts, the ITQ system would be
unenforceable.
Response: NMFS does not agree that the ITQ program will be
unenforceable. First, NMFS anticipates cooperation from all the Gulf
coastal states who have indicated that they will implement regulations
for their waters consistent with those in the exclusive economic zone.
Specifically, Texas and Florida provided comments in support of
Amendment 8 and indicated a capability to enact compatible regulations
in waters under their jurisdiction. Alabama, Louisiana, and Mississippi
provided similar comments that were received after the end of the
comment period, but before NMFS took final action to approve the
remaining measures of Amendment 8. Thus, in making its decision to
approve and implement the remaining measures of Amendment 8, NMFS
obtained reasonable assurance from all the affected states that they
will be able to issue compatible state regulations effective on or
about the time that Amendment 8 is fully implemented (April 1, 1996).
This cooperation will greatly enhance enforcement of the regulations.
NMFS also has committed the resources for additional Federal
enforcement agents.
Second, the Council and NMFS believe that the ITQ system will be
more self-policing than the current management system (permit
endorsements with trip limits) because ITQ holders will have a vested
interest in seeing that all red snapper landings conform with the ITQ
program requirements. ITQ shares will have a value to the holder
proportionate to the size of the total commercial quota. Fishermen who
hold ITQ shares will have a greater incentive to report to enforcement
officials (NMFS Enforcement, the Coast Guard, or state enforcement
agencies) any illegal/unreported landings outside the ITQ program
(e.g., landings without use of ITQ share coupons), since such landings
would eventually result in adverse effects on the stock condition with
the likely result of quota reductions.
Comment: Two of the commenters indicated that fishermen may
illegally sell red snapper to restaurants without using their ITQ
shares, thus allowing them to catch large quantities of red snapper
outside of the ITQ program.
Response: NMFS acknowledges that illegal activity is possible with
or without ITQs. Nevertheless, NMFS has determined that such activity
can be kept to a minimum with compatible state regulations, which will
greatly increase the probability of any fisherman being detected
landing fish illegally and thereby risking his/her right to participate
in the ITQ program.
Comment: One of the commenters stated that ITQ shareholders have an
interest in helping the ITQ system succeed and, therefore, may report
violations and keep enforcement costs down. That commenter stated that
the additional requirement of ITQ coupons should help enforcement
officers to detect chronic violators.
Response: NMFS agrees.
Use of Qualifying Years (1990-92)
Comment: Another commenter stated that the qualifying years (1990-
92) were atypical of his historic dependence on the fishery, as he
stopped fishing due to the derby fishery during that time.
Response: The collection of past landings data under Amendment 9
covers all red snapper landings information for the period when data
were readily available (i.e., 1990 through 1992). Data were not readily
available before 1990, and the vessel permit endorsement provisions,
including trip limits, were implemented in 1993. As a result, the years
1990-92 constitute the best available qualifying period for determining
eligibility for the ITQ system. The Council, after extensive
deliberations and consideration of longer qualifying periods,
determined that the 1990-92 period was the most appropriate for
determining historical dependence on the fishery. No reliable
information or data were provided at Council-held public hearings or
during NMFS-held comment periods on Amendment 8 and the proposed rule
that convinced the Council or NMFS that this qualifying period was
unfair or inappropriate. Based on these considerations, NMFS agreed
with the Council's decision about the qualifying period in approving
certain measures of both Amendments 8 and 9.
Comment: One of the commenters stated that the Amendment 8 proposed
rule is inconsistent with the National Standards because it denies
access to the red snapper fishery by those who did not have red snapper
catches during the years 1990-92; those fishermen will not receive an
initial allocation.
Response: The rationale for selecting the 1990-92 qualifying period
was discussed above. Regarding access to the red snapper resource, a
major feature of the ITQ program is allowance of new entrants to
participate by buying existing ITQ shares. Hence, the program allows
wider participation than the permit endorsement system it will replace.
The choice of the eligibility period (1990-92) to determine access
also is consistent with the Council's established control date for the
fishery. The published notice of the control date stated that anyone
entering the Gulf of Mexico commercial reef fish fishery after November
7, 1989, could not be assured of future access to the reef fish fishery
if a management regime were developed and implemented that
[[Page 61204]]
limited the number of participants in the fishery.
Comment: One of the commenters requested that NMFS further review
all landings data submitted for the ITQ program-qualifying period.
Response: NMFS does not agree that the additional review of
qualifying landings data, as requested by the commenter, is necessary.
The red snapper landings data for the 1990-92 qualifying period
submitted to NMFS by the cutoff date (established under Amendment 9)
were carefully reviewed by NMFS before being accepted as a basis for
calculating individual percentage shares of the commercial quota.
Persons submitting data showing landings during the 1990-92 eligibility
period were given an opportunity to review NMFS' landings figures.
Finally, Amendment 8 establishes a Council advisory panel to consider
written requests from persons who contest their tentative allocations
of shares or determinations of historical captain status.
