2007-05-08 Joint Work SessionCITY COUNCIL — BOROUGH ASSEMBLY
JOINT WORK SESSION AGENDA
May 8, 2007
Kodiak Island Borough Assembly Chambers
7:30 p.m.
Joint work sessions are informal meetings of the City Council and Borough Assembly where
elected officials discuss issues that affect both City and Borough governments and residents.
Although additional items not listed on the joint work session agenda are sometimes discussed
when introduced by elected officials, staff, or members of the public, no formal action is taken at
joint work sessions and items that require formal action are placed on a regular City Council
and /or Borough Assembly meeting agenda. Public comments at work sessions are NOT consid-
ered part of the official record. Public comments intended for the "official record" should be made
at a regular City Council or Borough Assembly meeting.
Discussion Items
1. Public Comments (limited to 2 minutes)
2. Fisheries Update (Joe Sullivan) No backup
3. Joint GOA Groundfish Rationalization Taskforce — Future/Role? 1
4. Request for Support of IFQs to a Crewman's Cooperative in
the BSAI Crab Fishery (Shawn Dochtermann) 5
Freed, Linda
From: Debora King [deb @kodiak.org]
Sent: Friday, April 27, 2007 11:08 AM
To: Carolyn Floyd; Freed, Linda; Rick Gifford
Subject: GOA Groundfish Rationalization Taskforce Committee
April 25 2007
mtg.doc
Hello Everyone,
The taskforce committee met on Wednesday, April 25, 2007 to discuss the
future of the group and a number of fisheries issues. The group felt we
have served our purpose as it relates to the initial mission as defined
by the Kodiak Island Borough and the City of Kodiak. I have attached a
recap of the meeting for your perusal.
Please advise what role, if any, this committee could /should continue to
play within the realms of the City /KIB agenda. There was consensus
within the group that meetings prior to NPFMC meeting would be
beneficial, but because of the timelines for information dessimination
from the Council and City /KIB meeting schedule requirements
recommendations to the council /assembly may not be possible.
I have thoroughly enjoyed being a part of this process and I look
forward to continued involvement with this group.
Debora King
Executive Director
Kodiak Chamber of Commerce
Tel: 907 486 5557
fax: 907 486 7605
1
Recap of GOA Groundfish Taskforce Committee Meeting
April 25, 2007
Kodiak College
The committee met to discuss the future role of the taskforce and fisheries issues that are
important to the Kodiak community.
The committee agreed that it has fulfilled the mission statement defined by the City of
Kodiak and the Kodiak Island Borough, that being:
"It is the purpose of the Kodiak City /KIB GOA Groundfish Task Force to work toward a
community consensus regarding what is best for the Kodiak Island community and GOA
groundfish fishery in the context of the NPFMC considering a rationalization (motion
plan) for GOA groundfish."
However, the committee felt that although groundfish rationalization is not on the table
for the upcoming Council meetings, there is value to having a venue that allows for free
exchange of ideas between different groups /factions in the Kodiak fisheries community.
A suggestion was made to have the committee meet prior to each NPFMC meeting with
Duncan Fields, as a Council member, chairing the meeting. Issues can be discussed,
council documents reviewed and all groups would be able to participate.
The GOA Groundfish Rationalization Taskforce Committee as commissioned by the
Kodiak Island Borough and the City of Kodiak would be dissolved and replaced with a
more informal community -based fisheries committee (all of the same players, plus any
other sector groups that wish to participate) whose purpose would be to discuss issues
that the Council has on its agenda. It was suggested that the Chamber stay involved in
terms of coordinating meetings and participating on a regular basis.
Hon. Governor Sarah Palin
State of Alaska, Office of the Governor
P.O. Box 110001
Juneau, Alaska 99811 -0001
April 23, 2007
Clerk's Note: Shawn Dochtermann requested
that the hard copy of this information be
provided to the Mayor and Council. The email
version was previously forwarded to you.
RE: Requesting Endorsement by Governor's Office for Reallocation of
Bering Sea Crab Individual Fish Quotas to a Crewmen's Cooperative
Dear Governor Palin,
Bering Sea/Aleutian Island `crab rationalization' has created unforeseen negative
consequences in the fishing industry that need to be addressed now. However, the Palin
administration has yet to formulate its position regarding the effects of this federal (`CR
crab') privatization program on Alaskans, and deal with the excessive market powers
granted under the 90/10% allocation occurring under the Knowles administration.
The job losses due to corporate consolidation and reduction of the fishing fleet have
been exponential. And every time I return from sea, I find another Kodiak business has
closed its doors. Therefore, we ask for your endorsement of a proposal to promote a fair
reallocation and thereby increase stability for the Bering Sea/Aleutian Islands crab fisheries
and dependent communities.
Soon after briefly telling you this March in Juneau that I had presented a draft of this
formal proposal to certain legislators, I asked the North Pacific Fishery Management
Council to reallocate a portion of the total allowable catch (TAC) to the crab crewmen.
Absent a free market with transparency and accountability, and absent any fair price - making
mechanism, along with a majority of our crab being shipped overseas subject to offshore
profit taking, we need this proposal moved forward soon in order to form a cooperative that
will help us gain bargaining power to obtain fair and equitable earnings.
Please allow me to humbly ask for your assistance in endorsing the proposal to the
North Pacific Fishery Management Council and Secretary of Commerce to help
promote this earnest effort to have Congress put crab crewmen back in the their
rightful place, on the decks of boats. With a restored historical share - and given the
cooperative's profits - crewmembers would have a stronger interest in the crab fishery and
that would provide for professional crewmen and restore the opportunity for new entrants.
These additional issues on Crab Rationalization also need to be addressed:
1. Restraints of Trade that arose as a result of processor quotas, which also have
harmful antitrust effects on ex- vessel prices.
2. The economic damages to coastal communities as a result of crewmen and indirect
employment losses, lost business ..--- y =.,� =__.._.,..v�uw, i
�v�t uualltvss ieVClluCS and resultant lost taxes.
3. Exorbitant lease rates are being extracted for their crab IFQ's by a majority of boat
owners who then furnish/pay crewmen with largely diminished earnings.
Page 2 — Shawn Dochtermann, April 23
The North Pacific Fishery Management Council was frequently warned that such
potential damaging effects would occur as the result of privatization. This was clearly
predicted by its own Advisory Panel, in a minority report issued in June of 2002. The
Department of Justice's Antitrust Division also warned of the possible economic harms that
would arise. However, the regional fish Council and Congress failed to heed those
warnings, a congressional appropriations rider provided an end -run of public due process,
and now we are suffering under all of those predicted consequences.
