Fisheries of the Exclusive Economic Zone Off Alaska; Amendment 96 to the Gulf of Alaska Fishery Management Plan; Management of Community Quota Entities, 46237-46245 [2014-18678]
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emcdonald on DSK67QTVN1PROD with PROPOSALS
Federal Register / Vol. 79, No. 152 / Thursday, August 7, 2014 / Proposed Rules
(viii) Fee. The Regional Administrator
may, after publication of a fee
notification in the Federal Register,
charge a permit fee before issuance of
the permit to recover administrative
expenses. Failure to pay the fee will
preclude issuance of the permit.
(ix) Abandonment or voluntary
relinquishment. Any ITQ permit that is
voluntarily relinquished to the Regional
Administrator, or deemed to have been
voluntarily relinquished for failure to
renew in accordance with paragraph
(a)(1)(ii) of this section, shall not be
reissued or renewed in a subsequent
year, except as specified in paragraph
(a)(1)(x) of this section.
(x) Transitional grace period. A
surfclam or ocean quahog quota share
holder who does not apply for an ITQ
permit before the end of the 2015
fishing year, may be granted a grace
period of up to one year to complete the
initial application process, and be
issued an ITQ permit, before the quota
share is considered permanently
relinquished. If an individual is issued
a 2015 ITQ permit, but fails to renew
that ITQ permit before the end of the
2016 fishing year, the Regional
Administrator may allow a grace period
until no later than July 1, 2017, to
complete the renewal process and retain
the permit. A permit holder may not be
issued cage tags or transfer quota share
until a valid ITQ permit is issued.
Failure to complete the ITQ permit
application or renewal process, and be
issued a valid ITQ permit before the end
of such a grace period would result in
the ITQ permit and any associated ITQ
quota share being permanently forfeit.
(2) [Reserved]
(b) Transfers—(1) Quota share
percentage. Subject to the approval of
the Regional Administrator, part or all
of a quota share percentage may be
transferred in the year in which the
transfer is made, to any person or entity
with a valid ITQ allocation permit
under paragraph (a). Approval of a
transfer by the Regional Administrator
and for a new ITQ permit reflecting that
transfer may be requested by submitting
a written application for approval of the
transfer and for issuance of a new ITQ
permit to the Regional Administrator at
least 10 days before the date on which
the applicant desires the transfer to be
effective, in the form of a completed
transfer form supplied by the Regional
Administrator. The transfer is not
effective until the new holder receives
a new or revised ITQ permit from the
Regional Administrator reflecting the
new quota share percentage. An
application for transfer may not be made
between October 15 and December 31 of
each year.
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(2) Cage tags. Cage tags issued
pursuant to § 648.77 may be transferred
at any time, and in any amount subject
to the restrictions and procedure
specified in paragraph (b)(1) of this
section; provided that application for
such cage tag transfers may be made at
any time before December 10 of each
year. The transfer is effective upon the
receipt by the transferee of written
authorization from the Regional
Administrator.
(3) Denial of ITQ transfer application.
The Regional Administrator may reject
an application to transfer surfclam or
ocean quahog ITQ quota share or cage
tags for the following reasons: The
application is incomplete; the transferor
or transferee does not possess a valid
surfclam or ocean quahog ITQ permit
for the appropriate species; the
transferor’s or transferee’s surfclam or
ocean quahog ITQ permit has been
sanctioned pursuant to an enforcement
proceeding under 15 CFR part 904; or
any other failure to meet the
requirements of this subpart. Upon
denial of an application to transfer ITQ
allocation, the Regional Administrator
shall send a letter to the applicant
describing the reason(s) for the denial.
The decision by the Regional
Administrator is the final decision of
the Department of Commerce; there is
no opportunity for an administrative
appeal.
[FR Doc. 2014–18676 Filed 8–6–14; 8:45 am]
BILLING CODE 3510–22–P
DEPARTMENT OF COMMERCE
National Oceanic and Atmospheric
Administration
50 CFR Part 679
[Docket No. 131115973–4630–01]
RIN 0648–BD74
Fisheries of the Exclusive Economic
Zone Off Alaska; Amendment 96 to the
Gulf of Alaska Fishery Management
Plan; Management of Community
Quota Entities
National Marine Fisheries
Service (NMFS), National Oceanic and
Atmospheric Administration (NOAA),
Commerce.
ACTION: Proposed rule; request for
comments.
AGENCY:
NMFS proposes regulations to
implement Amendment 96 to the
Fishery Management Plan for
Groundfish of the Gulf of Alaska (FMP).
If approved, Amendment 96 would
amend certain provisions of the
SUMMARY:
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46237
Individual Fishing Quota Program for
the Fixed-Gear Commercial Fisheries for
Pacific Halibut and Sablefish in Waters
in and off Alaska (IFQ Program). This
action would remove a regulation that
prohibits a Gulf of Alaska (GOA)
Community Quota Entity (CQE) from
transferring and holding small blocks of
halibut and sablefish quota share (QS).
This action would allow CQEs to
acquire additional QS and facilitate
sustained participation by CQE
community residents in the IFQ
Program. This action would promote the
goals and objectives of the MagnusonStevens Fishery Conservation and
Management Act, the Northern Pacific
Halibut Act of 1982, the FMP, and other
applicable law.
DATES: Submit comments on or before
September 8, 2014.
ADDRESSES: You may submit comments
on this document, identified by NOAA–
NMFS–2013–0161, by any of the
following methods:
• Electronic Submission: Submit all
electronic public comments via the
Federal e-Rulemaking Portal. Go to
www.regulations.gov/
#!docketDetail;D=NOAA-NMFS-20130161, 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:
Ellen Sebastian. 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). Attachments to
electronic comments will be accepted in
Microsoft Word, Excel, or Adobe PDF
file formats only.
An electronic copy of the Regulatory
Impact Review (RIR)/Initial Regulatory
Flexibility Analysis (IRFA) (collectively,
Analysis) prepared for Amendment 96
and the regulatory amendment to allow
CQE acquisition of small block halibut
QS is available from https://
www.regulations.gov or from the NMFS
Alaska Region Web site at https://
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alaskafisheries.noaa.gov. An electronic
copy of the 2010 Review of the CQE
Program under the Halibut and
Sablefish IFQ Program prepared by the
North Pacific Fishery Management
Council (Council) is available from the
Council Web site at www.npfmc.org/
community-quota-entity-program/.
FOR FURTHER INFORMATION CONTACT:
Peggy Murphy, (907) 586–7228.
SUPPLEMENTARY INFORMATION:
Regulatory Authority
NMFS proposes regulations to
implement Amendment 96 to the FMP
and a regulatory amendment to revise
the CQE Program. The Council
recommended and NMFS approved the
FMP in 1978 under the authority of the
Magnuson-Stevens Fishery
Conservation and Management Act
(Magnuson-Stevens Act) (16 U.S.C. 1801
et seq.). Regulations implementing the
FMP and general regulations governing
groundfish appear at 50 CFR part 679.
Fishing for Pacific halibut
(Hippoglossus stenolepis) is managed by
the International Pacific Halibut
Commission (IPHC) and the Council
under the Northern Pacific Halibut Act
of 1982 (Halibut Act). Section 773(c) of
the Halibut Act authorizes the Council
to develop regulations that are in
addition to, and not in conflict with,
approved IPHC regulations. Such
Council-recommended regulations may
be implemented by NMFS only after
approval by the Secretary of Commerce.
The Council submitted Amendment
96 for review by the Secretary of
Commerce, and a Notice of Availability
of this amendment was published in the
Federal Register on July 25, 2014 (79 FR
43377) with comments invited through
September 23, 2014. All relevant written
comments received by the end of the
applicable comment period, whether
specifically directed to the FMP
amendment, this proposed rule, or both,
will be considered in the decision to
approve or disapprove Amendment 96
and addressed in the response to
comments in the final decision.
emcdonald on DSK67QTVN1PROD with PROPOSALS
Background
The IFQ Program is a limited access
privilege program for the commercial
fixed-gear halibut and sablefish
(Anoplopoma fimbria) fisheries in and
off Alaska. The IFQ Program limits
access to the halibut and sablefish
fisheries to those persons holding QS in
specific regulatory areas. Quota shares
equate to individual harvesting
privileges that are given effect on an
annual basis through the issuance of
IFQ permits. An annual IFQ permit
authorizes the permit holder to harvest
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a specified amount of IFQ halibut or
sablefish in a regulatory area. A
comprehensive explanation of the IFQ
Program can be found in the final rule
implementing the IFQ Program (58 FR
59375, November 9, 1993).
Although the IFQ Program resulted in
significant safety and economic benefits
for many fishermen, since the inception
of the IFQ Program, many residents of
Alaska’s smaller remote coastal
communities in the GOA who held QS
have transferred their QS to noncommunity residents or moved out of
the smaller coastal communities. As a
result, the number of resident QS
holders has declined substantially in
most of the GOA communities with IFQ
Program participants. This transfer of
halibut and sablefish QS and the
associated fishing effort from the GOA’s
smaller remote coastal communities has
limited the ability of residents to locally
purchase or lease QS and reduced the
diversity of fisheries to which fishermen
in remote coastal communities have
access. The Council recognized that a
number of remote coastal communities
were struggling to remain economically
viable and developed the CQE Program
to provide these communities with longterm opportunities to access the halibut
and sablefish resources that have been
historically available to resident
fishermen.
The Council recommended the CQE
Program as an amendment to the IFQ
Program in 2002 (Amendment 66 to the
FMP), and NMFS implemented the
program in 2004 (69 FR 23681, April 30,
2004). The CQE Program adopted by the
Council, and implemented by NMFS,
was specifically intended to provide
fishing opportunities to communities in
the GOA that had a historic dependence
on the halibut and sablefish fisheries.
The Council recommended and NMFS
implemented a CQE Program that would
provide similar opportunities to coastal
communities in the Aleutian Islands in
2013, known as the Aleutian Islands
CQE Program (79 FR 8870, February 14,
2014). The Aleutian Islands CQE
Program would not be affected by this
proposed action and is not addressed
further. Where the terms ‘‘CQE’’ or
‘‘CQE Program’’ are used in this
preamble, they are specifically referring
to the regulations and management
measures applicable to the GOA CQE
Program, and not to the Aleutian Islands
CQE Program.
The CQE Program allows 45 small,
remote, coastal communities in the GOA
that met historic participation criteria in
the halibut and sablefish fisheries to
transfer (purchase) and hold catcher
vessel halibut and sablefish QS in
specific regulatory areas (see Table 21 to
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50 CFR Part 679). The communities are
eligible to participate in the CQE
Program once they are represented by a
NMFS-approved non-profit entity called
a CQE. After NMFS approval, a CQE
may receive catcher vessel QS for the
represented community or communities
through NMFS-approved transfers. The
CQE is the holder of the QS and is
issued the IFQ annually by NMFS. Once
a CQE holds QS in the GOA, the CQE
can lease the annual IFQ derived from
its QS to individual GOA community
residents. With certain exceptions, the
QS must be held by the CQE. This
program structure creates a permanent
asset for the community to use. The
structure promotes community access to
QS to generate participation in, and
fishery revenues from, the commercial
halibut and sablefish fisheries. The CQE
Program also promotes QS ownership
by individual community residents.
Individuals who lease annual IFQ from
the CQE could use resulting IFQ
revenue to transfer their own QS. The
Council believed, and NMFS agrees,
that both CQE- and non-CQE-held QS
are important in terms of providing
community residents fishing access that
promotes the economic health of
communities.
Current CQE Program regulations
include a number of management
provisions that originated from the IFQ
Program structure and affect the use of
CQE-held QS and the annual IFQ
derived from the QS. Under some
provisions, a CQE has the same
privileges and is held to the same
limitations as individual QS holders in
the IFQ fishery. For example, CQE-held
QS is subject to the same IFQ regulatory
area use cap that applies to non-CQE
held QS. In other instances, the CQE is
subject to less restrictive provisions
than individual, non-CQE QS holders.
For example, a community resident
leasing IFQ from a CQE may fish the
IFQ assigned to a larger vessel size
category on a smaller size category of
catcher vessel. In other instances, the
CQE must operate under more
restrictive provisions than individual,
non-CQE QS holders, in part to protect
existing QS holders and preserve
‘‘entry-level’’ opportunities for new
entrants. A comprehensive explanation
of the CQE Program provisions can be
found in the final rule implementing the
CQE Program (69 FR 23681, April 30,
2004). Recent modifications to the CQE
Program can be found in a rule that
amended several components of the
CQE Program (78 FR 33243, June 4,
2013).
A number of IFQ Program provisions
that apply to CQE Program participants
are important to understanding the
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proposed action and are summarized in
this preamble. These provisions include
regulatory area and vessel size
categories; QS use caps; and QS blocks.
Additional detail on the IFQ Program is
available in the final rule implementing
the IFQ Program (58 FR 59375,
November 9, 1993). Since
implementation of the IFQ Program,
there have been changes to halibut and
sablefish QS use caps (62 FR 7947,
February 21, 1997; 67 FR 20916, April
29, 2002) and to the halibut block use
cap (72 FR 44795, August 9, 2007).
