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Web posted Sunday, October 14, 2007

Federal council asks for review of crab fisheries' shares

By Margaret Bauman
Alaska Journal of Commerce


  Fields    
Federal fisheries regulators agreed Oct. 7 to revisit a bitter dispute of how shares of the lucrative Bering Sea and Aleutian Islands crab fisheries are doled out to harvesters and processors.

The action, opposed by some and seen as a breath of fresh air to others, is a lengthy process that could take several years to resolve.

The analysis by staff of the North Pacific Fishery Management Council will be presented in Anchorage in October 2008. At that point, the council is likely to refine its request, seeking further detailed analysis before approving any changes in the federal crab rationalization plan, which states that 90 percent of the crab harvested be delivered only to processors that are allocated individual processor quota shares.

The fishery, worth hundreds of millions of dollars, got a boost in late September, when the Alaska Department of Fish and Game announced harvest quotas of 20.3 million pounds of king crab, 63 million pounds of snow crab and 5.6 million pounds of tanner crab. All three quotas were significant increases over the 2006-07 season.

Processors for the most part have argued that the crab rationalization program is working as anticipated, while harvesters argue they've been shortchanged.

Duncan Fields, a commercial fisherman and attorney from Kodiak who was recently appointed to the council, applauded the decision to examine the quota share issue. He said it's a significant first step toward resolving the bitter issues related to the federal crab rationalization program.

“I trust that as the analysis is developed, we will better understand in detail and depth who the winners and losers have been,” he said.

Fields said he was heartened that the motion proposed by Fish and Game Commissioner Denby Lloyd includes crew representation on the crab advisory committee, but disappointed that communities are not included in the discussion.

“I expected a thorough review of skipper/crew issues through the committee,” Fields said.

Lloyd proposed that the council examine the effects of a change in the way shares in the fishery are split on the distribution of benefits between harvesters and processors, and on the role or necessity of binding arbitration in harvester and processor negotiations.

Lloyd asked further that the analysis include a discussion of expected effects of such a change on the distribution of harvest landings among communities. The amended proposal approved at length by the council directed that analysis be provided for the status quo 10/10 split, as well as 80/20, 70/30, 50/50 and 0/100 splits for each of several crab fisheries.

The council also asked its crab advisory committee to continue its work, with a focus on programmatic issues and effects of policy decisions related to the crab rationalization program.

Processors, skippers and crews involved in the lucrative shellfish harvests packed the meeting room at the Anchorage Hilton Hotel Oct. 5-8, where management of the Bering Sea-Aleutian Island crab fishery filled the agenda for nearly four days. The federal plan, informally referred to in the industry as “crab ratz,” has been controversial since the fall of 2005, when the public crab resources were first divvied up between harvesters, processors and coastal Alaska fishing communities.

The plan allows for allocating a percentage of each year's allowable catch to qualified harvesters based on their history in the fishery. It also dictates that 90 percent of the shares, known as A shares, may be delivered only to processors allocated individual processor quota. The other 10 percent, the B shares, may be sold by harvesters to any processor they choose.

The controversial decision to allocate A shares to approved processors was intended primarily to add stability to the processing sector, according to the council. The 10 percent B share allocation was intended to provide negotiating leverage to harvesters, opportunities to enter the processing sector, and a check on the processing market by providing a negotiated market price.

To address potential disputes over the price and other terms of A share crab deliveries, the program includes a controversial arbitration system.

Some participants in the crab fishery, like crab vessel owner Lenny Herzog, told the council that the arbitration program was intended to and is protecting the harvesters.

“Harvesters have gotten great prices for their crab in he first two years,” Herzog said during testimony to the council.

Others, like harvester Margaret Hall, said the current arbitration system is expensive and cumbersome, and that the B shares have failed to provide harvesters with much flexibility in the marketplace.

Fields and former Alaska legislator Sam Cotton of Eagle River, another recently appointed council member, argued that it would be better for the council to get its first look at the analysis in April. But others, like Gerry Merrigan of Prowler Fisheries in Petersburg, Seattle's Glacier Fish Co. president John Bundy and Bill Tweit of the Washington Department of Fish and Game, were successful in pushing the October deadline.

In advance of the October session, the council's senior economist, Mark Fina, prepared a regulatory impact review and initial regulatory flexibility analysis on several areas of the crab rationalization plan, including C shares, the 3 percent of total allowable harvest shares currently allocated to skippers and crew.

Under the initial crab plan, captains and crew allocated harvest shares were allowed for the first three years of the federal program to sell their harvest anywhere they chose. The council could decide at its December meeting whether C shares also would fall under the 90/10 program, dictating that 90 percent of C shares also must be delivered only to processors allocated quota shares.

Margaret Bauman can be reached at margie.bauman@ alaskajournal.com.

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