Ocean and Coastal Law Memo

Ocean and Coastal Law Center, School of Law, University of Oregon, Eugene OR 97403

I. Introduction

The Ocean and Coastal Law Center at the University of Oregon School of Law is in the process of
completely revising its Federal Fisheries Management guidebook to the Magnuson Fishery
Conservation and Management Act (MFCMA). Currently, Congress is considering significant
changes to the MFCMA, and it is our intention to not publish the new edition until the
reauthorization process is complete and the new amendments can be incorporated. The following
update is intended to inform readers on the reauthorization process primarily by highlighting
the key amendments to the Magnuson Act under consideration by Congress as of August 19,
1994. Although congressional staffers and fishery administrators remain optimistic that the
reauthorization of the MFCMA will be completed before Congress's October adjournment, it is
not clear that this goal will be achieved. Therefore, it is not possible at this time to state a
specific publication date for the new guidebook.

The new guidebook is being designed to serve as a guide to the MFCMA for all interest groups and
their legal counsel. It will not be limited to an analysis of the MFCMA. Other changes in
international and national law increasingly are affecting the domestic commercial fishing
industry and its managers. The new guidebook will therefore briefly discuss the relationship of
these laws to the MFCMA. These laws include (1) recent amendments to the Marine Mammal
Protection Act (MMPA) and other laws; (2) the 1982 United Nations Convention on the Law of
the Sea (UNCLOS), which the Clinton Administration is submitting to the Senate for advice and
consent to ratification; (3) the General Agreement on Tariffs and Trade (GATT); and (4) recent
MFCMA-related court decisions. Because of dramatic changes in fisheries management in the
United States 200-mile exclusive economic zone (EEZ), the new guidebook will shift its
emphasis away from foreign fishing and joint ventures. The book will include more information
on emerging fishery management tools, especially the increased use of various forms of limited
entry, such as individual transferable quotas (ITQs).

Our intention is to provide a comprehensive review of the MFCMA and other laws that affect
commercial fishing in waters within United States jurisdiction, especially in the EEZ. We
apologize for the delay in producing a new guidebook, but in the interest of publishing an up-to-
date and useful guide it is the view of the editor that it would be best to await the results of the
current reauthorization process.

Since the Magnuson Act is currently being reauthorized, a reasonable place to begin this memo
is by defining reauthorization and its role in congressional oversight of federal fisheries law.

II.Reauthorization

A. What Does It Mean?

When a law comes up for "reauthorization" it means Congress must review a schedule of future
funding for previously approved and already functioning government programs. Therefore,
reauthorization does not affect all laws. Instead it is a tool Congress uses to keep tabs on ongoing
programs. For example, the Magnuson Act created eight regional councils that draft and
implement federally approved fishery management plans (FMPs). It also requires the National
Marine Fisheries Service (NMFS) to conduct research and provide scientific data on the status
of various stocks. These activities cost money, and reauthorization allows Congress to set
funding guidelines for a period of years into the future. For example, Congress is currently
planning on reauthorizing the MFCMA through 1999. This gives the President and the
administration guidance as they prepare budgets to present to Congress each year. Of course,
the administration and Congress itself can later choose not to fund programs at the reauthorized
level set by Congress. In any case, when the authorized period of years set by Congress lapses,
the bill comes up for "reauthorization." This provides an opportunity for Congress to review
the successes or failures of programs. Based on the review, Congress can cancel a program or
redirect future funding. Often substantive new programs or provisions are added to the law.

It is important to note that the dollar amounts set during reauthorization are not the same as an
appropriation in the annual budget. Exactly how much money actually will be appropriated is
decided each year when every on-going government program gets an appropriation in the annual
budget. It is during this appropriating or annual budgeting process that the actual dollars are
doled out for federal programs. This is when fishery management competes with national
defense, health care, highway construction, and countless other federal programs for funding.
Reauthorization, on the other hand, is a part of the authorizing (as opposed to the
appropriating) legislation that creates the law itself. It serves as an opportunity for Congress
to fine tune or otherwise adjust a law and also for Congress to set new funding levels it believes
necessary to carry out those changes.

B.What If a Law Is Not Reauthorized Before the Previous Authorization Expires?

Since Congress must also pass a separate appropriations bill each year anyway, a law such as
the MFCMA does not expire if reauthorization is not completed before the prescribed period
lapses.

The fact is that most federal environmental laws do not evaporate merely because their
authorizations have expired. Absent express "sunset" language, a federal statute's substantive
provisions usually remain in effect despite the expiration of its authorizations. In such a
situation, the only essential question is whether the government continues to possess adequate
"budget authority" to spend federal funds on behalf of the expired program. Conveniently,
annual appropriations acts are deemed adequate for providing this requisite "budget authority."
Thus, as long as funds are appropriated, an environmental statute remains in business.[1]

In short, a failure to reauthorize does not mean a whole lot as long as Congress appropriates
money in the annual budget to keep a program going. Annual appropriations are approved in the
interim as a sort of stopgap measure until Congress later picks up the debate on proposed
amendments and completes the reauthorization process during a subsequent session.

C.The Status of the Current Reauthorization of the MFCMA

The Magnuson Act's authorization lapsed on September 30, 1993. Congress failed to
reauthorize the law before it adjourned last October. It instead appropriated money to fund the
various activities authorized by the MFCMA for one more year. The issue now is whether
Congress will reauthorize the Act before it adjourns this October, or whether it will once again
keep the current law in effect for another year as it continues to debate proposed amendments.