IFQ Regulatory Area and Vessel Size
Categories
The IFQ Program annually issues
fixed-gear halibut and sablefish QS
specific to IFQ regulatory area and
vessel category. In the GOA there are
three IPHC halibut regulatory areas:
Areas 2C (Southeast Alaska), 3A
(Central Gulf of Alaska), and 3B
(Western Gulf of Alaska), and four
sablefish regulatory areas: Southeast
(SE), West Yakutat (WY), Central GOA
(CG), and Western GOA (WG). The
boundaries for the halibut and sablefish
IFQ regulatory areas are defined in
regulation (see definition of ‘‘IFQ
Regulatory Area’’ at § 679.2). Each QS is
assigned to a vessel based upon the size
of the vessel from which IFQ halibut
and sablefish may be harvested and/or
processed (see regulations at
§ 679.40(a)(5)). Halibut QS and its
associated IFQ are assigned to one of
four vessel categories in each regulatory
area: Freezer (catcher/processor)
category (category A); catcher vessel
greater than 60 ft. length overall (LOA)
(category B); catcher vessel 36 ft. to 60
ft. LOA (category C); and catcher vessel
35 ft. LOA or less (category D). Sablefish
QS and its associated IFQ are assigned
to one of three vessel categories in each
regulatory area: Freezer (catcher/
processor) category (category A); catcher
vessel greater than 60 ft. LOA (category
B); and catcher vessel 60 ft. LOA or less
(category C). The vessel categories were
designed to ensure that the IFQ Program
did not substantially change the
structure of the fleet that existed at the
time the IFQ Program was implemented.
These vessel size restrictions prevent
the fishery from being dominated by
large vessels or by any particular vessel
category.
CQEs may obtain by transfer and hold
QS only in specified areas in order to
facilitate local support of community
fishing operations (see § 679.40 and
Table 21 to part 679). However, CQEs
are restricted in terms of the IFQ
regulatory area(s) in which they may
transfer and hold halibut. Table 1 below
illustrates the IFQ regulatory area and
vessel category of halibut QS a CQE can
transfer and hold based on the location
of the community represented by the
CQE. As shown in Table 1 (below) and
in Table 21 to part 679, a CQE
representing an eligible community may
transfer and hold halibut QS in the
regulatory area in which the community
is located (their regulatory area). CQEs
are restricted, however, to transferring
and holding certain halibut QS inside
and outside their regulatory area. For
example, CQEs in Area 2C may not
transfer and hold halibut category D QS
in Area 2C. Generally, CQEs can transfer
and hold halibut QS in adjacent
regulatory areas. However, CQEs located
in Area 3A may not transfer and hold
halibut QS in Area 2C, although CQEs
located in Area 2C may transfer and
hold halibut category A, B and C QS in
Area 3A. CQEs located in Areas 3A or
3B may transfer and hold halibut QS in
Areas 3A and 3B, but CQEs in Area 3B
cannot transfer and hold category D QS
in Area 3A. Table 1 (below) illustrates
the limitations on CQEs’ transferring
and holding halibut QS by regulatory
area and vessel category. For further
explanation and the rationale for the
restrictions, see the final rule
implementing the CQE Program (69 FR
23681, April 30, 2004) and subsequent
amendment (78 FR 33243, June 4, 2013).
TABLE 1—AUTHORITY OF A CQE REPRESENTING A COMMUNITY LOCATED IN IFQ REGULATORY AREAS 2C, 3A, OR 3B
(ROW) TO OBTAIN THROUGH TRANSFER AND HOLD CATEGORY A, B, C AND/OR D HALIBUT QUOTA SHARE BY AREA
2C, 3A OR 3B (COLUMN)
Halibut quota share category by area
Area 2C
A, B, C
Area 2C
D
Area 3A
A, B, C
Area 3A
D
Area 3B
A, B, C
2C ...........................................................................
3A ...........................................................................
3B ...........................................................................
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Area
Yes ..............
No ................
No ................
No ................
No ................
No ................
Yes ..............
Yes ..............
Yes ..............
No ...............
Yes ..............
No ...............
No ................
Yes ..............
Yes ..............
The CQE Program authorizes CQEs to
obtain by transfer and hold catcher
vessel QS: Category B, C, and D halibut
QS, with area-specific limitations for
category D halibut QS; and category B
and C sablefish QS. However, the vessel
size categories do not apply to IFQ
derived from QS held by a CQE, with an
exception for category D halibut QS in
Area 3A.
The Council recommended specific
limitations for CQEs to transfer and hold
category D halibut QS in Areas 2C and
3A. These limitations were intended to
balance the Council’s objective for
providing CQEs with increased
opportunities to acquire halibut QS with
its objective to limit potential
competition for category D halibut QS
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between non-CQE and CQE QS holders.
Vessel category D halibut QS is
generally the least expensive category of
halibut QS because non-CQE IFQ
derived from category D QS must be
used on the smallest category of catcher
vessel. It is often transferred and held by
smaller operations or by new entrants to
the IFQ fisheries. CQE Program
regulations at § 679.41(g)(5) prohibit a
CQE from transferring and holding
category D halibut QS in Area 2C. The
Council recommended this prohibition
because a greater portion of the total
Area 2C halibut QS is issued as category
D QS relative to Areas 3A and 3B, and
category D halibut QS is more
commonly transferred by new entrants
in Area 2C than in Areas 3A and 3B.
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Area 3B
D
No.
Yes.
Yes.
A CQE representing one or more
communities in Area 3A is allowed to
transfer and hold a limited amount of
Area 3A category D halibut QS, but the
IFQ derived from that QS must (among
other restrictions) be fished on a
category D vessel, which are vessels less
than or equal to 35 ft. LOA (see
regulations at § 679.42(a)(2)(iii)).
Category D vessels are typically held by
new entrants and by most fishery
participants residing in Area 3A
communities. An Area 3A CQE is
limited to transferring and holding no
more than the total number of category
D halibut QS units initially issued to
individual residents of Area 3A CQE
communities. The Council
recommended this provision to provide
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emcdonald on DSK67QTVN1PROD with PROPOSALS
opportunities for CQEs to transfer and
hold an amount of category D halibut
QS up to the amount historically held
by CQE residents without increasing
potential competition for category D
halibut QS between non-CQE and CQE
QS holders (78 FR 14490, March 6,
2013).
A CQE representing one or more
communities in Areas 3A and 3B is
allowed to transfer and hold Area 3B
category D halibut QS. As noted in the
final rule implementing the CQE
Program (69 FR 23681, April 30, 2004),
a relatively small amount of category D
halibut QS exists in Area 3B, and
traditionally few prospective buyers
exist for this category of QS.
QS units that cannot be subdivided
upon transfer (see regulations at
§ 679.41(e)(1)). One of the primary
purposes of QS blocks and the
subsequent amendments to the block
provisions was to conserve small blocks
of QS that could be transferred at a
relatively low cost by crew members
and new entrants to the IFQ fisheries.
Blocked QS typically is less expensive
and more affordable for new entrants.
The IFQ Program incorporates a
‘‘sweep-up’’ provision to allow very
small blocks of QS to be permanently
consolidated, up to specified limits, so
as to be practical to fish (see regulations
at §§ 679.41(e)(2) and (e)(3)).
CQE Program QS Use Caps
Individual community use caps limit
the amount of halibut QS and sablefish
QS that each CQE may transfer and hold
on behalf of a community. The use caps
accommodate existing QS holders who
are concerned that shifting QS holdings
to CQEs could disadvantage individual
fishermen in the IFQ fishery by
reducing the amount of QS available to
them in the QS market. In the CQE
Program, the CQE individual
community use cap is limited to an
amount of QS equal to the individual
IFQ Program use cap. GOA CQEs are
limited to transferring and holding a
maximum of 1 percent of the Area 2C
halibut QS (see regulations at
§ 679.42(f)(2)(ii)) and a maximum of 0.5
percent of the combined Area 2C, 3A,
and 3B halibut QS (see regulations at
§ 679.42(f)(2)(i)). GOA CQEs also are
limited to transferring and holding a
maximum of 1 percent of the Southeast
sablefish QS (see regulations at
§ 679.42(e)(5)) and a maximum of 1
percent of all combined sablefish areas
QS (see regulations at § 679.42(e)(4)(i)).
In addition to individual community
use caps, cumulative community use
caps limit the amount of halibut QS and
sablefish QS that all CQE eligible
communities within an IFQ regulatory
area can transfer and hold. CQEs are
limited to a maximum of 21 percent of
the total halibut QS pool (see
regulations at § 679.42(f)(5)) and a
maximum of 21 percent of the total
sablefish QS pool (see regulations at
§ 679.42(e)(6)) in each IFQ regulatory
area in the GOA. Therefore, all CQEs in
the GOA are subject to the maximum
cumulative community use cap of 21
percent of each species’ total QS pool in
each IFQ regulatory area.
A block use cap restricts how many
blocks of QS an individual can transfer
and hold. In the IFQ Program, an
individual may transfer and hold no
more than three blocks of halibut QS
and two blocks of sablefish QS (see
regulations at § 679.42(g)(1)). The
purpose of this cap is to limit the
consolidation of blocked QS and to
ensure that smaller aggregate units
would be available on the market. These
provisions were established to prevent
unrestricted transfer of QS by fishermen
with greater capital or operating
efficiency. These fishermen could also
disadvantage new entrants, particularly
fishermen with smaller operations in
remote communities who have typically
sought to transfer ‘‘blocked QS.’’ The
block use cap was intended to preserve
the character of the fishing fleet in
remote Alaska fishing communities by
ensuring that QS would be available to
the fleet of smaller operators, thereby
maintaining the diversity in operation
types that exist in more remote coastal
communities.
The IFQ Program also limits the
number of blocks a CQE may transfer
and hold. The limitation prevents CQEs
from consolidating the type of QS that
is most attractive to and feasible for new
entrant, non-CQE fishermen to transfer.
CQEs may transfer and hold up to a
maximum of 10 blocks of halibut QS
and 5 blocks of sablefish QS in each
GOA regulatory area (see regulations at
§ 679.42(g)(ii)). These limits on CQE
block holdings and the limit on where
CQEs can hold QS restrict CQEs to 20
halibut QS blocks (10 blocks in each of
two areas) and 20 sablefish QS blocks (5
blocks in each of four areas).
QS Blocks
The IFQ Program initially issued QS
in blocks. A block is a consolidation of
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QS Block Use Cap
Minimum Block Size
During development of the CQE
Program, the Council and NMFS were
concerned that CQEs would seek to
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acquire as much of the most affordable
QS as they were allowed to hold. The
Council and NMFS determined that if
no limit on the acquisition of blocked
QS was established, then gains in CQE
holdings could reflect losses of QS
holdings among residents of the same
CQE communities. The Council and
NMFS were also concerned that CQEs
might have greater access to capital than
individuals, so they could buy up
blocks of QS that are most in demand
by non-CQE fishermen with small
operations. Fishermen entering the IFQ
fishery tend to seek relatively smaller
blocks of QS. Smaller blocks of QS are
typically designated for vessels of a
smaller size category: Category C and D
in the halibut fishery and category C in
the sablefish fishery. New entrants tend
to own or use smaller category C and D
vessels. Therefore, smaller blocks are
more in demand by new entrants, and
less in demand by fishermen using
larger vessels. Smaller blocks of QS are
typically more affordable due to their
low total cost compared to the cost of
larger blocks (see Section 2.7.2.2 of the
Analysis). Given these factors, the
Council and NMFS determined it was
appropriate to restrict CQEs from
purchasing or holding blocked QS of
less than a minimum size to preserve
fishing opportunities for new entrants in
certain regulatory areas.
The CQE program prohibits CQEs
from transferring and holding a QS
block that is less than the ‘‘sweep up’’
limit, or the number of QS units initially
issued as blocks that could be combined
to form a single block (see regulations at
§§ 679.41(e)(4) and (e)(5)). Quota share
blocks that are less than or equal to the
‘‘sweep up’’ limit are known as ‘‘small
blocks.’’ The amount of QS units that
comprise a small block in each IFQ
regulatory area in the GOA is specified
for the halibut fishery (see regulations at
§ 679.41(e)(3)) and for the sablefish
fishery (see regulations at § 679.41(e)(2))
(see Table 2 below). Currently, CQEs are
prohibited from purchasing or using
small blocks of halibut QS in Areas 2C
and 3A (see regulations at
§ 679.41(e)(5)), and sablefish QS in the
SE., WY, CG, and WG (see regulations
at § 679.41(e)(4)) regulatory areas. The
Council did not recommend a small
block restriction for Area 3B halibut QS.
Fewer small blocks exist in Area 3B and
few new entrants in Area 3B have
sought these small blocks of halibut QS
(69 FR 23681, April 30, 2004).
Therefore, CQEs transferring Area 3B
QS are not subject to a small block
restriction.
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TABLE 2—CURRENT AND PROPOSED RESTRICTIONS ON THE MINIMUM BLOCK SIZE BY IFQ REGULATORY AREA.
Species
Area
Current minimum block size restriction
Halibut .....................................................
2C ...........................................................
3A ...........................................................
3B ...........................................................
SE ..........................................................
WY .........................................................
CG ..........................................................
WG .........................................................
33,320 QS ..............................................
46,520 QS ..............................................
No Restriction ........................................
33,270 QS ..............................................
43,390 QS ..............................................
46,055 QS ..............................................
48,410 QS ..............................................
Sablefish ..................................................
The total amount of QS units issued
in small blocks differs by IFQ regulatory
area. Sections 2.6.3.2 and 2.7.1 of the
Analysis report that 11.3 percent of the
total Area 2C and Area 3A halibut QS
is small block halibut QS, and 3.7
percent of the total sablefish QS (i.e.,
SE., WY, CG, and WG) is small block
sablefish QS. Even though a relatively
small proportion of QS is issued as
small blocks and not available for
transfer by CQEs, existing regulations
may constrain small block holders from
selling their small blocks and CQEs
from transferring QS.