Congressional Action and User Fees
Comment: The minority report and two fishing association
representatives stated that Amendment 8 should not be approved because
it would be ``in defiance of the Congressional mandate to develop
appropriate guidelines for ITQs.'' The minority report also stated that
Amendment 8 should not be approved, since the user fee schedule
currently being considered in a proposed amendment to the Magnuson Act
is unknown. According to the minority report, the user fee issue would
have a bearing on industry's evaluation of the effects of the proposed
rule.
Response: NMFS acknowledges the possibility that an amendment to
the Magnuson Act or other Congressional action could affect
continuation of the ITQ system under Amendment 8. NMFS also
acknowledges the potential importance of user fees to persons involved
in fishery business decisions. However, what final action Congress will
take in amending the Magnuson Act regarding the establishment of ITQ
programs or the application of user fees in fisheries management is
unknown. Until such time as the Magnuson Act is amended, it authorizes
the development and implementation of ITQ programs for fisheries under
Federal management.
Costs of Implementing the ITQ System
Comment: Four of the commenters, including a representative of a
fishing association, complained about the high costs of implementing
and enforcing the ITQ system. One comment indicated that costs should
be one of the factors considered before implementing ITQs.
Response: The regulatory impact review (RIR) prepared by the
Council estimates that Amendment 8 will increase annual administration
and enforcement costs on a continuing basis between $659,000 and
$1,749,000, depending on the level of law enforcement efforts. However,
it further indicates that annual benefits include increased revenues of
$2.5 to $4.1 million and a decrease in the total cost of harvesting.
While the RIR clearly points out that costs of the ITQ system are
higher than for other management systems considered, the ITQ system
should provide the largest increase in net economic benefits to the
fishery of any of the management options for red snapper considered by
the Council.
Duration of Implementing Regulations
Comment: One of the commenters supported the ITQ system and the 4-
year evaluation period, noting that an evaluation might give the
Council an opportunity to develop a more comprehensive ITQ system after
the 4-year period. Another commenter supported the ITQ system and a 4-
year evaluation as a flexible approach that will benefit the fishery in
terms of achieving the goals of Amendment 8. That commenter stated that
4 years was an appropriate time period for monitoring and evaluation,
without imposing an unnecessarily long time period that encourages
windfall profits.
Response: NMFS agrees with these comments and has approved the
Council's proposed measure to evaluate the ITQ system no later than 4
years after initial implementation.
Comment: The minority report stated that the proposed 4-year
evaluation period would preclude the industry from making business
decisions. One of the commenters stated that the time limitation
creates uncertainty in the ITQ system. Another commenter stated that
the mandatory evaluation is not needed, because the Council already has
the authority to evaluate the ITQ system and make changes as
appropriate. Another commenter expressed a preference for an indefinite
duration for the ITQ program.
Response: The 4-year evaluation period was selected by the Council
after consideration of various time periods. The Council was aware of
the potential that fewer economic benefits might result from having an
ITQ program with a fixed time period compared to a system of indefinite
duration, but decided that a 4-year evaluation period was necessary to
minimize windfall profits and speculation while still allowing a
sufficiently long period to test the effectiveness of the program.
NMFS agrees with the Council's decision to select a 4-year ITQ
program period with an evaluation of its effectiveness at that time.
This approach will allow the Council and NMFS to terminate the program
at that time if it does not produce the expected benefits. The
mandatory evaluation, while unavoidably creating a degree of
uncertainty in the industry, is needed in order that the Council may
identify and propose necessary changes to the ITQ program for achieving
the greatest possible level of benefits.
Comment: One of the commenters also objected to treating fish as
private property, and stated that the ITQ program is a bad idea and
should not be approved.
Response: NMFS disagrees. The ITQ system will remain in effect for
4 years from the date the system is implemented, while the
effectiveness of the system is monitored and evaluated. Based on the
evaluation, the system will be modified, or terminated. This temporary
harvest privilege is not a transfer of the resource, but a revocable
license to take a specified amount of the resource. There are no
private property rights to wild fish before they have been reduced to
one's possession.
Comment: One commenter suggested that each permit holder be issued
transferable ITQ coupons in an allotted percentage based on their
previous records of red snapper landings, and be given 1 year to use
their coupons.
Response: This suggestion is already provided for by the provisions
of the ITQ program. The Regional Director will provide each shareholder
with ITQ coupons in various denominations on an annual basis, the total
of which equals his or her ITQ share.
Comment: Two of the commenters responded to the request in the
proposed rule for specific comments on the possibility of a quota
overrun if the states do not enact compatible regulations. Those two
comments indicated that each state should enact specific compatible
regulations for waters under their jurisdiction, since large quantities
of landings are made from state waters off Texas and Louisiana.
Response: NMFS shares the concerns expressed by these comments
about the adverse effects of a quota overrun and a fishery closure
before all ITQ coupons are used, if compatible state regulations are
not enacted to prevent catch by non-permitted vessels in state waters.
As noted above, NMFS has received reasonable assurance that all Gulf
coastal states will enact or have in place
[[Page 61205]]
in a timely manner regulations to require that vessels landing red
snapper possess a Federal permit, no matter where the red snapper are
harvested or possessed. This should preclude any non-ITQ harvest.
