Management & Regulation

The following report from the October 27, 2009 oversight hearing on the implementation of the 2006 amendments to the Magnuson-Stevens Fishery Conservation and Management Act highlights the portions of the hearing which addressed Catch Shares.

Transcribed by Nicole Smith

On Tuesday, October 27, 2009, the House Natural Resources Committee, Subcommittee on Insular Affairs, Oceans and Wildlife held an oversight hearing focusing on the implementation of the 2006 amendments to the Magnuson-Stevens Fishery Conservation and Management Act. The hearing was led by Delegate Madeleine Bordallo (D-GU) and featured testimonies of progress being made in setting annual catch limits and accountability measures to end overfishing and rebuild overfished stocks.

During her opening remarks, Del. Bordallo acknowledged the challenges NFMS and regional councils face to meet the statutory deadlines and welcomed constructive suggestions for assisting them in their efforts to ensure the requirements are achieved in a timely manner. “It is better to discuss and seek solutions to the challenges involved in fully implementing the law now than to have to return several years from now when these vital resources are further depleted to try and answers the questions of why Congress did not do enough to ensure that overfishing was brought to an end.”

The first panel of witnesses included Dr. Steven Murawski, National Marine Fisheries Service; Duane Harris, South Atlantic Fishery Management Council; Dr. Andrew Cooper, Simon Fraser University; Shawn Stebbins, Archipelago Marine Research Ltd.; Randy Fisher, Pacific States Marine Fisheries Commission. The second panel consisted of Julian Magras, St. Thomas Fishermen’s Association; Captain David Goethel, Fishing Vessel Ellen Diane; Herbert Moore, Gallagher, Briody & Butler; Captain Mark Brown, Fishing Vessel Teaser 2; Gregory Didomenico, Garden State Seafood Association.

Catch shares was a source of discussion during the hearing. Several witnesses drew attention to the subject during their five-minute testimonies.

Dr. Murawski stated:

NOAA supports the appropriate use of rights-based management programs also called catch share programs. Toward that end, NOAA has established a “Catch Shares Task Force” to develop a national policy. Although they vary by fishery and region, all catch share programs help end the race for fish and provide participants with economic incentives to end overfishing and maintain healthy stocks. I want to emphasize that these programs are not appropriate for all fisheries, but the administration does want the councils to consider them for the use where they may be appropriate.

Preventing and eliminating overfishing and rebuilding overfished stocks are critical steps toward more sustainable fisheries. The trend toward exclusive and tradable catch share programs, combined with judicious application of MSA Section 312 (b) (Fishing Capacity Reduction Program), should result in significant reductions in fleet overcapacity and upgrade the quality and competitiveness of domestically harvested fish.

More stable fisheries should ease some of the stress on participants that we have seen in recent years. Management programs that allocate catch shares to communities should help us maintain the sustained participation of those fishing communities, an MSA mandate under National Standard 8. Ending the race to fish and reducing overcapacity should produce continued improvements in the safety of fishermen at sea, another MSA requirement under National Standard 10. The projected improvements in economic performance should result in an increase in employment in the domestic seafood industry (although probably not in the harvesting sector). NMFS recently estimated that employment in the seafood industry could increase by as much as 500,000 jobs.

The FY 2010 President’s budget request would provide an additional $3.3 million to NMFS science centers and regional offices. Greater use of catch share programs will have some additional economic data needs not included in this calculation. Likewise, the increased need for social data and (particularly employment information) is a high-priority item for NMFS.

Shawn Stebbins stated:

Catch shares are a tool that can bring increased industry participation in ensuring the long term health of a fishery, reduced risk, and may also bring increased returns to harvesters.

Catch shares and improved monitoring and data collection processes are not co-dependent but are highly complimentary. Catch share management can benefit from improved data and implementation of catch shares can provide an opportunity to improve data collection and monitoring.

Catch shares and improved monitoring and data collection when used in concert can create a positive spiral leading to sustainable management.

Catch share management will create industry dependencies on reliable fishery data in order to support the commerce of quota trading.