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Proposed Action
This proposed action would amend
the FMP and halibut and sablefish CQE
regulations to remove the restriction on
CQEs’ ability to purchase and use small
blocks of halibut and sablefish QS less
than or equal to the sweep-up limit
currently specified in regulations at
§§ 679.41(e)(5) and 679.41(e)(4),
respectively. Under this proposed
action, all CQEs in the GOA could
receive by transfer any size block of
halibut and sablefish QS to hold for use
by eligible community members. CQEs
would be able to transfer the similar size
of QS blocks in the market place as
individual non-CQE QS holders. The
objectives of this action are to provide
CQE communities in the GOA with
increased opportunity to transfer and
hold QS and sustain participation of
CQE community residents in the IFQ
halibut and sablefish fisheries.
Although the proposed action would
allow CQEs to transfer any size block of
QS from any QS holder, provisions of
the IFQ Program described above would
still apply. These include regulatory
area restrictions, community QS use
caps (individual and cumulative), the
prohibition on CQEs’ transfer and
holding of category D halibut QS in
Area 2C, the limitation on the amount
of category D halibut QS that an Area
3A CQE may transfer and hold, and the
prohibition on transfer and holding of
category D halibut QS in Area 3A by
CQEs located outside Area 3A.
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The proposed rule would update
Table 21 to part 679 to clarify the
category of halibut QS (A, B, C and D)
and IFQ regulatory area of the QS that
a CQE can transfer by area. This revision
to Table 21 to part 679 would provide
a clearer and more comprehensive
summary of CQE harvesting privileges.
Rationale for and Effects of the
Proposed Action
This proposed action would provide
additional opportunities for CQEs to
transfer and hold QS, and NMFS
expects it will not adversely affect the
ability of non-CQE fishery participants
to transfer and hold small blocks of QS.
In proposing this action, the Council
and NMFS considered the current
participation of CQE and non-CQE QS
holders in the IFQ fishery, and the
potential impact on QS access and
markets. The Council and NMFS
determined that removing the small
block restriction from the CQE Program
could improve the ability of CQEs to
obtain the most affordable blocks of QS
without negatively impacting the ability
of non-CQE fishery participants to
obtain the similar size blocks of QS.
CQEs participating in the CQE
Program have made little progress
towards reaching the regulatory limits
on the maximum amount of QS that
may be transferred or IFQ that may be
harvested. Since implementation of the
CQE program in 2004, only two of the
45 communities eligible for the CQE
program have formed CQEs, transferred
QS, and harvested the resulting IFQ.
These two CQEs hold less than 0.5
percent of the combined Area 2C, 3A,
and 3B halibut QS pool. These two
CQEs do not hold sablefish QS. The
Council’s analysis of the CQE Program
indicated that lack of participation in
the CQE Program can be attributed to 1)
financial barriers to transferring QS, and
2) CQE Program-related restrictions. Key
financial barriers to the transfer of QS
by CQEs include limited availability of
QS for transfer, increased market prices
for halibut and sablefish QS, and
limited viable options for financing QS
transfer. Each of these barriers is a
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Proposed block
size restriction
No
No
No
No
No
No
No
Restriction.
Restriction.
Restriction.
Restriction.
Restriction.
Restriction.
Restriction.
function of market forces and cannot be
addressed through regulatory
amendment (see the Review of the CQE
Program under the Halibut and
Sablefish IFQ Program and Section
2.6.3.1 of the Analysis for additional
detail (see ADDRESSES)).
Analysis of the percent of blocked and
unblocked QS in 2013 (the year of the
most recent available data) indicates
that the percentage of small block QS
relative to the total amount of QS in the
GOA IFQ regulatory areas is greater for
halibut (11.3 percent of the total Area
2C and Area 3A halibut QS) than for
sablefish (3.7 percent of the total SE.,
WY, CG, WG sablefish QS). Therefore,
while this proposed action would
impact sablefish QS holders, it likely
would have a greater impact on halibut
QS holders. Section 2.7.2.1 of the
Analysis (see ADDRESSES) examines the
amount of small block QS in the 2013
QS pool by regulatory area and vessel
size category and serves as an example
of the amount of small block QS that
could be made available to CQEs as a
result of this action. The Analysis
considers the maximum potential
impacts of the proposed action, which
assumes that all eligible communities
form CQEs and secure funding to
transfer all the newly available small
blocks of QS, up to CQE Program limits
described above and in regulations at
§§ 679.41 and 679.42. For reasons
described above, the Analysis indicates
this outcome is unlikely given
reasonably foreseeable trends in QS
holdings by CQEs.
Within Areas 2C and 3A, less than 1
percent of the total amount of category
A halibut QS could be made available
for transfer by CQEs if they could hold
small blocks of category A halibut QS;
less than 5 percent of the total amount
of category B halibut QS could be made
available for transfer by CQEs if they
could hold small blocks of category B
halibut QS; about 50 percent of the total
amount of category C halibut QS in
these areas could be available for
transfer by CQEs if they could hold
small blocks of category C halibut QS;
and 43 percent of Area 3A category D
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halibut QS could be available for
transfer by CQEs if they could hold
small blocks of Area 3A category D
halibut QS. This proposed action would
not remove the regulation at
§ 679.41(g)(5) prohibiting a CQE from
transferring and holding category D
halibut QS in Area 2C. Therefore, no
small blocks of category D halibut QS
could be transferred and held by a CQE
in Area 2C (see Table 1 in the section
titled ‘‘IFQ Regulatory Area and Vessel
Size Categories’’ of this proposed rule).
Because there is no restriction on CQEs
transferring and holding small blocks of
Area 3B category D halibut QS, this
proposed action would not affect the
ability of CQEs in Areas 3A and 3B to
transfer and hold small blocks of Area
3B category D halibut QS.
In Southeast, West Yakutat, Central
GOA and Western GOA regulatory
areas, 2 percent, 7 percent, 3 percent,
and 15 percent of the total amount of A
share sablefish QS could be available,
respectively, for purchase by CQEs if
they could hold small blocks of A share
sablefish QS; 9 percent, 19 percent, 26
percent, and 37 percent of the B share
sablefish QS could be available,
respectively, for purchase by CQEs if
they could hold small blocks of B share
sablefish QS; and 89 percent, 75
percent, 71 percent, and 47 percent of
the C share sablefish QS could be
available, respectively, for purchase by
CQEs if they could hold small blocks of
C share sablefish QS.
Analysis of the amount of small block
QS by regulatory area in 2013 indicates
that cumulative use caps on CQE QS
ownership would not constrain the
maximum potential transfer of QS by
CQEs. The more likely constraint on
CQE transfer and holding of QS would
be the limit on the number of blocks
that a CQE can own in any one area (10
halibut blocks and 5 sablefish blocks).
Based on 2013 data, CQEs in Area 2C
would gain access to 507 small blocks
of Area 2C halibut QS plus 635 small
blocks of Area 3A halibut QS in
categories A, B and C. At maximum
participation, even if all 23 eligible
communities in Area 2C formed CQEs,
those CQEs could not transfer and hold
more than 230 small blocks of the 507
small blocks of halibut QS available in
Area 2C due to the block limit of 10
blocks per CQE eligible to purchase in
Area 2C. At maximum participation,
even if all 23 eligible communities in
Area 2C, all 14 eligible communities in
Area 3A, and all 8 eligible communities
in Area 3B formed CQEs, those CQEs
could not transfer and hold more than
450 of the 635 small blocks of halibut
QS available in Area 3A due to the
block limit of 10 blocks per CQE eligible
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to transfer in Area 3A. In addition, the
8 eligible communities in Area 3B
would gain access to the same 635
blocks of category A, B and C QS in
Area 3A, but none of the category D QS
in Area 3A. Even at maximum CQE
participation, QS block limits and the
reservation of a limited amount of Area
3A category D QS for transfer by CQEs
representing communities in Area 3A
would prevent CQEs from collectively
acquiring all small block halibut QS
made available under the proposed
action. Thus, the Council and NMFS
determined that small block halibut QS
would continue to be available to nonCQE participants in the IFQ halibut
fishery. See section 2.7.2.1 of the
Analysis for additional detail.
For sablefish, a CQE can own up to 5
blocks of QS in its area plus 5 blocks
from each of the other 3 sablefish
regulatory areas. Based on 2013 data,
CQEs would gain access to 156 small
blocks of SE sablefish QS, 122 small
blocks of WY sablefish QS, 179 small
blocks of CG sablefish QS, and 59 small
blocks of WG sablefish QS. At
maximum participation, if all 45 eligible
communities formed CQEs, those CQEs
could transfer and hold 225 small
blocks of sablefish QS in each IFQ
regulatory area. Under these allowable
block limits, CQEs would be able
collectively to transfer and hold all the
available sablefish small block QS in
each IFQ regulatory area. Given the
financial barriers to CQE transfers of QS,
such as limited availability of QS for
transfer, increased market prices for
halibut and sablefish QS, and limited
viable options for financing QS transfer,
described above and in the Analysis, the
Council and NMFS determined it is
unlikely that CQEs would transfer the
maximum amount of small block
sablefish QS made available by the
proposed action. Thus, small block
halibut QS would continue to be
available to non-CQE participants in the
IFQ sablefish fishery. See sections
2.6.3.1 and 2.7.2.1 of the Analysis for
additional detail.
Although this proposed action would
allow CQEs to transfer and hold small
blocks of category A halibut and
sablefish QS, the Council and NMFS
anticipate that CQE transfers of category
A QS would be extremely limited.
Because IFQ derived from category A
halibut and sablefish QS may be caught
and processed at sea, category A QS is
typically priced much higher than all
other QS categories. In addition, the
total amount of category A QS issued is
small relative to all other categories of
QS. Therefore, the potential impact of
allowing CQEs to transfer and hold
small blocks of category A QS on new
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entrants, small-boat operations and CQE
fishery participants would be minimal.
See sections 2.6.3.1 and 2.7.2.1 of the
Analysis for additional detail.
To date, CQEs have transferred and
held a limited amount of QS that likely
has not negatively impacted non-CQE
fishery participants’ ability to acquire
QS in the open market. Transferring and
holding small block QS will benefit
CQEs, their community members, and
future community members, who tend
to rely on these restricted blocks of
mainly small vessel category QS.
Allowing CQEs to transfer and hold
small block QS could also enhance a
CQE’s ability to keep QS in remote
communities and create some
operational efficiencies that could
provide a net benefit to both the CQEs
and their community residents. The
impacts of the proposed action can be
categorized into (1) changes in access to
QS, (2) effects on the QS market, and (3)
social and economic tradeoffs. These
impacts are described in section 2.7.2.2
of the Analysis and are summarized
here.
Changes in Access to QS
Under this proposed action, CQE
fishery participants gain access to more
lower-cost QS, though the extent to
which this occurs will be shaped by a
CQE’s progress in securing the
necessary financing for CQE transfers. In
turn, CQEs provide fishery access by
leasing QS to community residents.
Leasing QS from a CQE at favorable
financial terms, compared to lease fees
on the QS market, can aid new entrants
in building up the financial base
necessary to transfer and hold QS in the
future. While this may facilitate CQE
community resident ownership of QS, it
may not benefit persons who do not
reside in a CQE-eligible community.
Transfer of small block QS by CQEs
under the proposed action could result
in a reduction in the amount of QS that
would be available to individual CQE
community residents and could
constitute an economic loss for these
individuals. Conversely, CQE
acquisition of QS could also be
considered a benefit to community
residents because it is a public
investment in the community’s future.
The proposed action would also enable
CQE residents retiring from the IFQ
fishery to transfer small block QS to a
CQE by selling or gifting the QS.
Effects on the QS Market
The Council and NMFS considered
whether entry of CQEs into the small
block QS market could bid up the price
of QS. This price effect could occur
through price competition and reduced
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supply of small blocks on the market. If
CQEs can afford to pay as much or more
for small block QS than existing buyers,
then competition could increase the
price for small block QS. This type of
demand-driven price effect would
impact both CQE and non-CQE
community residents who are in the
market for small block QS. However,
based on the 10-year review of the CQE
Program (see ADDRESSES), CQEs have
not and are not likely to accrue the
financial assets to transfer a quantity of
QS that would have a large impact on
QS price.
Allowing CQEs to transfer and hold
small blocks of QS could reduce the
supply of small block QS available for
transfer. This could occur when CQE
community residents, who are reducing
their fishery participation, transfer their
QS to benefit other small operators or
new entrants in the CQE community.
However, allowing CQEs access to small
block QS is not expected to reduce QS
supply to non-CQE fishery participants
or result in a corresponding near-term
increase in QS price.
Social and Economic Tradeoffs
An increase in CQE QS holdings
would likely result in both social and
economic trade-offs. Social benefits
could include increased fishery
participation for communities eligible to
form CQEs and transfer QS, as well as
increased harvest opportunities for new
entrants and fishery participants who
live in these communities. These social
benefits could have varying
distributional impacts since CQEs by
nature are localized. From an economic
view point, facilitating community QS
transfer comes at a cost but also offers
some operational efficiency that may
not be realized when QS is held by
individuals living in remote
communities. For example, when CQEs
transfer QS they gain an asset that can
be leased out to new entrants and smallboat operators who then could build up
their own financial base to transfer QS.
Benefits from QS holdings that provide
future value to the community support
the original goals of the CQE Program.
Any future value that does not accrue to
individual CQE or non-CQE community
residents could be viewed as an indirect
impact that the Council and NMFS
acknowledged as consistent with the
goals of the CQE Program.
Other Alternatives Considered
The Council and NMFS considered
two alternatives for the proposed action,
one of which is the status quo. The
action alternative (Alternative 2) would
revise regulations to allow a CQE to
transfer and hold any size block of
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halibut and sablefish QS from any QS
holder (Option 1), or from a subset of
QS holders determined by the location
of the QS holder’s residence (Options 2
and 3). The Council selected the least
restrictive option, Option 1 under
Alternative 2.