An arm's length, open - market exchange system has been a viable system of economic
free trade that has existed for thousands of years. It works to the benefit of buyers, sellers
and consumers. Yet the new system of CR Crab privatization operates with 90% closed
markets; the forced binding arbitration for the product delivery price has over - complicated
the crab fishery; and this promotes price -fixing and restraint of open trade.
At the April 2007 NPFMC meeting in Anchorage, during the 18 -month review of the
program, processors and cooperative directors asked for `immunity' for those involved in
binding arbitration. Repeatedly stressing a desire to handle any problems "privately and
contractually" among themselves only, these beneficiaries not only reject public scrutiny of
public resources, but also asked for immunity not only for participants, but for arbitration
lawyers and market analysts, as well.
The future of Alaska's fishing industry depends on viable and sustainable fisheries, with
on -deck fishermen earning fair incomes, and on those first dollars helping our fishery-
dependent communities to maintain a healthy state economy. And that depends on
continued public scrutiny. And I believe that a fair balance of quota lease fees, crew
compensation, and prices paid for crab products can only be achieved with a suitable
reallocation of crab quotas to a crew and skippers' cooperative.
At some point, the Constitutional rights of Alaskans to maximum benefits from
common use resources, and the implications of Alaska's own antitrust legal doctrines come
into play. It is time to recognize the excessive market powers granted to a few consolidating
corporations domiciled elsewhere, and to help us bring back statehood's promised rewards.
Please consider writing a letter endorsing the proposal to the Legislature, Secretary of
Commerce and the NPFMC. Thank you.
Respectful
Shiwn C. Dochtermann
Crewman's Association, Secretary
F/V Isanotski
P.O. Box 3886
Kodiak, AK 99615
Tel: 907 - 486 -8777
Email: drdrmannnhotrnail.com
House Special Committee on Fisheries
Alaska State Legislature
State Capitol (MS 3100)
Juneau, Alaska 99801 -1182
April 23, 2007
RE: Requesting Endorsement by Legislature for Reallocation of
Bering Sea Crab Individual Fish Quotas to a Crewmen's Cooperative
Dear Chairman Seaton and House Fisheries Committee members,
Bering Sea/Aleutian Island `crab rationalization' has created unforeseen negative
consequences in the fishing industry that need to be addressed now. However, the Pa lin
administration has yet to formulate its position regarding the effects of this federal (`CR
crab') privatization program on Alaskans, and deal with the excessive market powers
granted under the 90/10% allocation occurring under the Knowles administration.
Your committee is an important place to begin speaking back for Alaska.
The job losses due to corporate consolidation and reduction of the fishing fleet have
been exponential. And every time I return from sea, I find another Kodiak business has
closed its doors. Therefore, we ask for your endorsement of a proposal to promote a fair
reallocation and thereby increase stability for the Bering Sea/Aleutian Islands crab fisheries
and dependent communities.
I presented a formal proposal to the North Pacific Fishery Management Council to
reallocate a portion of the total allowable catch (TAC) to the crab crewmen. We need this in
order to form a cooperative that will help us gain bargaining power to obtain fair and
equitable earnings. With a restored historical share - and given the cooperative's profits -
crewmembers would have a stronger interest in the crab fishery and that would provide for
professional crewmen and restore the opportunity for new entrants.
I ask for your assistance in endorsing the proposal to the North Pacific Fishery
Management Council and Secretary of Commerce to help promote this earnest effort
to have Congress put crab crewmen back in the their rightful place, on the decks of
boats.
These additional issues on crab rationalization also need to be addressed:
1. Restraints of trade that arose as a result of processor quotas, which also have harmful
antitrust effects on ex- vessel prices.
2. The economic damages to coastal communities as a result of crewmen and indirect
employment losses, lost business revenues and resultant lost taxes.
3. Exorbitant lease rates are being extracted � r ,.
___o_„i„,nt lease as tes a re bein extracted for their crab IFQ's by a majority of boat
owners who then furnish/pay crewmen with largely diminished earnings.
The North Pacific Fishery Management Council was frequently warned that such
potential damaging effects would occur as the result of privatization. This was clearly
predicted by its own Advisory Panel, in a minority report issued in June of 2002.
Page 2 — Shawn Dochtermann, April 23
The Department of Justice's Antitrust Division also warned of the possible economic
harms that would arise. However, the regional fish Council and Congress failed to heed
those warnings, a congressional appropriations rider provided an end -run of public due
process, and now we are suffering under all of those predicted consequences.
An arm's length, open - market exchange system has been a viable system of economic
free trade that has existed for thousands of years. It works to the benefit of buyers, sellers
and consumers. Yet the new system of CR Crab privatization operates with 90% closed
markets; the forced binding arbitration for the product delivery price has over - complicated
the crab fishery; and this promotes price- fixing and restraint of open trade.
At the April 2007 NPFMC meeting in Anchorage, during the 18 -month review of the
program, processors and cooperative directors asked for `immunity' for those involved in
binding arbitration. Repeatedly stressing a desire to handle any problems "privately and
contractually" among themselves only, these beneficiaries not only reject public scrutiny of
public resources, but also asked for immunity not only for participants, but for arbitration
lawyers and market analysts, as well.
The future of Alaska's fishing industry depends on viable and sustainable fisheries, with
on -deck fishermen earning fair incomes, and on those first dollars helping our fishery-
dependent communities to maintain a healthy state economy. And that depends on
continued public scrutiny. And I believe that a fair balance of quota lease fees, crew
compensation, and prices paid for crab products can only be achieved with a suitable
reallocation of crab quotas to a crew and skippers' cooperative.
At some point, the Constitutional rights of Alaskans to maximum benefits from
common use resources, and the implications of Alaska's own antitrust legal doctrines come
into play; and this is the business of the Legislature. It is time for the State Legislature to
recognize the excessive market powers granted to a few consolidating corporations
domiciled elsewhere, and to help us bring back statehood's promised rewards.
Please • spider writing a letter endorsing the proposal to the Governor, Secretary of
Commerce the NPFMC. Thank you.