Comment: One of the commenters suggested that a rule allowing
permitted vessels without ITQ shares to sell red snapper harvested in
state waters would encourage violations of the ITQ program.
Response: NMFS agrees. The implementing regulations specify that
red snapper in or from the EEZ, or on board a permitted reef fish
vessel, may not be possessed without sufficient ITQ coupons on board.
One of the permit conditions is that permitted vessels comply with the
ITQ provisions, no matter where the red snapper are harvested or
possessed. This would minimize violations, since the states have
provided assurance that they will require that red snapper landings be
from federally permitted vessels only.
A federally permitted reef fish dealer would be allowed to receive
red snapper only from a permitted vessel with ITQ coupons on board,
regardless of where the red snapper were harvested. These provisions
are intended to encourage effective monitoring and enforcement of the
ITQ system.
Comment: One of the commenters questioned the meaning of
``excessive effort capacity'' in the proposed rule. Another commenter
indicated that the ITQ system would force him to discharge two or three
of his three to four employees from his vessel. The ITQ system,
therefore, would be economically disadvantageous, particularly in areas
with high unemployment and when fishermen are ineligible for
unemployment benefits.
Response: The term ``excessive effort capacity'' indicates the
ability of red snapper fishermen to catch the annual quota in
increasingly shorter time periods, resulting in fewer net economic
benefits. Regarding the comment, NMFS acknowledges that some decrease
in employment is expected to result from a reduction of effort capacity
that optimizes net economic benefits of the fishery. While this may
disadvantage some sectors, as stated in the comment, the net benefits
to the entire fishery are increased.
Comments in Support of the Proposed Rule
Comment: Seventeen of the commenters supported the ITQ system.
Eleven supported the ITQ system because of problems with vessel crew
safety and the short season due to the endorsement system. Seven also
supported the ITQ system to avoid other problems associated with a
derby fishery, such as low ex-vessel prices, and one noted that the
commercial fishery is unable to achieve OY under the existing
endorsement provisions. That commenter opposed the views of the
minority report and urged NMFS to implement the ITQ system as soon as
possible.
Response: NMFS acknowledges these supportive comments and the
identified program benefits.
Additional Issues Outside the Scope of the Proposed Rule
Comment: One of the commenters suggested that sale of red snapper
harvested in state waters be counted against the recreational harvest,
not the commercial quota.
Response: This provision is not currently in the FMP or Amendment
8, and is outside the scope of the proposed rule.
Comment: Three commenters noted that an ITQ system would not help
the red snapper fishery, because imports comprise most of the total red
snapper market. Another stated that imports should be considered before
implementing ITQs.
Response: The Magnuson Act currently does not govern imported fish,
which may be legally landed in compliance with the Lacey Act and other
applicable Federal laws. Moreover, inclusion of imported red snapper in
the ITQ system is outside the scope of the proposed rule.
Comment: One of the comments requested consideration of a small
incidental catch of red snapper for boats operating out of Florida
ports.
Response: This requested action was not included in Amendment 8 or
the proposed rule and, therefore, is outside the scope of this rule.
Comment: One of the commenters stated that the penalty fee schedule
should be provided in the proposed rule.
Response: NOAA has made its Civil Administrative Penalty Schedule
available (59 FR 19160, April 22, 1994). That schedule is outside the
scope of the proposed rule and Amendment 8. The schedule, however, will
be revised as any additional regulations are implemented.
Comment: One of the commenters expressed no opinions on the
proposed rule but requested that hardship appeals be considered.
Response: The hardship appeals provisions proposed in Amendment 8
were disapproved by NMFS during its preliminary review of the amendment
for the reasons stated in the preamble of the proposed rule. These
provisions were not included in the proposed rule and, therefore, are
not included in the final rule. Therefore, this comment is considered
outside the scope of the proposed rule.
Comment: One of the commenters suggested that, instead of the ITQ
program, fishermen be allowed to fish 10 days a month.
Response: A split season was not included in Amendment 8 or the
proposed rule. Therefore, this comment is outside the scope of this
rule.
Changes From the Proposed Rule
Specific dates are added as follows: (1) In Sec. 641.10
introductory text, for the termination of the period during which NMFS
and the Council will evaluate the ITQ system; (2) in
Sec. 641.10(c)(2)(iv), for the submission of requests for transfers of
landings records; (3) in Sec. 641.10(c)(4)(iii), for the submission of
appeals; and (4) in Sec. 641.10(c)(5), for the initial restrictions
regarding transfers of shares.
In Sec. 641.10(a)(3), information is added as to how a person who
does not have an ITQ share may obtain a list of shareholders.
The ITQ coupon system is simplified and clarified as follows. Since
ITQ coupons will be used on board vessels rather than by individual
fishermen, references in the proposed rule to the ``Fisherman'' part of
coupons are changed to ``Vessel'' part. In Sec. 641.10(b)(3), when a
coupon is transferred, the name of the recipient and the signature of
the seller are no longer required. In lieu thereof, if the transfer is
by sale, the price paid for the coupon must be entered on the coupon.