Option 2 would allow CQE
communities to transfer and hold any
size block of halibut and sablefish QS
from residents of any CQE community.
Option 2 was not selected because a
relatively small number of small blocks
are held by residents of CQE
communities, and many of those small
blocks are designated as category C and
D QS. This would greatly limit the
potential number of small blocks
available to CQEs, and would increase
potential competition among CQEs and
residents of CQE communities seeking
to transfer these small blocks (see
Section 2.7.2 of the Analysis for
additional detail).
Option 3 would allow CQE
communities to transfer and hold any
size block of halibut and sablefish QS
from residents of their CQE community,
but not from any non-resident. Option 3
was not selected because an even
smaller number of small blocks are held
by residents of CQE communities, and
in some CQE communities, no CQE
resident may hold small blocks,
effectively excluding some CQE
communities and not others from
holding small blocks. Section 2.7.2 of
the Analysis notes that no CQE
residents hold small blocks of halibut
QS in 17 of the 45 eligible CQE
communities, and no CQE residents
hold small blocks of sablefish QS in 31
of the 45 communities. Overall, option
3 would limit the number of CQEs that
could transfer and hold small block QS
more than Options 1 or 2 (see Section
2.7.2 of the Analysis for additional
detail).
Classification
Pursuant to sections 304(b)(1)(A) and
305(d) of the Magnuson-Stevens Act, the
NMFS Assistant Administrator has
determined that Amendment 96 and
this proposed rule are consistent with
the FMP, provisions of the MagnusonStevens Act, the Halibut Act, and other
applicable laws, subject to further
consideration after public comment.
This proposed rule has been
determined to be not significant for
purposes of Executive Order 12866.
Initial Regulatory Flexibility Analysis
An Initial Regulatory Flexibility
Analysis (IRFA) was prepared for this
action, as required by section 603 of the
Regulatory Flexibility Act (RFA). The
IRFA describes the economic impact
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46243
this proposed rule, if adopted, would
have on small entities. The IRFA
describes the reasons why this action is
being proposed; the objectives and legal
basis for the proposed rule; the number
of small entities to which the proposed
rule would apply; any projected
reporting, recordkeeping, or other
compliance requirements of the
proposed rule; any overlapping,
duplicative, or conflicting Federal rules;
impacts of the action on small entities;
and any significant alternatives to the
proposed rule that would accomplish
the stated objectives of the MagnusonStevens Act, and any other applicable
statutes, and would minimize any
significant adverse impacts of the
proposed rule on small entities. The
description of the proposed action, its
purpose, and the legal basis are
contained earlier in this preamble and
in the SUMMARY and are not repeated
here. A summary of the IRFA follows.
A copy of the Analysis is available from
NMFS (see ADDRESSES).
On June 12, 2014, the Small Business
Administration (SBA) issued a final rule
revising the small business size
standards for several industries effective
July 14, 2014 (79 FR 33647, June 12,
2014). The rule increased the size
standard for Finfish Fishing from $19.0
to 20.5 million. The new size standards
were used to prepare the IRFA for this
action.
Number and Description of Small
Entities Directly Regulated by the
Proposed Action
The proposed action would directly
regulate 45 CQEs that would be
considered small entities under the RFA
(Section 601(3)). The CQEs qualify as
small not-for-profit organizations that
are not dominant in their field. CQEs
represent small communities that would
directly benefit from the proposed
action. Each of the communities
qualifies as a small entity under the
RFA since they are governments of
towns or villages with populations less
than 50,000 people. The CQE acquires
QS and makes the resulting IFQ
available by lease to eligible harvesters
who are community residents. Those
harvesters are required to make a series
of reports and declarations to NMFS in
order to be found eligible to participate.
Therefore, those commercial fishing
operations would be directly regulated
small entities, although their number is
unknown at this time. No adverse
economic impact on community
residents is expected under the
proposed action. Further, NMFS
anticipates that any economic impacts
accruing from the proposed action to
these small entities would be beneficial
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because their access to the IFQ fisheries
will be improved.
Existing individual halibut and
sablefish QS holders and new entrants
to the IFQ fishery have potential to be
impacted by this proposed action but
are not directly regulated by this
proposed rule. Currently, there are 2,565
unique halibut QS holders and 845
unique sablefish QS holders across all
regulatory areas. These entities and
future fishery entrants, of which the
number is unknown, could potentially
be impacted by this proposed action.
Under the IRFA, NMFS considers only
those entities that are directly regulated
by the proposed action. An impact on
existing halibut and sablefish QS
holders and new entrants to the IFQ
fishery could be realized if CQE transfer
of QS results in a significant increase in
the price for QS. The Analysis indicates
this impact has not been observed in the
past and is not likely to occur in the
future, given the present constraints on
CQE access to investment capital and
the range of other factors that also
influence QS prices (see Section 2.6.3.1
of the Analysis). Therefore, existing and
potential future non-CQE QS holders are
not considered to be directly regulated
by this action and are not further
analyzed in this IRFA.
Impacts of the Action on Small Entities
This proposed rule would remove the
regulations prohibiting Gulf of Alaska
CQE from transferring and holding
small blocks of halibut and sablefish
quota share. The proposed rule is
intended to allow CQEs to acquire small
block QS and make the resulting IFQ
available by lease to eligible harvesters
who are community residents. Allowing
CQEs to transfer and hold small block
QS should benefit their community
members or future community
members. Unrestricted transfer of small
block QS should enhance the CQEs’
ability to keep QS in remote
communities and as a result provide for
active participation of CQE and
community residents in the halibut and
sablefish fisheries in the future. By
increasing their QS transfers and
holdings under the proposed action,
CQEs would provide fishery access
through leasing to community residents
who are new entrants to the fishery or
who currently fish small quota holdings
and wish to increase their participation.
Leasing quota from a CQE at favorable
terms, compared to market lease fees,
could aid new entrants in building up
the financial base necessary to transfer
and hold individual QS in the future.
However, Section 2.7.2.1 of the Analysis
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notes that the amount of QS that would
become available is likely greater than
what CQEs could expect to finance in
the present capital market. Increased QS
availability to CQEs under the proposed
action could provide some operational
efficiency that results in a net benefit to
both the CQEs and their community
residents. One such efficiency that
could result from allowing CQEs to
transfer and hold small block QS is that
community residents would be able to
transfer small block QS to a CQE as they
retire or otherwise reduce their active
participation in the fishery, keeping the
QS holdings within the community.
Description of Significant Alternatives
That Minimize Adverse Impacts on
Small Entities
The IRFA also requires a description
of any significant alternatives to the
preferred alternative that accomplish
the stated objectives, are consistent with
applicable statutes, and would
minimize any significant economic
impact of the proposed rule on small
entities. The suite of potential actions
includes two alternatives and associated
options. A detailed description of these
alternatives and options is provided in
section 2.7 of the Analysis.
The significant alternative to the
proposed action is the status quo
alternative (Alternative 1). Under
Alternative 1, NMFs would make no
changes to the current regulations.
Alternative 1 would not have adverse
economic impacts on CQEs or the
resident QS holders in the CQE
qualifying communities, which would
be the small entities directly regulated
by this action. Alternative 1 does not
meet the objectives of the action to
promote more CQE access to QS and
facilitate the sustained participation by
CQE community residents in the IFQ
Program. Under Alternative 2, NMFS
would implement the proposed action,
which is less restrictive on CQEs than
Alternative 1, and is the least
burdensome of the available alternatives
for directly regulated small entities.
Alternative 2 specified three options
(Options 1, 2 and 3) that allow CQEs to
transfer any size block of QS from any
QS holder or a subset of QS holders
depending on the option and
determined by the location of the QS
holder’s residence.
Option 1 would allow CQEs to
transfer and hold any size block of
halibut or sablefish QS. This option is
the least burdensome on directly
regulated small entities of all the
options considered, and would
minimize any significant adverse
PO 00000
Frm 00044
Fmt 4702
Sfmt 4702
economic impact. Option 2 would allow
CQE communities to transfer and hold
any size block of halibut and sablefish
QS from residents of any CQE
community. Option 2 was not selected
because it would have greatly limited
the potential number of small blocks
available to CQEs. This would be more
burdensome on directly regulated CQEs
than Option 1. Option 3 would allow
CQE communities to transfer and hold
any size block of halibut and sablefish
QS from residents of their CQE
community, but not from any nonresident. Option 3 was not selected
because it would have limited the
potential number of small blocks
available to CQEs and the number of
CQEs that could transfer and hold small
block QS. Option 3 would be more
burdensome on directly regulated CQEs
than either Option 1 or 2. The Analysis
did not identify any other alternatives
that would more effectively meet the
RFA criteria to minimize adverse
economic impacts on directly regulated
small entities.
Projected Reporting, Recordkeeping and
Other Compliance Requirements
This action does not modify reporting,
recordkeeping or other compliance
requirements.
Duplicate, Overlapping, or Conflicting
Federal Rules
No Federal rules that might duplicate,
overlap, or conflict with these proposed
actions have been identified.
List of Subjects in 50 CFR Part 679
Alaska, Fisheries.
Dated: August 1, 2014.
Samuel D. Rauch III,
Deputy Assistant Administrator for
Regulatory Programs, National Marine
Fisheries Service.
For the reasons set out in the
preamble, NMFS proposes to amend 50
CFR part 679 as follows:
PART 679—FISHERIES OF THE
EXCLUSIVE ECONOMIC ZONE OFF
ALASKA
1. The authority citation for part 679
continues to read as follows:
■
Authority: 16 U.S.C. 773 et seq.; 1801 et
seq.; 3631 et seq.; Pub. L. 108–447.
§ 679.41
[Amended]
2. In § 679.41, remove paragraphs
(e)(4) and (e)(5).
■ 3. Revise Table 21 to part 679 to read
as follows:
■
E:\FR\FM\07AUP1.SGM
07AUP1
46245
Federal Register / Vol. 79, No. 152 / Thursday, August 7, 2014 / Proposed Rules
TABLE 21 TO PART 679—ELIGIBLE COMMUNITIES, HALIBUT IFQ REGULATORY AREA LOCATION, COMMUNITY GOVERNING
BODY THAT RECOMMENDS THE CQE, AND THE FISHING PROGRAMS AND ASSOCIATED AREAS WHERE A CQE REPRESENTING AN ELIGIBLE COMMUNITY MAY BE PERMITTED TO PARTICIPATE
May hold halibut QS in halibut IFQ regulatory area and
vessel category
Eligible GOA or
AI community
Adak ...................
Akhiok ................
Angoon ...............
Chenega Bay .....
Chignik ...............
Chignik Lagoon ..
Halibut IFQ
regulatory
area in
which the
community
is located
4B
3A
2C
3A
3B
3B
Chignik Lake ......
3B
Coffman Cove ....
Cold Bay ............
Craig ..................
Edna Bay ...........
2C
3B
2C
2C
Elfin Cove ..........
2C
Game Creek ......
Gustavus ............
2C
2C
Halibut Cove ......
Hollis ..................
3A
2C
Hoonah ..............
Hydaburg ...........
Ivanof Bay ..........
2C
2C
3B
Kake ...................
Karluk .................
2C
3A
Kasaan ...............
King Cove ..........
Klawock ..............
Larsen Bay .........
Metlakatla ...........
2C
3B
2C
3A
2C
Meyers Chuck ....
Nanwalek ...........
2C
3A
Naukati Bay .......
Old Harbor .........
Ouzinkie .............
Pelican ...............
Perryville ............
2C
3A
3A
2C
3B
Point Baker ........
2C
Port Alexander ...
2C
Port Graham ......
3A
Port Lions ...........
Port Protection ...
3A
2C
Sand Point .........
Seldovia .............
Tatitlek ................
3B
3A
3A
Tenakee Springs
2C
Thorne Bay ........
Tyonek ...............
2C
3A
Whale Pass ........
2C
Yakutat ...............
3A
Community governing
body that
recommends
the CQE
City of Adak ..............
City of Akhiok ...........
City of Angoon ..........
Chenega IRA Village
City of Chignik ..........
Chignik Lagoon Village Council.
Chignik Lake Traditional Council.
City of Coffman Cove
City of Cold Bay .......
City of Craig .............
Edna Bay Community
Association.
Community of Elfin
Cove.
N/A ............................
Gustavus Community
Association.
N/A ............................
Hollis Community
Council.
City of Hoonah .........
City of Hydaburg ......
Ivanof Bay Village
Council.
City of Kake ..............
Native Village of
Karluk.
City of Kasaan ..........
City of King Cove .....
City of Klawock .........
City of Larsen Bay ....
Metlakatla Indian Village.
N/A ............................
Nanwalek IRA Council.
Naukati Bay, Inc .......
City of Old Harbor ....
City of Ouzinkie ........
City of Pelican ..........
Native Village of Perryville.
Point Baker Community.
City of Port Alexander.
Port Graham Village
Council.
City of Port Lions ......
Port Protection Community Association.
City of Sand Point ....
City of Seldovia ........
Native Village of
Tatitlek.
City of Tenakee
Springs.
City of Thorne Bay ...
Native Village of
Tyonek.
Whale Pass Community Association.
City of Yakutat ..........
Area 2C
Area 3A
Area 3B
....................
....................
A,B,C
....................
....................
....................
....................
All
A,B,C
All
A,B,C
A,B,C
....................
A,B,C
....................
A,B,C
A,B,C
Area 4B
May hold sablefish QS in
sablefish IFQ
regulatory areas
CG, SE,
WG, and
WY
(All GOA)
AI
....................
X
X
X
X
X
Maximum number of CHPs that
may be held in
halibut IFQ
regulatory area
Area
2C
Area
3A
X
....................
....................
....................
....................
....................
............