Respect
Shawn C. Dochtermann
Crewman's Association, Secretary
F/V Isanotski
P.O. Box 3886
Kodiak, AK 99615
Tel: 907 -486 -8777
Email: drdrmann(a>,hotmail.com
BS /AI CRAB RATIONALIZATION IFQ REALLOCATION
FOR SKIPPER/CREWMEN COOPERATIVE
AMENDMENT PROPOSAL
1'a. Si14 -r,� 'i74esit po
RE:
North Pacific Fishery Management Council
Name of sponsor: Shawn C. Dochtermann
Address: P.O. Box 3886
Kodiak, AK 99615
Telephone: 907 - 486 -8777 Email: drdrmannra,hotmail.com
Brief Statement of Proposal:
1. Reallocation of a percentage of Individual Fish Quota (IFQs) harvest privilege
shares of "CR Crab" - Bering Sea/Aleutian Islands king crab, opilio, and tanner
crab fisheries — to active crab crewmembers; and
2. Provision for a single Crewmember's Cooperative for all "CR Crab ".
3. Retain Open Market for All Crewmember Shares.
Objectives of the Proposal (What is the Problem ?):
The problem is an inequitable distribution of CR Crab fishing privileges that resulted in
excessive shares being assigned to vessel owners, and granted them inordinate control over
fishermen on decks and in the wheelhouses, who are engaged in active fish harvesting.
This was an unbalanced, direct and deliberate distribution of the opportunity to fish to a
discrete user group or set of individuals that excluded long -term participants (boots -on -deck
fishermen) without any justification in terms of the objectives of the Crab Rationalization
FMP.
This failed to preserve the status quo of economic distributions in the crab fisheries,
ignored the dependence of present participants (crew) and coastal communities, and failed to
fully consider the social and economic consequences (harms) of the scheme (rationalization).
1. Correct Inequitable Distribution of Harvester Shares under CR Crab FMP; and
Restore Historical Crewmembers Compensation Levels.
Skipper shares of 3 %, combined with a complete failure to recognize deckhands as
members of a vessel crew (by allocating 0% to them), fall drastically short of the historic
earnings of crewmembers who actually harvest crab. A germane legal argument is that an
inequitable `takings' occurred as vessel owners confiscated upwards of 70% of ex - vessel fish
ticket earnings as quota rents once the CR Crab FMP went into effect.
Reallocation of crab quotas would provide the crewmen with fair and equitable quotas
with which they, as small businesses that were needlessly harmed (even foreclosed) by
Date: Aprill, 2007
inequitable allocations under Crab Rationalization to date, can retain future employment
opportunities in these crab fisheries.
2. Crewmember Representation in Binding Arbitration & Price Negotiation.
Add crewmember representatives to the binding arbitration tables to protect the financial
interests of the skippers and crewmembers.
3. Assure Experienced Crews are Available and Rewarded in CR Crab Fisheries.
Assure crewmember jobs in the future have earnings that are commensurate to their
personal investments and the dangers of participation in CR Crab fisheries.
Needs and Justifications for Council Action
(Why can't the problem be solved through other channels ?):
The drastic reduction of jobs and pay with the massive consolidation of the rationalized crab
fisheries forces this issue to be dealt with forthwith. There was no provision for crewmen to
actually receive allocated quota initially in BS /AI crab rationalization, which violates:
Section 600.325 National Standard #4 Allocations.
Conservation and management measures shall not discriminate between residents of
different states. If it becomes necessary to allocate or assign fishing privileges among
various U.S. fishermen, such allocations shall be:
(1) Fair and equitable to all such fishermen.
(2) Reasonably calculated to promote conservation.
(3) Carried out in such a manner that no particular individual, corporation, or
other entity acquires an excessive share of such privileges.
Discussion: In determining the allocations under CR Crab regime(s), the privileges were
not rationally connected to the achievement of Optimum Yield — especially considering that it
is through the crewmembers earnings that maximum net economic benefits flow widely to
communities. The motives for making particular allocations were not justified in terms of
objectives — i.e. to increase safety and reduce overcapacity — and disadvantaged crewmembers
as individuals and a user group, without cause. Nor did the FMP properly contain income
shifts from crewmembers to rent - seeking owners, nor deter acquisition of excessive shares.
This resulted in obvious inequities that need to be corrected, not the least of which are up to
70% quota lease rents.
There are two ways to correct this:
1) Council action to correct the inequities and re- establish crewmem hers q
share (ownership) rights; oC quota
2) Judicial Review — i.e. a lawsuit.
This proposal gives the Council the opportunity to correct program flaws and avoid such
litigation.
(c
Foreseeable Impacts of the Proposal (Who wins, who loses ?):
Who Wins: By having quota rights Crewmembers (deckhands, engineers and skippers) gain
ability for substantial employment opportunities and are more likely to achieve fair earnings.
This enhances the interests of new entrants, as well. Crew will benefit from increased
bargaining power for ex vessel compensation with both cooperatives and processors. Fishery
dependent communities will benefit from increased (restored) crew incomes. Federal and
state taxes will likely be higher, in total, as crewmembers invariably pay taxes whereas
corporations shelter them.
Are there alternative solutions? If so, what are they? And why do
you consider your proposal the best way of solving the problem ?:
Yes, an alternative would be to overturn crab rationalization and return to Open Access with a 100 pot
limit for king crab and 250 for opilio. This is the option that would best have modified Status Quo,
which when coupled with buyback would have helped maintain crew jobs and avoid excessive
consolidation onto fewer boats.
A second alternative is to cap rents for vessel owners to a much reduced percentage, more like 35 %,
rather than the current exorbitant rates of between 70 %-50% being taken by boatowners/IFQ holders.
This would be coupled with giving the crewmembers their historical 35% - 40% of total fish value.
Reallocation to fair and equitable historical participation levels through Council action is far better
than facing inevitable and costly litigation.
Supportive Data and Other Information
(What data are available and where can they be found ?):
Previous to IFQ shares being allocated to all entities, vessel owners, or corporations they were all
required to submit 3 years (2002 -04) of crab data to NMFS in order to receive crab quota shares.
NMFS and /or related agencies could release this data in summary to substantiate the overall
participation levels (i.e. to establish the estimated 35% to 40% historical crew rights).
The present BS /AI crab rationalization requires that all quota shares holders furnish NMFS with
extensive crew and other data. Gunnar Knapp of ISER conducted a study for the City of Kodiak and it
contained preliminary analysis that puts job losses in the BSAI crab industry at 892 persons who held
jobs prior to rationalization. (An estimated 1,500 persons previously held crab jobs before
rationalization.)
Additional Notes
Inherent in this proposal is a request that the Council begin a Discussion Paper and
provide data for the allocation of the historical crewmembers' share of Bering
Sea/Aleutian Islands "CR Crab" IFQs to be assigned to a Crewmembers Cooperative.