At this time it is unclear if Congress will complete the reauthorization process before its
scheduled October adjournment. The House fisheries subcommittee approved a proposed bill in
early August that is now before the full Merchant Marine and Fisheries Committee. The
subcommittee, however, avoided debate on some key issues, including ITQs, preferring instead
to let the full committee debate such topics. The bill now awaits markup by the House Merchant
Marine and Fisheries Committee, where staffers expect it will undergo significant modification.
The Senate National Ocean Policy Study released a draft bill for consideration by the Senate's
Commerce, Science, and Transportation Committee in early August. It would amend both the
MFCMA and the Merchant Marine Act. Markup by the committee is not expected before early
September.

The debates on crime and health care initiatives are delaying action on and threatening to
prevent reauthorization of the MFCMA this year. Originally staffers hoped to have a draft bill
through both the House and Senate committees prior to Congress's scheduled August 12 recess.
Upon return from recess, both houses would then have had a bill ready for floor debate,
improving chances for passage of a reauthorized bill by the October adjournment. This has not
happened, as both bills have yet to be moved out of committee. Furthermore, Congress has not
taken its recess, and it is unclear if or when it will do so. Finally, at this time the House and
Senate versions differ significantly. This means that, even upon approval of a bill by both
houses, some time must be allowed for a joint conference committee to draft a compromise bill
that must then be approved by both houses before it is presented to the President for his
signature. Staffers and other interested parties agree that time is running short but remain
optimistic that a reauthorized bill can be approved this year.

The remainder of this memo discusses many, but not all, of the proposed amendments to the
MFCMA. The draft bills discussed are those made public as of August 19. Readers are cautioned
that both the Senate and House versions have yet to be marked up and approved by the
appropriate committees. Congressional staffers expect significant changes to be made at the
committee level.

III.The End of Foreign Fishing: A Magnuson Act Success Story

Congress enacted the MFCMA and created the 200-mile fishery conservation zone (now called
the exclusive economic zone or EEZ) in direct response to a dramatic rise in foreign fishing off
the coasts of the United States in the early 1970s. One undisputed success of the MFCMA has
been the virtual elimination of foreign fishing within the EEZ. Likewise, the interim use of
joint ventures between American fishers and foreign processors declined and was phased out as
American processors invested in shore facilities and offshore processing vessels to accommodate
many previously underutilized species. Originally, Congress did not intend to eliminate foreign
fishing in the EEZ. Subsequent amendments to the Magnuson Act, however, did establish a
hierarchy giving first preference to American fishing and processing interests, second
preference to joint ventures, and third preference to foreign fishing.

The transformation from having 70 percent of the fish off the United States coasts caught by
foreigners in 1973 reduced to about 1 percent in 1989 is a remarkable achievement. Most
experts agree that foreign fishing and joint ventures are now relegated to history and that they
are unlikely to play a significant role in the future of American EEZ fisheries. In May of 1994,
one NMFS official said that some Atlantic mackerel was made available for a joint venture in
1994, but foreign fishing fleets expressed little interest because the venture did not also
include any direct foreign fishing. He concluded, "I doubt we'll ever have a TALFF again."[2]
Some commercial fishers on the East Coast have complained that they have been unable to
establish markets for some fish because buyers are reluctant to contract for fish that might be
bought cheaper if the resource is allocated to foreigners. The House and Senate draft
reauthorization bills would place a moratorium on offering foreign fishing for certain Atlantic
mackerel and herring fisheries. Joint ventures would, however, be allowed. The House and
Senate versions also add provisions requiring foreign-flag vessels to obtain "transshipment
permits" before transferring United States fish within the EEZ.

The mechanisms for allowing foreign participation in United States EEZ fisheries remain a part
of the MFCMA. This means foreign fishing or joint ventures remain an option if American
fishing or processing interests are unable to catch or process allocations of EEZ fish. The
overcapitalized state of the domestic fishing industry, however, renders this possibility remote.
States also retain the option of requesting permits allowing foreign participation in state-
managed fisheries, but for similar reasons such requests have become a rarity. The bottom line
is that foreign fishing and joint ventures briefly played a major role in EEZ fish management,
but, as intended by Congress, they were only stepping stones to full domestic utilization.

It is worth noting that some critics point out that just because factory trawlers fly American
flags and modern shoreplants have been constructed on American soil does not mean foreign
interests have been shut out of United States fisheries. They point to Alaska, where the factory
trawler fleet has been heavily financed by a Norwegian bank and where many new shoreplants
were financed and are, in part, owned by Japanese companies. The prospect that some of these
foreign interests might acquire permanent quota rights to United States EEZ fish resources may
prove to be a hurdle for expanding the use of limited entry and ITQs. Indeed, how to prevent
foreign investors from getting control over ITQs has been a part of the congressional debate on
ITQs (discussed further below) during the reauthorization process.

IV.New Groups Take an Interest in the Health of United States Fisheries

It is difficult to provide a nationwide overview of fish stocks because there are so many species
ranging over the 200-mile-wide EEZ off all the coasts of the United States from Maine to the
Gulf of Mexico and from the South Pacific to the West Coast and on up to Alaska. Efforts by
NMFS, the agency charged with assessing fishery stocks, to evaluate populations are hampered
by the fact that, unlike land-based animals, fish are part of a fluid underwater environment.
This makes it difficult to actually count fish populations and forces NMFS to estimate stocks
based on the "best scientific evidence available," which in many cases is limited. Nevertheless,
NMFS recently published its assessment of United States fish stocks.[3] It is impossible to
provide an adequate summary of the status of all fish stocks here, but in its report NMFS notes
that some of the nation's most historically important fisheries are in serious decline, including
several key species of Northeast groundfish, Atlantic bluefin tuna, many Pacific coast salmon
runs, and Gulf of Mexico shrimp.[4] Of the fish stocks where status is known, 40 percent are
overutilized, and more than 65 species are overfished.[5]

