Fisheries of the Exclusive Economic Zone Off Alaska; Amendment 96 to the Gulf of Alaska Fishery Management Plan; Management of Community Quota Entities, 66324-66337 [2014-26466]

Download as PDF 66324 Federal Register / Vol. 79, No. 216 / Friday, November 7, 2014 / Rules and Regulations meaning that just over 1 percent of the butterfish mortality cap has been harvested each month. At this rate, NMFS has projected that less than 15 percent of the current (3,884 mt) butterfish mortality cap will be harvested by December 31, 2014. If implementation of this quota transfer is delayed to solicit public comment, the increase may not be effective prior to the end of the 2014 fishing year and butterfish that is currently allocated to the longfin squid fishery may go unutilized, thereby undermining the intended economic benefits associated with this action. Transferring the allocation allows the directed butterfish fishery to continue to target butterfish while the fish are available. NMFS further finds, pursuant to 5 U.S.C. 553(d)(3), good cause to waive the 30day delayed effectiveness period for the reasons stated above. Authority: 16 U.S.C. 1801 et seq. Dated: November 3, 2014. Emily H. Menashes, Acting Director, Office of Sustainable Fisheries, National Marine Fisheries Service. [FR Doc. 2014–26413 Filed 11–3–14; 4:15 pm] BILLING CODE 3510–22–P DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration specification of a commercial quota that is apportioned among the coastal states from Florida through Maine. The process to set the annual commercial quota and the percent allocated to each state are described in § 648.162. The final rule implementing Amendment 1 to the Bluefish Fishery Management Plan, which was published in the Federal Register on July 26, 2000 (65 FR 45844), provided a mechanism for bluefish quota to be transferred from one state to another. Two or more states, under mutual agreement and with the concurrence of the Administrator, Greater Atlantic Region, NMFS (Regional Administrator), can transfer or combine bluefish commercial quota under § 648.162(e). The Regional Administrator is required to consider the criteria in § 648.162(e)(1) in the evaluation of requests for quota transfers or combinations. Florida has agreed to transfer 250,000 lb (113,398 kg) of its 2014 commercial quota to New York. This transfer was prompted by the diligent efforts of state officials in New York not to exceed the commercial bluefish quota. The Regional Administrator has determined that the criteria set forth in § 648.162(e)(1) have been met. The revised bluefish quotas for calendar year 2014 are: Florida, 500,309 lb (226,936 kg); and New York, 1,024,579 lb (464,741 kg). Classification 50 CFR Part 648 This action is taken under 50 CFR part 648 and is exempt from review under Executive Order 12866. [Docket No. 140214138–4482–02] RIN 0648–XD584 Authority: 16 U.S.C. 1801 et seq. Fisheries of the Northeastern United States; Bluefish Fishery; Quota Transfer National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce. ACTION: Temporary rule; quota transfer. AGENCY: NMFS announces that the State of Florida is transferring a portion of its 2014 commercial bluefish quota to the State of New York. By this action, NMFS adjusts the quotas and announces the revised commercial quota for each state involved. DATES: Effective November 3, 2014 through December 31, 2014. FOR FURTHER INFORMATION CONTACT: Carly Bari, Fishery Management Specialist, 978–281–9224. SUPPLEMENTARY INFORMATION: Regulations governing the bluefish fishery are found at 50 CFR part 648. The regulations require annual rmajette on DSK2VPTVN1PROD with RULES SUMMARY: VerDate Sep<11>2014 14:20 Nov 06, 2014 Jkt 235001 Dated: November 3, 2014. Emily H. Menashes, Acting Director, Office of Sustainable Fisheries, National Marine Fisheries Service. [FR Doc. 2014–26412 Filed 11–3–14; 4:15 pm] BILLING CODE 3510–22–P DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration 50 CFR Part 679 [Docket No. 131115973–4885–02] 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 AGENCY: PO 00000 Frm 00058 Fmt 4700 Sfmt 4700 Atmospheric Administration (NOAA), Commerce. ACTION: Final rule. NMFS publishes regulations to implement Amendment 96 to the Fishery Management Plan for Groundfish of the Gulf of Alaska (FMP) and an amendment to the Pacific halibut commercial fishery regulations for waters in and off Alaska. Amendment 96 to the FMP and the regulatory amendment modify the Individual Fishing Quota Program for the FixedGear Commercial Fisheries for Pacific Halibut and Sablefish in Waters in and off Alaska (IFQ Program). This action will 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 will allow CQEs to acquire additional QS and facilitate CQE community resident participation in the IFQ Program. This action promotes 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: Effective December 8, 2014. ADDRESSES: Electronic copies of this rule, the Regulatory Impact Review (RIR)/Initial Regulatory Flexibility Analysis (IRFA) (collectively, Analysis), and the proposed rule prepared for Amendment 96 and the regulatory amendment may be obtained from https://www.regulations.gov or from the NMFS Alaska Region Web site at https:// 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: SUMMARY: Regulatory Authority NMFS issues regulations to implement Amendment 96 to the FMP and revise the halibut and sablefish provisions of 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 sablefish appear at 50 CFR part 679. Fishing for Pacific halibut (Hippoglossus stenolepis) is managed by E:\FR\FM\07NOR1.SGM 07NOR1 Federal Register / Vol. 79, No. 216 / Friday, November 7, 2014 / Rules and Regulations 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. Councilrecommended regulations may be implemented by NMFS only after approval by the Secretary of Commerce. rmajette on DSK2VPTVN1PROD with RULES Background The Notice of Availability for Amendment 96 was published in the Federal Register on July 25, 2014 (79 FR 43377), with a 60-day comment period that ended September 23, 2014. The Secretary approved Amendment 96 on October 21, 2014. The Council submitted the proposed rule to NMFS, and it was published in the Federal Register on August 7, 2014 (79 FR 46237). The 30-day comment period on the proposed rule ended on September 8, 2014. NMFS received a total of three comment letters on Amendment 96 and the proposed rule during the comment periods. A summary of the comments and the responses by NMFS are provided under the ‘‘Comments and Responses’’ section of this preamble. A detailed review of the provisions of Amendment 96, the proposed regulations, and the rationale for these regulations is provided in the preamble to the proposed rule (79 FR 46237, August 7, 2014). The proposed rule is available from the NMFS Alaska Region Web site (see ADDRESSES). This final rule implements Amendment 96 and amends CQE Program regulations. Amendment 96 amends the FMP to remove a restriction that prohibits a GOA CQE from transferring and holding small blocks of sablefish QS. This final rule amends the CQE Program regulations by removing a restriction that prohibits a GOA CQE from transferring and holding small blocks of halibut QS. The IFQ and CQE Programs The IFQ Program is a limited access privilege program for the commercial fixed-gear halibut and sablefish (Anoplopoma fimbria) fisheries in the exclusive economic zone 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. An explanation of the IFQ Program can VerDate Sep<11>2014 14:20 Nov 06, 2014 Jkt 235001 be found in the final rule implementing the program (58 FR 59375, November 9, 1993). 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 provides fishing opportunities to communities in the GOA that depend on the halibut and sablefish fisheries. Another CQE Program, known as the Aleutian Islands CQE Program, provides similar opportunities to coastal communities in the Aleutian Islands (79 FR 8870, February 14, 2014). The Aleutian Islands CQE Program is not affected by this action and is not addressed further. Where the terms ‘‘CQE’’ or ‘‘CQE Program’’ are used in this preamble, they are 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 to transfer and hold catcher vessel halibut and sablefish QS in specific regulatory areas (see Table 21 to Part 679). The CQE is the holder of the QS and is issued the IFQ annually by NMFS. The CQE leases the IFQ to individual GOA community residents. The program’s structure promotes community access to QS to generate participation in, and fishery revenues from, the commercial halibut and sablefish fisheries. Long-term retention of QS by the CQE creates a permanent asset for the community to use. Both CQE- and non-CQE-held QS provide community residents fishing access that promotes the economic health of communities. The final rule implementing the CQE Program describes the CQE Program objectives and provisions (69 FR 23681, April 30, 2004). Several IFQ Program provisions apply to CQE Program participants. These provisions include regulatory area and vessel size categories; QS use caps; and QS blocks. A detailed discussion of these provisions and others that restrict CQE transfer and holding of QS is provided in the proposed rule preamble for this action (79 FR 46237, August 7, 2014) and in the final rule implementing the CQE Program (69 FR 23681, April 30, 2004). Except for the small block restrictions that this final rule will revise, these QS use provisions will continue to apply to the CQE program participants. For background purposes, a summary of the QS use provisions follows. PO 00000 Frm 00059 Fmt 4700 Sfmt 4700 66325 IFQ Regulatory Area and Vessel Size Categories Fixed-gear halibut and sablefish QS is specific to regulatory area and vessel size 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). Each QS is assigned to a vessel category 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). CQEs may obtain by transfer and hold certain vessel categories of QS in specified areas in order to facilitate local support of community fishing operations (see § 679.40 and Table 21 to Part 679). CQEs may obtain by transfer and hold sablefish QS in all IFQ regulatory areas and vessel categories. However, CQEs are restricted with respect to the IFQ regulatory area(s) and vessel category of halibut QS they may transfer and hold. A detailed explanation of the IFQ regulatory area(s) and vessel category of halibut QS a CQE can transfer and hold is provided in the proposed rule for this action (79 FR 46237, August 7, 2014). 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 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 requirement that IFQ derived from Area 3A category D QS must (among other restrictions) be fished on a category D vessel are discussed in more detail in the E:\FR\FM\07NOR1.SGM 07NOR1 66326 Federal Register / Vol. 79, No. 216 / Friday, November 7, 2014 / Rules and Regulations preamble to the proposed rule for this action (79 FR 46237, August 7, 2014). 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. rmajette on DSK2VPTVN1PROD with RULES 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 individual community cap is limited to the individual IFQ Program use caps. Each GOA CQE is limited to transferring and holding a maximum of 1 percent of the Area 2C halibut QS (see regulations at § 679.42(f)(2)(i)) and a maximum of 0.5 percent of the combined Area 2C, 3A, and 3B halibut QS (see regulations at § 679.42(f)(2)(ii)). Each GOA CQE also is 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. The cumulative community use caps limit all CQEs in the GOA 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. 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 § 679.41(e)(1)). One of the primary purposes of QS blocks and the subsequent amendments to the block regulatory 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. The IFQ Program incorporates a ‘‘sweep-up’’ provision to allow very small blocks of QS to be permanently consolidated, up to VerDate Sep<11>2014 14:20 Nov 06, 2014 Jkt 235001 specified limits, so as to be practical to fish (see regulations at §§ 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. 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, 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. 