Si nature
North Pacific Fishery Management Council
604 West 4 Avenue Suite #306
Anchorage, Alaska 99501
181 Plenary Session — March 26- April 3, 2007
Hilton Hotel - Anchorage, Alaska
Testimony: Crewmen's Association
P_ L STSOf 1)915* GN6-
Public Comment re:
By: Mr. Shawn C. Dochtermann
Kodiak, Alaska
Tel: (907)486 -8777
Mr. Secretary, Madame Chair, Council members, and
Honorable Citizens of the United States:
The Crewman's Association based in Kodiak represents hundreds of commercial
fisheiinen in the state of Alaska and other West Coast states. We would like to propose
that the NPFMC reallocate a percentage of the Bering Sea/Aleutian Individual Fish
Quotas (IFQs) of king and tanner crab for the formation of a crewmen's
cooperative. It is clear that between 800 -1,000 crewmen were disenfranchised from the
crab fleet with the consolidation of the crab fleet as a result of improper measures during
Crab Rationalization. To ensure that there is a future for crewmen, plus fair earnings
paid, the crewmen will depend on a co-op that will be a single shareholder of crab quotas.
The proposal is to reallocate crab quotas to a crewmen's co -op that would be a held as a
single IFQ proportion of the TAC for all crewmen that are members of the co -op and who
fish in a calendar year. No actual person will ever hold IFQs, as the IFQ holder would be
the Bering Sea Crab Crewmen's Cooperative (BSCCC). The BSCCC would be formed
from the total numbers of crew positions that are actually available in the present BS /AI
crab fishery plus 5 or 10 %, as to provide for injury, family emergencies, and other
unavoidable situations that may arise while the crab fleet is prosecuting a fishery.
The BSCCC would give haven to all BS /AI crab crewmen from being exploited by crab
and co -op owners paying low wages for some of the most dangerous work in the world.
There should be minimum pay percentages for all crewmen, engineers, and captains of
BS crab fleet. Once the BSCCC had a fair allocation this would give the crewmen
leverage for fair and equitable pay percentages.
The proposed reallocation of BS /AI crab IFQ shares to crewmen would be formulated on
the basis of past historical compensation of the crews and skippers, as an average of the
years of 2002 -4.
It is clear that National Standard #4 was never applied in the preferred alternative that
was recommended to the U.S. Congress in August 5, 2002 by chairman David Benton.
Therefore, we request that the NPFMC follow this standard:
Sec. 600.325 National Standard #4 Allocations If it becomes necessary to
allocate or assign fishing privileges among various U.S fishermen, such
allocations shall be:
(1) Fair and equitable to all such fishermen
(2) Reasonably calculated to promote conservation
(3) Carried out in such a manner that no particular individual, corporation, or
other entity acquire an excessive share of such privileges
The crewmen are actually small businesses that were needlessly harmed (even
foreclosed) by inequitable allocation distribution under the Crab Rationalization.
There are two ways to correct this:
1) Council action to correct the inequities and reestablish
crewmembers quota share (ownership) rights; or
2) Judicial Review- i.e. a lawsuit
This proposal gives the Council the opportunity to correct program flaws and avoid such
litigation.
Another correction for the CR crab program is one of binding arbitration. Crewmen as I
have stated previously are small businesses that privately contract for their services.
Therefore, a crewmembers' representative needs to be added at the binding
arbitration table to protect the financial interests of the skippers and crewmembers.
The Crewman's Association requests that the Council begin a Discussion Paper
provide data for the reallocation of the historical Bering Sea/Aleutian crab Individual
Fish Quotas as a wmembers cooperative.
4
IP 1411 W .°
Respectfully,
Shawn C. Dochtermann
Secretary- Crewman's Association
Kodiak, AK 99615
North Pacific Fishery Management Council
604 West 4th Avenue Suite #306
Anchorage, Alaska 99501
180 Plenary Session — February 5 -13, 2007
Benson Hotel Portland, Oregon
Testimony: Fish Heads
Public Comment re: D -2 BSAI Crab
By: Mr. Shawn C. Dochtermann
Kodiak, Alaska
Tel: (907)486 -4759
Mr. Secretary, Madame Chair, Council members, and Honorable Citizens of the United
States,
My name is Shawn Dochtermann a 30 years commercial fisherman, 20 of those years for
crab in the Bering Sea. I am here representing Fish Heads an organization representing
fishermen, their families and coastal communities and their protections.
We're here to address multiple concerns about Bering Sea/ Aleutian Islands crab
rationalization.
1. The question of whether the NPFMC had the authority to create a program as
specified by the Congressional record.
2. Whether the proper economic analysis of the impacts of all the options on
communities, processors and fishing fleets were done in a timely manner.
3. The claims of improved economic conditions for all sectors of the industry.
4. The claims that the council designed a program that was fair and equitable, and
that would protect the interests of all those that depend on the BSAI crab
fisheries.
The Congressional Record dated December 15, 2000 Pages H12276 -79
SEC. 144 (a) The Magnuson- Stevens Fishery Conservation and Management Act (16
U.S.C. 1801 et. seq.) is amended --
The North Pacific Fishery Management Council shall examine the fisheries under its
jurisdiction, particularly the Gulf of Alaska groundfish and the Bering Sea crab
fisheries, to determine whether rationalization is needed. In particular, the North
Pacific Fishery Management Council shall analyze individual fishing quotas,
processor quotas, cooperatives, and quotas held by communities The analysis should
include an economic analysis of the impact of all options on communities and processo
rs as well as the fishing fleets The North Pacific Fishery Management Council shall
present all its analysis to the appropriations and authorizing committees of the Senate
and the House of Representatives in a timely manner.
The council was asked to determine whether rationalization was needed for the Bering
Sea crab fishery. They were then asked to analyze IFQs, PQs, Co -ops, and quota held
by communities. Then the council was mandated to present all its analysis to the
authorizing committees of the US Senate and House of Representatives.
1. There was no mention of the Aleutian Island crab fishery.
2. There was no mention that the council had authorization to
preferred alternative.
3. It was clear that the mandate was to present all the analysis
rationalization.
submit only a
on BS crab
I'm going to quote from a letter written to congress from the chairman Dave Benton of
the NPFMC as of August 5, 2002.
"The council recently completed an analysis of rationalization alternatives for the BSAI
crab fisheries as requested by Congress."
The final EISs were not available until late 2004. This was not in accordance with the
mandate which the congress requested.
"Rationalization will improve economic conditions substantially, for all sectors of
the crab industry."
"Allocations of harvest shares would be made to harvesters, communities, and
captains."
Next I will refer to the minority report of AP dated June 2002 Dutch Harbor, Alaska.
The multi- sector effort was undertaken to provide viable alternative to the two -pie
proposal. The motion offered was flatly rejected by the processing sector.