Catch shares change the harvester’s perspective to one of maximizing the value of their defined allocation rather than maximizing the volume of their catch.

Catch shares themselves do not ensure accountability. Accountability is motivated when harvesters gain faith in the management system and understand the role that they play. This change can be facilitated by catch shares and improved monitoring and data systems.

Catch shares are not a “cure all”. They must be implemented thoughtfully in the context of a collaboratively developed and well-designed management strategy.

Fisheries may consolidate under catch shares but those fishers that remain in the fishery will have better business success. Short term economic success will turn into long term success.

Industry accountability can (and should) extend to funding of monitoring programs where the economics of the fishery support it. In BC catch shares facilitated industry to fund or co-fund much of the cost.

Randy Fisher stated:

I personally believe the appetite for recreational fishing is nearly insatiable. What that means to resource managers is developing methods of control. In our case, it is quotas and allocations, and probably not in the too far distant future LAP’s or limited fishery quotas for the recreational charter fleet.

David Goethel stated:

The ACL setting process has forced the councils for the first time to allocate shares of fish between the commercial and recreational fisheries as well as catch shares to individual commercial fishermen. In this process our council, in my opinion, failed to adhere to the mandate of National Standard 4 to allocate fish fairly and equitably among user groups. The end result is that commercial fishermen of New Hampshire have received far less of key species than they should have if National Standard 4 had been followed. Combine this with the amount of allowable catch removed by the Science and Statistical Committee to account for scientific and management uncertainty, and most of the fishermen in New Hampshire will not receive a quota share that is large enough for them to be remotely considered a viable business.

The largest single systemic problem encountered has been the inability to provide fishermen or the council with analyses of the economic and social costs and benefits of various management options that are adequate to support meaningful public comment and debate. For example, in groundfish, we voted an allocation scheme and management regimes in June and the ACL’s in September; and yet no fisherman has any idea what these mean in terms of their catch and business viability in 2010. This rapid decision-making process has been necessary to meet the arbitrary timelines for Magnuson-Stevens Act implementation, but has been described by one observer of the process as, “Fire, Ready, Aim!” When the individual allocations are finally announced, the outcry and anger will be loud and long.

In providing commercial fishermen with their catch history for the purpose of determining their individual allocations, numerous flaws in the recording of the catch across fisheries have been found. Data gaps are multiple and systemic, coming from both dealers and misrecording by the National Marine Fisheries Service itself, but should have been discovered by some kind of auditing process long ago. Now many fishermen are left to fish in 2010 for less then their fair share and scientists are left wondering how stock assessments will have to be modified, when and if a reliable landings census, can be constructed.

What solutions can Congress provide absent a rewrite of Magnuson-Stevens? First, reaffirm the importance of National Standard 4, so that all fishermen are put on a common, fair and equitable baseline when determining allocation. Second, provide adequate funding for monitoring to make sure that both recreational and commercial fishermen do not exceed their ACL’s. Third, provide adequate funding to either correct the landings data base or require the National Marine Fisheries Service to request the councils to consider alternative currency exchange methods, other than landings, when converting from effort control systems to allocation based systems. Fourth, provide clear guidance on how much consolidation is acceptable as the cost of effort control. Finally, specifically, in the case of New England Groundfish, create a government funded permit bank that buys retiring groundfish permits at an equitable price and divides the allocation evenly among remaining fishermen.

Gregory DiDomenico stated:

The five overarching priorities of the national catch share program currently under development are to ensure consideration of such programs by the regional councils, to provide technical/administrative support, to ensure that fisheries perform properly under such programs, to enhance communication with the public sector, and to provide the councils with adequate resources to develop catch share programs. The term ‘catch shares’ is being broadly defined and implementation of such programs may require strong ecosystem-based performance criteria.

Our main concern with any national program is that it must provide the regional councils with adequate flexibility to develop programs tailored to industry needs in the individual regions. In some fisheries (Atlantic mackerel/squid/herring; West Coast groundfish to name a few) it may be applicable for councils to include shore side communities and processors while in other situations it may not be necessary and can be vessel-based. Fisheries are so diverse that providing flexibility to the councils to develop catch share programs is critical. We remain hopeful the agency will pursue such an approach.

Some of the questions asked by subcommittee members included:

Del. Bordolla: If you had to prioritize what would be the top three things this congress could do to help the councils implement their change to end overfishing and rebuild fish populations?

Harris:  First would be increased funding to the councils…the councils need additional funding resources to do the job,  especially with respect to catch shares. As you add responsibilities onto the council’s plates, it gets very difficult for the councils to do the job that we are being requested to do with the same amount of funding we have received in the past… Additional fund are needed to move us forward in the direction you would want to see us move toward.  Also scientific monitoring of fisheries has go to be of huge importance and ranks up with increasing funding as a number one priority. We have to have better data, the fishermen deserve better data. Until we provide them better data, they will never believe the stock assessments no matter who does them or how scientifically valid they are.

Del. Christensen: What are some of the drawbacks of the catch shares program?
Stebbins: There is no perfect solution. It’s always a challenge. When catch shares are fist introduced, there’s often a consolidation of resources. The fisheries in British Columbia  were overprescribed too many boats, large investment in technology and to the point where the entire annual quotas were being caught in anywhere to from a day to a week. So when catch shares came into place, it was a consolidation of those fisheries just based on efficiency.  So fewer boats resulted. It adjusted over time. One of the fisheries, halibut fishery, went from 400 active licenses to about 230. The quota didn’t decrease at all, it was caught more efficiently. Those businesses that did remain I could see were flourishing on a year-round basis. They were much more efficient and for the same amount of fish there was a better return to those boats as well as to Canadians in general who own the stocks simply because they were caught more efficiently. The value of the stocks went way up and the accountability by those that held those licenses went way up to the point that they were actually funding some of the things stock assessments and monitoring programs. That won’t be the case all the time but that particular fishery was very successful in that way.

Rep. Shea-Porter: Were there fewer boats because the fishermen went out of business or did they retire and sell their permits?

Shebbins: There was a consolidation of quota so the actual permits themselves weren’t necessarily retired. But the quota was consolidated and that where the efficiency come from, so vessels were given the opportunity to streamline their operations to coordinate across the different fisheries they were involved in and spread out to maximize their returns. In concern to coastal communities, there was in at least BC a movement of quota in some cases outside of the coastal communities toward some of the larger communities. Now after over ten years, actually the reverse is happening and there is some movement of quota back into the coastal communities. Relating to how catch shares might affect a fishery, the quality of fish went way up and the hence the dollar value of the fish went way up simply because a better product was landed because the motivation of the fishermen became to maximize the quality of the catch.

I know you’re concerned about jobs in the coastal communities. The number of jobs decreased but the quality of jobs that remained was much better, the returns were better, and there were year-round jobs.

Rep. Shea-Porter: Are you concerned about the ability of the small fishermen to pay for the monitoring, and what do you think the cost will be, and will it put any of them out of business?

Goethel: We had a catch shares workshop last week and we were told the most recent number was 63.4 million, and of that the best guesses of the cost of the monitoring system for this sector allocation plan is anywhere from 12.5-25 million in a 63.4 million dollar fishery. The reason for variation in the number because we don’t know how many people in the sector will actually fish first of all and second of all we don’t know the exact level of monitoring. The council has mandated a certain level and we’re still determining if that will be achievable.

Rep. Shea-Porter: So you’re not so much concerned about the monitoring, you recognize that it’s the cost – you don’t want it to fall on unfairly on the small fishermen?

Goethel: That’s correct. If you’re going to run this kind of a system, an allocation based system, you have to have meaningful monitoring. I fished during our last attempt at quotas in New England during the ‘70s and it was a complete disaster because there was no monitoring. No one was there to verify what was actually landed. If you are going to use it this way, you have to have an extensive and unfortunately very expensive monitoring system.

Nicole Smith is a fellow in Environmental Defense Fund’s Washington, DC office.

Audio of the hearing can be found on the committee’s website.