A variety of fishing industry and environmental publications, as well as major newspapers,
have documented the decline in certain fish stocks and the resulting economic devastation of
many coastal communities. In 1991, the Center for Marine Conservation (CMC) published a
comprehensive analysis of federal fishery management that concludes that the MFCMA succeeded
in getting rid of foreign overfishing only to replace it with domestic overfishing.[6] In 1993, the
CMC published Fish for the Future: A Citizens' Guide to Federal Marine Fisheries Management
that further warns of stock declines as it encourages the public to become more involved in the
management process.[7] The CMC also has played an important role in founding the Marine Fish
Conservation Network (MFCN), an umbrella group representing a broad range of
environmental, conservation, commercial and sport fishing, coastal community, and other
interest groups. Most recently, a popular liberal and environmental magazine published a
series of stories on the politics and health of commercial fish populations.[8] One article noted
that the United Nations has reported that up to 60 percent of the world's fish populations it
monitors are fully exploited or depleted.[9]

Bill Mott, a spokesman for the MFCN, recently said that it is because of serious declines in many
fish populations that reauthorization is needed this year to prevent further devastation and to
bolster the MFCMA's provisions regarding conservation, management, and protection of fish
stocks. The management regimes being proposed by groups like the MFCN are partly responsible
for prolonging debate on reauthorization of the Magnuson Act. As new interest groups,
especially environmental and conservation organizations, take an interest in fishery
management, it becomes increasingly difficult for Congress to agree on a law that is satisfactory
to all.

Historically the management process at the regional council level has been dominated by the
various commercial fishing interests themselves. Council debate focused largely on how much
of a quota would be allocated to various user groups. Today this is no longer true.
Environmentalists, coastal communities, sport and recreational fishing interests, and others
are demanding a larger role, including seeking more nominations to the regional councils. The
MFCN and other conservation interests are keeping a constant vigil over the reauthorization
process and have found bipartisan support in Congress to promote their interests. Several of
the network's proposals have been incorporated into the House draft bill.

V. Proposed Amendments to the Magnuson Act

The most significant amendments under consideration aim to rebuild, conserve, and better
manage EEZ fish resources. As one conservationist told Congress, "we have lost the 'C' in the
FCMA."[10] Whether it is the effectiveness of the conservation lobby or the cry from
constituencies devastated by the collapse of key fisheries is unclear, but Congress seems to be
heeding the call for increased conservation. The primary proposed amendments include those
that would (a) address conflicts of interest; (b) define "overfishing" and "bycatch" and
mandate specific actions to eliminate or reduce their negative effects on stocks; (c) institute
fees for ITQ shares; (d) place a three-year moratorium on new ITQ programs; (e) protect and
enhance fish habitats; (f) bolster fishery research and monitoring of fisheries; and (g)
implement a National Vessel Registration Program, provide disaster relief, and refinance debt.
In addition, the Senate draft has several detailed provisions for managing fisheries off Alaska's
coasts and a program for the management of United States high seas fishing vessels in order to
comply with international commitments. Again, it should be noted that these are only draft
proposals, and they are subject to significant changes. They are likely to be amended by the
appropriate committees, the full House and Senate memberships, and a joint conference
committee.

A.Conflict of Interests

Because of the increased involvement of new interest groups, the domination of many regional
fishery management councils by the commercial fishing industry may be coming to an end.
Critics of the historical makeup of the regional councils suggest that fishing industry
representatives have controlled policy, been shortsighted, and often lined their own pockets
after being appointed to the regional councils and various advisory committees. Commonly,
critics make an analogy to allowing the "fox in the hen house," with those who want to harvest
the fish deciding who gets the rights to fish and how much they will take. In support of this
position, they argue that while the MFCMA succeeded in eliminating foreign fishing, the
government's own statistics show a continued decline in many vital fish stocks. On the other
hand, one former North Pacific Fishery Management Council (NPFMC) member believes that
these claims are not always warranted. He says that the NPFMC, which manages Alaska's vast
fish resources, is a good example of a council that has approved measures that consider a broad
range of interests and conserve fish despite being dominated by various fishing industry
interests.[11]

The House and Senate draft bills both propose to tighten the conflict of interest provisions of the
MFCMA by requiring council members to recuse themselves from voting on issues in which they
have a direct financial stake. The MFCMA currently requires voting members to disclose when
they, their family members, or groups they belong to have a financial interest in a fishery, but
it does not require them to abstain from voting on decisions where those interests are directly
affected. The House version directs the Secretary of Commerce to establish rules for recusal.
The General Counsel of the National Oceanic and Atmospheric Administration (NOAA) or a
designee would determine whether a conflict exists. Any voting council member could request
NOAA to make a conflict of interest determination. The standard is whether a voting member
would be "significantly affected." The Senate version would have the Secretary designate an
official to make such determinations based on a test of whether council members might
"significantly enhance" their economic positions. Under both drafts, a finding of a conflict
prevents voting, but the council member could continue to participate in the debate on the
issue. The Senate version also directs the Secretary to formulate regulations for recusals and to
review the decisions of the designated official.

Proposals to limit the number of seats held by industry interests or to guarantee
conservationists seats are not contained in the draft bills. But some strengthening of the Act's
language requiring input from a broad spectrum of interests and ensuring opportunities for
public participation in the council process has been included in the House draft. Both the House
and Senate versions would require the placement of a Native American representative on the
Pacific Fishery Management Council.