The minority feel the IPQs will:
• Un- necessarily complicate management of the crab fishery
• Create a highly segmented market, negatively impacting competition and prices
• Contribute nothing to achieve resource conservation goals
• Artificially allocate market shares
• Turn fishermen into a commodity, extinguishing market freedom
• Constitute economic protections rather than rationalization
• Accelerate irreversible consolidation
• Undermine the ability of Kodiak and other communities to benefit from
rationalization
• Allocate public fishery resource control to the foreign corporations
Here the council had a minority report that predicted all the ills of crab ratz, and now the
ugly head of the beast has arisen. We're sitting in this room today with vessels that can't
go out and prosecute the Opilio fishery or even make a delivery until March and probably
April. This council, the Department of Commerce, Ted Stevens and the Congress are all
responsible for halting the natural progression of commerce in the Bering Sea crab
fisheries.
You have allowed the very basic properties of the problem statement to be broken
Trident, Unisea, Icicle and Snopac have been given special rights to not process in the
Northern region. This is contrary to the community protections clauses promulgated in
the program.
The city of King Cove has been devastated by the onslaught of crab rationalization. The
new boat harbor that was built is almost empty year round. The pot hauling business has
6 or 7 boats now verses 60 -70 boats to haul gear for. The stores have lost about 90% of
their crab food orders and crew gear buying sprees. Where were their protections?
In just two years we've seen a dramatic decline in price of king and opilio crab. Binding
arbitration is like negotiating over a cow after the product has been processed through the
sewer plant. PQs have given the processors the overall control of the price making
mechanism. There is no comparable uncontrollable price as the crab market is controlled
by a cartel that you have created. PQs violate antitrust laws of this country. The council
at their own volition can change the extreme distress to the industry. I would appreciate
if all of you would move to make a motion to remove PQs from crab rationalization
forthwith to let the free market operate as it has since this country gained its
independence.
The fishermen, the actual harvesters, were given nothing, I will repeat nothing for our
life risking services. Without crew not one single crab would have been hauled
aboard, sorted for legal size, put in the holding tanks, and brought to the d a nd
delivered to market. We work in some of the most adverse conditions in the world and
all this council came up was "it was too hard to figure out who the crews were ", as
spoken by Dr. Earl Kryger. There are such things as crew contracts, vessel logs, and
1099s that the boat owners retain, so I beg to differ. The most interesting fact that will
need to be dealt with in the very near future is that there is no definition for "fishermen"
in the MSA. But the council decided to allocate quota without a definition.
Well, I'll tell you what a fisherman is: a person that puts on his boots, goes down to the
dock, prepares his boat and gear, and actually goes to the fishing grounds and prosecutes
a fishery, then returns to port and delivers his catch. This council gave all the fishing
rights to investors, not to the true harvesters, except the pittance of 3% of allocations to
the skippers /captains.
I will repeat as I have previously spoken to this council that they have disregarded
Sec. 600.325 National Standard #4 Allocations If it becomes necessary to allocate or
assign fishing privileges among various U.S fishermen, such allocations shall be:
(1) Fair and equitable to all such fishermen
(2) Reasonably calculated to promote conservation
(3) Carried out in such a manner that no particular individual, corporation, or other
entity acquire an excessive share of such privileges
The crab allocations were not fair and equitably distributed to the crewmen and if this
council will not make provisions in the future for crewmen allocations we will have no
other choice but to seek judicial review.
A letter of update to the Congress from the NPFMC, April 2003: additional provisions
"A program that would allocate a portion of each fishery for the exclusive use of captains
and crew"
So where is it? The so- called program for crew to purchase quota is devoid, as there is
no money appropriated for the program. Why should the crewmen that worked for 5, 10,
or even 20 years such as my self have to purchase the public resource that was given to
investor/boat owners. For the 18 month review we expect this council to initiate a motion
for a discussion paper from the staff on the redistribution of crab quotas to crews with a
guild system built in so that there is a viable future for crab fishermen, AKA Crewmen.
I would appreciate if this council would carefully consider my comments. Many
professional crewmen did exist before crab rationalization and are now out of work and
would like to participate in the Bering Sea crab fishery. They will not work for peanuts,
w hich is ho the maj of the et
•• -__ how �..., majority of «�� �ess��siw -ops are paying them because of the
intolerable lease fees as the re it of crab rationalization.
Shawn C. Dochtermann
Fish Heads - Member
17-
market to any buyer. The crew pool of QS would be overseen by RAM. The proceeds from the sale of this QS by
auction to the highest qualified bidder would go into a dedicated low interest loan program for crew.
Motion passed 16/0
Option D Low Interest Loan Program
A low - interest rate loan program, consistent with MSA provisions, for slipper and crew purchases of QS would
be established or made part of the existing loan program for IFQ purchases using 25% of the Crab IFQ fee
program funds collected Motion passed 16/0
The AP recommends that the Council include the binding arbitration process as part of the crab IFQ program.
Motion passed 15/1.
AFA sideboards
rJ 2 C)2 1 N 1-; -,-?.el t,k,.Z
Issue 1 AFA Processing Sideboards
Option The crab processing caps enacted by Section 211(c)(2(A) of the AFA would be terminated (from Section
2.8.1) Motion passed 16/0
Issue 2 AFA Harvester Sideboards
Option Eliminate AFA crab harvester sideboard caps upon implementation of the crab rationalization program
(from Section 1.8.5) Motion passed 16/0
Observer Program
Status Quo — ADF &G and the BOF will establish vessel and processor observer coverage levels as needed under
the rationalized fishery program. Motion passed 16/0
A motion to adopt the BSAI rationalization program alternatives failed 5/11
Minority Report on the main motion:
The undersigned feel the framework motion failed precisely because it represented a good solution that required
compromise from all parties.
Signed Lance Farr, Jef Steele, Al Burch, Teresa Kandianis, Bill Jacobsen.
AP Minority Report on Crab Rationalization
The undersigned believe it is possible to craft a rationalization program that addresses resource conservation
priorities and the concerns of harvesters, communities, and processors without the inclusion of IPQs
Attempts were made in various motions throughout this issue to address the concerns of the processing sector
regarding stranded capital and stability in a balanced manner. A motion failed 10-7 to provide for a closed class
of processors, with a percentage of the shares restricted for delivery only to processors in the closed class. This
was an attempt to address the concerns of the processors, in a manner that would have retained a competitive
environment for conducting price negotiations.
The Advisory Panel then voted unanimously in favor of using the State's voluntary cooperative model as the basis
for designing a rationalization program.