............
4
............
............
............
............
7
............
7
............
............
emcdonald on DSK67QTVN1PROD with PROPOSALS
..................
2
..................
2
3
4
..................
..................
..................
..................
..................
..................
A,B,C
All
....................
X
....................
............
............
2
..................
A,B,C
A,B,C
A,B,C
A,B,C
....................
All
....................
....................
....................
....................
....................
....................
X
X
X
X
....................
....................
....................
....................
4
............
............
4
............
............
............
............
..................
..................
..................
..................
..................
2
..................
..................
A,B,C
A,B,C
....................
....................
X
....................
............
............
..................
..................
A,B,C
A,B,C
A,B,C
A,B,C
....................
....................
....................
....................
X
X
....................
....................
4
............
............
............
..................
..................
..................
..................
....................
A,B,C
All
A,B,C
All
....................
....................
....................
X
X
....................
....................
............
4
7
............
2
..................
..................
..................
A,B,C
A,B,C
....................
A,B,C
A,B,C
A,B,C
....................
....................
All
....................
....................
....................
X
X
X
....................
....................
....................
4
4
............
............
............
............
..................
..................
..................
..................
..................
2
A,B,C
....................
A,B,C
All
....................
All
....................
....................
X
X
....................
....................
4
............
............
7
..................
2
..................
..................
A,B,C
....................
A,B,C
....................
A.B.C
A,B,C
A,B,C
A,B,C
All
A,B,C
....................
All
....................
All
....................
....................
....................
....................
....................
....................
X
X
X
X
X
....................
....................
....................
....................
....................
4
............
4
............
4
............
............
............
7
............
..................
..................
..................
2
..................
..................
9
..................
..................
..................
A,B,C
....................
A,B,C
All
....................
All
....................
....................
X
X
....................
....................
4
............
............
7
..................
2
..................
..................
A,B,C
....................
....................
A,B,C
....................
A,B,C
All
All
A,B,C
A,B,C
....................
All
All
....................
All
....................
....................
....................
....................
....................
X
X
X
X
X
....................
....................
....................
....................
....................
4
............
............
4
............
............
7
7
............
............
..................
5
9
..................
..................
..................
..................
..................
..................
2
A,B,C
A,B,C
....................
....................
X
....................
4
............
..................
..................
A,B,C
A,B,C
....................
....................
X
....................
4
............
..................
..................
....................
All
All
....................
X
....................
............
7
2
..................
....................
A,B,C
All
A,B,C
All
....................
....................
....................
X
X
....................
....................
............
4
7
............
6
..................
..................
..................
....................
....................
....................
A,B,C
All
All
All
All
All
....................
....................
....................
X
X
X
....................
....................
....................
............
............
............
............
7
7
..................
8
2
14
..................
..................
A,B,C
A,B,C
....................
....................
X
....................
4
............
..................
..................
A,B,C
....................
A,B,C
All
....................
All
....................
....................
X
X
....................
....................
4
............
............
7
..................
2
..................
..................
A,B,C
A,B,C
....................
....................
X
....................
4
............
..................
..................
....................
All
All
....................
X
....................
............
7
3
..................
BILLING CODE 3510–22–P
Jkt 232001
Western
GOA
All
....................
....................
....................
....................
....................
[FR Doc. 2014–18678 Filed 8–6–14; 8:45 am]
17:16 Aug 06, 2014
Central
GOA
....................
All
....................
All
All
All
N/A means there is not a governing body recognized in the community at this time.
CHPs are Charter halibut permits.
All means category A, B, C, and D quota share.
VerDate Mar<15>2010
Maximum number of
Pacific cod endorsed
non-trawl groundfish
licenses that may be
assigned in the GOA
groundfish regulatory
area
PO 00000
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Fmt 4702
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E:\FR\FM\07AUP1.SGM
07AUP1
]]>Agencies
[Federal Register Volume 79, Number 152 (Thursday, August 7, 2014)]
[Proposed Rules]
[Pages 46237-46245]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-18678]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
National Oceanic and Atmospheric Administration
50 CFR Part 679
[Docket No. 131115973-4630-01]
RIN 0648-BD74
Fisheries of the Exclusive Economic Zone Off Alaska; Amendment 96
to the Gulf of Alaska Fishery Management Plan; Management of Community
Quota Entities
AGENCY: National Marine Fisheries Service (NMFS), National Oceanic and
Atmospheric Administration (NOAA), Commerce.
ACTION: Proposed rule; request for comments.
-----------------------------------------------------------------------
SUMMARY: NMFS proposes regulations to implement Amendment 96 to the
Fishery Management Plan for Groundfish of the Gulf of Alaska (FMP). If
approved, Amendment 96 would amend certain provisions of the Individual
Fishing Quota Program for the Fixed-Gear Commercial Fisheries for
Pacific Halibut and Sablefish in Waters in and off Alaska (IFQ
Program). This action would remove a regulation that prohibits a Gulf
of Alaska (GOA) Community Quota Entity (CQE) from transferring and
holding small blocks of halibut and sablefish quota share (QS). This
action would allow CQEs to acquire additional QS and facilitate
sustained participation by CQE community residents in the IFQ Program.
This action would promote the goals and objectives of the Magnuson-
Stevens Fishery Conservation and Management Act, the Northern Pacific
Halibut Act of 1982, the FMP, and other applicable law.
DATES: Submit comments on or before September 8, 2014.
ADDRESSES: You may submit comments on this document, identified by
NOAA-NMFS-2013-0161, by any of the following methods:
Electronic Submission: Submit all electronic public
comments via the Federal e-Rulemaking Portal. Go to
www.regulations.gov/#!docketDetail;D=NOAA-NMFS-2013-0161, 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: Ellen Sebastian. 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).
Attachments to electronic comments will be accepted in Microsoft Word,
Excel, or Adobe PDF file formats only.
An electronic copy of the Regulatory Impact Review (RIR)/Initial
Regulatory Flexibility Analysis (IRFA) (collectively, Analysis)
prepared for Amendment 96 and the regulatory amendment to allow CQE
acquisition of small block halibut QS is available from https://www.regulations.gov or from the NMFS Alaska Region Web site at https://
[[Page 46238]]
alaskafisheries.noaa.gov. An electronic copy of the 2010 Review of the
CQE Program under the Halibut and Sablefish IFQ Program prepared by the
North Pacific Fishery Management Council (Council) is available from
the Council Web site at www.npfmc.org/community-quota-entity-program/.
FOR FURTHER INFORMATION CONTACT: Peggy Murphy, (907) 586-7228.
SUPPLEMENTARY INFORMATION:
Regulatory Authority
NMFS proposes regulations to implement Amendment 96 to the FMP and
a regulatory amendment to revise the CQE Program. The Council
recommended and NMFS approved the FMP in 1978 under the authority of
the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-
Stevens Act) (16 U.S.C. 1801 et seq.). Regulations implementing the FMP
and general regulations governing groundfish appear at 50 CFR part 679.
Fishing for Pacific halibut (Hippoglossus stenolepis) is managed by the
International Pacific Halibut Commission (IPHC) and the Council under
the Northern Pacific Halibut Act of 1982 (Halibut Act). Section 773(c)
of the Halibut Act authorizes the Council to develop regulations that
are in addition to, and not in conflict with, approved IPHC
regulations. Such Council-recommended regulations may be implemented by
NMFS only after approval by the Secretary of Commerce.
The Council submitted Amendment 96 for review by the Secretary of
Commerce, and a Notice of Availability of this amendment was published
in the Federal Register on July 25, 2014 (79 FR 43377) with comments
invited through September 23, 2014. All relevant written comments
received by the end of the applicable comment period, whether
specifically directed to the FMP amendment, this proposed rule, or
both, will be considered in the decision to approve or disapprove
Amendment 96 and addressed in the response to comments in the final
decision.
Background
The IFQ Program is a limited access privilege program for the
commercial fixed-gear halibut and sablefish (Anoplopoma fimbria)
fisheries in and off Alaska. The IFQ Program limits access to the
halibut and sablefish fisheries to those persons holding QS in specific
regulatory areas. Quota shares equate to individual harvesting
privileges that are given effect on an annual basis through the
issuance of IFQ permits. An annual IFQ permit authorizes the permit
holder to harvest a specified amount of IFQ halibut or sablefish in a
regulatory area. A comprehensive explanation of the IFQ Program can be
found in the final rule implementing the IFQ Program (58 FR 59375,
November 9, 1993).
Although the IFQ Program resulted in significant safety and
economic benefits for many fishermen, since the inception of the IFQ
Program, many residents of Alaska's smaller remote coastal communities
in the GOA who held QS have transferred their QS to non-community
residents or moved out of the smaller coastal communities. As a result,
the number of resident QS holders has declined substantially in most of
the GOA communities with IFQ Program participants. This transfer of
halibut and sablefish QS and the associated fishing effort from the
GOA's smaller remote coastal communities has limited the ability of
residents to locally purchase or lease QS and reduced the diversity of
fisheries to which fishermen in remote coastal communities have access.
The Council recognized that a number of remote coastal communities were
struggling to remain economically viable and developed the CQE Program
to provide these communities with long-term opportunities to access the
halibut and sablefish resources that have been historically available
to resident fishermen.
The Council recommended the CQE Program as an amendment to the IFQ
Program in 2002 (Amendment 66 to the FMP), and NMFS implemented the
program in 2004 (69 FR 23681, April 30, 2004). The CQE Program adopted
by the Council, and implemented by NMFS, was specifically intended to
provide fishing opportunities to communities in the GOA that had a
historic dependence on the halibut and sablefish fisheries. The Council
recommended and NMFS implemented a CQE Program that would provide
similar opportunities to coastal communities in the Aleutian Islands in
2013, known as the Aleutian Islands CQE Program (79 FR 8870, February
14, 2014). The Aleutian Islands CQE Program would not be affected by
this proposed action and is not addressed further. Where the terms
``CQE'' or ``CQE Program'' are used in this preamble, they are
specifically referring to the regulations and management measures
applicable to the GOA CQE Program, and not to the Aleutian Islands CQE
Program.
The CQE Program allows 45 small, remote, coastal communities in the
GOA that met historic participation criteria in the halibut and
sablefish fisheries to transfer (purchase) and hold catcher vessel
halibut and sablefish QS in specific regulatory areas (see Table 21 to
50 CFR Part 679). The communities are eligible to participate in the
CQE Program once they are represented by a NMFS-approved non-profit
entity called a CQE. After NMFS approval, a CQE may receive catcher
vessel QS for the represented community or communities through NMFS-
approved transfers. The CQE is the holder of the QS and is issued the
IFQ annually by NMFS. Once a CQE holds QS in the GOA, the CQE can lease
the annual IFQ derived from its QS to individual GOA community
residents. With certain exceptions, the QS must be held by the CQE.
This program structure creates a permanent asset for the community to
use. The structure promotes community access to QS to generate
participation in, and fishery revenues from, the commercial halibut and
sablefish fisheries. The CQE Program also promotes QS ownership by
individual community residents. Individuals who lease annual IFQ from
the CQE could use resulting IFQ revenue to transfer their own QS. The
Council believed, and NMFS agrees, that both CQE- and non-CQE-held QS
are important in terms of providing community residents fishing access
that promotes the economic health of communities.
Current CQE Program regulations include a number of management
provisions that originated from the IFQ Program structure and affect
the use of CQE-held QS and the annual IFQ derived from the QS. Under
some provisions, a CQE has the same privileges and is held to the same
limitations as individual QS holders in the IFQ fishery. For example,
CQE-held QS is subject to the same IFQ regulatory area use cap that
applies to non-CQE held QS. In other instances, the CQE is subject to
less restrictive provisions than individual, non-CQE QS holders. For
example, a community resident leasing IFQ from a CQE may fish the IFQ
assigned to a larger vessel size category on a smaller size category of
catcher vessel. In other instances, the CQE must operate under more
restrictive provisions than individual, non-CQE QS holders, in part to
protect existing QS holders and preserve ``entry-level'' opportunities
for new entrants. A comprehensive explanation of the CQE Program
provisions can be found in the final rule implementing the CQE Program
(69 FR 23681, April 30, 2004). Recent modifications to the CQE Program
can be found in a rule that amended several components of the CQE
Program (78 FR 33243, June 4, 2013).
A number of IFQ Program provisions that apply to CQE Program
participants are important to understanding the
[[Page 46239]]
proposed action and are summarized in this preamble. These provisions
include regulatory area and vessel size categories; QS use caps; and QS
blocks. Additional detail on the IFQ Program is available in the final
rule implementing the IFQ Program (58 FR 59375, November 9, 1993).
Since implementation of the IFQ Program, there have been changes to
halibut and sablefish QS use caps (62 FR 7947, February 21, 1997; 67 FR
20916, April 29, 2002) and to the halibut block use cap (72 FR 44795,
August 9, 2007).
IFQ Regulatory Area and Vessel Size Categories
The IFQ Program annually issues fixed-gear halibut and sablefish QS
specific to IFQ regulatory area and vessel category. In the GOA there
are three IPHC halibut regulatory areas: Areas 2C (Southeast Alaska),
3A (Central Gulf of Alaska), and 3B (Western Gulf of Alaska), and four
sablefish regulatory areas: Southeast (SE), West Yakutat (WY), Central
GOA (CG), and Western GOA (WG). The boundaries for the halibut and
sablefish IFQ regulatory areas are defined in regulation (see
definition of ``IFQ Regulatory Area'' at Sec. 679.2). Each QS is
assigned to a vessel based upon the size of the vessel from which IFQ
halibut and sablefish may be harvested and/or processed (see
regulations at Sec. 679.40(a)(5)). Halibut QS and its associated IFQ
are assigned to one of four vessel categories in each regulatory area:
Freezer (catcher/processor) category (category A); catcher vessel
greater than 60 ft. length overall (LOA) (category B); catcher vessel
36 ft. to 60 ft. LOA (category C); and catcher vessel 35 ft. LOA or
less (category D). Sablefish QS and its associated IFQ are assigned to
one of three vessel categories in each regulatory area: Freezer
(catcher/processor) category (category A); catcher vessel greater than
60 ft. LOA (category B); and catcher vessel 60 ft. LOA or less
(category C). The vessel categories were designed to ensure that the
IFQ Program did not substantially change the structure of the fleet
that existed at the time the IFQ Program was implemented. These vessel
size restrictions prevent the fishery from being dominated by large
vessels or by any particular vessel category.