To aid in monitoring the lawful use of coupons, Sec. 641.10(b)(5) is
revised to require entry on the ``Vessel'' part of each coupon of the
permit number of the dealer to whom red snapper are transferred.
Sections 641.10(b)(6) and (b)(7) are modified to clarify that, after
being landed, red snapper must be accompanied by appropriate amounts of
properly completed ``Fish House'' parts of ITQ coupons, even when such
red snapper are offloaded at a facility other than a dealer's; for
example, when offloaded to a dealer's truck. In Sec. 641.10(b)(7), the
requirement to enter the dealer's permit number on the ``Fish House''
part of a coupon is removed.
Classification
The Director, Southeast Region, NMFS, determined that Amendment 8
is necessary for the conservation and management of the reef fish
fishery of the Gulf of Mexico and that it is consistent with the
Magnuson Act and
[[Page 61206]]
other applicable laws, with the exception of those measures that were
disapproved at the beginning of formal agency review based on a
preliminary evaluation of Amendment 8. (See the proposed rule (60 FR
44825, August 29, 1995) for a discussion of the disapproved measures.)
This action has been determined to be not significant for purposes
of E.O. 12866.
The Council prepared an initial regulatory flexibility analysis
(IRFA) as part of its regulatory impact review of Amendment 8. The IRFA
described the impacts that the proposed rule would have on small
entities, if adopted. Those impacts were summarized in the proposed
rule. NMFS prepared an FRFA, which adopts the IRFA without substantive
change. A copy of the FRFA is available (see ADDRESSES).
Notwithstanding any other provision of law, no person is required
to respond to nor shall a person be subject to a penalty for failure to
comply with a collection of information subject to the requirements of
the Paperwork Reduction Act unless that collection of information
displays a currently valid OMB Control Number.
This rule contains a new, one-time collection of information and
three new continuing collections, namely: (1) The one-time submission
of a request for appeal of tentative share allocations and of
determinations of historical captain status; (2) the submission by
fishermen and dealers of ITQ coupons; (3) requests for transfer of ITQ
shares; and (4) monthly dealer reports when red snapper are received.
These collections of information have been approved by OMB under OMB
control numbers 0648-0297, 0648-0298, 0648-0299, and 0648-0301,
respectively. The public reporting burdens for these collections of
information are estimated to average 90, 0.5, 15, and 15 minutes per
response, respectively.
This rule requires permits for dealers who receive red snapper
harvested by permitted vessels from state waters adjoining the EEZ in
the Gulf of Mexico. Previously, dealer permits were required only for
those dealers receiving red snapper harvested in the EEZ. The
collection of information for dealer permit applications is currently
approved under OMB Control No. 0648-0205. The public reporting burden
for this collection was estimated at 5 minutes per response and is
unchanged by the revision.
This rule also involves the collection of information under
Amendment 9 of landings records during the period 1990 through 1992.
That collection is currently approved under OMB Control No. 0648-0281
and its public reporting burden is estimated at 2 hours per response.
Each of the above reporting burden estimates includes the time for
reviewing instructions, searching existing data sources, gathering and
maintaining the data needed, and completing and reviewing the
collections of information. Send comments regarding any of these
reporting burden estimates, or any other aspects of the collections of
information, including suggestions for reducing the burdens, to NMFS
and OMB (see ADDRESSES).
The publication of the OMB control numbers for approved collection-
of-information requirements at 15 CFR part 902 does not constitute a
substantive rule because it does not affect the activities of
fishermen. The correction of the definition of ``Science and Research
Director'' at 50 CFR 641.2, the addition of the prohibition at 50 CFR
641.7(s), which complements an existing requirement, and the
clarification of the permit requirements at 50 CFR 641.7(ee) and
641.24(g) do not constitute substantive rules because they do not
change existing requirements. Thus, pursuant to 5 U.S.C. 553(d), there
is no need to delay the effective date of these provisions. The
addition to the regulations at 50 CFR 641.10(c) contains administrative
procedures necessary for timely implementation of the ITQ system. Each
potential initial shareholder in the ITQ system was advised of these
procedures in the proposed rule and by letter dated September 14, 1995.
Delay in effectiveness of the administrative procedures would
unnecessarily delay commencement of the ITQ system. Accordingly, the
Assistant Administrator for Fisheries, NOAA, finds that, pursuant to 5
U.S.C. 553(d)(3), good cause exists to waive the 30-day delay in
effective date of 50 CFR 641.10(c). To allow time for the determination
of initial ITQ shares and for the distribution of ITQ coupons, NMFS
makes the provisions of this final rule requiring ITQ coupons for the
possession of red snapper in the commercial fishery effective on April
1, 1996.
List of Subjects
15 CFR Part 902
Reporting and recordkeeping requirements.
50 CFR Part 641
Fisheries, Fishing, Reporting and recordkeeping requirements.
Dated: November 22, 1995.
Nancy Foster,
Deputy Assistant Administrator for Fisheries, National Marine Fisheries
Service.