A motion using the State's voluntary cooperative program was crafted, modeled after the AFA -style cooperatives,
which have worked out to be acceptable to both harvesters and processors involved
This coop motion provided a voluntary choice regarding which cooperative a harvester could join, based on
relationships developed in the year prior to implementation of the program. Clear incentives for fishing within
15
�= /02
cooperatives and strong disincentives for leaving coops were features unique to this proposal. This fully fleshed
out proposal is based upon the elements and options contained within the analysis. It provides for a closed class
of processors that guaranteed the eligible processors, in the aggregate, 80% of the overall CV harvest. A
substantial disincentive for fishermen to leave a coop (potential loss of 20% of their annual history) was built into
the motion in order to provide assurances to the processors that this cooperative model would benefit their
interests and guarantee that fishermen would participate.
We, the dissenting members of the Advisory Panel worked very hard to attempt to reach some middle ground,
utilizing the elements and options contained in the analysis. It was our hope that this would provide an
acceptable solution to all sides, recognizing that neither processors nor harvesters were gaining a
disproportionate advantage in this proposal
This multi - sector effort was undertaken to provide a viable alternative to the two -pie proposal. The motion
offered was flatly rejected by the processing sector.
* The minority feels that IPQs will:
• Un- necessarily complicate management of the crab fishery
• Create a highly segmented market, negatively impacting competition and prices
• Contribute nothing to achieving resource conservation goals
• Artificially allocate market shares
• Turn fishermen into a commodity, extinguishing their market freedom
• Constitute economic protections rather than rationalization
• Accelerate irreversible consolidation
• Undermine the ability of Kodiak and other communities to benefit from rationalization
• Allocate public fishery resource control to foreign corporations
The processor section of the analysis contained a very narrow suite of elements and options for IPQs, the scope of
which will result in significant impacts on the distribution of IPQs. The distribution of IPQs will have secondary
impacts on communities, which were not captured due to the lack of contrasfing alternative distributional criteria.
Analysis of a full suite of community protections is imperative to assessing the implications of IPQs on
communities. We are concerned that the range of options was too narrow to satisfy NEPA and other legal
requirements for an action of this magnitude.
Through drafting of the AP's advice on crab rationalization, two important issues have been relegated to future
development, with little or no information known on the possibility or legality of these issues. The first is binding
arbitration, which has dearly been identified as a vital element for ensuring that the two-pie program provides
for a more balanced negotiating structure for harvesters The second is the issue of first right of refusal options
for CDQ groups of local governments.
Further, specific means by which to achieve the full benefits of rationalization to address bycatch reduction and
other conservation goals have not been clarified Without these issues being clearly defined and analyzed, it is
premature to approve a two pie program.
Finally, the undersigned request that the Council give thoughtful consideration to the program outlined in the
modfffd voluntary cooperative model.
Signed, Craig Cross, Dan Falvey, Dave Fraser, Hazel Nelson, Michelle Ridgway, Je
16
r I.7 c
Independent Economic Overview
Bering Sea Crab Vessel Structure
Presented to:
North Pacific Fisheries Management Council
April 11, 2006
Anchorage, AK
Tony Lara
P.O. Box 8082
Kodiak, AK 99615
(907) 486 -4303
(907) 486 -2649 Fax
(907) 539 -2301 CeII
Pre Privatization Crab Economics
(2 month Season - IFQ Qualifying years)
Gross Stock
Fuel Costs
Bait Expense
Fuel Price 1.25 / gal
Fuel Consumed 40,000 gallons
Total Fuel Costs = Price x Gallons = $ 50,000
25,000
Net Proceeds
$ 1,000,000
925,000
'istorica
rew ompensa
Sh ares are
Nogg
Vessel and. bart ex perts
Vessel Net
555,000
Insurance Costs
P &I ($5,000 per man / Month)
Hull and Machinery
Pollution
Total'. Insurance
$82,000
Net Profit $ 193,000
Pre Privatization
NOTE: Mortgage payments are not
included in this breakdown as most
new entrants to the fishery are
owner - operators. Captain's share is
included in Crew Compensation.
Operating Expenses
26%
Post Privatization
'Maintenance
25%
)--
Misc
4%
Operating Expenses
19%
Misc
3%
44
Post Privatization Crab Economics
(2 month Season)
Gross Stock $ 1,000,000
NOTE: a $1 mil gross stock would require a vessel catch 3% of the 2005 -6 Opilio TAC
Fuel Costs
Bait Expense
Fuel Price 2.60 / gal
Fuel Consumed 40,000 gallons
Total Fuel Costs = Price x Gallons = $ 104,000
$ 25,000
Net Proceeds
Vessel Net
Balance Remaining for Maintenance & Profit Margin
$ 371,000
222,600
Insurance Costs
P &I ($6,600 per man / Month)
Hull and Machinery
Pollution
Total Insurance
$66,000
$24,000
90,600
A Tough Choice for Quota Owners
Go Fishing =
Play Goff =
Crab Capitalization
Pre Ratz Post Ratz
Vessels Actively Fishing 200 120
Average Vessel Cost $1,800,000 $1,200,000
$144,000,000
Quota Share Value (Spring 2006)
Opilio Quota 33,465,000 Ibs
A Share Value $10 / pound
B Share Value $7 / pound
Total $331,638,150
Bairdi Quota 1,458,000 Ibs
A Share Value $12 / pound
B Share Value $10 / pound
Total $17,408,520
Red Crab Quota 16,496,000 Ibs
A Share Value $25 / pound
B Share Value $22 / pound
Total $410,915,360
Industry Capitalization
Total Steel $360,000,000
Pre Ratz
Total Steel $360,000,000
Total Paper -NA-
Post Ratz
$144,000,000
$759,962,030
Total Capitalization $360,000,000 $903,962,030
A note of interest: At current prices, when the opilio TAC returns to a total of 160
million pounds, the market cap for the industry will reach $2 billion.
In comparison, Ford Motor Company has a current market cap of $14 billion.
The 20 year average Opilio TAC from 1980 to 1999 is 124 million pounds.
Fisheries Issues Status Report
Prepared for the Kodiak City Council
May 2, 2007
The topics of this report are the crab rationalization program 18 month review, the Gulf of Alaska Pacific cod
sector split and Gulf of Alaska groundfish License Limitation Program ( "LLP ") license recent landing
requirements, all of which are under consideration by the North Pacific Fishery Management Council.
1. Crab Rationalization 18 Month Review.
A. Background. The Bering Sea crab rationalization program was implemented through a very unusual
combination of North Pacific Fishery Management Council action and Congressional legislation.
• The North Pacific Council adopted the framework for the crab rationalization program as a
"preliminary preferred alternative ", which would normally have been released to the public for
comment. Upon receiving public comments, the Council would normally have had an opportunity to
modify the preferred alternative in response to those comments before taking final action.
• However, under the Consolidated Appropriations Act of 2001, the North Pacific Council was directed
by Congress to "examine the fisheries under its jurisdiction, particularly the Gulf of Alaska groundfish
and Bering Sea crab fisheries, to determine whether rationalization is needed ", and to "present its
analysis to the appropriations and authorizing committees of the Senate and House of
Representatives in a timely manner."
• The Council therefore decided to forward its crab rationalization preliminary preferred alternative to
Congress before making it available for public comment and taking final action, to fulfill its
obligations under the Consolidated Appropriations Act of 2001 and to request the authority to have
certain components of the preferred alternative (such as processor shares) implemented by the
Department of Commerce.'
• Upon receiving the Council's report, rather than simply authorizing the North Pacific Council to take
final action adopting the preferred alternative, Congress voted to require the Secretary of Commerce
to implement the Council's preferred alternative. However, Congress gave the Council full authority
to modify all aspects of the crab rationalization program after initial implementation.
• While Congress was considering whether to authorize the preferred alternative, a number of parties,
including the Antitrust Division of the U.S. Department of Justice, voiced serious concerns regarding
processor quota shares. In response to those concerns, at its February 2004 meeting, the Council
scheduled a review of the processor quota share and binding arbitration components of the crab
rationalization program for 18 months after fishing under the program began.
• The Council motion establishing the 18 month review states that the related analysis is to "examine
the effects of the 90/10 A share /B share split and the binding arbitration program on the distribution
of benefits between harvesters and processors in the BSAI crab fisheries." ( "A" shares are
harvester quota shares _...� iL..a must L. .Y �a�L�J with .a. .L._.. t. L. delivered. J �a ran
rldl VesLCI quULd shales LIIdt Illusl be 1IIdu.Ireu with prUL:ebbul quota Snares LU be delivered. D
shares are harvester quota shares that can be delivered to any licensed crab processor. By
establishing a 90/10 split, the Council required that 90% of the harvester quota shares issued to crab
vessel owners be matched with processor quota shares at delivery.)
1 Under the Magnuson- Stevens Act as in effect when the Council adopted the crab rationalization preferred alternative,
the Council did not have authority to adopt and the Department of Commerce did not have the authority to implement a
fishery rationalization program including processor quota shares. Congress has since prohibited processor quota
shares in any fishery except Bering Sea crab.
1
• On behalf of the City, we requested the North Pacific Council to expand the scope of the 18 month
review to analyze the effect of the 90/10 split and the binding arbitration system on the distribution of
benefits among harvesters, processors and communities. Our requests were unsuccessful, but the
City Council encouraged us to continue to pursue this modification of the 18 month review if the
opportunity presented itself.
B. North Pacific Council Action at the March 2007 Meeting. The North Pacific Council received the
preliminary crab rationalization 18 month review analysis from its staff at the Council's March 2007 meeting.
• The 18 month review analysis states that the crab rationalization program's B share allocation is
intended to serve several purposes, including facilitating processor entry. (Staff analysis, March 19,
2007, page 32.) The analysis notes that B shares have been used for other purposes, and to that
extent, they have not been available to fulfill their intended purposes.
• The B share function of "facilitating processor entry" is very important for Kodiak. As an artifact of
the processor quota share qualifying years chosen by the Council, Kodiak processors received
processor quota share allocations that are much lower than the percentages of Bering Sea crab
processed in Kodiak prior to crab rationalization. Therefore, it is only by competing for B share
deliveries that Kodiak processors have an opportunity to attain their prior level of participation in the
Bering Sea crab processing market, and it is only by using B shares that Kodiak crab vessels can
deliver make deliveries into the community commensurate with their historical landing patterns.
• In connection with this issue, we have requested that North Pacific Council staff provide a break-
down of A share and B share landing patterns by community for the first two years of the program.
We have been told by Council and NMFS staff that there are confidentiality problems associated
with obtaining that data. We are working with the respective staffs to identify options for resolving
those confidentiality problems. If they cannot be resolved otherwise, the City may need to seek
confidentiality waivers from Kodiak processors, and possibly harvesters as well, to obtain community
specific crab landing data.
• Given the importance of B shares to Kodiak's processors and to Kodiak harvesters wishing to make
deliveries into their home port, we specifically requested that the Council direct its staff to determine
how B shares are being used under the crab rationalization program, and whether those uses are
consistent with the original intent. Our request received strong support from ADF &G Commissioner
Lloyd, and was adopted by the Council. This analysis is to be prepared in draft for the June 2007
Council meeting, and a final draft is to be presented to the Council at its October 2007 meeting. At
that time, the North Pacific Council could consider initiating a crab rationalization program
amendment adjusting the B share percentage upward, if it appears appropriate to do so. The City
Council may wish to consider adopting a resolution to be presented to the Council at that meeting, or
as otherwise appropriate in connection with the North Pacific Council's deliberations on this matter.
• It is important to note that A shares are subject to regional landing restrictions, and that B shares are
not. The A share regional landing restrictions are intended to preserve pre - rationalization landing
patterns in the major Bering Sea crab fisheries, and thus provide economic stability for communities
with substantial participation in or reliance upon the Bering Sea crab fisheries. The City Council
supported regional landing restrictions in connection with the North Pacific Council's deliberations on
Gulf groundfish rationalization. If the City Council decides to recommend that the crab
rationalization B share percentage be increased, the City Council may also wish to recommend that
any additional B shares issued under the crab rationalization program be subject to appropriate
regional landing restrictions. This would still permit competition among communities and processors
for landings within each region.
2
2. Gulf of Alaska Pacific Cod Sector Split and Gulf of Alaska Groundfish License Limitation Program ( "LLP ")
Recent Landing Requirements.
A. Background. In response to recommendations from its Gulf Groundfish Task Force, the City
Council adopted a resolution requesting that the North Pacific Council suspend action on Gulf groundfish
rationalization, and instead initiate an allocation of Gulf Pacific cod among gear groups, and initiate a
discussion paper on identifying and removing latent licenses from the Gulf groundfish sectors that are
subject to the License Limitation Program ( "LLP "). The North Pacific Council has proceeded accordingly.
B. Gulf of Alaska Pacific Cod Sector Split. At its March 2007 meeting, the North Pacific Council
adopted a draft purpose and need statement and preliminary components for a Gulf Pacific cod sector split.
