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Scallop Permit Stacking: Corporate Takeover ?
Steve Ouelette, a lawyer representing the small scallop boats in New Bedford, Mass., said that permit stacking and leasing will benefit only a few, big-business fishermen, who will buy up permits and shut out small-boat fishermen. “It involves a fairly serious modification to the way this fishery is conducted,” Ouelette said. He said the proposals will only make certain large business operations more efficient, and will not truly result in any capacity reduction. Stacking will not reduce the amount of product that’s caught, nor the number of days spent fishing. “The idea is to make one vessel a more efficient, profit-making machine,” he said. “By allowing consolidation, you’ll move multiple permits to the more efficient vessels.” Small-boat fishermen will be unable to compete, Ouelette said. “It will change the nature of the fishery from small businesses to a corporate structure,” he said. As the fishery is structured now, he said, it is viable for all fishermen. A survey of limited access boat owners revealed that single-boat owners overwhelmingly oppose the capacity reduction alternatives, while owners of multiple boats support them, Ouelette said. By letter, scallop fisherman Arthur Ochse said he also opposed permit stacking and leasing. “It has been demonstrated in the past in other fisheries that permit stacking and leasing has resulted in monopoly which in turn has caused loss of jobs and opportunity for related businesses,” Ochse wrote. Permit stacking and leasing “will cause the loss of jobs, great stress and loss of opportunity to related businesses,” he wrote. But Jeff Pike, representing the Sea Scallop Capacity Reduction Coalition, which represents about a hundred full-time permits, said the stacking provision is necessary to allow limited-access fishermen to get by, particularly with IFQs and sectors off the table now. Most small boats fish in the general category, Pike said, and the provision would not affect them. “There’s a tremendous amount of overcapacity,” Pike said. A decade ago, he noted, boats worked more than 200 days per year. That number is down to 80 today. Boats sit idle 75 percent of the year, he said. “We have a lot of steel just sitting in the water”. The coalition’s proposal, he said, is to stack or lease only two similar permits, not to allow large businesses to buy dozens of permits. The 5 percent ownership cap would remain intact. The proposal, he said, does not promote an increase in fishing effort or fishing mortality. Addressing excess capacity in the limited access fishery is one of the goals for A15.“There is currently excess capacity in the limited access scallop fishery; that is, the capacity of individual vessels and the fleet as a whole is greater than what is needed to harvest sustainable levels of catch,” the A15 draft reads. “Since the limited access program was implemented in 1994, the number of DAS has reduced steadily. Due to effort reductions in Amendment 4 (1994) and Amendment 7 (1999), DAS allocations were reduced almost by half from 204 DAS in 1994 to 120 DAS in 1999. Since 1999 more effort has been allocated to access areas rather than open areas, so the number of open area DAS allocated has continued to decline. Today open area DAS allocations are closer to 40 DAS and five access area trips for a full-time vessel. For an average full-time vessel, that represents about 80 DAS per year – about 40 in open areas and 40 in access areas. “Members of the industry have approached the Council explaining that this level of effort is insufficient to maintain vessels and crew throughout the year with increasing costs. Therefore, the Council is considering a range of options to reduce excess capacity in the limited access fishery and increase efficiency of the fishery overall.” Permit stacking is viewed as a way to allow a single limited access vessel to have more than one limited access scallop permit. Various options include a restriction on the number of permits that can be “stacked” and specific adjustments that would be “charged” if a vessel decides to stack permits in order to reduce capacity. A restriction that limits stacking to two permits only would allow a limited access vessel to fish the allocations for both permits. Both permits could be of unlike permit categories and unlike vessel baselines in terms of horsepower and length. There could be additional restrictions on stacking in terms of fishing power adjustments and other provisions, in order to address concerns that stacking could move effort from less powerful or lower- performing vessels to more powerful or higher-performing vessels, potentially increasing capacity and fishing mortality. It is expected that a stacking alternative would reduce the size of the scallop fleet by allowing a limited level of permit stacking. Idled vessels could be sold or scrapped and future investments could be made into one vessel instead of two. A leasing alternative would allow a limited access vessel to lease fishing effort from another limited access permit. There is one option for DAS leasing, leasing of access area trips, or leasing of an entire permit. There are several alternatives for fishing power adjustments that would be “charged” if a vessel decides to lease effort in order to reduce capacity. The Sea Scallop Capacity Reduction Coalition’s Pike said that stacking and leasing would eventually weed out 50-70 boats from the fishery, probably boats that are older, making for a safer fishery. In other business, NEFMC decided to remove an individual fishing quota option for limited access vessels from consideration for A15. NEFMC and its Scallop Oversight Committee had previously heard comment from many fishermen that the fishery is ripe for a transition to an IFQ program, noted committee chairman Sally McGee. The benefits, she said, would include increased catch per unit of effort, which would reduce scallop gear/sea turtle interaction; and would lead to greater efficiency and profitability for fishermen. But there wasn’t enough consensus among stakeholders to pursue the program at this time, she said. An IFQ program would require a referendum and the process would be lengthy, and there didn’t seem to be sufficient interest to pursue this at this time, committee documents say. In general, IFQ management involves allocating scallop catch in pounds rather than DAS and access area trips. NEFMC retained a measure that would expand the rotational area program so that open area DAS would be replaced with a certain number of trips. NEFMC said that one of the desired outcomes of the program could be an increase in scallop catch-per-unit-of-effort and potential decreases in the adverse impacts on sea turtles and habitat. NEFMC also approved priorities to guide the development of Amendment 15 during 2009. These are: ACLs and AMs, followed by a specs package in fishing year 2010 and finally all other measures. |