CQEs may obtain by transfer and hold QS only in specified areas in
order to facilitate local support of community fishing operations (see
Sec. 679.40 and Table 21 to part 679). However, CQEs are restricted in
terms of the IFQ regulatory area(s) in which they may transfer and hold
halibut. Table 1 below illustrates the IFQ regulatory area and vessel
category of halibut QS a CQE can transfer and hold based on the
location of the community represented by the CQE. As shown in Table 1
(below) and in Table 21 to part 679, a CQE representing an eligible
community may transfer and hold halibut QS in the regulatory area in
which the community is located (their regulatory area). CQEs are
restricted, however, to transferring and holding certain halibut QS
inside and outside their regulatory area. For example, CQEs in Area 2C
may not transfer and hold halibut category D QS in Area 2C. Generally,
CQEs can transfer and hold halibut QS in adjacent regulatory areas.
However, CQEs located in Area 3A may not transfer and hold halibut QS
in Area 2C, although CQEs located in Area 2C may transfer and hold
halibut category A, B and C QS in Area 3A. CQEs located in Areas 3A or
3B may transfer and hold halibut QS in Areas 3A and 3B, but CQEs in
Area 3B cannot transfer and hold category D QS in Area 3A. Table 1
(below) illustrates the limitations on CQEs' transferring and holding
halibut QS by regulatory area and vessel category. For further
explanation and the rationale for the restrictions, see the final rule
implementing the CQE Program (69 FR 23681, April 30, 2004) and
subsequent amendment (78 FR 33243, June 4, 2013).
Table 1--Authority of a CQE Representing a Community Located in IFQ Regulatory Areas 2C, 3A, or 3B (Row) To Obtain Through Transfer and Hold Category A,
B, C and/or D Halibut Quota Share by Area 2C, 3A or 3B (Column)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Halibut quota share category by area
Area ------------------------------------------------------------------------------------------------------------------------
Area 2C A, B, C Area 2C D Area 3A A, B, C Area 3A D Area 3B A, B, C Area 3B D
--------------------------------------------------------------------------------------------------------------------------------------------------------
2C............................. Yes................ No................ Yes............... No................ No................ No.
3A............................. No................. No................ Yes............... Yes............... Yes............... Yes.
3B............................. No................. No................ Yes............... No................ Yes............... Yes.
--------------------------------------------------------------------------------------------------------------------------------------------------------
The CQE Program authorizes CQEs to obtain by transfer and hold
catcher vessel QS: Category B, C, and D halibut QS, with area-specific
limitations for category D halibut QS; and category B and C sablefish
QS. However, the vessel size categories do not apply to IFQ derived
from QS held by a CQE, with an exception for category D halibut QS in
Area 3A.
The Council recommended specific limitations for CQEs to transfer
and hold category D halibut QS in Areas 2C and 3A. These limitations
were intended to balance the Council's objective for providing CQEs
with increased opportunities to acquire halibut QS with its objective
to limit potential competition for category D halibut QS between non-
CQE and CQE QS holders. Vessel category D halibut QS is generally the
least expensive category of halibut QS because non-CQE IFQ derived from
category D QS must be used on the smallest category of catcher vessel.
It is often transferred and held by smaller operations or by new
entrants to the IFQ fisheries. CQE Program regulations at Sec.
679.41(g)(5) prohibit a CQE from transferring and holding category D
halibut QS in Area 2C. The Council recommended this prohibition because
a greater portion of the total Area 2C halibut QS is issued as category
D QS relative to Areas 3A and 3B, and category D halibut QS is more
commonly transferred by new entrants in Area 2C than in Areas 3A and
3B.
A CQE representing one or more communities in Area 3A is allowed to
transfer and hold a limited amount of Area 3A category D halibut QS,
but the IFQ derived from that QS must (among other restrictions) be
fished on a category D vessel, which are vessels less than or equal to
35 ft. LOA (see regulations at Sec. 679.42(a)(2)(iii)). Category D
vessels are typically held by new entrants and by most fishery
participants residing in Area 3A communities. An Area 3A CQE is limited
to transferring and holding no more than the total number of category D
halibut QS units initially issued to individual residents of Area 3A
CQE communities. The Council recommended this provision to provide
[[Page 46240]]
opportunities for CQEs to transfer and hold an amount of category D
halibut QS up to the amount historically held by CQE residents without
increasing potential competition for category D halibut QS between non-
CQE and CQE QS holders (78 FR 14490, March 6, 2013).
A CQE representing one or more communities in Areas 3A and 3B is
allowed to transfer and hold Area 3B category D halibut QS. As noted in
the final rule implementing the CQE Program (69 FR 23681, April 30,
2004), a relatively small amount of category D halibut QS exists in
Area 3B, and traditionally few prospective buyers exist for this
category of QS.
CQE Program QS Use Caps
Individual community use caps limit the amount of halibut QS and
sablefish QS that each CQE may transfer and hold on behalf of a
community. The use caps accommodate existing QS holders who are
concerned that shifting QS holdings to CQEs could disadvantage
individual fishermen in the IFQ fishery by reducing the amount of QS
available to them in the QS market. In the CQE Program, the CQE
individual community use cap is limited to an amount of QS equal to the
individual IFQ Program use cap. GOA CQEs are limited to transferring
and holding a maximum of 1 percent of the Area 2C halibut QS (see
regulations at Sec. 679.42(f)(2)(ii)) and a maximum of 0.5 percent of
the combined Area 2C, 3A, and 3B halibut QS (see regulations at Sec.
679.42(f)(2)(i)). GOA CQEs also are limited to transferring and holding
a maximum of 1 percent of the Southeast sablefish QS (see regulations
at Sec. 679.42(e)(5)) and a maximum of 1 percent of all combined
sablefish areas QS (see regulations at Sec. 679.42(e)(4)(i)).
In addition to individual community use caps, cumulative community
use caps limit the amount of halibut QS and sablefish QS that all CQE
eligible communities within an IFQ regulatory area can transfer and
hold. CQEs are limited to a maximum of 21 percent of the total halibut
QS pool (see regulations at Sec. 679.42(f)(5)) and a maximum of 21
percent of the total sablefish QS pool (see regulations at Sec.
679.42(e)(6)) in each IFQ regulatory area in the GOA. Therefore, all
CQEs in the GOA are subject to the maximum cumulative community use cap
of 21 percent of each species' total QS pool in each IFQ regulatory
area.
QS Blocks
The IFQ Program initially issued QS in blocks. A block is a
consolidation of QS units that cannot be subdivided upon transfer (see
regulations at Sec. 679.41(e)(1)). One of the primary purposes of QS
blocks and the subsequent amendments to the block provisions was to
conserve small blocks of QS that could be transferred at a relatively
low cost by crew members and new entrants to the IFQ fisheries. Blocked
QS typically is less expensive and more affordable for new entrants.
The IFQ Program incorporates a ``sweep-up'' provision to allow very
small blocks of QS to be permanently consolidated, up to specified
limits, so as to be practical to fish (see regulations at Sec. Sec.
679.41(e)(2) and (e)(3)).
QS Block Use Cap
A block use cap restricts how many blocks of QS an individual can
transfer and hold. In the IFQ Program, an individual may transfer and
hold no more than three blocks of halibut QS and two blocks of
sablefish QS (see regulations at Sec. 679.42(g)(1)). The purpose of
this cap is to limit the consolidation of blocked QS and to ensure that
smaller aggregate units would be available on the market. These
provisions were established to prevent unrestricted transfer of QS by
fishermen with greater capital or operating efficiency. These fishermen
could also disadvantage new entrants, particularly fishermen with
smaller operations in remote communities who have typically sought to
transfer ``blocked QS.'' The block use cap was intended to preserve the
character of the fishing fleet in remote Alaska fishing communities by
ensuring that QS would be available to the fleet of smaller operators,
thereby maintaining the diversity in operation types that exist in more
remote coastal communities.
The IFQ Program also limits the number of blocks a CQE may transfer
and hold. The limitation prevents CQEs from consolidating the type of
QS that is most attractive to and feasible for new entrant, non-CQE
fishermen to transfer. CQEs may transfer and hold up to a maximum of 10
blocks of halibut QS and 5 blocks of sablefish QS in each GOA
regulatory area (see regulations at Sec. 679.42(g)(ii)). These limits
on CQE block holdings and the limit on where CQEs can hold QS restrict
CQEs to 20 halibut QS blocks (10 blocks in each of two areas) and 20
sablefish QS blocks (5 blocks in each of four areas).
Minimum Block Size
During development of the CQE Program, the Council and NMFS were
concerned that CQEs would seek to acquire as much of the most
affordable QS as they were allowed to hold. The Council and NMFS
determined that if no limit on the acquisition of blocked QS was
established, then gains in CQE holdings could reflect losses of QS
holdings among residents of the same CQE communities. The Council and
NMFS were also concerned that CQEs might have greater access to capital
than individuals, so they could buy up blocks of QS that are most in
demand by non-CQE fishermen with small operations. Fishermen entering
the IFQ fishery tend to seek relatively smaller blocks of QS. Smaller
blocks of QS are typically designated for vessels of a smaller size
category: Category C and D in the halibut fishery and category C in the
sablefish fishery. New entrants tend to own or use smaller category C
and D vessels. Therefore, smaller blocks are more in demand by new
entrants, and less in demand by fishermen using larger vessels. Smaller
blocks of QS are typically more affordable due to their low total cost
compared to the cost of larger blocks (see Section 2.7.2.2 of the
Analysis). Given these factors, the Council and NMFS determined it was
appropriate to restrict CQEs from purchasing or holding blocked QS of
less than a minimum size to preserve fishing opportunities for new
entrants in certain regulatory areas.
The CQE program prohibits CQEs from transferring and holding a QS
block that is less than the ``sweep up'' limit, or the number of QS
units initially issued as blocks that could be combined to form a
single block (see regulations at Sec. Sec. 679.41(e)(4) and (e)(5)).
Quota share blocks that are less than or equal to the ``sweep up''
limit are known as ``small blocks.'' The amount of QS units that
comprise a small block in each IFQ regulatory area in the GOA is
specified for the halibut fishery (see regulations at Sec.
679.41(e)(3)) and for the sablefish fishery (see regulations at Sec.
679.41(e)(2)) (see Table 2 below). Currently, CQEs are prohibited from
purchasing or using small blocks of halibut QS in Areas 2C and 3A (see
regulations at Sec. 679.41(e)(5)), and sablefish QS in the SE., WY,
CG, and WG (see regulations at Sec. 679.41(e)(4)) regulatory areas.
The Council did not recommend a small block restriction for Area 3B
halibut QS. Fewer small blocks exist in Area 3B and few new entrants in
Area 3B have sought these small blocks of halibut QS (69 FR 23681,
April 30, 2004). Therefore, CQEs transferring Area 3B QS are not
subject to a small block restriction.
[[Page 46241]]
Table 2--Current and Proposed Restrictions on the Minimum Block Size by IFQ Regulatory Area.
----------------------------------------------------------------------------------------------------------------
Current minimum block Proposed block size
Species Area size restriction restriction
----------------------------------------------------------------------------------------------------------------
Halibut............................ 2C.................... 33,320 QS............. No Restriction.
3A.................... 46,520 QS............. No Restriction.
3B.................... No Restriction........ No Restriction.
Sablefish.......................... SE.................... 33,270 QS............. No Restriction.
WY.................... 43,390 QS............. No Restriction.
CG.................... 46,055 QS............. No Restriction.
WG.................... 48,410 QS............. No Restriction.
----------------------------------------------------------------------------------------------------------------
The total amount of QS units issued in small blocks differs by IFQ
regulatory area. Sections 2.6.3.2 and 2.7.1 of the Analysis report that
11.3 percent of the total Area 2C and Area 3A halibut QS is small block
halibut QS, and 3.7 percent of the total sablefish QS (i.e., SE., WY,
CG, and WG) is small block sablefish QS. Even though a relatively small
proportion of QS is issued as small blocks and not available for
transfer by CQEs, existing regulations may constrain small block
holders from selling their small blocks and CQEs from transferring QS.
Proposed Action
This proposed action would amend the FMP and halibut and sablefish
CQE regulations to remove the restriction on CQEs' ability to purchase
and use small blocks of halibut and sablefish QS less than or equal to
the sweep-up limit currently specified in regulations at Sec. Sec.
679.41(e)(5) and 679.41(e)(4), respectively. Under this proposed
action, all CQEs in the GOA could receive by transfer any size block of
halibut and sablefish QS to hold for use by eligible community members.
CQEs would be able to transfer the similar size of QS blocks in the
market place as individual non-CQE QS holders. The objectives of this
action are to provide CQE communities in the GOA with increased
opportunity to transfer and hold QS and sustain participation of CQE
community residents in the IFQ halibut and sablefish fisheries.