For the reasons set out in the preamble, 15 CFR part 902 and 50 CFR
part 641 are amended as follows:
15 CFR Chapter IX
PART 902--NOAA INFORMATION COLLECTION REQUIREMENTS UNDER THE
PAPERWORK REDUCTION ACT: OMB CONTROL NUMBERS
1. The authority citation for part 902 continues to read as
follows:
Authority: 44 U.S.C. 3501 et seq.
2. In part 902, paragraph (b) table, effective November 24, 1995 in
the entries for 50 CFR in the right column, corresponding to entry
641.5 in the left column, the entry ``-0013 and -0016.'' is removed and
``-0013, -0016, and -0301.'' is added in its place; and in the left
column, in numerical order ``641.10'' is added, and in the right
column, in corresponding position, the entry ``-0297, -0298, and -
0299.'' is added.
50 CFR Chapter VI
PART 641--REEF FISH FISHERY OF THE GULF OF MEXICO
3. The authority citation for part 641 continues to read as
follows:
Authority: 16 U.S.C. 1801 et seq.
4. In Sec. 641.1, paragraph (b) is revised to read as follows:
Sec. 641.1 Purpose and scope.
* * * * *
(b) This part governs conservation and management of reef fish in
the Gulf of Mexico EEZ, except that Secs. 641.5 and 641.25 also apply
to reef fish from adjoining state waters and Sec. 641.4(a)(2) and (q)
also apply in the manner stated therein to red snapper from adjoining
state waters. The Gulf of Mexico EEZ extends from the U.S./Mexico
border to the intercouncil boundary between the South Atlantic and Gulf
of Mexico Fishery Management Councils, as specified at 50 CFR
601.11(c). ``EEZ'' in this part refers to the EEZ in the Gulf of
Mexico, unless the context clearly indicates otherwise.
5. In Sec. 641.2, effective November 24, 1995, the definition of
``Science and Research Director'' is revised to read as follows:
Sec. 641.2 Definitions.
* * * * *
Science and Research Director means the Science and Research
Director, Southeast Fisheries Science Center,
[[Page 61207]]
NMFS, 75 Virginia Beach Drive, Miami, FL 33149, telephone: 305-361-
5761; or a designee.
* * * * *
6. In Sec. 641.4, the first sentence of paragraph (a)(2) and the
third sentence of paragraph (i) are revised and paragraph (q) is added
to read as follows:
Sec. 641.4 Permits and fees.
(a) * * *
(2) * * * A dealer who receives from a fishing vessel reef fish
harvested from the EEZ, or red snapper from adjoining state waters
harvested by or possessed on board a vessel with a permit issued under
this section, must obtain an annual dealer permit. * * *
* * * * *
(i) * * * In addition, a copy of the dealer's permit must accompany
each vehicle that is used to pick up from a fishing vessel reef fish
harvested from the EEZ or red snapper from adjoining state waters
harvested by or possessed on board a vessel with a permit issued under
this section. * * *
* * * * *
(q) Permit conditions. (1) As a condition of a vessel permit issued
under this section, without regard to where red snapper are harvested
or possessed, a permitted vessel--
(i) Must comply with the red snapper individual transferable quota
requirements of Sec. 641.10(b).
(ii) May not transfer red snapper at sea or receive red snapper at
sea.
(iii) Must maintain red snapper with head and fins intact through
landing, and the exceptions to that requirement contained in
Sec. 641.21(b)(3) and (b)(4) do not apply to red snapper. Such red
snapper may be eviscerated, gilled, and scaled but must otherwise be
maintained in a whole condition.
(2) As a condition of a dealer permit issued under this section,
without regard to where red snapper are harvested or possessed, a
permitted dealer must comply with the red snapper individual
transferable quota requirements of Sec. 641.10(b).
7. In Sec. 641.5, paragraph (d)(3) is redesignated as paragraph
(d)(4), paragraph (d)(2) is revised, and paragraph (d)(3) is added to
read as follows:
Sec. 641.5 Recordkeeping and reporting.
* * * * *
(d) * * *
(2) In any month that a red snapper is received, a dealer must
report total poundage of red snapper received during the month, in
whole or eviscerated weight, the average monthly price paid for red
snapper by market size, and the proportion of total poundage landed by
each gear type. The ``Fish House'' parts of red snapper individual
transferable coupons, received during the month in accordance with
Sec. 641.10(b), must be submitted with the report to the Science and
Research Director postmarked not later than 5 days after the end of the
month.
(3) For reef fish other than red snapper, when requested by the
Science and Research Director, a dealer must provide the following
information from his/her record of reef fish received: Total poundage
of each species received during the requested period, average monthly
price paid for each species by market size, and proportion of total
poundage landed by each gear type.
* * * * *
8. In Sec. 641.7, effective November 24, 1995, paragraph (s) is
revised and paragraph (ee) is added; and, effective April 1, 1996,
paragraphs (g), (r), and (bb) are revised and paragraphs (ff) through
(kk) are added to read as follows:
Sec. 641.7 Prohibitions.