Others suggest that meddling with the appointment provisions is unnecessary. They propose
better oversight of the regional councils' FMPs by the Secretary of Commerce. At least one
court has agreed that the required approval of FMPs by the Secretary need not be a mere rubber
stamp and that the MFCMA allows the Secretary to unilaterally make changes to plans under
review.[12] Still others propose oversight of the councils by creating a central fishery
commission appointed by the President with approval from Congress. Such proposals have not
gotten strong support, probably because the apparent intent of Congress in creating regional
councils was to decentralize fishery management by giving regional councils (and the states that
appoint the members) the primary role in designing FMPs. Barring a fundamental
philosophical shift by Congress, it is unlikely that a grant of power to a central decision-
making body will occur during reauthorization.

B.Defining Terms: Bycatch and Overfishing

In an effort to prevent further declines in fish stocks, proposed amendments in both houses
define or redefine certain terms, including "overfishing," "bycatch," and "essential fishery
habitat." Councils would be required to institute actions and amend FMPs to restore overfished
stocks, prevent overfishing and bycatch, and protect and restore fishery habitats. Both drafts
require councils to institute recovery programs for overfished or depleted stocks, providing a
timetable for full recovery has been included. Increasing the emphasis on biological and
ecological factors, despite adverse economic effects on the fishing industry, is also being
proposed. In short, conservation of fish stocks at sustainable levels, not the fishing industry's
economic woes, would be the prevailing factor when a council sets a total allowable catch (TAC).

Perhaps one of the more controversial areas is the bycatch of nontargeted, prohibited, juvenile,
and undersized fish. It has been estimated that up to one-third of all the fish harvested by
commercial fishing vessels is returned to the sea, most often dead or dying. This waste of
valuable food resources is being widely publicized by conservationists. On August 30, 1994,
the Associated Press reported on a recent study commissioned by the Alaska Department of Fish
and Game that concluded that in 1993 more than 740 million pounds of edible fish were dumped
overboard in the North Pacific. The majority of the fish was harvested by the trawl fleet
operating in the Bering Sea and Aleutian Islands regions.[13]

At this time, the Senate bycatch provisions, proposed by Senator Ted Stevens (R Alaska), would
affect only the NPFMC. Critics have pointed out that bycatch occurs in every region, and in
response staffers say some nationwide restrictions on bycatch may be added to the Senate bill.
The Senate version defines bycatch as "fish . . . for which conservation and management
measures have been established, but which are not a target of the fishery in which a fishing
vessel is operating; or marine mammals, birds or prohibited fish." "Prohibited fish" are
defined as those fish caught in a commercial fishery that fishers "are prohibited by regulation
from retaining, or are required by regulation to retain but not sell." These definitions do not
include all nontarget fish. Instead, another term, "economic discards," is defined as "fish
which are not retained by the fishing vessel harvesting those fish or which are not processed by
United States fish processors because they are the wrong size or sex, of poor quality, or for
other economic reasons."

Senator Stevens's proposal would require the NPFMC to include fees or incentives to reduce
bycatch, waste, and discards in all its FMPs by January 1996. By 1997 a system to measure
each fishing vessel's total catch with separately enumerated tonnage for target, bycatch, and
prohibited species must be implemented. Based on these data, future allocations of fish by the
council will give preference to catchers and processors with the least bycatch and discards.
Stevens's bill also aims to achieve full utilization of all fish landed, except prohibited species,
by the year 2000. All fish, and all of each fish caught, must be utilized. Those parts not used
for food would probably be made into fish oil and meal, requiring some investment in new
equipment for some processors.

Critics of the Stevens proposal say it is an "after-the-fact" plan, meaning it does little to
actually prevent fishers from catching and landing unwanted or prohibited fish. They point out
that the majority of fish cannot be returned to the sea alive, and therefore the goal should be to
minimize the catching of all but the target species.

The House draft defines bycatch as fish that are caught, taken, or harvested by a fishing vessel
that are not the target of the fishery, that are discarded in the course of fishing, or the retention
of which is prohibited. Its bycatch provisions would apply nationwide and create an eighth
national standard, requiring that FMPs, "to the maximum extent practicable, minimize
bycatch." It also authorizes councils to use incentives and allocation preferences within a gear
group to promote avoidance of bycatch. Neither draft mandates that cleaner fishing techniques
or gear be developed; however, fishers might be encouraged to alter catch methods to avoid the
proposed council-imposed sanctions. Conservationists say such a mandate would strike closer to
the heart of the problem of actually reducing bycatch.

Better management and conservation of fish resources is the ultimate goal of the bycatch
proposals, but even when regional councils have acted, results have been slow. For example, in
the Gulf of Mexico shrimp fishery it is estimated that 10 pounds of finfish, including many
young recruits for other commercial fisheries, are wasted for every pound of shrimp caught. A
three-year study was authorized to find solutions, but just last year the industry proposed
another three-year extension for "further study." The Senate draft bill does require the
Secretary of Commerce to complete this research within nine months after the bill is enacted,
but it does not provide a time frame for implementing changes to reduce finfish bycatch. Instead
it calls for more data demonstrating a relationship between incidental harvests of fish by
shrimp trawlers. Conservationists argue that this relationship is already evident and that
delaying changes to shrimp fishing gear will result in continued devastation from which some
species might never recover.

It is worthwhile noting that even if tougher bycatch measures are not added to the MFCMA, the
Secretary and the regional councils can approve provisions to regulate and reduce bycatch.
Some councils have already done so by requiring modifications to fishing gear (such as
requiring turtle excluder devices in the Gulf of Mexico) to allow escapement of undersized or
prohibited species. Critics say that until councils are no longer dominated by the commercial
fishing industry, such changes are too slow in developing, and that Congress itself should amend
the Act now to mandate reductions in bycatch.

