H. R. 6362
IN THE HOUSE OF REPRESENTATIVES
September 10, 2012
Mr. Thompson of California (for himself, Mrs. Capps, Mr. DeFazio, Ms. Eshoo, Mr. Farr, Ms. Herrera Beutler, Mr. Larsen of Washington, Mr. Schrader, Ms. Speier, Ms. Woolsey, and Mr. Young of Alaska) introduced the following bill; which was referred to the Committee on Natural Resources
To direct the Secretary of Commerce to issue a fishing capacity reduction loan to refinance the existing loan funding the Pacific Coast Groundfish Fishery Fishing Capacity Reduction Program.
This Act may be cited as the
Revitalizing the Economy of Fisheries
in the Pacific Act of 2012 or the
Pacific Act of 2012.
Congress finds as follows:
In 2000, the Secretary of Commerce declared the Pacific Coast Groundfish Fishery a Federal fisheries disaster due to low stock abundance of groundfish and an overcapitalized fleet.
In 2003, section 212 of the Department of Commerce and Related Agencies Appropriations Act, 2003 (title II of division B of Public Law 108–7; 117 Stat. 80) was enacted to require establishment of a Pacific Coast groundfish fishery buyback program to remove excess fishing capacity from the groundfish, crab, and shrimp fisheries.
In 2003, a $35,700,000 buyback loan was authorized by Congress, creating the Pacific Coast Groundfish Fishing capacity reduction program through the National Marine Fisheries Service Fisheries Finance Program with a term of 30 years. The interest rate of the buyback loan was fixed at 6.97 percent and is paid back based on an ex-vessel fee landing rate of 5 percent for the loan.
The buyback program resulted in the removal of limited entry trawl Federal fishing permits from the fishery, representing approximately 46 percent of total landings at the time.
Because of an absence of a repayment mechanism, $4,243,730 in interest was accrued before fee collection procedures were established in 2005, over 18 months after the fishing capacity reduction program was initiated.
In 2011, the Pacific Coast groundfish fishery transitioned to a catch share program.
By 2015, Pacific Coast groundfish fishermen’s expenses are expected to include fees of approximately $450 per day for observers, a 3-percent cost recovery fee as authorized by the Magnuson-Stevens Fishery Conservation and Management Act for catch share programs, and a 5-percent ex-vessel landings rate for the loan repayment, which could reach 18 percent of their total gross revenue.
In the period covering 2006 through 2011, the annual average Pacific Coast Groundfish Fishery ex-vessel revenue was $85,945,847, which included revenue of at-sea catcher processors, at-sea mothership catcher vessels, trawls, open access, and tribal fishing and all other groundfish revenue. Of that revenue, an average of $45,000,000 was generated by the limited entry trawl fishery.
Currently, National Oceanic and Atmospheric Administration Fisheries administers industry-funded capacity reduction programs in the Bering Sea-Aleutian Islands crab, Bering Sea-Aleutian Islands non-pollock groundfish, and American Fisheries Act pollock fisheries, along with the Pacific Coast groundfish fishery. Each program has a 30-year, long-term loan repayment period based on fees for future landings in the fisheries.
A fifth reduction buyback program was implemented in 2012 for the Alaska Purse Seine Salmon Fishery, which has a 40-year, long-term repayment period based on fees for future landings in the fishery with an ex-vessel landing rate of 3 percent.
In the past when fishery disasters have been declared, some fisheries have been issued Federal disaster assistance grants to provide short-term economic assistance to fishermen leaving the industry, increased profitability for remaining fishermen, and conservation of fish stocks.
In 1996 and 1997, a $23,000,000 Federal disaster assistance grant was issued for the New England Groundfish Fishery, which was used to remove 68 multi-species permits and scrap 58 vessels associated with those permits. No loan repayments were required for this grant.
The purpose of the Act is to refinance the Pacific Coast Groundfish Fishery Fishing Capacity Reduction Program to protect and conserve the Pacific Coast groundfish fishery, fishermen’s economic livelihood, and jobs of associated industries.
Refinancing of West Coast Groundfish Fishery fishing capacity reduction loan
The Secretary of Commerce shall, upon receipt of such assurances as the Secretary considers appropriate to protect the interests of the United States, issue a loan to refinance the existing debt obligation funding the fishing capacity reduction program for the Pacific Coast Groundfish Fishery implemented under section 212 of the Department of Commerce and Related Agencies Appropriations Act, 2003 (title II of division B of Public Law 108–7; 117 Stat. 80).
Except as otherwise provided in this section, the Secretary shall issue such loan in accordance with subsections (b) through (e) of section 312 of the Magnuson-Stevens Fishery Conservation and Management Act (16 U.S.C. 1861a) and sections 53702 and 53735 of title 46, United States Code.
Notwithstanding section 53735(c)(4) of title 46, United States Code, a loan under this section must have a maturity that expires at the end of the 45-year period beginning on the date of issuance of such loan.
Limitation on fee amount
Notwithstanding section 312(d)(2)(B) of the Magnuson-Stevens Fishery Conservation and Management Act (16 U.S.C. 1861(d)(2)(B)), the fee established by the Secretary with respect to a loan under this section shall not exceed 3 percent of the ex-vessel value of all fish harvested from each fishery for which the loan is issued.
To implement this section there is authorized to be appropriated to the Secretary an amount equal to 1 percent of the amount of the loan authorized under this section.