Although the proposed action would allow CQEs to transfer any size
block of QS from any QS holder, provisions of the IFQ Program described
above would still apply. These include regulatory area restrictions,
community QS use caps (individual and cumulative), the prohibition on
CQEs' transfer and holding of category D halibut QS in Area 2C, the
limitation on the amount of category D halibut QS that an Area 3A CQE
may transfer and hold, and the prohibition on transfer and holding of
category D halibut QS in Area 3A by CQEs located outside Area 3A.
The proposed rule would update Table 21 to part 679 to clarify the
category of halibut QS (A, B, C and D) and IFQ regulatory area of the
QS that a CQE can transfer by area. This revision to Table 21 to part
679 would provide a clearer and more comprehensive summary of CQE
harvesting privileges.
Rationale for and Effects of the Proposed Action
This proposed action would provide additional opportunities for
CQEs to transfer and hold QS, and NMFS expects it will not adversely
affect the ability of non-CQE fishery participants to transfer and hold
small blocks of QS. In proposing this action, the Council and NMFS
considered the current participation of CQE and non-CQE QS holders in
the IFQ fishery, and the potential impact on QS access and markets. The
Council and NMFS determined that removing the small block restriction
from the CQE Program could improve the ability of CQEs to obtain the
most affordable blocks of QS without negatively impacting the ability
of non-CQE fishery participants to obtain the similar size blocks of
QS.
CQEs participating in the CQE Program have made little progress
towards reaching the regulatory limits on the maximum amount of QS that
may be transferred or IFQ that may be harvested. Since implementation
of the CQE program in 2004, only two of the 45 communities eligible for
the CQE program have formed CQEs, transferred QS, and harvested the
resulting IFQ. These two CQEs hold less than 0.5 percent of the
combined Area 2C, 3A, and 3B halibut QS pool. These two CQEs do not
hold sablefish QS. The Council's analysis of the CQE Program indicated
that lack of participation in the CQE Program can be attributed to 1)
financial barriers to transferring QS, and 2) CQE Program-related
restrictions. Key financial barriers to the transfer of QS by CQEs
include limited availability of QS for transfer, increased market
prices for halibut and sablefish QS, and limited viable options for
financing QS transfer. Each of these barriers is a function of market
forces and cannot be addressed through regulatory amendment (see the
Review of the CQE Program under the Halibut and Sablefish IFQ Program
and Section 2.6.3.1 of the Analysis for additional detail (see
ADDRESSES)).
Analysis of the percent of blocked and unblocked QS in 2013 (the
year of the most recent available data) indicates that the percentage
of small block QS relative to the total amount of QS in the GOA IFQ
regulatory areas is greater for halibut (11.3 percent of the total Area
2C and Area 3A halibut QS) than for sablefish (3.7 percent of the total
SE., WY, CG, WG sablefish QS). Therefore, while this proposed action
would impact sablefish QS holders, it likely would have a greater
impact on halibut QS holders. Section 2.7.2.1 of the Analysis (see
ADDRESSES) examines the amount of small block QS in the 2013 QS pool by
regulatory area and vessel size category and serves as an example of
the amount of small block QS that could be made available to CQEs as a
result of this action. The Analysis considers the maximum potential
impacts of the proposed action, which assumes that all eligible
communities form CQEs and secure funding to transfer all the newly
available small blocks of QS, up to CQE Program limits described above
and in regulations at Sec. Sec. 679.41 and 679.42. For reasons
described above, the Analysis indicates this outcome is unlikely given
reasonably foreseeable trends in QS holdings by CQEs.
Within Areas 2C and 3A, less than 1 percent of the total amount of
category A halibut QS could be made available for transfer by CQEs if
they could hold small blocks of category A halibut QS; less than 5
percent of the total amount of category B halibut QS could be made
available for transfer by CQEs if they could hold small blocks of
category B halibut QS; about 50 percent of the total amount of category
C halibut QS in these areas could be available for transfer by CQEs if
they could hold small blocks of category C halibut QS; and 43 percent
of Area 3A category D
[[Page 46242]]
halibut QS could be available for transfer by CQEs if they could hold
small blocks of Area 3A category D halibut QS. This proposed action
would not remove the regulation at Sec. 679.41(g)(5) prohibiting a CQE
from transferring and holding category D halibut QS in Area 2C.
Therefore, no small blocks of category D halibut QS could be
transferred and held by a CQE in Area 2C (see Table 1 in the section
titled ``IFQ Regulatory Area and Vessel Size Categories'' of this
proposed rule). Because there is no restriction on CQEs transferring
and holding small blocks of Area 3B category D halibut QS, this
proposed action would not affect the ability of CQEs in Areas 3A and 3B
to transfer and hold small blocks of Area 3B category D halibut QS.
In Southeast, West Yakutat, Central GOA and Western GOA regulatory
areas, 2 percent, 7 percent, 3 percent, and 15 percent of the total
amount of A share sablefish QS could be available, respectively, for
purchase by CQEs if they could hold small blocks of A share sablefish
QS; 9 percent, 19 percent, 26 percent, and 37 percent of the B share
sablefish QS could be available, respectively, for purchase by CQEs if
they could hold small blocks of B share sablefish QS; and 89 percent,
75 percent, 71 percent, and 47 percent of the C share sablefish QS
could be available, respectively, for purchase by CQEs if they could
hold small blocks of C share sablefish QS.
Analysis of the amount of small block QS by regulatory area in 2013
indicates that cumulative use caps on CQE QS ownership would not
constrain the maximum potential transfer of QS by CQEs. The more likely
constraint on CQE transfer and holding of QS would be the limit on the
number of blocks that a CQE can own in any one area (10 halibut blocks
and 5 sablefish blocks). Based on 2013 data, CQEs in Area 2C would gain
access to 507 small blocks of Area 2C halibut QS plus 635 small blocks
of Area 3A halibut QS in categories A, B and C. At maximum
participation, even if all 23 eligible communities in Area 2C formed
CQEs, those CQEs could not transfer and hold more than 230 small blocks
of the 507 small blocks of halibut QS available in Area 2C due to the
block limit of 10 blocks per CQE eligible to purchase in Area 2C. At
maximum participation, even if all 23 eligible communities in Area 2C,
all 14 eligible communities in Area 3A, and all 8 eligible communities
in Area 3B formed CQEs, those CQEs could not transfer and hold more
than 450 of the 635 small blocks of halibut QS available in Area 3A due
to the block limit of 10 blocks per CQE eligible to transfer in Area
3A. In addition, the 8 eligible communities in Area 3B would gain
access to the same 635 blocks of category A, B and C QS in Area 3A, but
none of the category D QS in Area 3A. Even at maximum CQE
participation, QS block limits and the reservation of a limited amount
of Area 3A category D QS for transfer by CQEs representing communities
in Area 3A would prevent CQEs from collectively acquiring all small
block halibut QS made available under the proposed action. Thus, the
Council and NMFS determined that small block halibut QS would continue
to be available to non-CQE participants in the IFQ halibut fishery. See
section 2.7.2.1 of the Analysis for additional detail.
For sablefish, a CQE can own up to 5 blocks of QS in its area plus
5 blocks from each of the other 3 sablefish regulatory areas. Based on
2013 data, CQEs would gain access to 156 small blocks of SE sablefish
QS, 122 small blocks of WY sablefish QS, 179 small blocks of CG
sablefish QS, and 59 small blocks of WG sablefish QS. At maximum
participation, if all 45 eligible communities formed CQEs, those CQEs
could transfer and hold 225 small blocks of sablefish QS in each IFQ
regulatory area. Under these allowable block limits, CQEs would be able
collectively to transfer and hold all the available sablefish small
block QS in each IFQ regulatory area. Given the financial barriers to
CQE transfers of QS, such as limited availability of QS for transfer,
increased market prices for halibut and sablefish QS, and limited
viable options for financing QS transfer, described above and in the
Analysis, the Council and NMFS determined it is unlikely that CQEs
would transfer the maximum amount of small block sablefish QS made
available by the proposed action. Thus, small block halibut QS would
continue to be available to non-CQE participants in the IFQ sablefish
fishery. See sections 2.6.3.1 and 2.7.2.1 of the Analysis for
additional detail.
Although this proposed action would allow CQEs to transfer and hold
small blocks of category A halibut and sablefish QS, the Council and
NMFS anticipate that CQE transfers of category A QS would be extremely
limited. Because IFQ derived from category A halibut and sablefish QS
may be caught and processed at sea, category A QS is typically priced
much higher than all other QS categories. In addition, the total amount
of category A QS issued is small relative to all other categories of
QS. Therefore, the potential impact of allowing CQEs to transfer and
hold small blocks of category A QS on new entrants, small-boat
operations and CQE fishery participants would be minimal. See sections
2.6.3.1 and 2.7.2.1 of the Analysis for additional detail.
To date, CQEs have transferred and held a limited amount of QS that
likely has not negatively impacted non-CQE fishery participants'
ability to acquire QS in the open market. Transferring and holding
small block QS will benefit CQEs, their community members, and future
community members, who tend to rely on these restricted blocks of
mainly small vessel category QS. Allowing CQEs to transfer and hold
small block QS could also enhance a CQE's ability to keep QS in remote
communities and create some operational efficiencies that could provide
a net benefit to both the CQEs and their community residents. The
impacts of the proposed action can be categorized into (1) changes in
access to QS, (2) effects on the QS market, and (3) social and economic
tradeoffs. These impacts are described in section 2.7.2.2 of the
Analysis and are summarized here.
Changes in Access to QS
Under this proposed action, CQE fishery participants gain access to
more lower-cost QS, though the extent to which this occurs will be
shaped by a CQE's progress in securing the necessary financing for CQE
transfers. In turn, CQEs provide fishery access by leasing QS to
community residents. Leasing QS from a CQE at favorable financial
terms, compared to lease fees on the QS market, can aid new entrants in
building up the financial base necessary to transfer and hold QS in the
future. While this may facilitate CQE community resident ownership of
QS, it may not benefit persons who do not reside in a CQE-eligible
community. Transfer of small block QS by CQEs under the proposed action
could result in a reduction in the amount of QS that would be available
to individual CQE community residents and could constitute an economic
loss for these individuals. Conversely, CQE acquisition of QS could
also be considered a benefit to community residents because it is a
public investment in the community's future. The proposed action would
also enable CQE residents retiring from the IFQ fishery to transfer
small block QS to a CQE by selling or gifting the QS.
Effects on the QS Market
The Council and NMFS considered whether entry of CQEs into the
small block QS market could bid up the price of QS. This price effect
could occur through price competition and reduced
[[Page 46243]]
supply of small blocks on the market. If CQEs can afford to pay as much
or more for small block QS than existing buyers, then competition could
increase the price for small block QS. This type of demand-driven price
effect would impact both CQE and non-CQE community residents who are in
the market for small block QS. However, based on the 10-year review of
the CQE Program (see ADDRESSES), CQEs have not and are not likely to
accrue the financial assets to transfer a quantity of QS that would
have a large impact on QS price.
Allowing CQEs to transfer and hold small blocks of QS could reduce
the supply of small block QS available for transfer. This could occur
when CQE community residents, who are reducing their fishery
participation, transfer their QS to benefit other small operators or
new entrants in the CQE community. However, allowing CQEs access to
small block QS is not expected to reduce QS supply to non-CQE fishery
participants or result in a corresponding near-term increase in QS
price.
Social and Economic Tradeoffs
An increase in CQE QS holdings would likely result in both social
and economic trade-offs. Social benefits could include increased
fishery participation for communities eligible to form CQEs and
transfer QS, as well as increased harvest opportunities for new
entrants and fishery participants who live in these communities. These
social benefits could have varying distributional impacts since CQEs by
nature are localized. From an economic view point, facilitating
community QS transfer comes at a cost but also offers some operational
efficiency that may not be realized when QS is held by individuals
living in remote communities. For example, when CQEs transfer QS they
gain an asset that can be leased out to new entrants and small-boat
operators who then could build up their own financial base to transfer
QS. Benefits from QS holdings that provide future value to the
community support the original goals of the CQE Program. Any future
value that does not accrue to individual CQE or non-CQE community
residents could be viewed as an indirect impact that the Council and
NMFS acknowledged as consistent with the goals of the CQE Program.
Other Alternatives Considered
The Council and NMFS considered two alternatives for the proposed
action, one of which is the status quo. The action alternative
(Alternative 2) would revise regulations to allow a CQE to transfer and
hold any size block of halibut and sablefish QS from any QS holder
(Option 1), or from a subset of QS holders determined by the location
of the QS holder's residence (Options 2 and 3). The Council selected
the least restrictive option, Option 1 under Alternative 2.
Option 2 would allow CQE communities to transfer and hold any size
block of halibut and sablefish QS from residents of any CQE community.
Option 2 was not selected because a relatively small number of small
blocks are held by residents of CQE communities, and many of those
small blocks are designated as category C and D QS. This would greatly
limit the potential number of small blocks available to CQEs, and would
increase potential competition among CQEs and residents of CQE
communities seeking to transfer these small blocks (see Section 2.7.2
of the Analysis for additional detail).
Option 3 would allow CQE communities to transfer and hold any size
block of halibut and sablefish QS from residents of their CQE
community, but not from any non-resident. Option 3 was not selected
because an even smaller number of small blocks are held by residents of
CQE communities, and in some CQE communities, no CQE resident may hold
small blocks, effectively excluding some CQE communities and not others
from holding small blocks. Section 2.7.2 of the Analysis notes that no
CQE residents hold small blocks of halibut QS in 17 of the 45 eligible
CQE communities, and no CQE residents hold small blocks of sablefish QS
in 31 of the 45 communities. Overall, option 3 would limit the number
of CQEs that could transfer and hold small block QS more than Options 1
or 2 (see Section 2.7.2 of the Analysis for additional detail).