Both draft bills also define overfishing and require regional councils to define overfishing in
every FMP and take action to rebuild overfished species to sustainable levels. The House draft
allows the Secretary, upon a finding of overfishing, to request a council to halt the overfishing
and develop a plan to rebuild the stocks. If a council fails to do so, the Secretary may
unilaterally implement an FMP to prevent overfishing and rebuild stocks. The House version
has specific provisions for restoring certain runs of Pacific salmon. Although the drafts differ
somewhat, they both aim to prevent and stop overfishing and rebuild overfished stocks by
requiring councils to address those issues in their FMPs. Another key term, "essential fishery
habitat," is discussed below.

C.Fees

United States commercial fishing interests harvest a public resource that, in theory at least,
belongs to all of the citizens of the United States. They sell that resource for profit in both
domestic and foreign markets. With the exception of some minor licensing charges and fees,
members of the fishing industry do not pay the federal government for the fish they harvest or
for the federal research and management programs that aim to protect those fish stocks.[14] This
has led many to ask why the American public and United States government should give away fish
resources while spending millions to ensure that fish continue to be available to the commercial
fishing industry. Often an analogy to other federal resources is made. For example, lumber
companies must bid and pay for the harvest of trees in national forests, and oil companies must
bid to drill on federal lands and pay royalties for every barrel they pump. The fishing industry
counters that it provides jobs, helps balance international trade, and cannot afford to pay fees.
However, in an era of huge national deficits, it is becoming difficult for the industry to justify
its position.

At this point, fees will likely only be paid by fishers when a limited entry or ITQ system has
been put in place for a fishery. In other words, if fishing interests get a private, exclusive
right to harvest fish, they will pay a fee, probably a percentage of the value of their ITQ take.
An earlier House draft set fee levels at either 4, 3, or 1 percent, and revenues would remain in
the region where they are generated. The fees must be used for conservation and management in
that region. However, the subcommittee dropped all language on ITQs in its most recent version.
Staffers say this does not mean ITQs and fees are a dead issue in the House. On the contrary, the
subcommittee apparently decided it would be better to delete the language and allow the full
committee to take up this debate anew. The Senate draft also calls for fees based on the value of
one's ITQ share. Supporters urge that such fees be in addition to current levels of federal
support, not as a substitute. They point out that federal funding of marine fish research falls
far short of that needed to adequately assess and manage stocks. Some proposals would create a
centralized national fund or trust with the fees. Others propose leaving fee setting to the
regional councils.

Despite the strong rationale behind setting fees for ITQs, approval is not certain. One would
certainly expect the commercial fishing industry to oppose them. The industry is most likely to
point out the severe economic plight facing so many catchers and processors, as evidenced by
President Clinton's recent decision to provide economic relief for the industry in New England
and the Pacific Northwest. Since fees are only being discussed in relation to ITQs, it is
significant that the current Senate draft bill and an earlier House version would put a
moratorium on the creation of more ITQ fisheries.

D.Limiting Entry: ITQs and CDQs

By far the most significant and controversial trend in federal fishery management is to restrict
entry into commercial fisheries. Historically fisheries have been open. People needed only a
license, a boat, and fishing gear to fish commercially. Conservationists say the result today is
an overcapitalization of the commercial fishing industry, which has led to increased pressure to
raise or maintain quotas and declines in stocks. In short, too many boats are chasing too few
fish. However, efforts to change the open-entry system have met with widespread opposition
and litigation.[15] The MFCMA already allows (and in fact encourages) regional councils to limit
entry into commercial fisheries as a legitimate management tool. But it has only been recently
that the councils have been willing to approve the use of quota shares.

In any limited entry scheme there will be winners and losers. If the goal is to limit fishing
effort, some individuals will not make the cut. Opponents of limited entry also argue that the
government cannot or should not "privatize" a public resource. But clearly this has been done
with other resources such as federally owned oil, lumber, and minerals, and, in fact, the open-
entry system for fisheries is in reality an exception, not the rule. One of the most common
methods for determining who will get a quota, and the one contained in the Senate draft bill, is to
base the allocation on a set of criteria, including present and historical catches and dependence
on a fishery.

The Senate draft and an earlier House draft called for a three-year moratorium on new ITQ
plans. Under the Senate plan, during the moratorium years the Secretary of Commerce would
review and evaluate already approved ITQ plans and promulgate rules to guide post-October
1997 regimes for limiting entry. It has a provision reserving some fish for non-ITQ fishers.
The Senate draft is also replete with references to including consideration of the effects of all
management plans, including ITQs, on coastal communities. This is probably due to the efforts
of Senator Stevens to protect coastal residents in his state, many of whom are Alaska Natives.
The NPFMC has already implemented a community development quota (CDQ) system in Alaska,
whereby coastal communities are granted a portion of TACs that they can trade to fishers or
processors for cash, jobs, or other benefits.

It is not clear why Congress is discussing a three-year moratorium. One concern is that foreign
interests will gain control of United States fish resources by buying up or otherwise acquiring
quota shares. Another possibility is that limiting entry can become highly political, as
exemplified by the NPFMC's decision to delay an ITQ system for the Bering Sea and Gulf of Alaska
pollock fisheries. The Bering Sea fishery is divided between the large at-sea factory trawlers
that catch and process and the catcher boats that deliver to shore-based processing plants. It
has been suggested that the purchase of Arctic Alaska, one of the North Pacific's largest factory
trawler fleets, by the nation's largest chicken-processing company, Tyson Foods, was made
primarily because the Arctic fleet's historical catch would grant Tyson a large part of any
future ITQ. Others criticize the use of historical catches for setting trawl-fleet ITQs because it
rewards those who have in the past not only caught the most fish, but also wasted the most fish
or fished illegally. Shore-based processors have also stated that if catcher and
catcher/processor boats are to get quotas to catch pollock, then shore-based seafood plants
deserve quotas to process. They argue that their investment is no less important or significant
than that of the fishing fleet.

