SUPPLEMENTARY INFORMATION:

Background

NMFS manages fishing for groundfish by U.S. vessels in the exclusive economic zone (EEZ) off Alaska in accordance with the Fishery Management Plan (FMP) for Groundfish of the Gulf of Alaska (GOA) and the FMP for the Groundfish Fishery of the Bering Sea and Aleutian Islands Area (BSAI). The North Pacific Fishery Management Council (Council) prepared the FMPs under authority of the Magnuson-Stevens Act. Regulations implementing the FMPs at 50 CFR part 679 and subpart H of 50 CFR part 600 govern fishing by U.S. vessels. Recordkeeping and reporting requirements appear at 50 CFR 679.5.

Catcher/processors and motherships operating in the EEZ off Alaska represent a significant part of the total capacity of groundfish processors in the BSAI and GOA and account for a substantial part of the total landings each year, but currently are not required to supply groundfish product value information. In February 1999, the Council requested that NMFS collect exvessel and first wholesale value data for fish and shellfish products from motherships and catcher/processors through the COAR. Currently, shoreside processors and stationary floating processors are required to submit the COAR annually under title 5 of the Alaska Administrative Code (AAC), chapter 39.130. The information submitted in the COAR is protected by Alaska State confidentiality statute AS 16.05.815.

NMFS proposes to require federally permitted motherships and catcher/processors to complete and submit the Alaska COAR on an annual basis. Combining these data from motherships and catcher/processors with the information from shoreside processors and stationary floating processors would yield equivalent annual product value information for all processing sectors and would provide a consistent time series of information. NMFS could use this information to more efficiently manage groundfish resources. NMFS and the State of Alaska would coordinate the use of the information generated by the COAR.

The expected result of expanding the COAR’s collection of information would be an enhanced socioeconomic database that NMFS could use to more accurately measure economic and socioeconomic impacts and to prepare economic analyses of proposed or existing management measures. It would provide detailed (and consistent) data on production, prices, and product forms that NMFS would use to respond to requests for economic information from Federal and state management agencies, the fishing industry, and the general public. NMFS would also use the COAR data in analyses it prepares in compliance with the mandates of Executive Order 12866, the Magnuson-Stevens Act, including national standards 2, 4, 7 and 8, the American Fisheries Act (to monitor and report to Congress on the effects and efficacy of the new groundfish management programs), and the Regulatory Flexibility Act.

Additionally, the database would be used in the annual NMFS Stock Assessment and Fishery Evaluation documents for the groundfish fisheries of the BSAI and GOA, in annual Federal publications on the value of U.S. commercial fisheries, and in periodic reports that describe the fisheries.

The information would be collected annually on COAR paper application forms from all catcher/processors and motherships issued a Federal Fisheries permit to conduct fishing activities in the EEZ of the BSAI or GOA. ADF&G would provide the COAR forms to each mothership and catcher/processor on an annual basis to record information from the previous year. The motherships and catcher/processors would submit the COAR the following April to ADF&G, Juneau, AK. Each mothership or catcher/processor would be required to complete and submit one or more pages of the COAR to ADF&G for computer data entry. Only one COAR would be required from a vessel that functions both as a mothership and as a catcher/processor during a given year. A certification page would be submitted to indicate that no receipt or production of groundfish took place for that year, and that no other COAR pages would be required. Information from motherships and catcher/processors would be verified using the NMFS weekly production report data base. Information from processors that operate in state waters and shore-based processors would be verified using the ADF&G fish ticket data base.

About 58 percent of the motherships and catcher/processors that would be affected by this proposed rule are already voluntarily complying with the COAR requirement. In 1998, approximately 96 motherships and 237 catcher/processors were issued Federal Fisheries Permits, for a total of 333 at-sea processors. In 1998, based on weekly production report data, 35 motherships and 99 catcher/processors were active. Because 32 of the motherships also functioned as catcher/processors, a more accurate estimate of at-sea processors is 102. A total of 59 at-sea processors complied voluntarily with the 1998 State's data collection requirement and submitted a COAR to ADF&G, leaving approximately 43 processors that did not voluntarily submit the report.

This proposed rule would revise regulations at § 679.2 by adding a definition of COAR and at § 679.5 by adding a new paragraph (p) that sets forth requirements on completing and submitting the C OAR. Finally, several tables would be amended or added to part 679, specifically:

Table 1—Product Codes would be amended by removing code 96 and replacing it with two new codes, codes 88 and 89. Code 96 was established as a category for fish that were in any way adulterated. However, regulations require different handling of fish dependent on the type of adulteration. Therefore code 96, the “discard, decomposed” category, would be split into code 88 for flea-infested or parasite-infested fish, and code 89 for previously discarded or decomposed fish.