* * * * *
(g) Possess a finfish without its head and fins intact, as
specified in Sec. 641.21(b); or a red snapper without its head and fins
intact, as specified in Sec. 641.4(q)(1)(iii).
* * * * *
(r) Transfer reef fish at sea, as specified in Sec. 641.24(f); or
transfer or receive red snapper at sea, as specified in
Sec. 641.4(q)(1)(ii).
(s) Purchase, barter, trade, or sell, or attempt to purchase,
barter, trade, or sell, a reef fish--
(1) Harvested from the EEZ by a vessel that does not have a valid
Federal permit, or
(2) Possessed under the bag limits--as specified in Sec. 641.24(g).
* * * * *
(bb) Receive from a fishing vessel, by purchase, trade, or barter,
reef fish harvested from the EEZ, or red snapper from adjoining state
waters harvested by or possessed on board a vessel with a Federal
permit, without a dealer permit, as specified in Sec. 641.4(a)(2).
* * * * *
(ee) Falsify information required for administration of the
individual transferable quota (ITQ) system specified in Sec. 641.10.
(ff) Transfer an ITQ coupon by sale without the sale price
completed thereon, as specified in Sec. 641.10(b)(3).
(gg) Possess red snapper in or from the EEZ, or on board a
federally permitted vessel, in an amount exceeding the total of the ITQ
coupons on board or without the vessel permit on board, as specified in
Sec. 641.10(b)(4).
(hh) Fail to--
(1) Sign and date the ``Vessel'' part of ITQ coupons;
(2) Enter on the ``Vessel'' part the permit number of the dealer to
whom red snapper are transferred; or
(3) Submit such coupon parts with the logbook forms for that
fishing trip--as specified in Sec. 641.10(b)(5).
(ii) Transfer red snapper harvested from the EEZ, or possessed by a
permitted vessel, to a dealer who does not have a Federal permit, or
fail to give a dealer the ``Fish House'' part of ITQ coupons, as
specified in Sec. 641.10(b)(6).
(jj) As a permitted dealer--
(1) Receive red snapper from a vessel that does not have a reef
fish permit;
(2) Fail to receive the ``Fish House'' part of ITQ coupons in
denominations at least equal to the eviscerated weight of red snapper
received; or
(3) Fail to properly complete the ``Fish House'' parts of ITQ
coupons--as specified in Sec. 641.10(b)(7).
(kk) Fail to make ITQ coupons available to an authorized officer,
as specified in Sec. 641.10(b)(5) and (b)(7).
9. Effective November 24, 1995, Sec. 641.10 consisting of paragraph
(c) is added to subpart A; effective April 1, 1996, the introductory
text and paragraphs (a) and (b) are added to read as follows:
Sec. 641.10 Red snapper individual transferable quota (ITQ) system.
The ITQ system established by this section will remain in effect
through March 31, 2000, during which time NMFS and the Gulf of Mexico
Fishery Management Council (Council) will evaluate the effectiveness of
the system. Based on the evaluation, the system may be modified,
extended, or terminated.
(a) Percentage shares. (1) Initial percentage shares of the annual
commercial quota of red snapper are assigned to persons in accordance
with the procedure specified in Amendment 8 to the Fishery Management
Plan for the Reef Fish Fishery of the Gulf of Mexico (FMP) and in
paragraphs (c)(1) through (c)(4) of this section. Each person is
notified by the Regional Director of his or her initial percentage
shares. If additional shares become available to NMFS, such as by
forfeiture pursuant to subpart F of 15 CFR part 904 for rule
violations, such shares will be proportionately reissued to
shareholders based on their shares as of November 1, after the
additional shares become available. If NMFS is required to issue
additional shares, such as may
[[Page 61208]]
be required in the resolution of disputes, existing shares will be
proportionately reduced. This reduction of shares will be based on
shares as of November 1 after the required addition of shares.
(2) All or a portion of a person's percentage shares may be
transferred to another person who is a U.S. citizen or permanent
resident alien. (See paragraph (c)(5) of this section for restrictions
on the transfer of shares in the initial months under the ITQ system.)
Transfer of shares must be reported on a form available from the
Regional Director. The Regional Director will confirm, in writing, the
registration of each transfer. The effective date of each transfer is
the confirmation date provided by the Regional Director. The
confirmation of registration date will normally be not later than 3
working days after receipt of a properly completed transfer form.
However, reports of share transfers received by the Regional Director
from November 1 through December 31 will not be recorded or confirmed
until after January 1. A fee is charged for each transfer of percentage
shares. The amount of the fee is calculated in accordance with the
procedures of the NOAA Finance Handbook for determining the
administrative costs of each special product or service provided by
NOAA to non-Federal recipients. The fee may not exceed such costs and
is specified with each transfer form. The appropriate fee must
accompany each transfer form.
(3) On or about January 1 each year, the Regional Director will
provide each red snapper shareholder with a list of all red snapper
shareholders and their percentage shares, reflecting share transfers as
indicated on properly completed transfer forms received through October
31. Updated lists may be obtained at other times, and by persons who
are not red snapper shareholders, by written request to the Regional
Director.