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)(1)(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 regulatory areas) and 20 sablefish QS blocks (5 blocks in each of four regulatory areas). Minimum Block Size During development of the CQE Program, 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. Therefore, CQEs were restricted from transferring or holding blocked QS of less than a minimum size to preserve fishing opportunities for new entrants in certain regulatory areas. CQE program regulations prohibit 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)). The CQE Program regulations do not prohibit CQEs in Area 3B from transferring or holding small blocks of 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). Actions Implemented by This Final Rule This final rule amends the FMP and halibut and sablefish CQE regulations to PO 00000 Frm 00060 Fmt 4700 Sfmt 4700 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. The proposed rule preamble provides a detailed description of the rationale for removing the regulation prohibiting a GOA CQE from transferring and holding small blocks of halibut QS (79 FR 46237, August 7, 2014). Under this final rule, all CQEs in the GOA may receive by transfer any size block of halibut and sablefish QS to hold for use by eligible community members. CQEs will be able to transfer similar sized blocks of QS in the market place as individual non-CQE QS holders. The objectives of this final rule 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. This final rule also updates 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 provides a clear and more comprehensive summary of CQE harvesting privileges. Effects of This Final Rule A description of the anticipated effects of this action is included in the preamble to the proposed rule and is summarized here. This final rule provides 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 evaluating this action, the Council and NMFS considered the current participation of CQE and nonCQE 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 should 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 similar size blocks of QS. See the proposed rule preamble and section 2.7.2 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 E:\FR\FM\07NOR1.SGM 07NOR1 rmajette on DSK2VPTVN1PROD with RULES Federal Register / Vol. 79, No. 216 / Friday, November 7, 2014 / Rules and Regulations 2C and Area 3A halibut QS) than sablefish (3.7 percent of the total SE., WY, CG, WG sablefish QS). Therefore, while this action will impact sablefish QS holders, it likely will have a greater impact on halibut QS holders. As described in the preamble to the proposed rule, section 2.7.2.1 of the Analysis considers the maximum potential impacts of the action, which assumes that all eligible communities form CQEs and secure funding to transfer all of the newly available small blocks of QS, up to CQE Program limits described above and in regulations at §§ 679.41 and 679.42. The Analysis indicates this outcome is unlikely given reasonably foreseeable trends in QS holdings by CQEs. Analysis of the amount of small block QS by regulatory area in 2013 indicates that cumulative use caps on CQE QS ownership will not constrain the maximum potential transfer of QS by CQEs. The more likely constraint on CQE transfer and holding of QS will be the limit on the number of blocks that a CQE can transfer and hold in any one regulatory area (10 halibut blocks and 5 sablefish blocks). Even at maximum CQE participation, QS block limits and the reservation of a limited amount of Area 3A D share QS for purchase by CQEs representing communities in Area 3A will prevent CQEs from collectively acquiring all small block halibut QS made available under this action. Thus, the Council and NMFS determined that small block halibut QS will continue to be available to non-CQE participants in the IFQ halibut fishery under this final rule. See section 2.7.2.1 of the Analysis for additional detail. For sablefish, under allowable block limits, CQEs will be able collectively to transfer and hold all of the available sablefish small block QS in each IFQ regulatory area. Given the financial barriers to CQE transfers of QS described in the Analysis and in the preamble to the proposed rule, the Council and NMFS determined it is unlikely that CQEs will transfer the maximum amount of small block sablefish QS made available by this action. Thus, small block sablefish QS will continue to be available to non-CQE participants in the IFQ sablefish fishery under this final rule. See sections 2.6.3.1 and 2.7.2.1 of the Analysis for additional detail. Although this action allows CQEs to transfer and hold small blocks of A share halibut and sablefish QS, the Council and NMFS anticipate that CQE purchases of A share QS will be limited. Because IFQ derived from A share halibut and sablefish QS may be caught and processed at sea, A share QS is VerDate Sep<11>2014 14:20 Nov 06, 2014 Jkt 235001 typically priced much higher than all other QS categories. In addition, the total amount of A share QS issued is small relative to all other categories of QS. Therefore, the potential impact of allowing CQEs to purchase small blocks of A share QS on new entrants, smallboat operations and CQE fishery participants will be minimal under this final rule. 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 provide a net benefit to both the CQEs and their community residents. Changes From the Proposed Rule There are no changes to the proposed regulations (79 FR 46237, August 7, 2014). Comments and Responses During the public comment period on the Notice of Availability for Amendment 96 and the proposed rule to revise CQE program regulations, NMFS received three comment letters. Two letters from members of the public did not address the proposed action. These letters expressed concerns about fishery management policies that are outside the scope of this action. The third comment letter expressed concerns about and did not support Amendment 96 and the proposed rule. The letter was submitted by an organization representing non-CQE IFQ Program participants and contained six comments. NMFS’ responses to the public comments on Amendment 96 and the proposed rule are presented below. No changes were made to this final rule in response to the comment letters received. Comment 1: The commenter states that Amendment 96 violates National Standard 4 of the Magnuson-Stevens Act, which specifies that conservation and management measures shall not discriminate between residents of different states and that any allocation of fishing privileges must be fair and equitable. Amendment 96 benefits CQEs and residents of CQE communities at the expense of non-residents of Alaska PO 00000 Frm 00061 Fmt 4700 Sfmt 4700 66327 that participate in the IFQ fishery. This is unfair, discriminatory, and contrary to the requirements of National Standard 4. Response: NMFS disagrees that Amendment 96 violates National Standard 4 of the Magnuson-Stevens Act. The Council and NMFS have determined that Amendment 96 is consistent with the requirements of the Magnuson-Stevens Act. The CQE Program was established to allow a group of non-profit entities to hold QS on behalf of residents of specific small, geographically isolated, rural communities located adjacent to the coast of the GOA with a historical link to the halibut and sablefish fisheries. Communities that do not meet the eligibility criteria may not participate in the program and do not benefit from the CQE Program. Communities that are excluded from the CQE Program include Alaska and non-Alaska communities. Therefore, this action is not predicated on an effort to discriminate between residents of different states. Amendment 96 removes a prohibition on CQEs’ transferring and holding small blocks of QS. Non-CQE participants in the IFQ Program are not subject to this prohibition, so this action is not predicated upon any effort to unfairly advantage CQEs. As described in the proposed rule preamble (79 FR 46237, August 7, 2014) and in section 2.2 of the Analysis, Amendment 96 and this final rule promote the Council’s objective to provide an opportunity for CQE communities to acquire additional QS and facilitate sustained participation by CQE community residents in the IFQ Program. Since the inception of the IFQ Program, the number of resident halibut and sablefish QS holders has declined substantially in CQE communities. This transfer of QS and the associated fishing effort from CQE communities has limited the ability of residents to locally transfer and hold QS and reduced the diversity of fisheries to which fishermen in these communities have access (see section 2.6.1.2 of the Analysis). Fisheries participation by CQE community residents may also be limited because these individuals live in small, remote coastal communities and have a higher cost of participation than individuals living in larger communities with road access to supplies and markets (see section 2.6.3 of the Analysis). The Council and NMFS intend for Amendment 96 and this final rule to improve the ability of CQEs to obtain the most affordable blocks of QS and lease annual IFQ to community residents without negatively impacting the ability of non-CQE fishery E:\FR\FM\07NOR1.SGM 07NOR1 rmajette on DSK2VPTVN1PROD with RULES 66328 Federal Register / Vol. 79, No. 216 / Friday, November 7, 2014 / Rules and Regulations participants to obtain similar size blocks of QS. Also see the response to comment 3. Comment 2: The commenter states that the Council’s recommendation of Amendment 96 without considering their proposal is unfair and discriminatory. In February 2013, the commenter submitted a proposal to the Council that was similar to Amendment 96. The commenter proposed increasing the small block QS transfer and holding limits that apply to non-CQE participants in the IFQ Program. The Council denied the proposal and referred it to the IFQ Committee for consideration. Response: The Council did not deny the commenter’s proposal to increase the amount of small block QS that may be transferred and held by non-CQE fishery participants, but referred the proposal to its IFQ Committee for review and discussion (see the minutes of the February 2013 Council meeting at https://www.npfmc.org/wp-content/ PDFdocuments/minutes/ 213Council.pdf.). NMFS notes that referral of the commenter’s proposal to the IFQ Committee is consistent with the established Council process for addressing proposed revisions to the IFQ Program. Under its long-established process, the Council accepts proposals from the public until a scheduled date prior to convening the IFQ Committee. The Council’s IFQ Committee plays a significant role in reviewing proposals and developing recommendations to the Council for improvements to the IFQ Program. The IFQ Committee is a Council advisory body comprised of participants in the IFQ Program. The Council relies on the committee to review and prioritize the large numbers of proposals to revise the components of the IFQ Program that it receives each year. For additional detail on the Council’s process for reviewing the IFQ Program, see the NMFS Web site at https://alaskafisheries.noaa.gov/ram/ ifq/ifqpaper.htm. NMFS has determined that Amendment 96 and this final rule are consistent with the MagnusonStevens Act and do not unfairly disadvantage or discriminate against non-CQE participants in the IFQ program. See the response to Comment 1. Comment 3: The commenter states that CQEs have an unfair financial advantage compared to non-CQE participants in the IFQ Program. CQEs are tax-exempt and can retain more revenue from their fishing activities than IFQ program participants who must pay taxes. The commenter is also aware of efforts to establish a low interest loan program for CQEs to VerDate Sep<11>2014 14:20 Nov 06, 2014 Jkt 235001 purchase halibut and sablefish QS. The tax-exempt status of CQEs and the potential loan program discriminate against non-CQE fishermen and make it difficult for them to purchase QS. Response: NMFS disagrees that that CQEs have an unfair financial advantage compared to non-CQE participants in the IFQ Program. Section 2.6.3.4 in the Analysis and the proposed rule preamble describe that CQEs have had significant difficulties obtaining financing to transfer and hold QS, and that these difficulties have created a barrier to participation in the CQE Program. The Analysis describes that at prevailing QS prices, it is difficult or infeasible for CQEs to transfer and hold QS because they do not generally have assets to offer as collateral for a loan. In addition, the administrative cost necessary to establish and support the CQE organization likely makes it more difficult for a CQE to obtain financing to transfer and hold QS than for a non-CQE fishery participant who does not incur these administrative costs. Because CQEs hold QS and lease annual IFQ to local residents, there is a layer of both administrative cost and fiduciary responsibility that has made it difficult for CQEs to access funding sources to transfer and hold QS. The administrative overhead for a CQE includes arranging and maintaining financing for the QS, negotiating transfers of QS, developing and administering the criteria for distributing IFQ among potential lessees, and submitting annual reports to NMFS detailing its activities. As described in the Analysis, the prevailing price of QS has been sufficiently high that CQEs have not been able to afford the administrative costs, while leasing the shares to community residents at a reasonable rate, and still have funds remaining for debt repayment. This information provides strong evidence that CQEs do not have a financial advantage over non-CQE fishery participants. The Council and NMFS intend for this final rule to improve the ability of CQEs to transfer and hold QS by removing the prohibition on CQEs’ holding small block QS. Removing this prohibition will provide CQEs with the opportunity to transfer and hold QS that is available at a lower cost, and therefore will be more affordable for CQEs. As described in section 2.7.2 of the Analysis and in the preamble to the proposed rule, NMFS anticipates that Amendment 96 and this final rule will not adversely affect the ability of nonCQE participants to transfer and hold small blocks of QS. NMFS expects that PO 00000 Frm 00062 Fmt 4700 Sfmt 4700 this final rule may allow some redistribution of QS because it is intended to have distributional effects among QS holders by promoting the transfer of QS from existing QS holders to the CQE. However, based upon the Analysis, the Council and NMFS anticipate this final rule may provide additional opportunity for CQEs to transfer and hold more affordable QS without negatively impacting non-CQE participants in the IFQ Program (see section 2.7.3 of the Analysis for additional detail). Section 2.7.2.4 of the Analysis and the proposed rule preamble note that removing the prohibition on CQEs purchasing small blocks of halibut and sablefish QS could create the potential for greater competition in the market for purchasing QS, which could result in higher QS prices. However, the Analysis notes that such increases in QS prices would occur only if CQEs can afford to pay as much or more for small block QS than non-CQE fishery participants. As described above and in section 2.6.3.4 of the Analysis, the difficulties that CQEs have faced in obtaining financing to transfer and hold QS are unlikely to change under Amendment 96 and this final rule. Therefore, the Council and NMFS determined it is unlikely that CQEs will accrue the financial assets to transfer a quantity of QS that would have a significant impact on QS price or on the ability of non-CQE fishery participants’ to transfer and hold QS. Several other factors are also likely to limit the impact of this final rule on non-CQE fishery participants. The most important factors are (1) a CQE must receive QS by transfer on the open market from a willing seller, (2) the amount of small block QS made available to CQEs through this final rule is limited to 11.3 percent of the combined halibut QS pool for Areas 2C and 3A, and 3.7 percent of the combined sablefish QS pool for the SE., WY, CG, and WG areas (see section 2.7.2.1 in the Analysis), and (3) each CQE will be subject to existing restrictions for CQEs on transferring and holding QS that are specified in regulation. Section 2.7.2.1 in the Analysis and the proposed rule preamble note that these restrictions include regulatory area designations applicable to all QS holders, individual and cumulative QS use caps specific to CQEs, a prohibition on CQEs transferring and holding category D halibut QS in Area 2C, a limitation on the amount of category D halibut QS that a CQE in Area 3A may transfer and hold, and the requirement that IFQ derived from Area 3A category D QS must (among other restrictions) be E:\FR\FM\07NOR1.SGM 07NOR1 rmajette on DSK2VPTVN1PROD with RULES Federal Register / Vol. 79, No. 216 / Friday, November 7, 2014 / Rules and Regulations fished on a category D vessel. Therefore, NMFS does not anticipate that this final rule will negatively impact the ability of non-CQE fishery participants to transfer and hold small blocks of QS. NMFS has determined that Amendment 96 and this final rule are consistent with the Magnuson-Stevens Act and do not unfairly disadvantage or discriminate against non-CQE participants in the IFQ program. See the response to Comment 1. NMFS notes that development of a loan program for CQEs to transfer and hold QS is outside NMFS’ authority and the scope of this action. The final rule implementing the CQE Program describes that the Council and NMFS have determined that a non-profit entity is the appropriate type of entity to transfer and hold halibut and sablefish QS on behalf of CQE communities (69 FR 23681, April 30, 2004). The decision to grant non-profit organizations taxexempt status is based on State of Alaska law and is outside NMFS’s authority and the scope of this action. Comment 4: The commenter notes that the proposed rule states that the CQE program is essential to the survival of small Alaska communities because members of these communities either sold their initially issued QS or moved from their communities. The proposed rule also suggests that CQEs will offer ‘‘favorable lease terms as compared to the open market.’’ The commenter disagrees with these assertions. The CQE program will not address the issue of initial recipients selling their QS and moving from communities. The price of QS will rise and fall with the demands of the open market and a CQE cannot change this by offering favorable lease rates to community residents. Response: The final rule implementing the GOA CQE Program (69 FR 23681, April 30, 2004) and the proposed rule to implement Amendment 96 (79 FR 46237, August 7, 2014) describe that the Council and NMFS have determined that the CQE Program promotes community access to QS to generate participation in, and fishery revenues from, the commercial halibut and sablefish fisheries. The Council and NMFS recognize that significant barriers exist to CQEs obtaining financing to transfer and hold QS and these barriers have limited participation in the program. Amendment 96 and this final rule are intended to provide an opportunity for increased participation in the CQE program. The amendment allows CQEs to transfer and hold small block QS, which is generally available at a lower price than larger QS blocks or VerDate Sep<11>2014 14:20 Nov 06, 2014 Jkt 235001 unblocked QS (see section 2.6.2 in the Analysis for additional detail). Residents of CQE communities who lease QS are likely to pay a lower rate to lease IFQ from a CQE than they would pay to lease IFQ from a non-CQE QS holder. Section 2.7.1.4 in the Analysis describes that the two currently active CQEs lease IFQ to community residents at a 45-percent rate, meaning that the CQE recovers 45 percent of the gross fishing revenue. The CQEs use these funds to repay the debt from purchasing QS and cover administrative costs, and may use some of the funds to transfer and hold additional QS in the future. NMFS cannot compare this 45-percent rate to the terms offered in private IFQ leases, since private parties do not submit lease data to NMFS, but it is likely that CQEs are offering favorable lease terms in relation to the market average. Based on this information, the Council and NMFS have determined that Amendment 96 and this final rule may enhance the ability of CQEs to transfer and hold QS for the long-term benefit of community residents. Also see the response to Comment 3. Comment 5: The commenter states that individuals who are not eligible to lease IFQ from a CQE would be disadvantaged compared to fishermen harvesting CQE-held IFQ because those fishermen are subject to less restrictive regulations. For example, CQE fishery participants are exempt from the requirement to harvest IFQ on a vessel that corresponds to the vessel size category of the IFQ. In addition, CQEs must hire skippers to harvest annual IFQ. Non-CQE fishery participants are no longer allowed to hire a skipper without additional restrictions. Response: The final rule implementing the GOA CQE Program (69 FR 23681, April 30, 2004) and the proposed rule to implement Amendment 96 (79 FR 46237, August 7, 2014) describe that the Council and NMFS have identified specific objectives for the CQE Program and rationale for specific provisions that result in different requirements for CQE and non-CQE participants in the IFQ fisheries (see sections 2.6.1.2 and 2.6.2 in the Analysis for additional detail). These fishery provisions and requirements are consistent with the goals for the IFQ Program (58 FR 59375, November 9, 1993). NMFS has determined that this final rule meets the Council’s objective to provide CQE communities in the GOA with long-term opportunities to access the halibut and sablefish fisheries, is consistent with the goals for the IFQ Program, and is not likely to have significant effects on PO 00000 Frm 00063 Fmt 4700 Sfmt 4700 66329 individual participants in the IFQ fisheries or residents of non-CQE communities. In recommending Amendment 96, the Council and NMFS balanced the objective of promoting community access to QS and IFQ with the intent to maintain entry-level opportunities for fishermen residing in other fisherydependent communities, consistent with the goals of the IFQ Program. This final rule allows IFQ derived from category B and C catcher vessel share QS held by a CQE to be fished from a vessel of any size regardless of the QS vessel category from which the IFQ was derived (see § 679.42(a)(2)(iii)). As described in section 2.6.1.2 of the Analysis and the final rule implementing the CQE Program, allowing IFQ derived from category B and C catcher vessel share QS held by a CQE to be fished from a vessel of any size facilitates the use of IFQ on the wide range of vessel types that fish in GOA communities. NMFS notes that the CQE Program does not provide this flexibility for CQEs holding category D catcher vessel QS in Area 3A. Regulations at § 679.42(a)(2)(iii) specify that IFQ derived from category D catcher vessel QS held by a CQE must be fished on a category D vessel (35 ft. LOA or less), consistent with requirements for nonCQE QS holders. The Council and NMFS determined that CQEs should be subject to the same rules as other QS holders participating in the IFQ Program with regard to the use of category D catcher vessel QS in Area 3A. The comment refers to IFQ Program regulations that require, with some exceptions, a catcher vessel QS holder to be onboard the vessel during harvest and offloading of IFQ derived from their QS. As described in the final rule to implement the IFQ Program, this requirement at § 679.42(c) is intended to promote stewardship by providing active fishermen with a vested interest in the long-term productivity of the halibut and sablefish resources. CQE community fishermen do not hold QS but instead are allowed to lease IFQ derived from CQE-held QS. This final rule maintains regulations at § 679.42(c) and § 679.42(i)(5) that require that during harvest and offloading, the lessee must be onboard the vessel fishing the IFQ leased from the CQE, consistent with the owner onboard objective for the IFQ Program. The regulations at § 679.42(i)(5) specify that an individual who receives IFQ derived from QS held by a CQE may not designate a hired master to fish the community IFQ; the individual must be on board the vessel when the IFQ is being fished. E:\FR\FM\07NOR1.SGM 07NOR1 rmajette on DSK2VPTVN1PROD with RULES 66330 Federal Register / Vol. 79, No. 216 / Friday, November 7, 2014 / Rules and Regulations Individuals who hold leases of IFQ from a CQE are considered IFQ permit holders and are subject to the regulations that govern other IFQ permit holders. Comment 6: A CQE is allowed to lease its IFQ and is able to benefit from QS through multiple generations. A nonCQE QS holder’s beneficiaries do not receive the long-term benefit of the QS after the death of the non-CQE QS holder. The non-CQE QS holder’s beneficiary may only lease the resulting IFQ for three years and after that time, the beneficiary must meet the eligibility requirements to hold QS and must be onboard the vessel when the IFQ is harvested, or they must transfer the QS. The commenter states that this is unfair to non-CQE fishery participants, will reduce the amount of QS on the market, and lead to higher QS purchase prices. Response: The commenter is correct that a CQE could lease IFQ to multiple generations of CQE community fishermen. NMFS notes this is consistent with the CQE Program objective to provide CQE community residents with long-term opportunities to access the halibut and sablefish fisheries, as described in the proposed rule, in section 2.6.1.2 of the Analysis, and in the final rule implementing the CQE Program (69 FR 23681, April 30, 2004). The commenter contrasts the CQE Program objective to promote long-term QS holdings by the community entity with regulations at § 679.41(k) that impose a limit on the amount of time a non-CQE QS holder’s beneficiary may hold the QS after the non-CQE QS holder’s death, if the beneficiary is not otherwise eligible to hold QS under IFQ Program requirements at § 679.41(d). As described in the response to Comment 4, the Council and NMFS have determined that the CQE Program structure promotes community access to QS to generate participation in, and fishery revenues from, the commercial halibut and sablefish fisheries. To meet the objectives for the CQE Program, the Council and NMFS have developed different requirements for CQE and nonCQE participants in the IFQ fisheries (see the response to Comment 5). NMFS has determined that Amendment 96 and this final rule meet the Council’s objective to provide the CQE communities with long-term opportunities to access the halibut and sablefish IFQ fisheries, is consistent with the goals for the IFQ Program, and is not likely to have significant effects on individual participants in the IFQ fisheries or residents of non-CQE communities. VerDate Sep<11>2014 14:20 Nov 06, 2014 Jkt 235001 Section 2.6.3.1 of the Analysis and the proposed rule preamble for this action (79 FR 46237, August 7, 2014) indicate that this action is not expected to result in increased demand for QS or a higher price for QS. These impacts have not been observed in the past and are 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 the response to Comment 3). Therefore, NMFS does not consider existing and potential future non-CQE QS holders to be significantly impacted by this action. Classification The Administrator, Alaska Region, NMFS determined that Amendment 96 to the FMP is necessary for the conservation and management of the sablefish IFQ and CQE fisheries and that it is consistent with the MagnusonStevens Act and other applicable laws. Regulations governing the U.S. fisheries for Pacific halibut are developed by the International Pacific Halibut Commission (IPHC), the Pacific Fishery Management Council, the North Pacific Fishery Management Council (Council), and the Secretary of Commerce. Section 5 of the Northern Pacific Halibut Act of 1982 (Halibut Act, 16 U.S.C. 773c) allows the regional council having authority for a particular geographical area to develop regulations governing the allocation and catch of halibut in U.S. Convention waters as long as those regulations do not conflict with IPHC regulations. The final action is consistent with the Council’s authority to allocate halibut catches among fishery participants in the waters off Alaska. This rule has been determined to be not significant for purposes of Executive Order 12866. Small Entity Compliance Guide Section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996 states that, for each rule or group of related rules for which an agency is required to prepare a final regulatory flexibility analysis (FRFA), the agency shall publish one or more guides to assist small entities in complying with the rule, and shall designate such publications as ‘‘small entity compliance guides.’’ The agency shall also explain the actions a small entity is required to take to comply with a rule or group of rules. The preamble to the proposed rule and this final rule serve as the small entity compliance guide. This action does not require any additional compliance from small entities that is not described in the PO 00000 Frm 00064 Fmt 4700 Sfmt 4700 proposed and final rules. Copies of these rules are available from the NMFS Alaska Region Web site at https:// alaskafisheries.noaa.gov. Final Regulatory Flexibility Analysis A final regulatory flexibility analysis (FRFA) is required by the Regulatory Flexibility Act (RFA). This FRFA incorporates the Initial Regulatory Flexibility Analysis (IRFA) prepared for the proposed rule and addresses the applicable requirements of section 604 of the RFA. The IRFA was summarized in the ‘‘Classification’’ section of the preamble to the proposed rule. Analytical requirements for the FRFA are described in the RFA, sections 604(a)(1) through (5), and summarized below. The FRFA must contain: 1. A succinct statement of the need for, and objectives of, the rule; 2. A summary of the significant issues raised by the public comments in response to the initial regulatory flexibility analysis, a summary of the assessment of the agency of such issues, and a statement of any changes made in the proposed rule as a result of such comments; 3. A description and an estimate of the number of small entities to which the rule will apply, or an explanation of why no such estimate is available; 4. A description of the projected reporting, recordkeeping, and other compliance requirements of the rule, including an estimate of the classes of small entities which will be subject to the requirement and the type of professional skills necessary for preparation of the report or record; and 5. A description of the steps the agency has taken to minimize the significant economic impact on small entities consistent with the stated objectives of applicable statutes, including a statement of the factual, policy, and legal reasons for selecting the alternative adopted in the final rule and why each one of the other significant alternatives to the rule considered by the agency which affect the impact on small entities was rejected. The ‘‘universe’’ of entities to be considered in a FRFA generally includes only those small entities that can reasonably be expected to be directly regulated by the final rule. If the effects of the rule fall primarily on a distinct segment of the industry, or portion thereof (e.g., user group, gear type, geographic area), that segment is considered the universe for purposes of this analysis. In preparing an FRFA, an agency may provide either a quantifiable or E:\FR\FM\07NOR1.SGM 07NOR1 Federal Register / Vol. 79, No. 216 / Friday, November 7, 2014 / Rules and Regulations numerical description of the effects of a rule (and alternatives to the rule), or more general descriptive statements, if quantification is not practicable or reliable. Need for and Objectives of This Final Rule The objectives of this final rule 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. An explanation of the need for this final rule is described in preamble of this rule and is not repeated here. This information also was described in detail in the preamble to the proposed rule (79 FR 46237, August 7, 2014). rmajette on DSK2VPTVN1PROD with RULES Comments on the IRFA NMFS published the proposed rule on August 7, 2014 (79 FR 46237), with comments invited through September 8, 2014. NMFS received three comment letters from the public on Amendment 96 and the proposed rule. None of these comments specifically addressed the IRFA, but Comments 3, 4, 5 and 6 expressed concerns about the potential impacts of allowing CQEs in the GOA to transfer and hold small blocks of QS on non-CQE participants in the halibut and sablefish IFQ fisheries. NMFS’ responses to these comments explain that the Council and NMFS considered the potential impacts of Amendment 96 and the final rule on participants in the halibut and sablefish fisheries and determined that it is unlikely to have negative impacts on non-CQE participants in the halibut and sablefish fisheries. Several provisions of the CQE Program, including QS blocks and QS use limits, restrict the amount of total QS that a CQE may obtain by transfer and hold. NMFS has determined that this final rule balances the objectives of the action with consideration of the impacts on non-CQE participants in the halibut and sablefish fisheries. No comments on the proposed rule were filed with NMFS by the Chief Counsel for Advocacy of the Small Business Administration. Number and Description of Directly Regulated Small Entities The determination of the number and description of small entities regulated by this action is based on small business standards established by the Small Business Administration (SBA). On June 12, 2014, the 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 VerDate Sep<11>2014 14:20 Nov 06, 2014 Jkt 235001 standard for Finfish Fishing from $19.0 to 20.5 million. The new size standards were used to prepare the FRFA for this action. At present, NMFS does not have sufficient ownership and affiliation information to determine precisely the number of entities in the IFQ Program that are ‘‘small’’ based on SBA guidelines, nor the number that will be adversely impacted by the present action. This FRFA therefore assumes that all directly regulated operations are small. The action applies to 45 CQEs that are 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 directly benefit from this 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 obtains by transfer and holds QS and makes the resulting IFQ available by lease to eligible harvesters that 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 harvesters are directly regulated small entities, although their number is unknown at this time. No adverse economic impact on community residents is expected under this action. Further, NMFS anticipates that any economic impacts accruing from the action to these small entities will be beneficial because their access to the IFQ halibut and sablefish 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 action, but are not directly regulated by this final 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 action. The most likely impact on these entities will occur 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 PO 00000 Frm 00065 Fmt 4700 Sfmt 4700 66331 by this action and are not further analyzed in this FRFA. Recordkeeping and Reporting Requirements Implementation of this final rule will not change the recordkeeping or reporting requirements of the community residents that lease IFQ from GOA CQEs or the vessels they use to participate in the IFQ fisheries. No additional recordkeeping or reporting by directly regulated entities will be required by this action. Description of Significant Alternatives to the Final Rule That Minimize Adverse Impacts on Small Entities The FRFA also requires a description of any significant alternatives to the rule that accomplish the stated objectives, are consistent with applicable statutes, and that minimize any significant economic impact of the final 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 final action is the status quo alternative (Alternative 1). Alternative 1 does not have adverse economic impacts on CQEs or the resident QS holders in the CQE qualifying communities, which are 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. The preferred alternative implemented by this final rule, Alternative 2, 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 that allow CQEs to transfer and hold 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. The Council selected the least restrictive option under Alternative 2 (Option 1) that allows 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 of the options considered, and minimizes any significant adverse economic impact. Allowing CQEs to transfer and hold any size block of QS should benefit their community members and future community members. Unrestricted transfer of blocked QS should enhance the CQE’s ability to keep QS in remote E:\FR\FM\07NOR1.SGM 07NOR1 66332 Federal Register / Vol. 79, No. 216 / Friday, November 7, 2014 / Rules and Regulations rmajette on DSK2VPTVN1PROD with RULES communities and as a result provide for active participation of the CQE and community residents in the halibut and sablefish fisheries in the future. By increasing their QS holdings under this action, CQEs provide fishery access through leasing to community residents who are new entrants to the fishery or who currently fish small QS holdings and wish to increase their participation. Increased QS availability to CQEs under this action provides some operational efficiency and results in a net benefit to both the CQEs and their community residents. Option 2 allows 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 greatly limited the potential number of small blocks available to CQEs. Option 2 is more burdensome on directly regulated CQEs than Option 1. VerDate Sep<11>2014 14:20 Nov 06, 2014 Jkt 235001 Option 3 allows 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 significantly limited the potential number of small blocks available to CQEs and the number of CQEs that could transfer small block QS. Option 3 is more burdensome on directly regulated CQEs than either Option 1 or 2. The Analysis did not identify any other alternatives that more effectively meet the RFA criteria to minimize adverse economic impacts on directly regulated small entities. Dated: October 30, 2014. Samuel D. Rauch III, Deputy Assistant Administrator for Regulatory Programs, National Marine Fisheries Service. Collection of Information Requirements This rule contains no collection-ofinformation requirement subject to review and approval by the Office of Management and Budget (OMB) under the Paperwork Reduction Act (PRA). Authority: 16 U.S.C. 773 et seq.; 1801 et seq.; 3631 et seq.; Pub. L. 108–447. List of Subjects in 50 CFR Part 679 Alaska, Fisheries. ■ PO 00000 Frm 00066 Fmt 4700 Sfmt 4700 For the reasons set out in the preamble, NMFS amends 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: ■ § 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\07NOR1.SGM 07NOR1 rmajette on DSK2VPTVN1PROD with RULES VerDate Sep<11>2014 Jkt 235001 PO 00000 Eligible GOA orAl community Frm 00067 Halibut IFQ regulatory area in which the community is located Fmt 4700 07NOR1 Akhiok 3A Angoon 2C Chenega Bay 3A Chignik 3B Chignik Lagoon 3B Chignik Lake 3B 2C Cold Bay E:\FR\FM\07NOR1.SGM 4B Coffman Cove Sfmt 4725 Adak 3B Community governing body that recommends theCQE May hold halibut QS in halibut IFQ regulatory area and vessel category Area 2C Area 3A Area 3B 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 Area 4B May hold sablefish QS in sablefish IFQ regulatory areas Maximum number of CHPs that may beheld in halibut IFQ regulatory Maximum number of Pacific cod endorsed non-trawl groundfish licenses that maybe assigned in the GOA groundfish regulatory area CG,SE,WG, andWY (All GOA) Area 2C Area 3A Central GOA A,B,C All 7 2 7 2 X X A,B,C 4 All All X A,B,C All X 3 A,B,C All X 4 A,B,C A,B,C Western GOA X All All AI All X 2 X A,B,C A,B,C All X 4 2 Federal Register / Vol. 79, No. 216 / Friday, November 7, 2014 / Rules and Regulations 14:20 Nov 06, 2014 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. 66333 ER07NO14.007</GPH> rmajette on DSK2VPTVN1PROD with RULES 66334 VerDate Sep<11>2014 Jkt 235001 Community governing body that recommends the CQE May hold halibut QS in halibut IFQ regulatory area and vessel category PO 00000 Area 3B Area 4B Frm 00068 May hold sablefish QS in sablefish IFQ regulatory areas Maximum number of Pacific cod endorsed non-trawl groundfish licenses that maybe assigned in the GOA groundfish regulatory area CG,SE,WG, andWY (All GOA) Area 2C Area 3A Central GOA 7 2 Area 2C Area 3A A,B,C A,B,C X A,B,C A,B,C X A,B,C A,B,C X Western GOA Bay. Sfmt 4725 E:\FR\FM\07NOR1.SGM 07NOR1 2C Edna Bay 2C Elfin Cove 2C Game Creek 2C N/A. A,B,C A,B,C X Gustavus 2C Gustavus Community Association. A,B,C A,B,C X Halibut Cove 3A N/A. Hollis 2C Hoonah 2C 2C IvanofBay Fmt 4700 Craig Hydaburg ER07NO14.008</GPH> AI City of Craig. 3B Edna Bay Community Association. Community of Elfin Cove. Hollis Community Council. City of Hoonah. City of Hydaburg. IvanofBay Village Council. All All 4 4 X A,B,C A,B,C X 4 A,B,C A,B,C X 4 A,B,C A,B,C X 4 A,B,C All X 2 Federal Register / Vol. 79, No. 216 / Friday, November 7, 2014 / Rules and Regulations 14:20 Nov 06, 2014 Eligible GOA orAl community Halibut IFQ regulatory aream which the community is located Maximum number of CHPsthat maybe held in halibut IFQ regulatory rmajette on DSK2VPTVN1PROD with RULES VerDate Sep<11>2014 Jkt 235001 PO 00000 Kake 2C Frm 00069 07NOR1 2C King Cove 3B Klawock 2C Larsen Bay 3A Metlakatla 2C Meyers Chuck 2C Nanwalek 3A 2C 3A Ouzinkie E:\FR\FM\07NOR1.SGM Kasaan Old Harbor Sfmt 4725 3A Naukati Bay Fmt 4700 Karluk 3A Community governing body that recommends the CQE May hold halibut QS in halibut IFQ regulatory area and vessel category Area 2C 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. Area 3A A,B,C A,B,C All A,B,C All CG,SE,WG, andWY (All GOA) Area 2C Area 3A Central GOA 7 2 All 4 9 4 7 A,B,C X A,B,C X 2 4 A,B,C 2 7 X A.B.C 4 All A,B,C All X X A,B,C Western GOA 4 X X All AI X X A,B,C All Area 4B X A,B,C A,B,C A,B,C Area 3B May hold sablefish QS in sablefish IFQ regulatory areas Maximum number of Pacific cod endorsed non-trawl groundfish licenses that maybe assigned in the GOA groundfish regulatory area 4 All All X 7 5 All All X 7 9 Federal Register / Vol. 79, No. 216 / Friday, November 7, 2014 / Rules and Regulations 14:20 Nov 06, 2014 Eligible GOA or AI community Halibut IFQ regulatory aream which the community is located Maximum number of CHPsthat maybe held in halibut IFQ regulatory 66335 ER07NO14.009</GPH> rmajette on DSK2VPTVN1PROD with RULES 66336 VerDate Sep<11>2014 Jkt 235001 PO 00000 Fmt 4700 Sfmt 4725 E:\FR\FM\07NOR1.SGM 07NOR1 Perryville 3B Point Baker 2C Port Alexander 2C Port Graham 3A Port Lions 3A Port Protection 2C Sand Point 3B 3A Tatitlek Frm 00070 2C Seldovia ER07NO14.010</GPH> Pelican 3A Community governing body that recommends the CQE May hold halibut QS in halibut IFQ regulatory area and vessel category Area 2C 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. Area 3A A,B,C A,B,C A,B,C Area 3B Area 4B May hold sablefish QS in sablefish IFQ regulatory areas Maximum number of Pacific cod endorsed non-trawl groundfish licenses that maybe assigned in the GOA groundfish regulatory area CG,SE,WG, andWY (All GOA) Area 2C Central GOA X All AI Area 3A Western GOA 4 X 2 A,B,C A,B,C X 4 A,B,C A,B,C X 4 All X 7 2 All A,B,C All All X 7 6 X A,B,C 4 A,B,C All X All All X 7 8 All All X 7 2 14 Federal Register / Vol. 79, No. 216 / Friday, November 7, 2014 / Rules and Regulations 14:20 Nov 06, 2014 Eligible GOA or AI community Halibut IFQ regulatory area in which the community is located Maximum number of CHPsthat maybe held in halibut IFQ regulatory rmajette on DSK2VPTVN1PROD with RULES PO 00000 Frm 00071 Fmt 4700 Sfmt 9990 E:\FR\FM\07NOR1.SGM Tenakee Springs 2C Thorne Bay 2C Tyonek 3A Whale Pass 2C Yakutat 3A Community governing body that recommends the CQE May hold halibut QS in halibut IFQ regulatory area and vessel category Area 2C Area 3A Central GOA 7 2 7 3 Area 3A A,B,C A,B,C X 4 A,B,C A,B,C X 4 All A,B,C All All AI X X A,B,C All Area 4B CG,SE, WG, andWY (All GOA) Area 2C City of Tenakee Springs. City of Thorne Bay. Native Village of Tyonek. Whale Pass Community Association. City of Yakutat. Area 3B May hold sablefish QS in sablefish IFQ regulatory areas Maximum number of Pacific cod endorsed non-trawl groundfish licenses that maybe assigned in the GOA groundfish regulatory area X 07NOR1 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. 4 Western GOA Federal Register / Vol. 79, No. 216 / Friday, November 7, 2014 / Rules and Regulations Jkt 235001 [FR Doc. 2014–26466 Filed 11–6–14; 8:45 am] 14:20 Nov 06, 2014 BILLING CODE 3510–22–P VerDate Sep<11>2014 Eligible GOA orAl community Halibut IFQ regulatory area in which the community is located Maximum number of CHPs that maybe held in halibut IFQ regulatory 66337 ER07NO14.011</GPH>