Table 14—Ports of landing, including CDQ and IFQ primary ports. Table 14, which currently lists CDQ and IFQ primary port codes, would be amended by creating three separate subtables (a, b, c) that show geographic subdivisions with the appropriate NMFS and ADF&G codes for each port of landing. The ADF&G developed alpha codes to designate ports in its computer database, while NMFS developed numerical codes to designate ports in its database. The ADF&G fish ticket program uses the alpha codes. The CDQ and IFQ programs use the NMFS numerical codes for ports of landing, and the IFQ program uses the NMFS numerical codes in the card-swipe terminal. With the advent of the NMFS shoreside processor electronic logbook and electronic weekly production reports, that use the numerical codes and this proposed expansion of the COAR that uses the alpha codes, NMFS proposes combining in one table both sets of codes in addition to the coordinates for those ports identified by NMFS as primary ports for the IFQ program. Table 14a would present the NMFS codes and the ADF&G codes for ports of landing in Alaska. Table 14b would present the NMFS codes and the ADF&G codes for ports of landing in California, Oregon, and Canada. Table 14c would present the NMFS codes and the ADF&G codes for ports of landing in Washington.

Table 15—Gear Codes, descriptions, and use. Table 15 (which currently describes gear codes and descriptions used with the IFQ Program on the card-swipe terminal plus ADF&G gear codes used on fish tickets) would be expanded to include all ADF&G gear codes. In addition, NMFS and ADF&G have agreed upon uniform definitions of gear types where differences existed. While ADF&G developed numeric codes to designate gear type in its computer database, NMFS developed alpha codes to designate gear type in its database. The CDQ and IFQ programs use the ADF&G numeric codes for gear type, and the IFQ program uses the ADF&G numeric codes for gear type in the card-swipe terminal. In addition, the NMFS logbook system uses whole words to describe a fewer number of gear types (e.g., trawl, jig). With the advent of the NMFS groundfish electronic weekly production reports (which use the alpha codes), the NMFS shoreside processor electronic logbook (which uses the whole words and both the numeric and alpha codes), and this proposed expansion of the COAR (which uses the numeric codes), NMFS proposes to combine in one table, all references to gear types used by either NMFS or ADF&G and to indicate where they are used.

Table 16—Area Codes and descriptions for use with ADF&G COAR. Table 16 would be added to present ADF&G area codes that are used in the COAR. The State of Alaska developed two major systems over a period of about 25 years: the fish ticket system and the COAR. ADF&G defines registration areas for fish tickets as geographic areas for a species where fisheries are managed by the State, meaning that a person must be registered with the State (permitted) to fish in that area for that species. ADF&G registration areas are described in State of Alaska regulations with specific latitude and longitude coordinates, but geographic areas are not necessarily consistent between species. The COAR defines areas generally, often in terms of prominent features or the location of a processing plant. State of Alaska regulations do not describe the COAR areas. NMFS describes areas first by management area (Bering Sea, Aleutian Islands, Gulf of Alaska) and then by reporting area. NMFS’s data collection for all species uses the NMFS area designations (a Federal reporting area often contains State waters). The COAR describes federal waters as: FB for Federal waters, Bering Sea and Aleutian Islands; FG for Federal waters, Gulf of Alaska, and means waters outside of 3 miles in its 200-mile limit. Because the COAR requests information from both ADF&G registration areas and Federal management areas, NMFS proposes to combine in one table, all references to areas used by either ADF&G registration areas or ADF&G COAR. ADF&G is currently working on revising the COAR area descriptions to correspond to ADF&G registration areas. Table 16 would be referenced when completing the COAR to describe areas where products were processed and where products were purchased.

Table 17—COAR Process Codes. Table 17 would be added to present ADF&G codes that describe processes that are used in the COAR.

Table 18—COAR Buying and Production Forms. Table 18 would be added to present the ADF&G buying and production reporting forms that make up the COAR. A separate form is used for each species/gear combination, and for reporting buying of fish or production of fish products.

Classification

Notwithstanding any other provision of the law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the Paperwork Reduction Act (PRA), unless that collection of information displays a currently valid OMB control number.

This proposed rule contains collection-of-information requirements subject to the PRA. The proposed collection with this rulemaking has been submitted to OMB for review and approval. The estimated response times for the COAR requirements are estimated to range from 0.5 hr to 16 hr, at an average of 8 hr per year.

Public comment is sought regarding this proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; the accuracy of the burden estimate; ways to enhance the quality, utility, and clarity of the information to be collected; and ways to minimize the burden of the collection of information, including through the use of automated collection techniques or other forms of information technology. Send comments on these or any other aspects of the collection to NMFS and OMB (see ADDRESSES ).