(b) ITQs. (1) Annually, as soon after November 15 as the following
year's red snapper commercial quota is established, the Regional
Director will calculate each red snapper shareholder's ITQ in terms of
eviscerated weight. Each ITQ is the product of the red snapper
commercial quota, in whole weight, for the ensuing fishing year, the
factor for converting whole weight to eviscerated weight, and each red
snapper shareholder's percentage share, reflecting share transfers
reported on forms received by the Regional Director through October 31.
(2) The Regional Director will provide each red snapper shareholder
with ITQ coupons in various denominations, the total of which equals
his or her ITQ, and a copy of the calculations used in determining his
or her ITQ. Each coupon will be coded to indicate the initial
recipient.
(3) An ITQ coupon may be transferred. If the transfer is by sale,
the seller must enter the sale price on the coupon.
(4) Except when the red snapper bag limit applies, red snapper in
or from the EEZ or on board a vessel that has been issued a reef fish
permit under Sec. 641.4 may not be possessed in an amount, in
eviscerated weight, exceeding the total of ITQ coupons on board. (See
Sec. 641.24(a) for applicability of the bag limit.)
(5) Prior to termination of a trip, the operator's signature and
the date signed must be written in ink on the ``Vessel'' part of ITQ
coupons totaling at least the eviscerated weight of the red snapper on
board. An owner or operator of a vessel must separate the ``Vessel''
part of each such coupon, enter thereon the permit number of the dealer
to whom the red snapper are transferred, and submit the ``Vessel''
parts with the logbook forms for that fishing trip. An owner or
operator of a vessel must make available to an authorized officer all
ITQ coupons in his or her possession upon request.
(6) Red snapper harvested from the EEZ or possessed by a vessel
with a permit issued under Sec. 641.4 may be transferred only to a
dealer with a permit issued under Sec. 641.4. The ``Fish House'' part
of each ITQ coupon must be given to such dealer, or the agent or
employee of such dealer, in amounts totaling at least the eviscerated
weight of the red snapper transferred to that dealer.
(7) A dealer with a permit issued under Sec. 641.4 may receive red
snapper only from a vessel that has on board a reef fish permit issued
under Sec. 641.4. A dealer, or the agent or employee of a dealer, must
receive the ``Fish House'' part of ITQ coupons totaling at least the
eviscerated weight of the red snapper received. Immediately upon
receipt of red snapper, the dealer, or the agent or employee of the
dealer, must enter the permit number of the vessel received from and
date and sign each such ``Fish House'' part. The dealer must submit all
such parts as required by Sec. 641.5(d)(2). A dealer, agent, or
employee must make available to an authorized officer all ITQ coupons
in his or her possession upon request.
(c) Procedures for implementation--(1) Initial shareholders. The
following persons are initial shareholders in the red snapper ITQ
system:
(i) Either the owner or operator of a vessel with a valid permit on
August 29, 1995, provided such owner or operator had a landing of red
snapper during the period 1990 through 1992. If the earned income of an
operator was used to qualify for the permit that is valid on August 29,
1995, such operator is the initial shareholder rather than the owner.
In the case of an owner, the term ``person'' includes a corporation or
other legal entity; and
(ii) A historical captain. A historical captain means an operator
who--
(A) From November 6, 1989, through 1993, fished solely under verbal
or written share agreements with an owner, and such agreements provided
for the operator to be responsible for hiring the crew, who was paid
from the share under his or her control;
(B) Landed from that vessel at least 5,000 lb (2,268 kg) of red
snapper per year in 2 of the 3 years 1990, 1991, and 1992;
(C) Derived more than 50 percent of his or her earned income from
commercial fishing, that is, sale of the catch, in each of the years
1989 through 1993; and
(D) Landed red snapper prior to November 7, 1989.
(2) Initial shares. (i) Initial shares are apportioned to initial
shareholders based on each shareholder's average of the top 2 years'
landings in 1990, 1991, and 1992. However, no person who is an initial
shareholder under paragraph (c)(1) of this section will receive an
initial percentage share that will amount to less than 100 lb (45.36
kg), whole weight, of red snapper (90 lb (41 kg), eviscerated weight).
(ii) The percentage shares remaining after the minimum shares have
been calculated under paragraph (c)(2)(i) of this section are
apportioned based on each remaining shareholder's average of the top 2
years' landings in 1990, 1991, and 1992. In a case where a landing is
associated with an owner and a historical captain, such landing is
apportioned between the owner and historical captain in accordance with
the share agreement in effect at the time of the landing.
(iii) The determinations of landings of red snapper during the
period 1990 through 1992 and historical captain status are made in
accordance with the data collected under Amendment 9 to the FMP. Those
data identify each red snapper landing during the period 1990 through
1992. Each landing is associated with an owner and, when an operator's
earned income was used to qualify for the vessel permit at the time of
the landing, with such operator. Where appropriate, a landing is also
[[Page 61209]]
associated with a historical captain. However, a red snapper landings
record during that period that is associated solely with an owner may
be retained by that owner or transferred as follows:
(A) An owner of a vessel with a valid reef fish permit on August
29, 1995, who transferred a vessel permit to another vessel owned by
him or her will retain the red snapper landings record for the previous
vessel.