Classification
Pursuant to sections 304(b)(1)(A) and 305(d) of the Magnuson-
Stevens Act, the NMFS Assistant Administrator has determined that
Amendment 96 and this proposed rule are consistent with the FMP,
provisions of the Magnuson-Stevens Act, the Halibut Act, and other
applicable laws, subject to further consideration after public comment.
This proposed rule has been determined to be not significant for
purposes of Executive Order 12866.
Initial Regulatory Flexibility Analysis
An Initial Regulatory Flexibility Analysis (IRFA) was prepared for
this action, as required by section 603 of the Regulatory Flexibility
Act (RFA). The IRFA describes the economic impact this proposed rule,
if adopted, would have on small entities. The IRFA describes the
reasons why this action is being proposed; the objectives and legal
basis for the proposed rule; the number of small entities to which the
proposed rule would apply; any projected reporting, recordkeeping, or
other compliance requirements of the proposed rule; any overlapping,
duplicative, or conflicting Federal rules; impacts of the action on
small entities; and any significant alternatives to the proposed rule
that would accomplish the stated objectives of the Magnuson-Stevens
Act, and any other applicable statutes, and would minimize any
significant adverse impacts of the proposed rule on small entities. The
description of the proposed action, its purpose, and the legal basis
are contained earlier in this preamble and in the SUMMARY and are not
repeated here. A summary of the IRFA follows. A copy of the Analysis is
available from NMFS (see ADDRESSES).
On June 12, 2014, the Small Business Administration (SBA) issued a
final rule revising the small business size standards for several
industries effective July 14, 2014 (79 FR 33647, June 12, 2014). The
rule increased the size standard for Finfish Fishing from $19.0 to 20.5
million. The new size standards were used to prepare the IRFA for this
action.
Number and Description of Small Entities Directly Regulated by the
Proposed Action
The proposed action would directly regulate 45 CQEs that would be
considered small entities under the RFA (Section 601(3)). The CQEs
qualify as small not-for-profit organizations that are not dominant in
their field. CQEs represent small communities that would directly
benefit from the proposed action. Each of the communities qualifies as
a small entity under the RFA since they are governments of towns or
villages with populations less than 50,000 people. The CQE acquires QS
and makes the resulting IFQ available by lease to eligible harvesters
who are community residents. Those harvesters are required to make a
series of reports and declarations to NMFS in order to be found
eligible to participate. Therefore, those commercial fishing operations
would be directly regulated small entities, although their number is
unknown at this time. No adverse economic impact on community residents
is expected under the proposed action. Further, NMFS anticipates that
any economic impacts accruing from the proposed action to these small
entities would be beneficial
[[Page 46244]]
because their access to the IFQ fisheries will be improved.
Existing individual halibut and sablefish QS holders and new
entrants to the IFQ fishery have potential to be impacted by this
proposed action but are not directly regulated by this proposed rule.
Currently, there are 2,565 unique halibut QS holders and 845 unique
sablefish QS holders across all regulatory areas. These entities and
future fishery entrants, of which the number is unknown, could
potentially be impacted by this proposed action. Under the IRFA, NMFS
considers only those entities that are directly regulated by the
proposed action. An impact on existing halibut and sablefish QS holders
and new entrants to the IFQ fishery could be realized if CQE transfer
of QS results in a significant increase in the price for QS. The
Analysis indicates this impact has not been observed in the past and is
not likely to occur in the future, given the present constraints on CQE
access to investment capital and the range of other factors that also
influence QS prices (see Section 2.6.3.1 of the Analysis). Therefore,
existing and potential future non-CQE QS holders are not considered to
be directly regulated by this action and are not further analyzed in
this IRFA.
Impacts of the Action on Small Entities
This proposed rule would remove the regulations prohibiting Gulf of
Alaska CQE from transferring and holding small blocks of halibut and
sablefish quota share. The proposed rule is intended to allow CQEs to
acquire small block QS and make the resulting IFQ available by lease to
eligible harvesters who are community residents. Allowing CQEs to
transfer and hold small block QS should benefit their community members
or future community members. Unrestricted transfer of small block QS
should enhance the CQEs' ability to keep QS in remote communities and
as a result provide for active participation of CQE and community
residents in the halibut and sablefish fisheries in the future. By
increasing their QS transfers and holdings under the proposed action,
CQEs would provide fishery access through leasing to community
residents who are new entrants to the fishery or who currently fish
small quota holdings and wish to increase their participation. Leasing
quota from a CQE at favorable terms, compared to market lease fees,
could aid new entrants in building up the financial base necessary to
transfer and hold individual QS in the future. However, Section 2.7.2.1
of the Analysis notes that the amount of QS that would become available
is likely greater than what CQEs could expect to finance in the present
capital market. Increased QS availability to CQEs under the proposed
action could provide some operational efficiency that results in a net
benefit to both the CQEs and their community residents. One such
efficiency that could result from allowing CQEs to transfer and hold
small block QS is that community residents would be able to transfer
small block QS to a CQE as they retire or otherwise reduce their active
participation in the fishery, keeping the QS holdings within the
community.
Description of Significant Alternatives That Minimize Adverse Impacts
on Small Entities
The IRFA also requires a description of any significant
alternatives to the preferred alternative that accomplish the stated
objectives, are consistent with applicable statutes, and would minimize
any significant economic impact of the proposed rule on small entities.
The suite of potential actions includes two alternatives and associated
options. A detailed description of these alternatives and options is
provided in section 2.7 of the Analysis.
The significant alternative to the proposed action is the status
quo alternative (Alternative 1). Under Alternative 1, NMFs would make
no changes to the current regulations. Alternative 1 would not have
adverse economic impacts on CQEs or the resident QS holders in the CQE
qualifying communities, which would be the small entities directly
regulated by this action. Alternative 1 does not meet the objectives of
the action to promote more CQE access to QS and facilitate the
sustained participation by CQE community residents in the IFQ Program.
Under Alternative 2, NMFS would implement the proposed action, which is
less restrictive on CQEs than Alternative 1, and is the least
burdensome of the available alternatives for directly regulated small
entities. Alternative 2 specified three options (Options 1, 2 and 3)
that allow CQEs to transfer any size block of QS from any QS holder or
a subset of QS holders depending on the option and determined by the
location of the QS holder's residence.
Option 1 would allow CQEs to transfer and hold any size block of
halibut or sablefish QS. This option is the least burdensome on
directly regulated small entities of all the options considered, and
would minimize any significant adverse economic impact. Option 2 would
allow CQE communities to transfer and hold any size block of halibut
and sablefish QS from residents of any CQE community. Option 2 was not
selected because it would have greatly limited the potential number of
small blocks available to CQEs. This would be more burdensome on
directly regulated CQEs than Option 1. Option 3 would allow CQE
communities to transfer and hold any size block of halibut and
sablefish QS from residents of their CQE community, but not from any
non-resident. Option 3 was not selected because it would have limited
the potential number of small blocks available to CQEs and the number
of CQEs that could transfer and hold small block QS. Option 3 would be
more burdensome on directly regulated CQEs than either Option 1 or 2.
The Analysis did not identify any other alternatives that would more
effectively meet the RFA criteria to minimize adverse economic impacts
on directly regulated small entities.
Projected Reporting, Recordkeeping and Other Compliance Requirements
This action does not modify reporting, recordkeeping or other
compliance requirements.
Duplicate, Overlapping, or Conflicting Federal Rules
No Federal rules that might duplicate, overlap, or conflict with
these proposed actions have been identified.
List of Subjects in 50 CFR Part 679
Alaska, Fisheries.
Dated: August 1, 2014.
Samuel D. Rauch III,
Deputy Assistant Administrator for Regulatory Programs, National Marine
Fisheries Service.
For the reasons set out in the preamble, NMFS proposes to amend 50
CFR part 679 as follows:
PART 679--FISHERIES OF THE EXCLUSIVE ECONOMIC ZONE OFF ALASKA
0
1. The authority citation for part 679 continues to read as follows:
Authority: 16 U.S.C. 773 et seq.; 1801 et seq.; 3631 et seq.;
Pub. L. 108-447.
Sec. 679.41 [Amended]
0
2. In Sec. 679.41, remove paragraphs (e)(4) and (e)(5).
0
3. Revise Table 21 to part 679 to read as follows:
[[Page 46245]]
Table 21 to Part 679--Eligible Communities, Halibut IFQ Regulatory Area Location, Community Governing Body That Recommends the CQE, and the Fishing Programs and Associated Areas Where a CQE
Representing an Eligible Community May Be Permitted to Participate
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
May hold halibut QS in halibut IFQ regulatory area May hold sablefish QS in Maximum number Maximum number of
and vessel category sablefish IFQ regulatory of CHPs that may Pacific cod endorsed
Halibut IFQ ---------------------------------------------------- areas be held in non-trawl groundfish
regulatory -------------------------- halibut IFQ licenses that may be
area in Community governing regulatory area assigned in the GOA
Eligible GOA or AI community which the body that recommends ------------------ groundfish regulatory
community is the CQE Area 2C Area 3A Area 3B Area 4B CG, SE, WG, area
located and WY (All AI -----------------------
GOA) Area 2C Area 3A Central Western
GOA GOA
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Adak............................... 4B City of Adak......... ........... ........... ........... All ........... X ....... ....... .......... ..........
Akhiok............................. 3A City of Akhiok....... ........... All All ........... X ........... ....... 7 2 ..........
Angoon............................. 2C City of Angoon....... A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Chenega Bay........................ 3A Chenega IRA Village.. ........... All All ........... X ........... ....... 7 2 ..........
Chignik............................ 3B City of Chignik...... ........... A,B,C All ........... X ........... ....... ....... 3 ..........
Chignik Lagoon..................... 3B Chignik Lagoon ........... A,B,C All ........... X ........... ....... ....... 4 ..........
Village Council.
Chignik Lake....................... 3B Chignik Lake ........... A,B,C All ........... X ........... ....... ....... 2 ..........
Traditional Council.
Coffman Cove....................... 2C City of Coffman Cove. A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Cold Bay........................... 3B City of Cold Bay..... ........... A,B,C All ........... X ........... ....... ....... .......... 2
Craig.............................. 2C City of Craig........ A,B,C A,B,C ........... ........... X ........... ....... ....... .......... ..........
Edna Bay........................... 2C Edna Bay Community A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Association.
Elfin Cove......................... 2C Community of Elfin A,B,C A,B,C ........... ........... X ........... ....... ....... .......... ..........
Cove.
Game Creek......................... 2C N/A.................. A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Gustavus........................... 2C Gustavus Community A,B,C A,B,C ........... ........... X ........... ....... ....... .......... ..........
Association.
Halibut Cove....................... 3A N/A.................. ........... All All ........... X ........... ....... 7 2 ..........
Hollis............................. 2C Hollis Community A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Council.
Hoonah............................. 2C City of Hoonah....... A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Hydaburg........................... 2C City of Hydaburg..... A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Ivanof Bay......................... 3B Ivanof Bay Village ........... A,B,C All ........... X ........... ....... ....... .......... 2
Council.
Kake............................... 2C City of Kake......... A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Karluk............................. 3A Native Village of ........... All All ........... X ........... ....... 7 2 ..........
Karluk.
Kasaan............................. 2C City of Kasaan....... A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
King Cove.......................... 3B City of King Cove.... ........... A,B,C All ........... X ........... ....... ....... .......... 9
Klawock............................ 2C City of Klawock...... A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Larsen Bay......................... 3A City of Larsen Bay... ........... All All ........... X ........... ....... 7 2 ..........
Metlakatla......................... 2C Metlakatla Indian A.B.C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Village.
Meyers Chuck....................... 2C N/A.................. A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Nanwalek........................... 3A Nanwalek IRA Council. ........... All All ........... X ........... ....... 7 2 ..........
Naukati Bay........................ 2C Naukati Bay, Inc..... A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Old Harbor......................... 3A City of Old Harbor... ........... All All ........... X ........... ....... 7 5 ..........
Ouzinkie........................... 3A City of Ouzinkie..... ........... All All ........... X ........... ....... 7 9 ..........
Pelican............................ 2C City of Pelican...... A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Perryville......................... 3B Native Village of ........... A,B,C All ........... X ........... ....... ....... .......... 2
Perryville.
Point Baker........................ 2C Point Baker Community A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Port Alexander..................... 2C City of Port A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Alexander.
Port Graham........................ 3A Port Graham Village ........... All All ........... X ........... ....... 7 2 ..........
Council.
Port Lions......................... 3A City of Port Lions... ........... All All ........... X ........... ....... 7 6 ..........
Port Protection.................... 2C Port Protection A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Community
Association.
Sand Point......................... 3B City of Sand Point... ........... A,B,C All ........... X ........... ....... ....... .......... 14
Seldovia........................... 3A City of Seldovia..... ........... All All ........... X ........... ....... 7 8 ..........
Tatitlek........................... 3A Native Village of ........... All All ........... X ........... ....... 7 2 ..........
Tatitlek.
Tenakee Springs.................... 2C City of Tenakee A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Springs.
Thorne Bay......................... 2C City of Thorne Bay... A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Tyonek............................. 3A Native Village of ........... All All ........... X ........... ....... 7 2 ..........
Tyonek.
Whale Pass......................... 2C Whale Pass Community A,B,C A,B,C ........... ........... X ........... 4 ....... .......... ..........
Association.
Yakutat............................ 3A City of Yakutat...... ........... All All ........... X ........... ....... 7 3 ..........
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
N/A means there is not a governing body recognized in the community at this time.
CHPs are Charter halibut permits.
All means category A, B, C, and D quota share.
[FR Doc. 2014-18678 Filed 8-6-14; 8:45 am]
BILLING CODE 3510-22-P