Another concern is that many smaller interests will be swallowed up by larger interests,
leading to a concentration of quota shares and a private monopoly of a once public resource.
Some economists agree the "big fish will swallow the little fish," but they go on to say this is
good for the nation. They point out that larger interests are more efficient and often are more
stable, making the likelihood of future government bailouts of the industry less likely. Also,
management might also be streamlined if fewer interests have to be accommodated. Of course,
many small boat owners from families who have been fishing for generations are likely to take
issue with such views. Such a concentration of quota shares is already occurring in the ITQ
system created for the Pacific whiting fishery as catcher boats sell their quotas to factory
trawlers. Often a comparison to the decline of the family farmer in favor of "agri business" is
made. The impact of ITQs and concentration of quota shares on small coastal communities where
fishing is the primary source of revenue is another area of concern. Factory fleets are often
more self-contained and are less dependent on shore-based services than smaller catcher boats.

In Alaska, where the NPFMC allocates about half of all the fish caught in the United States,
several innovative measures have been taken to preserve fish stocks and the interests of those
who might be disenfranchised by ITQs. First, small boat owners, many of them Native Alaskans,
have been protected by creating "small-vessel-only" zones around some coastal communities.
Second, the council has indicated it will reward vessels with a "clean" history of little or no
bycatch. Third, the NPFMC has also approved CDQs that coastal communities can sell or barter
to the mostly Seattle-based high seas fishing and processing interests. Fourth, to prevent
overfishing, the NPFMC has also employed buffers in setting quotas whereby TAC is reduced to
allow for unforeseen circumstances and to help ensure that fish stocks do not fall below
sustainable levels. Finally, the council has divided the Bering Sea pollock harvest between at-
sea factory trawlers and shore-based processors.

While some of these practices are controversial, they indicate a willingness to accommodate a
variety of interests and at the same time to attempt to prevent the devastation of fish resources
that has occurred elsewhere. If nothing else, the NPFMC is a good indication of how the
Magnuson Act currently allows for great flexibility in tailoring fishery management and FMPs
to the needs of particular regions. Any proposed amendments to the MFCMA that might infringe
upon this flexibility are likely to be opposed by many in the fishing industry. Some
conservationists want stronger federal oversight of the actions of regional councils. They use
government statistics demonstrating continued declines in vital fish stocks to argue that the
regional councils have failed to protect the nation's fisheries. At this time, the draft bills
indicate a continued commitment to regional decision making, suggesting that conservationists
will need to become more involved at the regional as well as the national level.

E. The Protection of Marine Fish Habitat

Most interest groups agree that fish habitat needs to be better protected. Perhaps this is most
significant in the management of anadromous species, which rely on coastal estuaries and
streams for reproduction. The collapse of the commercial salmon industry in the Pacific
Northwest, as evidenced by the August 18 relisting by NMFS of Snake River chinook salmon
from threatened to endangered under the Endangered Species Act, is a vivid example of this
dilemma. Unfortunately, management of nearshore or onshore fisheries is complicated by the
complexity and number of federal and state laws governing coastal regions. Also, when
commercial fisheries are located near coastlines and large population centers, the fish habitat is
altered by various types of pollution associated with industrial, commercial, and residential
development. Fisheries are impacted by other factors, such as power-generating dams, logging,
farming, grazing, and pollution from urban runoff and sewer systems.

Anadromous species are not the only marine life impacted by coastal development and pollution.
Most fish and shellfish species at some point in their lives are dependent on the rich resources
of the continental shelf, often for critical activities such as reproduction and feeding. With the
possible exception of some highly migratory pelagic species, this means that the marine habitat
within 12 miles of shore is critical for the continued health of a majority of species.

Proposed House amendments define "essential fishery habitat" as areas necessary "to fish for
spawning, breeding, or growth to maturity." An earlier House draft would have (1) created a
national fishery habitat protection program, including the creation of a strategic plan; (2)
given NMFS authority to require that all federal actions affecting the EEZ be consistent with
objectives of FMPs; (3) mandated that NMFS implement policies to protect and restore critical
habitat and work with the regional councils and other federal agencies; (4) improved research
on fish habitat; and (5) provided funding to carry out these objectives. Much of this language
has been deleted from the most recent House draft. The House draft now more closely follows the
Senate bill, which stops short of requiring full consistency with FMPs by other federal
agencies. The most recent House draft requires the Secretary of Commerce to identify essential
fishery habitat for each fishery that has an FMP. The Senate version calls for increased
research on the impact of pollution and deterioration of wetlands and estuaries.

The widespread support of the commercial and sport fishing industries and conservationists for
habitat protection suggests that some language to address habitat protection will be approved by
Congress. However, habitat protection is also the object of several other federal laws, and
concerns regarding overlap and duplication could pose obstacles to approval.

F.Bolstering Data, Research, and Monitoring of Fisheries

Both the House and Senate drafts propose increased research and monitoring of fisheries and fish
habitats. The House draft, however, does not include significant increases in expenditures to
achieve this end. In light of the proposed moratorium on ITQs, significant new fees to augment
research will not be generated until after 1997. The Senate draft bill apparently provides not
only the language but also the means to improve fish management. Rather than mere
incremental increases, it proposes a boost in the budget to carry out the MFCMA from $106
million in 1994 to $143 million in 1995, with additional increases of $4 million a year
through 1999. The Senate draft would also improve data collection by requiring 100 percent
observer coverage in Alaska. Observers cost the government nothing because the program is
paid for by the industry. Supporters of the observer program note that observers have
enhanced the collection of data that could not otherwise have been readily obtained under today's
tighter budgets. Beyond boosting observer coverage, it remains to be seen how much funding, if
any, for increased research will be approved. Improving the Act's language to better promote
conservation and sustainability will do little without funding to carry out basic research on fish
habitat and life cycles. At this time, it is too early to guess how much money will be devoted to
improving research and data collection.