(B) An owner of a vessel with a valid reef fish permit on August
29, 1995, will retain the landings record of a permitted vessel if the
vessel had a change of ownership to another entity without a
substantive change in control of the vessel. It will be presumed that
there was no substantive change in control of a vessel if a successor
in interest received at least a 50 percent interest in the vessel as a
result of the change of ownership whether the change of ownership was--
(1) From a closely held corporation to its majority shareholder;
(2) From an individual who became the majority shareholder of a
closely held corporation receiving the vessel;
(3) Between closely held corporations with a common majority
shareholder; or
(4) From one to another of the following: Husband, wife, son,
daughter, brother, sister, mother, or father.
(C) In other cases of transfer of a permit through change of
ownership of a vessel, an owner of a vessel with a valid reef fish
permit on August 29, 1995, will receive credit for the landings record
of the vessel before his or her ownership only if there is a legally
binding agreement for transfer of the landings record.
(iv) Requests for transfers of landings records must be submitted
to the Regional Director and must be postmarked not later than December
14, 1995.The Regional Director may require documentation supporting
such request. After considering requests for transfers of landings
records, the Regional Director will advise each initial shareholder or
applicant of his or her tentative allocation of shares.
(3) Notification of status. The Regional Director will advise each
owner, operator, and historical captain for whom NMFS has a record of a
red snapper landing during the period 1990 through 1992, including
those who submitted such record under Amendment 9 to the FMP, of his or
her tentative status as an initial shareholder and the tentative
landings record that will be used to calculate his or her initial
share.
(4) Appeals. (i) A special advisory panel, appointed by the Council
to function as an appeals board, will consider written requests from
persons who contest their tentative status as an initial shareholder,
including historical captain status, or tentative landings record. In
addition to considering written requests, the board may allow personal
appearances by such persons before the board.
(ii) The panel is only empowered to consider disputed calculations
or determinations based on documentation submitted under Amendment 9 to
the FMP regarding landings of red snapper during the period 1990
through 1992, including transfers of such landings records, or
regarding historical captain status. In addition, the panel may
consider applications and documentation of landings not submitted under
Amendment 9 if, in the board's opinion, there is justification for the
late application and documentation. The board is not empowered to
consider an application from a person who believes he or she should be
eligible because of hardship or other factors.
(iii) A written request for consideration by the board must be
submitted to the Regional Director, postmarked not later than December
27, 1995, and must contain documentation supporting the allegations
that form the basis for the request.
(iv) The board will meet as necessary to consider each request that
is submitted in a timely manner. Members of the appeals board will
provide their individual recommendations for each appeal to the
Council, which will in turn submit its recommendation to the Regional
Director. The board and the Council will recommend whether the
eligibility criteria, specified in Amendment 8 to the FMP and
paragraphs (c)(1) and (c)(2) of this section, were correctly applied in
each case, based solely on the available record including documentation
submitted by the applicant. The Council will also base its
recommendation on the recommendations of the board. The Regional
Director will decide the appeal based on the above criteria and the
available record, including documentation submitted by the applicant
and the recommendation of the Council. The Regional Director will
notify the appellant of his decision and the reason therefor, in
writing, normally within 45 days of receiving the Council's
recommendation. The Regional Director's decision will constitute the
final administrative action by NMFS on an appeal.
(v) Upon completion of the appeal process, the Regional Director
will issue share certificates to initial shareholders. (5) Transfers of
shares. The following restrictions apply to the transfer of shares:
(i) The transfer of shares is prohibited through September 30,
1996.
(ii) From October 1, 1996, through September 30, 1997, shares may
be transferred only to other persons who are initial shareholders and
are U.S. citizens or permanent resident aliens.
10. In Sec. 641.24, effective November 24, 1995, paragraph (g) is
revised; and, effective April 1, 1996, paragraphs (a)(2) and (a)(3) are
redesignated as paragraphs (a)(3) and (a)(4), respectively, in newly
redesignated paragraph (a)(4), the reference to ``paragraph
(a)(2)(ii)(C)'' is revised to read ``paragraph (a)(1)(ii)(C)'', and
paragraph (a)(2) is added to read as follows:
Sec. 641.24 Bag and possession limits.
(a) * * *
(2) In addition, the bag limit for red snapper applies to a person
on board a vessel with a permit specified in Sec. 641.4 when that
vessel does not have ITQ coupons on board.
* * * * *
(g) Sale. A reef fish harvested in the EEZ by a vessel that does
not have a valid permit, as required by Sec. 641.4(a)(1), or possessed
under the bag limits specified in paragraph (b) of this section, may
not be purchased, bartered, traded, or sold, or attempted to be
purchased, bartered, traded, or sold.
[FR Doc. 95-29102 Filed 11-24-95; 12:10 am]
BILLING CODE 3510-22-F