Agencies

[Federal Register Volume 79, Number 216 (Friday, November 7, 2014)]
[Rules and Regulations]
[Pages 66324-66337]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-26466]


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DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

50 CFR Part 679

[Docket No. 131115973-4885-02]
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: Final rule.

-----------------------------------------------------------------------

SUMMARY: NMFS publishes regulations to implement Amendment 96 to the 
Fishery Management Plan for Groundfish of the Gulf of Alaska (FMP) and 
an amendment to the Pacific halibut commercial fishery regulations for 
waters in and off Alaska. Amendment 96 to the FMP and the regulatory 
amendment modify 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 will 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 will allow CQEs to acquire additional QS and 
facilitate CQE community resident participation in the IFQ Program. 
This action promotes 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: Effective December 8, 2014.

ADDRESSES: Electronic copies of this rule, the Regulatory Impact Review 
(RIR)/Initial Regulatory Flexibility Analysis (IRFA) (collectively, 
Analysis), and the proposed rule prepared for Amendment 96 and the 
regulatory amendment may be obtained from https://www.regulations.gov or 
from the NMFS Alaska Region Web site at https://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 issues regulations to implement Amendment 96 to the FMP and 
revise the halibut and sablefish provisions of 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 sablefish appear 
at 50 CFR part 679. Fishing for Pacific halibut (Hippoglossus 
stenolepis) is managed by

[[Page 66325]]

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. Council-recommended regulations may be implemented by NMFS 
only after approval by the Secretary of Commerce.

Background

    The Notice of Availability for Amendment 96 was published in the 
Federal Register on July 25, 2014 (79 FR 43377), with a 60-day comment 
period that ended September 23, 2014. The Secretary approved Amendment 
96 on October 21, 2014. The Council submitted the proposed rule to 
NMFS, and it was published in the Federal Register on August 7, 2014 
(79 FR 46237). The 30-day comment period on the proposed rule ended on 
September 8, 2014. NMFS received a total of three comment letters on 
Amendment 96 and the proposed rule during the comment periods. A 
summary of the comments and the responses by NMFS are provided under 
the ``Comments and Responses'' section of this preamble.
    A detailed review of the provisions of Amendment 96, the proposed 
regulations, and the rationale for these regulations is provided in the 
preamble to the proposed rule (79 FR 46237, August 7, 2014). The 
proposed rule is available from the NMFS Alaska Region Web site (see 
ADDRESSES).
    This final rule implements Amendment 96 and amends CQE Program 
regulations. Amendment 96 amends the FMP to remove a restriction that 
prohibits a GOA CQE from transferring and holding small blocks of 
sablefish QS. This final rule amends the CQE Program regulations by 
removing a restriction that prohibits a GOA CQE from transferring and 
holding small blocks of halibut QS.

The IFQ and CQE Programs

    The IFQ Program is a limited access privilege program for the 
commercial fixed-gear halibut and sablefish (Anoplopoma fimbria) 
fisheries in the exclusive economic zone 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. An explanation of the IFQ 
Program can be found in the final rule implementing the program (58 FR 
59375, November 9, 1993).
    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 provides 
fishing opportunities to communities in the GOA that depend on the 
halibut and sablefish fisheries. Another CQE Program, known as the 
Aleutian Islands CQE Program, provides similar opportunities to coastal 
communities in the Aleutian Islands (79 FR 8870, February 14, 2014). 
The Aleutian Islands CQE Program is not affected by this action and is 
not addressed further. Where the terms ``CQE'' or ``CQE Program'' are 
used in this preamble, they are 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 to transfer and hold catcher vessel halibut and sablefish QS in 
specific regulatory areas (see Table 21 to Part 679). The CQE is the 
holder of the QS and is issued the IFQ annually by NMFS. The CQE leases 
the IFQ to individual GOA community residents. The program's structure 
promotes community access to QS to generate participation in, and 
fishery revenues from, the commercial halibut and sablefish fisheries. 
Long-term retention of QS by the CQE creates a permanent asset for the 
community to use. Both CQE- and non-CQE-held QS provide community 
residents fishing access that promotes the economic health of 
communities. The final rule implementing the CQE Program describes the 
CQE Program objectives and provisions (69 FR 23681, April 30, 2004).
    Several IFQ Program provisions apply to CQE Program participants. 
These provisions include regulatory area and vessel size categories; QS 
use caps; and QS blocks. A detailed discussion of these provisions and 
others that restrict CQE transfer and holding of QS is provided in the 
proposed rule preamble for this action (79 FR 46237, August 7, 2014) 
and in the final rule implementing the CQE Program (69 FR 23681, April 
30, 2004). Except for the small block restrictions that this final rule 
will revise, these QS use provisions will continue to apply to the CQE 
program participants. For background purposes, a summary of the QS use 
provisions follows.

IFQ Regulatory Area and Vessel Size Categories

    Fixed-gear halibut and sablefish QS is specific to regulatory area 
and vessel size 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). Each QS is assigned to a vessel category 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).
    CQEs may obtain by transfer and hold certain vessel categories of 
QS in specified areas in order to facilitate local support of community 
fishing operations (see Sec.  679.40 and Table 21 to Part 679). CQEs 
may obtain by transfer and hold sablefish QS in all IFQ regulatory 
areas and vessel categories. However, CQEs are restricted with respect 
to the IFQ regulatory area(s) and vessel category of halibut QS they 
may transfer and hold. A detailed explanation of the IFQ regulatory 
area(s) and vessel category of halibut QS a CQE can transfer and hold 
is provided in the proposed rule for this action (79 FR 46237, August 
7, 2014).
    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 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 
requirement that IFQ derived from Area 3A category D QS must (among 
other restrictions) be fished on a category D vessel are discussed in 
more detail in the

[[Page 66326]]

preamble to the proposed rule for this action (79 FR 46237, August 7, 
2014). 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 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 individual community cap is limited to the individual 
IFQ Program use caps. Each GOA CQE is limited to transferring and 
holding a maximum of 1 percent of the Area 2C halibut QS (see 
regulations at Sec.  679.42(f)(2)(i)) 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)(ii)). Each GOA CQE also is 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. The cumulative community use caps limit all CQEs in the GOA 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.

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 regulatory 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. 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. 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, 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. 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)(1)(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 regulatory areas) and 20 
sablefish QS blocks (5 blocks in each of four regulatory areas).

Minimum Block Size

    During development of the CQE Program, 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. Therefore, CQEs 
were restricted from transferring or holding blocked QS of less than a 
minimum size to preserve fishing opportunities for new entrants in 
certain regulatory areas.
    CQE program regulations prohibit 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)). The CQE Program regulations do not prohibit CQEs in Area 
3B from transferring or holding small blocks of 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).

Actions Implemented by This Final Rule

    This final rule amends 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. The proposed rule preamble 
provides a detailed description of the rationale for removing the 
regulation prohibiting a GOA CQE from transferring and holding small 
blocks of halibut QS (79 FR 46237, August 7, 2014).
    Under this final rule, all CQEs in the GOA may receive by transfer 
any size block of halibut and sablefish QS to hold for use by eligible 
community members. CQEs will be able to transfer similar sized blocks 
of QS in the market place as individual non-CQE QS holders. The 
objectives of this final rule 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.
    This final rule also updates 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 provides a clear and more comprehensive summary of CQE harvesting 
privileges.

Effects of This Final Rule

    A description of the anticipated effects of this action is included 
in the preamble to the proposed rule and is summarized here. This final 
rule provides 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 
evaluating 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 should 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 similar size blocks of QS. See 
the proposed rule preamble and section 2.7.2 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

[[Page 66327]]

2C and Area 3A halibut QS) than sablefish (3.7 percent of the total 
SE., WY, CG, WG sablefish QS). Therefore, while this action will impact 
sablefish QS holders, it likely will have a greater impact on halibut 
QS holders. As described in the preamble to the proposed rule, section 
2.7.2.1 of the Analysis considers the maximum potential impacts of the 
action, which assumes that all eligible communities form CQEs and 
secure funding to transfer all of 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. The Analysis indicates this outcome is 
unlikely given reasonably foreseeable trends in QS holdings by CQEs.
    Analysis of the amount of small block QS by regulatory area in 2013 
indicates that cumulative use caps on CQE QS ownership will not 
constrain the maximum potential transfer of QS by CQEs. The more likely 
constraint on CQE transfer and holding of QS will be the limit on the 
number of blocks that a CQE can transfer and hold in any one regulatory 
area (10 halibut blocks and 5 sablefish blocks). Even at maximum CQE 
participation, QS block limits and the reservation of a limited amount 
of Area 3A D share QS for purchase by CQEs representing communities in 
Area 3A will prevent CQEs from collectively acquiring all small block 
halibut QS made available under this action. Thus, the Council and NMFS 
determined that small block halibut QS will continue to be available to 
non-CQE participants in the IFQ halibut fishery under this final rule. 
See section 2.7.2.1 of the Analysis for additional detail.
    For sablefish, under allowable block limits, CQEs will be able 
collectively to transfer and hold all of the available sablefish small 
block QS in each IFQ regulatory area. Given the financial barriers to 
CQE transfers of QS described in the Analysis and in the preamble to 
the proposed rule, the Council and NMFS determined it is unlikely that 
CQEs will transfer the maximum amount of small block sablefish QS made 
available by this action. Thus, small block sablefish QS will continue 
to be available to non-CQE participants in the IFQ sablefish fishery 
under this final rule. See sections 2.6.3.1 and 2.7.2.1 of the Analysis 
for additional detail.
    Although this action allows CQEs to transfer and hold small blocks 
of A share halibut and sablefish QS, the Council and NMFS anticipate 
that CQE purchases of A share QS will be limited. Because IFQ derived 
from A share halibut and sablefish QS may be caught and processed at 
sea, A share QS is typically priced much higher than all other QS 
categories. In addition, the total amount of A share QS issued is small 
relative to all other categories of QS. Therefore, the potential impact 
of allowing CQEs to purchase small blocks of A share QS on new 
entrants, small-boat operations and CQE fishery participants will be 
minimal under this final rule. 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 provide a net 
benefit to both the CQEs and their community residents.

Changes From the Proposed Rule

    There are no changes to the proposed regulations (79 FR 46237, 
August 7, 2014).

Comments and Responses

    During the public comment period on the Notice of Availability for 
Amendment 96 and the proposed rule to revise CQE program regulations, 
NMFS received three comment letters. Two letters from members of the 
public did not address the proposed action. These letters expressed 
concerns about fishery management policies that are outside the scope 
of this action. The third comment letter expressed concerns about and 
did not support Amendment 96 and the proposed rule. The letter was 
submitted by an organization representing non-CQE IFQ Program 
participants and contained six comments. NMFS' responses to the public 
comments on Amendment 96 and the proposed rule are presented below. No 
changes were made to this final rule in response to the comment letters 
received.
    Comment 1: The commenter states that Amendment 96 violates National 
Standard 4 of the Magnuson-Stevens Act, which specifies that 
conservation and management measures shall not discriminate between 
residents of different states and that any allocation of fishing 
privileges must be fair and equitable. Amendment 96 benefits CQEs and 
residents of CQE communities at the expense of non-residents of Alaska 
that participate in the IFQ fishery. This is unfair, discriminatory, 
and contrary to the requirements of National Standard 4.
    Response: NMFS disagrees that Amendment 96 violates National 
Standard 4 of the Magnuson-Stevens Act. The Council and NMFS have 
determined that Amendment 96 is consistent with the requirements of the 
Magnuson-Stevens Act. The CQE Program was established to allow a group 
of non-profit entities to hold QS on behalf of residents of specific 
small, geographically isolated, rural communities located adjacent to 
the coast of the GOA with a historical link to the halibut and 
sablefish fisheries. Communities that do not meet the eligibility 
criteria may not participate in the program and do not benefit from the 
CQE Program. Communities that are excluded from the CQE Program include 
Alaska and non-Alaska communities. Therefore, this action is not 
predicated on an effort to discriminate between residents of different 
states.
    Amendment 96 removes a prohibition on CQEs' transferring and 
holding small blocks of QS. Non-CQE participants in the IFQ Program are 
not subject to this prohibition, so this action is not predicated upon 
any effort to unfairly advantage CQEs.
    As described in the proposed rule preamble (79 FR 46237, August 7, 
2014) and in section 2.2 of the Analysis, Amendment 96 and this final 
rule promote the Council's objective to provide an opportunity for CQE 
communities to acquire additional QS and facilitate sustained 
participation by CQE community residents in the IFQ Program. Since the 
inception of the IFQ Program, the number of resident halibut and 
sablefish QS holders has declined substantially in CQE communities. 
This transfer of QS and the associated fishing effort from CQE 
communities has limited the ability of residents to locally transfer 
and hold QS and reduced the diversity of fisheries to which fishermen 
in these communities have access (see section 2.6.1.2 of the Analysis). 
Fisheries participation by CQE community residents may also be limited 
because these individuals live in small, remote coastal communities and 
have a higher cost of participation than individuals living in larger 
communities with road access to supplies and markets (see section 2.6.3 
of the Analysis). The Council and NMFS intend for Amendment 96 and this 
final rule to improve the ability of CQEs to obtain the most affordable 
blocks of QS and lease annual IFQ to community residents without 
negatively impacting the ability of non-CQE fishery

[[Page 66328]]

participants to obtain similar size blocks of QS. Also see the response 
to comment 3.
    Comment 2: The commenter states that the Council's recommendation 
of Amendment 96 without considering their proposal is unfair and 
discriminatory. In February 2013, the commenter submitted a proposal to 
the Council that was similar to Amendment 96. The commenter proposed 
increasing the small block QS transfer and holding limits that apply to 
non-CQE participants in the IFQ Program. The Council denied the 
proposal and referred it to the IFQ Committee for consideration.
    Response: The Council did not deny the commenter's proposal to 
increase the amount of small block QS that may be transferred and held 
by non-CQE fishery participants, but referred the proposal to its IFQ 
Committee for review and discussion (see the minutes of the February 
2013 Council meeting at https://www.npfmc.org/wp-content/PDFdocuments/minutes/213Council.pdf.). NMFS notes that referral of the commenter's 
proposal to the IFQ Committee is consistent with the established 
Council process for addressing proposed revisions to the IFQ Program. 
Under its long-established process, the Council accepts proposals from 
the public until a scheduled date prior to convening the IFQ Committee. 
The Council's IFQ Committee plays a significant role in reviewing 
proposals and developing recommendations to the Council for 
improvements to the IFQ Program. The IFQ Committee is a Council 
advisory body comprised of participants in the IFQ Program. The Council 
relies on the committee to review and prioritize the large numbers of 
proposals to revise the components of the IFQ Program that it receives 
each year. For additional detail on the Council's process for reviewing 
the IFQ Program, see the NMFS Web site at https://alaskafisheries.noaa.gov/ram/ifq/ifqpaper.htm. NMFS has determined that 
Amendment 96 and this final rule are consistent with the Magnuson-
Stevens Act and do not unfairly disadvantage or discriminate against 
non-CQE participants in the IFQ program. See the response to Comment 1.
    Comment 3: The commenter states that CQEs have an unfair financial 
advantage compared to non-CQE participants in the IFQ Program. CQEs are 
tax-exempt and can retain more revenue from their fishing activities 
than IFQ program participants who must pay taxes. The commenter is also 
aware of efforts to establish a low interest loan program for CQEs to 
purchase halibut and sablefish QS. The tax-exempt status of CQEs and 
the potential loan program discriminate against non-CQE fishermen and 
make it difficult for them to purchase QS.
    Response: NMFS disagrees that that CQEs have an unfair financial 
advantage compared to non-CQE participants in the IFQ Program. Section 
2.6.3.4 in the Analysis and the proposed rule preamble describe that 
CQEs have had significant difficulties obtaining financing to transfer 
and hold QS, and that these difficulties have created a barrier to 
participation in the CQE Program. The Analysis describes that at 
prevailing QS prices, it is difficult or infeasible for CQEs to 
transfer and hold QS because they do not generally have assets to offer 
as collateral for a loan. In addition, the administrative cost 
necessary to establish and support the CQE organization likely makes it 
more difficult for a CQE to obtain financing to transfer and hold QS 
than for a non-CQE fishery participant who does not incur these 
administrative costs. Because CQEs hold QS and lease annual IFQ to 
local residents, there is a layer of both administrative cost and 
fiduciary responsibility that has made it difficult for CQEs to access 
funding sources to transfer and hold QS. The administrative overhead 
for a CQE includes arranging and maintaining financing for the QS, 
negotiating transfers of QS, developing and administering the criteria 
for distributing IFQ among potential lessees, and submitting annual 
reports to NMFS detailing its activities. As described in the Analysis, 
the prevailing price of QS has been sufficiently high that CQEs have 
not been able to afford the administrative costs, while leasing the 
shares to community residents at a reasonable rate, and still have 
funds remaining for debt repayment. This information provides strong 
evidence that CQEs do not have a financial advantage over non-CQE 
fishery participants.
    The Council and NMFS intend for this final rule to improve the 
ability of CQEs to transfer and hold QS by removing the prohibition on 
CQEs' holding small block QS. Removing this prohibition will provide 
CQEs with the opportunity to transfer and hold QS that is available at 
a lower cost, and therefore will be more affordable for CQEs.
    As described in section 2.7.2 of the Analysis and in the preamble 
to the proposed rule, NMFS anticipates that Amendment 96 and this final 
rule will not adversely affect the ability of non-CQE participants to 
transfer and hold small blocks of QS. NMFS expects that this final rule 
may allow some redistribution of QS because it is intended to have 
distributional effects among QS holders by promoting the transfer of QS 
from existing QS holders to the CQE. However, based upon the Analysis, 
the Council and NMFS anticipate this final rule may provide additional 
opportunity for CQEs to transfer and hold more affordable QS without 
negatively impacting non-CQE participants in the IFQ Program (see 
section 2.7.3 of the Analysis for additional detail).
    Section 2.7.2.4 of the Analysis and the proposed rule preamble note 
that removing the prohibition on CQEs purchasing small blocks of 
halibut and sablefish QS could create the potential for greater 
competition in the market for purchasing QS, which could result in 
higher QS prices. However, the Analysis notes that such increases in QS 
prices would occur only if CQEs can afford to pay as much or more for 
small block QS than non-CQE fishery participants. As described above 
and in section 2.6.3.4 of the Analysis, the difficulties that CQEs have 
faced in obtaining financing to transfer and hold QS are unlikely to 
change under Amendment 96 and this final rule. Therefore, the Council 
and NMFS determined it is unlikely that CQEs will accrue the financial 
assets to transfer a quantity of QS that would have a significant 
impact on QS price or on the ability of non-CQE fishery participants' 
to transfer and hold QS.
    Several other factors are also likely to limit the impact of this 
final rule on non-CQE fishery participants. The most important factors 
are (1) a CQE must receive QS by transfer on the open market from a 
willing seller, (2) the amount of small block QS made available to CQEs 
through this final rule is limited to 11.3 percent of the combined 
halibut QS pool for Areas 2C and 3A, and 3.7 percent of the combined 
sablefish QS pool for the SE., WY, CG, and WG areas (see section 
2.7.2.1 in the Analysis), and (3) each CQE will be subject to existing 
restrictions for CQEs on transferring and holding QS that are specified 
in regulation. Section 2.7.2.1 in the Analysis and the proposed rule 
preamble note that these restrictions include regulatory area 
designations applicable to all QS holders, individual and cumulative QS 
use caps specific to CQEs, a prohibition on CQEs transferring and 
holding category D halibut QS in Area 2C, a limitation on the amount of 
category D halibut QS that a CQE in Area 3A may transfer and hold, and 
the requirement that IFQ derived from Area 3A category D QS must (among 
other restrictions) be

[[Page 66329]]

fished on a category D vessel. Therefore, NMFS does not anticipate that 
this final rule will negatively impact the ability of non-CQE fishery 
participants to transfer and hold small blocks of QS. NMFS has 
determined that Amendment 96 and this final rule are consistent with 
the Magnuson-Stevens Act and do not unfairly disadvantage or 
discriminate against non-CQE participants in the IFQ program. See the 
response to Comment 1.
    NMFS notes that development of a loan program for CQEs to transfer 
and hold QS is outside NMFS' authority and the scope of this action. 
The final rule implementing the CQE Program describes that the Council 
and NMFS have determined that a non-profit entity is the appropriate 
type of entity to transfer and hold halibut and sablefish QS on behalf 
of CQE communities (69 FR 23681, April 30, 2004). The decision to grant 
non-profit organizations tax-exempt status is based on State of Alaska 
law and is outside NMFS's authority and the scope of this action.
    Comment 4: The commenter notes that the proposed rule states that 
the CQE program is essential to the survival of small Alaska 
communities because members of these communities either sold their 
initially issued QS or moved from their communities. The proposed rule 
also suggests that CQEs will offer ``favorable lease terms as compared 
to the open market.'' The commenter disagrees with these assertions. 
The CQE program will not address the issue of initial recipients 
selling their QS and moving from communities. The price of QS will rise 
and fall with the demands of the open market and a CQE cannot change 
this by offering favorable lease rates to community residents.
    Response: The final rule implementing the GOA CQE Program (69 FR 
23681, April 30, 2004) and the proposed rule to implement Amendment 96 
(79 FR 46237, August 7, 2014) describe that the Council and NMFS have 
determined that the CQE Program promotes community access to QS to 
generate participation in, and fishery revenues from, the commercial 
halibut and sablefish fisheries. The Council and NMFS recognize that 
significant barriers exist to CQEs obtaining financing to transfer and 
hold QS and these barriers have limited participation in the program. 
Amendment 96 and this final rule are intended to provide an opportunity 
for increased participation in the CQE program. The amendment allows 
CQEs to transfer and hold small block QS, which is generally available 
at a lower price than larger QS blocks or unblocked QS (see section 
2.6.2 in the Analysis for additional detail).
    Residents of CQE communities who lease QS are likely to pay a lower 
rate to lease IFQ from a CQE than they would pay to lease IFQ from a 
non-CQE QS holder. Section 2.7.1.4 in the Analysis describes that the 
two currently active CQEs lease IFQ to community residents at a 45-
percent rate, meaning that the CQE recovers 45 percent of the gross 
fishing revenue. The CQEs use these funds to repay the debt from 
purchasing QS and cover administrative costs, and may use some of the 
funds to transfer and hold additional QS in the future. NMFS cannot 
compare this 45-percent rate to the terms offered in private IFQ 
leases, since private parties do not submit lease data to NMFS, but it 
is likely that CQEs are offering favorable lease terms in relation to 
the market average. Based on this information, the Council and NMFS 
have determined that Amendment 96 and this final rule may enhance the 
ability of CQEs to transfer and hold QS for the long-term benefit of 
community residents. Also see the response to Comment 3.
    Comment 5: The commenter states that individuals who are not 
eligible to lease IFQ from a CQE would be disadvantaged compared to 
fishermen harvesting CQE-held IFQ because those fishermen are subject 
to less restrictive regulations. For example, CQE fishery participants 
are exempt from the requirement to harvest IFQ on a vessel that 
corresponds to the vessel size category of the IFQ. In addition, CQEs 
must hire skippers to harvest annual IFQ. Non-CQE fishery participants 
are no longer allowed to hire a skipper without additional 
restrictions.
    Response: The final rule implementing the GOA CQE Program (69 FR 
23681, April 30, 2004) and the proposed rule to implement Amendment 96 
(79 FR 46237, August 7, 2014) describe that the Council and NMFS have 
identified specific objectives for the CQE Program and rationale for 
specific provisions that result in different requirements for CQE and 
non-CQE participants in the IFQ fisheries (see sections 2.6.1.2 and 
2.6.2 in the Analysis for additional detail). These fishery provisions 
and requirements are consistent with the goals for the IFQ Program (58 
FR 59375, November 9, 1993). NMFS has determined that this final rule 
meets the Council's objective to provide CQE communities in the GOA 
with long-term opportunities to access the halibut and sablefish 
fisheries, is consistent with the goals for the IFQ Program, and is not 
likely to have significant effects on individual participants in the 
IFQ fisheries or residents of non-CQE communities.
    In recommending Amendment 96, the Council and NMFS balanced the 
objective of promoting community access to QS and IFQ with the intent 
to maintain entry-level opportunities for fishermen residing in other 
fishery-dependent communities, consistent with the goals of the IFQ 
Program. This final rule allows IFQ derived from category B and C 
catcher vessel share QS held by a CQE to be fished from a vessel of any 
size regardless of the QS vessel category from which the IFQ was 
derived (see Sec.  679.42(a)(2)(iii)). As described in section 2.6.1.2 
of the Analysis and the final rule implementing the CQE Program, 
allowing IFQ derived from category B and C catcher vessel share QS held 
by a CQE to be fished from a vessel of any size facilitates the use of 
IFQ on the wide range of vessel types that fish in GOA communities.
    NMFS notes that the CQE Program does not provide this flexibility 
for CQEs holding category D catcher vessel QS in Area 3A. Regulations 
at Sec.  679.42(a)(2)(iii) specify that IFQ derived from category D 
catcher vessel QS held by a CQE must be fished on a category D vessel 
(35 ft. LOA or less), consistent with requirements for non-CQE QS 
holders. The Council and NMFS determined that CQEs should be subject to 
the same rules as other QS holders participating in the IFQ Program 
with regard to the use of category D catcher vessel QS in Area 3A. The 
comment refers to IFQ Program regulations that require, with some 
exceptions, a catcher vessel QS holder to be onboard the vessel during 
harvest and offloading of IFQ derived from their QS. As described in 
the final rule to implement the IFQ Program, this requirement at Sec.  
679.42(c) is intended to promote stewardship by providing active 
fishermen with a vested interest in the long-term productivity of the 
halibut and sablefish resources. CQE community fishermen do not hold QS 
but instead are allowed to lease IFQ derived from CQE-held QS. This 
final rule maintains regulations at Sec.  679.42(c) and Sec.  
679.42(i)(5) that require that during harvest and offloading, the 
lessee must be onboard the vessel fishing the IFQ leased from the CQE, 
consistent with the owner onboard objective for the IFQ Program. The 
regulations at Sec.  679.42(i)(5) specify that an individual who 
receives IFQ derived from QS held by a CQE may not designate a hired 
master to fish the community IFQ; the individual must be on board the 
vessel when the IFQ is being fished.

[[Page 66330]]

Individuals who hold leases of IFQ from a CQE are considered IFQ permit 
holders and are subject to the regulations that govern other IFQ permit 
holders.
    Comment 6: A CQE is allowed to lease its IFQ and is able to benefit 
from QS through multiple generations. A non-CQE QS holder's 
beneficiaries do not receive the long-term benefit of the QS after the 
death of the non-CQE QS holder. The non-CQE QS holder's beneficiary may 
only lease the resulting IFQ for three years and after that time, the 
beneficiary must meet the eligibility requirements to hold QS and must 
be onboard the vessel when the IFQ is harvested, or they must transfer 
the QS. The commenter states that this is unfair to non-CQE fishery 
participants, will reduce the amount of QS on the market, and lead to 
higher QS purchase prices.
    Response: The commenter is correct that a CQE could lease IFQ to 
multiple generations of CQE community fishermen. NMFS notes this is 
consistent with the CQE Program objective to provide CQE community 
residents with long-term opportunities to access the halibut and 
sablefish fisheries, as described in the proposed rule, in section 
2.6.1.2 of the Analysis, and in the final rule implementing the CQE 
Program (69 FR 23681, April 30, 2004).
    The commenter contrasts the CQE Program objective to promote long-
term QS holdings by the community entity with regulations at Sec.  
679.41(k) that impose a limit on the amount of time a non-CQE QS 
holder's beneficiary may hold the QS after the non-CQE QS holder's 
death, if the beneficiary is not otherwise eligible to hold QS under 
IFQ Program requirements at Sec.  679.41(d).
    As described in the response to Comment 4, the Council and NMFS 
have determined that the CQE Program structure promotes community 
access to QS to generate participation in, and fishery revenues from, 
the commercial halibut and sablefish fisheries. To meet the objectives 
for the CQE Program, the Council and NMFS have developed different 
requirements for CQE and non-CQE participants in the IFQ fisheries (see 
the response to Comment 5). NMFS has determined that Amendment 96 and 
this final rule meet the Council's objective to provide the CQE 
communities with long-term opportunities to access the halibut and 
sablefish IFQ fisheries, is consistent with the goals for the IFQ 
Program, and is not likely to have significant effects on individual 
participants in the IFQ fisheries or residents of non-CQE communities.
    Section 2.6.3.1 of the Analysis and the proposed rule preamble for 
this action (79 FR 46237, August 7, 2014) indicate that this action is 
not expected to result in increased demand for QS or a higher price for 
QS. These impacts have not been observed in the past and are 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 the response to Comment 3). Therefore, NMFS does not 
consider existing and potential future non-CQE QS holders to be 
significantly impacted by this action.

Classification

    The Administrator, Alaska Region, NMFS determined that Amendment 96 
to the FMP is necessary for the conservation and management of the 
sablefish IFQ and CQE fisheries and that it is consistent with the 
Magnuson-Stevens Act and other applicable laws.
    Regulations governing the U.S. fisheries for Pacific halibut are 
developed by the International Pacific Halibut Commission (IPHC), the 
Pacific Fishery Management Council, the North Pacific Fishery 
Management Council (Council), and the Secretary of Commerce. Section 5 
of the Northern Pacific Halibut Act of 1982 (Halibut Act, 16 U.S.C. 
773c) allows the regional council having authority for a particular 
geographical area to develop regulations governing the allocation and 
catch of halibut in U.S. Convention waters as long as those regulations 
do not conflict with IPHC regulations. The final action is consistent 
with the Council's authority to allocate halibut catches among fishery 
participants in the waters off Alaska.
    This rule has been determined to be not significant for purposes of 
Executive Order 12866.

Small Entity Compliance Guide

    Section 212 of the Small Business Regulatory Enforcement Fairness 
Act of 1996 states that, for each rule or group of related rules for 
which an agency is required to prepare a final regulatory flexibility 
analysis (FRFA), the agency shall publish one or more guides to assist 
small entities in complying with the rule, and shall designate such 
publications as ``small entity compliance guides.'' The agency shall 
also explain the actions a small entity is required to take to comply 
with a rule or group of rules. The preamble to the proposed rule and 
this final rule serve as the small entity compliance guide. This action 
does not require any additional compliance from small entities that is 
not described in the proposed and final rules. Copies of these rules 
are available from the NMFS Alaska Region Web site at https://alaskafisheries.noaa.gov.

Final Regulatory Flexibility Analysis

    A final regulatory flexibility analysis (FRFA) is required by the 
Regulatory Flexibility Act (RFA). This FRFA incorporates the Initial 
Regulatory Flexibility Analysis (IRFA) prepared for the proposed rule 
and addresses the applicable requirements of section 604 of the RFA. 
The IRFA was summarized in the ``Classification'' section of the 
preamble to the proposed rule.
    Analytical requirements for the FRFA are described in the RFA, 
sections 604(a)(1) through (5), and summarized below.
    The FRFA must contain:
    1. A succinct statement of the need for, and objectives of, the 
rule;
    2. A summary of the significant issues raised by the public 
comments in response to the initial regulatory flexibility analysis, a 
summary of the assessment of the agency of such issues, and a statement 
of any changes made in the proposed rule as a result of such comments;
    3. A description and an estimate of the number of small entities to 
which the rule will apply, or an explanation of why no such estimate is 
available;
    4. A description of the projected reporting, recordkeeping, and 
other compliance requirements of the rule, including an estimate of the 
classes of small entities which will be subject to the requirement and 
the type of professional skills necessary for preparation of the report 
or record; and
    5. A description of the steps the agency has taken to minimize the 
significant economic impact on small entities consistent with the 
stated objectives of applicable statutes, including a statement of the 
factual, policy, and legal reasons for selecting the alternative 
adopted in the final rule and why each one of the other significant 
alternatives to the rule considered by the agency which affect the 
impact on small entities was rejected.

The ``universe'' of entities to be considered in a FRFA generally 
includes only those small entities that can reasonably be expected to 
be directly regulated by the final rule. If the effects of the rule 
fall primarily on a distinct segment of the industry, or portion 
thereof (e.g., user group, gear type, geographic area), that segment is 
considered the universe for purposes of this analysis.
    In preparing an FRFA, an agency may provide either a quantifiable 
or

[[Page 66331]]

numerical description of the effects of a rule (and alternatives to the 
rule), or more general descriptive statements, if quantification is not 
practicable or reliable.

Need for and Objectives of This Final Rule

    The objectives of this final rule 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. An explanation of the need for this final rule is 
described in preamble of this rule and is not repeated here. This 
information also was described in detail in the preamble to the 
proposed rule (79 FR 46237, August 7, 2014).

Comments on the IRFA

    NMFS published the proposed rule on August 7, 2014 (79 FR 46237), 
with comments invited through September 8, 2014. NMFS received three 
comment letters from the public on Amendment 96 and the proposed rule. 
None of these comments specifically addressed the IRFA, but Comments 3, 
4, 5 and 6 expressed concerns about the potential impacts of allowing 
CQEs in the GOA to transfer and hold small blocks of QS on non-CQE 
participants in the halibut and sablefish IFQ fisheries. NMFS' 
responses to these comments explain that the Council and NMFS 
considered the potential impacts of Amendment 96 and the final rule on 
participants in the halibut and sablefish fisheries and determined that 
it is unlikely to have negative impacts on non-CQE participants in the 
halibut and sablefish fisheries. Several provisions of the CQE Program, 
including QS blocks and QS use limits, restrict the amount of total QS 
that a CQE may obtain by transfer and hold. NMFS has determined that 
this final rule balances the objectives of the action with 
consideration of the impacts on non-CQE participants in the halibut and 
sablefish fisheries.
    No comments on the proposed rule were filed with NMFS by the Chief 
Counsel for Advocacy of the Small Business Administration.

Number and Description of Directly Regulated Small Entities

    The determination of the number and description of small entities 
regulated by this action is based on small business standards 
established by the Small Business Administration (SBA). On June 12, 
2014, the 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 FRFA for this action.
    At present, NMFS does not have sufficient ownership and affiliation 
information to determine precisely the number of entities in the IFQ 
Program that are ``small'' based on SBA guidelines, nor the number that 
will be adversely impacted by the present action. This FRFA therefore 
assumes that all directly regulated operations are small.
    The action applies to 45 CQEs that are 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 directly benefit from this 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 obtains by transfer and holds QS and makes the 
resulting IFQ available by lease to eligible harvesters that 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 harvesters are directly regulated small 
entities, although their number is unknown at this time. No adverse 
economic impact on community residents is expected under this action. 
Further, NMFS anticipates that any economic impacts accruing from the 
action to these small entities will be beneficial because their access 
to the IFQ halibut and sablefish 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 
action, but are not directly regulated by this final 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 action. The most likely impact on these entities will occur 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 FRFA.

Recordkeeping and Reporting Requirements

    Implementation of this final rule will not change the recordkeeping 
or reporting requirements of the community residents that lease IFQ 
from GOA CQEs or the vessels they use to participate in the IFQ 
fisheries. No additional recordkeeping or reporting by directly 
regulated entities will be required by this action.

Description of Significant Alternatives to the Final Rule That Minimize 
Adverse Impacts on Small Entities

    The FRFA also requires a description of any significant 
alternatives to the rule that accomplish the stated objectives, are 
consistent with applicable statutes, and that minimize any significant 
economic impact of the final 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 final action is the status quo 
alternative (Alternative 1). Alternative 1 does not have adverse 
economic impacts on CQEs or the resident QS holders in the CQE 
qualifying communities, which are 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. The 
preferred alternative implemented by this final rule, Alternative 2, 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 that allow CQEs to 
transfer and hold 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.
    The Council selected the least restrictive option under Alternative 
2 (Option 1) that allows 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 of the options considered, and 
minimizes any significant adverse economic impact. Allowing CQEs to 
transfer and hold any size block of QS should benefit their community 
members and future community members. Unrestricted transfer of blocked 
QS should enhance the CQE's ability to keep QS in remote

[[Page 66332]]

communities and as a result provide for active participation of the CQE 
and community residents in the halibut and sablefish fisheries in the 
future. By increasing their QS holdings under this action, CQEs provide 
fishery access through leasing to community residents who are new 
entrants to the fishery or who currently fish small QS holdings and 
wish to increase their participation. Increased QS availability to CQEs 
under this action provides some operational efficiency and results in a 
net benefit to both the CQEs and their community residents.
    Option 2 allows 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 greatly limited the potential number of 
small blocks available to CQEs. Option 2 is more burdensome on directly 
regulated CQEs than Option 1.
    Option 3 allows 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 
significantly limited the potential number of small blocks available to 
CQEs and the number of CQEs that could transfer small block QS. Option 
3 is more burdensome on directly regulated CQEs than either Option 1 or 
2. The Analysis did not identify any other alternatives that more 
effectively meet the RFA criteria to minimize adverse economic impacts 
on directly regulated small entities.

Collection of Information Requirements

    This rule contains no collection-of-information requirement subject 
to review and approval by the Office of Management and Budget (OMB) 
under the Paperwork Reduction Act (PRA).

List of Subjects in 50 CFR Part 679

    Alaska, Fisheries.

    Dated: October 30, 2014.
Samuel D. Rauch III,
Deputy Assistant Administrator for Regulatory Programs, National Marine 
Fisheries Service.

    For the reasons set out in the preamble, NMFS amends 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).

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3. Revise Table 21 to Part 679 to read as follows

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[FR Doc. 2014-26466 Filed 11-6-14; 8:45 am]
BILLING CODE 3510-22-P
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