G. National Vessel Registration Program, Disaster Relief, and Refinancing Debt

The Senate draft calls for the creation of a national vessel registration system. Under the Senate
version, all fishing vessels--other than private, noncommercial, recreational fishing vessels--
would be required to register. The Senate draft calls for the Secretary of Commerce to submit
a national registration plan to Congress by December 1, 1997. The proposal aims to implement
the system by December 1, 1999. The goal is to create a single national system for registering
vessels under the MFCMA, the MMPA, and other federal fishery-related laws. The registration
program is designed to augment the research and data collection provisions discussed earlier.

The Senate draft also includes sections providing for fisheries disaster relief and the
refinancing of fishing industry debts, which have already been criticized by some nonindustry
observers. Under the proposals, the Secretary, at the request of a state governor, can declare a
"commercial fishery failure," whether it be the result of natural or other causes. The disaster
relief proposal would make funds available to the affected state or fishery-dependent community
at a 75 to 25 federal/state cost-sharing ratio. A determination of a failure also requires the
creation of a task force to help develop a recovery plan for the affected area. The recovery plan
must be presented to Congress within one year after it is established.

In addition to providing disaster relief to state and local communities, the Senate draft proposes
to amend the Merchant Marine Act to help the fishing industry refinance "existing obligations
relating to fishing vessels or fishery facilities." Critics say it makes no sense for Congress to
acknowledge the overcapitalized state of the nation's fishing fleet and at the same time to also
help keep more boats financially afloat. They say the government should simply let the
economics of the industry run its course, allowing overcapitalization to diminish through
foreclosures on debts. Furthermore, such a measure might actually encourage more
investment. Finally, a significant amount of the United States commercial industry is financed
by foreign investors. Critics say investing in the volatile fishing industry is risky business and
foreign investors should not be granted government assistance because they made poor business
decisions. But some industry officials argue that the government already meddled when it
encouraged and aided the industry to take on debt to achieve the "Americanization" of the
bottom-fishery in the 1980s. They say that the government encouraged investment, thereby
contributing to overcapitalization, and that it would be unfair for the government now to deny
assistance. The proposed amendment is complex and includes many exceptions and limitations.

The Senate draft proposes to streamline the FMP process, resulting in a shorter time period for
creating management plans. However, in light of the new requirements to amend all present and
future FMPs to address overfishing, bycatch, and habitat, it is difficult to understand how the
process will be streamlined when so many new and important objectives must be addressed.
Finally, some other proposed amendments include those (1) requiring that a Native American
seat be created on the Pacific Fishery Management Council; (2) adding a whistle blower clause
to protect council employees against reprisal for disclosing information to Congress or other
government agencies; 3) creating plan development teams to manage highly migratory species
under the jurisdiction of more than one council; and (4) amending the emergency action
provisions.

VI. Integration of the Magnuson Act with Other Laws

It is primarily in the area of habitat protection, especially coastal habitat protection, that the
MFCMA increasingly would overlap with other federal and state laws. Among these are the
Coastal Zone Management Act (CZMA), which grants states power to control development and
regulate certain activities within three miles of their shores and beyond, and the Clean Water
Act (CWA). The earlier House proposal to require federal agency consistency is similar to what
has proven to be one of the most controversial provisions of the CZMA. Called the "consistency
provision," states have used this power and other language in the CZMA to expand their influence
over how their coasts are developed. Any federal development affecting the coastal zone must be
consistent with a state's coastal zone management plan. Federal agency consistency
determinations are sometimes disputed, and some have ended up in court. A similar consistency
provision in the MFCMA might create significant overlap, confusion, and increased red tape and
paperwork for a variety of EEZ users.

The relevance of other laws has not gone unnoticed by commercial fishers. Members of the
fishing industry have testified before Congress requesting tougher enforcement of the CWA to
help protect vital marine habitats. Like the Magnuson Act, the CWA is currently being
reauthorized. The Clinton Administration has proposed sweeping changes to reduce pollution
from farmlands and city sewer systems. As of May 26, 1994, the reauthorization bill was still
in committee.

While the fishing industry seeks tougher CWA enforcement provisions, it has itself enjoyed
protection from other environmental laws, principally the MMPA. For years Congress has
provided commercial fishers with exemptions from the marine mammal takings prohibitions of
the MMPA, allowing fishers, under some circumstances, to take some marine mammals. The
recently reauthorized MMPA provides for a phase-out of the exemptions, and fishers will
eventually face stricter scrutiny, with the goal of reducing the taking of marine mammals by
fishers to a level approaching zero. Under the reauthorized MMPA, fisheries are being
prioritized on a three-tiered scale according to the amount of interaction with marine
mammals. Fisheries that interact heavily with marine mammals will be ranked first, meaning
that the resolution of those conflicts will get a higher priority from NMFS. The Senate's
national vessel registration system, discussed earlier, notes that the program should be
integrated and coordinated with similar provisions in the reauthorized MMPA.

Many leading commentators on ocean governance have stated that a new national vision of ocean
governance is needed--one that integrates all activities and laws that affect oceans and coasts.
They argue that a more holistic and ecosystem-wide approach to management is needed, with an
emphasis on sustaining renewable resources, especially marine mammals and commercial and
noncommercial fish resources. Of course, pointing out the need for such direction and achieving
it are not one and the same. However, as illustrated above, there is evidence of increased
interaction and integration of various ocean-related laws.