This proposed rule has been determined to be not significant for purposes of Executive Order 12866.

The Chief Counsel for Regulation of the Department of Commerce certified to the Chief Counsel for Advocacy of the Small Business Administration that this proposed rule, if adopted, would not have a significant economic impact on a substantial number of small entities as follows.

It is difficult to project how many of the firms that will be affected will fall into different size classes. NMFS has attempted to determine the numbers of BSAI and GOA groundfish catcher-processing operations that may be called small on the basis of U.S. Small Business Administration (SBA) guidelines for fishing firms. These guidelines use a $3,000,000 gross revenue threshold to separate small from large operations. These also require that the $3,000,000 threshold consider income to all affiliated operations in its application to any one firm.

NMFS reporting suggests that 70 of the 91 catcher-processors operating in 1999 were small vessels and that 21 were large. These totals changed significantly from 1997 when 58 of the catcher-processors were small and 58 were large. Three of the six motherships grossed more than $3,000,000 in 1999.

These NMFS reports are believed to overstate the numbers of small catcher-processors and motherships and to understate the numbers of large catcher-processors and motherships (with respect to the SBA definitions) for the following reasons: (1) a vessel’s earnings from other fisheries and activities were not included, (2) a vessel owner’s earnings from other sources (i.e., another vessel) were not included, (3) the ex-vessel value of a delivery by a catcher-vessel to an at-sea processor was included only when a fish ticket with value data was submitted for the delivery, (4) vessel specific fish ticket landings weight and value data are used to estimate ex-vessel value for catcher vessels but such data are not available for all deliveries to inshore processors, (5) these estimates do not take account of affiliation relationships that may exist between an individual vessel and other fishing or processing operations.

In 1999 there were 91 catcher-processors and six motherships (that did not also function as catcher processors) in the at-sea processing sector. In 1998, 59 out of 102 at-sea processors, or 58%, filed COAR reports in the absence of this regulation and 43, or 42%, did not. If the percentages were similar in 1999, 41 firms would not file COAR reports in the absence of this regulatory change.

It is estimated that completion of the COAR report takes 15 minutes of overhead time, and an additional 15 minutes for each species and product combination produced by the firm. Weekly Processor Reports for 1999 indicate that vessels were producing an average of 15 species and product combinations. The COAR report will increase the number of species and product combinations to be considered. For the purposes of this analysis, it is assumed that this will increase the number of species and product combinations by 50%, to 23. This means that it may take 360 minutes, or 6 hours, to fill out each COAR report.

It is estimated to cost $50/hour to complete these forms. This implies that the cost for completing a COAR report would be $300 if it took 6 hours. If regulatory change requires 41 vessels to begin to fill out these reports, the total annual additional compliance cost for all at-sea processors would be $12,300.

While it is hard to project the numbers of firms of different sizes that will be affected by this rule, it seems likely, on the basis of the considerations described in the cost discussion of this section, that this requirement will not have a substantial impact on the cash flow, or the profitability, of either large or small groundfish at-sea processors.

As noted above, the total annual industry cost of this rule is estimated to be about $12,300. In addition there will be some start-up expenses. The average cost for an individual vessel is estimated to be about $300. It has been estimated that in 1999 groundfish catcher-processors produced a processed value of about $469.6 million (this catcher-processor gross combined with an estimated 1999 mothership gross of $22.8 million, gave a total at-sea processor gross of $492.4 million). This is an average of $5.16 million for each catcher-processor operation. As noted above, only 21 operations grossed more than $3 million so the distribution of harvest values is highly skewed. Nevertheless, it seems unlikely that even smaller catcher processors will find their cash flow or profitability significantly negatively impacted.

Based on the above description, NMFS has determined that this action would not have a “significant impact” as NMFS has interpreted that term to mean that it would have disproportionate or profitability impacts. The proposed requirement would not place affected entities at a significant competitive disadvantage relative to large entities, and would not significantly reduce profit for the regulated entity. Therefore, a regulatory flexibility analysis was not prepared.

The President has directed Federal agencies to use plain language in their communications with the public, including regulations. To comply with that directive, we seek public comment on any ambiguity or unnecessary complexity arising from the language used in this proposed rule. Such comments should be sent to the Alaska Regional Administrator (see ADDRESSES ).

Alaska, Fisheries, Recordkeeping and reporting requirements.

For the reasons set forth in the preamble, 50 CFR part 679 is proposed to be amended as follows:

1. The authority citation for 50 CFR part 679 continues to read as follows:

Authority: 16 U.S.C. 773 et seq., 1801 et seq., and 3631 et seq.

2. Section 679.2 is amended by adding the definition for “Commercial Operator’s Annual Report (COAR).”

3. Section 679.5 is amended by adding paragraph (p) to read as follows: