MAINE PERMIT BANK OPENS continued from Home Page

In recent decades Maine has seen the groundfish stocks disappear from eastern Maine waters. The number of groundfish permits in Maine has also declined significantly at the same time. The only other permit bank in Maine was established by the Island Institute and the Nature Conservancy, which to date has bought one federal permit.

One other permit bank is not strictly a Maine entity.

Port Clyde fisherman Glen Libby noted that there are permits out there with no quota. These permits, as part of the total count on existing permits, gives a distorted count of the usable permits with value. As to the number of permits now held in Maine, no one interviewed would venture a guess and NMFS in Gloucester was equally vague.

Brawn said they are primarily interested in those permits with days at sea or those that can be used for Potential Sector Contribution.

Maine, as the New England state most seriously impacted by loss of access, has for many years attempted to have it’s case heard, which has included seeking emergency relief. The Maine Permit Bank Program has been chosen by the feds as a pilot program. The state of Maine has a general, species non-specific, commercial fishing license for state waters within the three-mile limit. The permit bank is seeking federal multi-species permits.

Part of the goal, said Brawn, is to restore and preserve groundfish access for the State of Maine. With $3 million in federal funds, Maine will buy limited access permits and distribute them to eligible fishermen. Eligibility is based, among other things, on town size, a population of 30,000 or less and a boat length of 45 feet or less.

The two other New England states that received federal funds for permit banks got $1 million each.

“The big story”, said Brawn, “is the purchase of permits, some of which could be active for 2011. Some days at sea permits could be active this fall.” Because of sector rules others will only be active after May 1, 2011.

The state will own the permits and give out allocation with them. At some point there will be a fee collected from permit users to pay for the management of the permit bank system.
After sending out a post card announcing the availability of an 8 page Request for Proposals (RFP) which seeks permits for sale, to 1,200 federal permit holders between Maine and Florida on June 28, and 100 cards were returned by July 21. Answering questions from these prospective sellers marked the official beginning of being in the business of buying permits for the Maine permit bank.

The price of permits can easily run to six figures, but it is hoped that patience and judicious action will stretch the available money. While it is possible for more federal money to be allocated to buy permits, with the current economic conditions it doesn’t seem likely any time soon.

The questions from prospective permit sellers ranged from why were they not proceeding some other way to how do sellers get paid. Other uses for the money were suggested, but the “DMR received this federal appropriation specifically to establish a Maine permit banking program. There are specific guidelines dictating how it must be used. The program is intended to help support the small vessels and infrastructure in Maine’s rural fishing communities by providing increased fishing access.”

The splitting of permits (lobster, groundfish, scallops, etc.) is not allowed according to federal regulations. However, Amendment 15 to the Federal Scallop Fishery includes an alternative that would allow IFQ permit holders to transfer all or part of their quota to other IFQ permit holders and/or community fishing organizations. At this time however, the alternative is merely an option under consideration.

Sellers of permits are not necessarily out of the fishing business after selling their permit, because they can buy other permits. In dealing with the permit bank they will not be able to negotiate the price with the buyer. The state and the federal government have guidelines for how money is spent and negotiation is not included.

The DMR will convene a Review Panel which will evaluate each proposal using the evaluation criteria outlined in the RFP. The panel will include the DMR, the fishing industry and members of the public. Those bids that score the highest will be purchased. Brawn said the state will only purchase permits that represent a good value. The State may choose to spend all available funds, or to reject all offers, or to spend only a portion of the funds available.

The DMR will not be involved with any aspect of assigning value to individual permits. Methods for helping determine a fair price include talking to other permit holders or permit brokers, etc. However, the final decision rests with the offeror, who must determine a price at which he/she would be willing to part with the permit.

As of July 22 the RFP has been temporarily suspended. Brawn said this is a temporary delay while the DMR and NOAA, which are partnering in the development of this Permit Bank, work out some of the ways to improve how the Permit Bank will be run. These details include how purchases of permits will be made given the purchasing will be done by state and federal agencies with federal money, while adhering to established guidelines for spending those funds.

Brawn could not comment on the details of the negotiations between NOAA and the DMR on these procedural matters, but she said they are using it as an opportunity to make necessary changes to the memorandum of agreement between the two agencies.

If there are changes to the RFP, they will be made promptly and sent out to prospective permit sellers who responded to the post card announcement.

Libby mentioned an area that might need to be reconsidered. He referred to the 30,000 town population limit as not recognizing the fact that there are fishermen in larger towns who need access. He also mentioned the 45 foot boat length limit. Many small boats are in the 50 to 70 foot range, he said, and would be excluded. A 45 foot boat limit would eliminate many of the Port Clyde fishermen in his sector.

The criteria set for eligibility in the Permit Bank Program that the DMR and NOAA are developing are different from those of the Nature Conservancy/Island Institute permit bank. The Island Institute and the Port Clyde fishermen were working together to develop low impact gear, and doing colaborative research, etc. Fishermen who lease the Nature Conservancy/Island Institute permit quota, will be required to use the gear improvements, etc., that the Port Clyde sector has committed to.

The Permit bank Program is officially in business, but procedural wrinkles are being ironed out as the plan to buy permits moves forward.