VII.International Considerations: Registration of High Seas
Vessels

Fish, of course, do not recognize borders. This makes management of some migratory species an
international issue. Efforts by one nation to conserve migratory stocks are not helpful if other
nations increase their catches. Management of these species rests on treaties and international
agreements. One such agreement is the International Conservation and Management Measures by
Fishing Vessels on the High Seas, adopted by the Conference of the Food and Agriculture
Organization (FAO) of the United Nations on November 23, 1993. The Senate draft includes an
administration-sponsored section called the High Seas Fisheries Licensing Act of 1994, which
aims to meet the country's obligations under the FAO agreement. If adopted, all United States
vessels operating on the high seas (areas outside recognized EEZs) will have to be licensed. The
proposed licensing scheme is lengthy and complex, and violators are subject to civil and
criminal enforcement provisions. The proposed Act also references UNCLOS, which President
Clinton just recently agreed to submit to the Senate for its advice and consent to U.S. accession.

Other international issues facing commercial fishers include President Clinton's adoption of the
Rio Earth Summit's resource "sustainability" principle, which has already been incorporated
into NMFS budget documents. Both draft bills call for sustainable yield management strategies.
On August 19, the Associated Press reported that GATT will face opposition in Congress if
environmental and labor concerns are not better linked to improvements in trade. The apparent
concern of Congress is that other nations will continue to have an edge in trade if they are not
bound by rules that ensure the health of the environment and the rights of their workers.
Finally, confrontations between United States fishers and Canada have occurred on both the East
and West Coasts, indicating the need for bilateral talks with our neighbors to the north.
Fundamentally different philosophies regarding fishery management have impeded progress in
this area.

VIII. Conclusion

At this stage it is uncertain whether the MFCMA will be reauthorized this year. It is also too
early to determine to what extent Congress will incorporate the various proposed amendments.
Staffers in the House say that the draft approved by the fisheries subcommittee deliberately
deleted many controversial provisions; however, they also say that the purpose in doing so was
to reserve that debate for the full Merchant Marine and Fisheries Committee. The debate over
reauthorization is centered around the issues discussed above. Also, at least two trends are
developing:

First, the domination of federal fishery management by commercial fishing interests is
probably waning. The Marine Fish Conservation Network and other groups have determined that
the nation's fisheries are a vital barometer by which the health of the nation's marine
ecosystems are measured. They have pledged continued involvement during the reauthorization
process and at the regional council level afterward. While they admit that protecting red
snapper and pollock does not have the same popular allure as protecting whales, they aim to
promote awareness and increase public participation in the fishery management process.

Second, fishery management will continue to be integrated as part of a larger scheme of
international and national ocean and coastal management, along with national security
objectives, oil and mineral development, marine mammal protection, commercial navigation,
urban growth, and other activities. Although commercial fishing interests and conservationists
are at odds over some aspects of fishery management, it is likely that the movement toward
more holistic and ecosystem-wide management of marine resources increasingly will bring
them together, because both groups, albeit for different reasons, seek to ensure the long-term
health of marine habitats.

ENDNOTES

[1]. Donald J. Barry, Amending the Endangered Species Act, the Ransom of Red Chief, and Other Related
Topics, 21 Envt'l L. 587, 596 (1991).

[2]. Telephone Interview with David Creston, Deputy Director of Fishery Conservation and
Management at NMFS (May 20, 1994). TALFF means total allowable level of foreign fishing.

[3]. National Marine Fisheries Service, Our Living Oceans: Report on the Status of U.S. Living
Marine Resources (1993).

[4]. Id. at 18.

[5]. Id.

[6]. John Wise, Federal Conservation and Management of Marine Fisheries in the United States 7
(Center for Marine Conservation 1991).

[7]. Suzanne Fowle, Fish for the Future: A Citizens' Guide to Federal Marine Fisheries Management
(Center for Marine Conservation 1993).

[8]. Special Report: A Farewell to Fish?, Mother Jones, July-Aug. 1994, at 30.

[9]. Peter Steinhart, The Cry of the Ocean, Mother Jones, July-Aug. 1994, at 30, 31.

[10]. Testimony of Suzanne Iudicello on behalf of the Center for Marine Conservation before the
House Subcommittee on Fisheries of the House Merchant Marine and Fisheries Committee (Apr.
21, 1993) (on file with author).

[11]. This individual preferred not to be named, but it should be noted that statistics add credence
to his view. The NPFMC in recent years has been a leader in setting conservative quotas, and
Alaska's fisheries are, for the most part, among the healthiest in the nation.

[12]. Parravano v. Babbitt, 837 F. Supp. 1034 (N.D. Cal. 1993).

[13]. Report: Millions of Edible Fish Dumped Overboard by Trawlers, Register Guard (Eugene,
Or.), Aug. 30, 1994, at 4C.

[14]. For example, Congress authorized more than $100 million of public funds to be spent to
carry out the provisions of the MFCMA in fiscal year 1993.

[15]. See, e.g., Northern Eagle Partners v. Franklin, No. C92-1915 (W.D. Wash. Aug. 24,
1993). The court upheld the power of the Pacific Fishery Management Council to set a cutoff
date for determining who would and would not get entry permits for the Pacific whiting fishery.

Glenn Boledovich
August 1994

For further information on subjects covered in the Ocean and Coastal Law Memo, contact
Professor Jon L. Jacobson, Ocean and Coastal Law Center, University of Oregon School of Law,
Eugene, OR 97403-1221. Tel. (541) 346-3845.