• The sectors among which the Council is considering allocating Gulf Pacific cod include trawl, hook
and line, and pot catcher vessels and catcher processors and jig vessels. The preliminary
components include set - asides for the jig sector that range from 1% to 7% of the Gulf Pacific cod
total allowable catch ( "TAC "), and rollover provisions which would make unused catch from one
sector available to one or more other sectors if a sector exhausts its halibut bycatch allocation
before harvesting its cod allocation, or if a sector fails to harvest its Pacific cod allocation by a date
certain.
• The City Council may wish to request that the Gulf Groundfish Task Force develop a
recommendation for the City Council concerning a Kodiak Gulf Pacific cod split preferred alternative.
Even if the City Council is not inclined to adopt a resolution concerning a specific Pacific cod
allocation alternative, the City Council may wish to request that the Task Force undertake an effort
to build consensus within the community concerning the purposes to be served by a Pacific cod
split, and the appropriate allocation to each sector.
B. Gulf of Alaska Groundfish License Limitation Program ( "LLP ") Recent Landing Requirements. At
its March 2007 meeting, the North Pacific Council adopted a draft purpose and need statement concerning
a recent landings requirement for Gulf of Alaska fixed gear LLP licenses, and options it will consider in
developing further components for analysis. In addition, the Council has expanded a Bering Sea trawl LLP
license recent landing requirement amendment already under development to include the Western and
Central Gulf.
• Again, the City Council may wish to request that the Gulf Groundfish Task Force develop a
recommendation for the City Council concerning a Kodiak LLP resent landings requirement
preferred alternative, or request that the Task Force undertake an effort to build consensus within
the community on this issue.
Respectfully submitted,
Joe Sullivan
Mundt MacGregor LLP
3
Freed, Linda
From: Debora King [deb@kodiak.org]
Sent: Wednesday, May 02, 2007 9:34 AM
To: Al Burch; Cecil Ranney; Charles Thompson; Dana Reid; Trevor Brown; Donna Jones; Duncan
Fields; FN Point Omega; fishtalerulz @yahoo.com; Gabriel Saravia; Jay Stinson; Jeff Stephan;
Jerry Bongen; Joe Sullivan; John Whiddon; Julie Bonney; Julie /Ron Kavanaugh; Kent
Helligso; Freed, Linda; Linda Kozak; Matt Moir; mrmartin @gci.net; Oliver Holm; Peter Allan;
Rick Gifford; Steve Branson; Terry Haines; Theresa Peterson; Walter Sargent
Subject: Fisheries Taskforce Committee Meeting
Hello Everyone,
One of the topics discussed at the last GOA Groundfish Rationalization
Taskforce Committee Meeting (April 25th) was, given that GOA Groundfish
Rationalization was no longer on the Council agenda, should we continue
to meet as a fisheries group, in what capacity, and the process for
initiating meetings. According to Linda Freed, the Taskforce meetings
were expected to be self - initiating, not based on a request by the City
or the Borough.
A suggestion was made to have a meeting of the taskforce prior to the
May 8th joint City /Borough Fisheries worksession - the status of the
taskforce is on the agenda. Joe Sullivan will be available for a meeting
on this date. *Please advise if the group would like to meet on this
date and I will make necessary arrangements.
*As the facilitator for the group in the past, I would suggest the
committee address some process issues:
1. "Name" of the group
2. Purpose
3. Mechanism for calling meetings
4. Chairperson
I have really enjoyed being a part of this group and would like to
continue to be involved - even in just a learning capacity (that goes
for Trevor Brown as well). Just let me know your wishes and I can get
an ad in the paper for the 8th.
Debora King
Executive Director
Kodiak Chamber of Commerce
Tel: 907 486 5557
fax: 907 486 7605
1
Gulf of Alaska Groundfish Rationalization Task Force
Meeting Summary
May 8, 2007
The Task Force members present recommend that the Task Force continue to
function, but with modifications to its name, its purpose and its composition in
response to the North Pacific Fishery Management Council's decision to
postpone further action on Gulf groundfish rationalization.
The recommended modifications are as follows:
1. Name: Kodiak Fisheries Task Force
2. Purposes:
a. To provide recommendations, when appropriate, to the Kodiak City
Council and the Kodiak Island Borough Assembly regarding the Kodiak
community's position on fisheries issues.
b. To provide a forum for representatives of community interest groups
to discuss, and, to the degree possible, reach consensus on fisheries issues
affecting Kodiak's fishermen, processors, businesses and residents.
3. The Task Force should be composed of voting representatives of the following
Kodiak interest groups:
Large Pot Vessels Kodiak Rural Communities
Small Pot Vessels ADF &G Advisory Committee
Large Trawl Vessels Business Community
Small Trawl Vessels Citizen -At -Large
Large Longline Vessels Conservation Community
Small Longline Vessels Lodge /Charter Boat Operators
Jig Vessels
Salmon /Herring Net Vessels
Crewmembers
Large Processors
Small Processors
Representatives of the City of Kodiak and the Kodiak Island Borough and
Kodiak residents serving on the North Pacific Fishery Management Council, the
North Pacific Council's Advisory Panel and the Alaska Board of Fisheries should
be ex officio, non - voting members of the Task Force. An ex- officio member may
also serve as a voting representative of a Kodiak interest group.
4. Task Force appointees should have the authority to designate an alternate
prior to a meeting if the appointee cannot attend.
5. The Task Force should develop procedures for calling and conducting
meetings, determining consensus, etc.
CITY OF KODIAK
RESOLUTION NUMBER 06-2
A RESOLUTION OF THE COUNCIL OF THE CITY OF KODIAK APPOINTING
A GULF OF ALASKA GROUNDFISH RATIONALIZATION TASK FORCE
WHEREAS, the harvesting and processing sectors of the Kodiak fishing community are
engaged in and substantially dependent upon the Gulf of Alaska (Gulf) groundfish fisheries; and
WHEREAS, Kodiak's economic and social health is intimately dependent upon the
community's sustained participation in all aspects of Gulf groundfish fisheries; and
WHEREAS, the City of Kodiak has made substantial infrastructure investments in support
of and in reliance upon the Gulf groundfish fishery, such as water system expansion and
improvement and port and harbor expansion and improvement; and
WHEREAS, the North Pacific Fishery Management Council has developed a suite of fishery
allocation alternatives for the Gulf of Alaska groundfish fisheries and is working toward adoption
of a preferred alternative for implementation; and
WHEREAS, allocating exclusive harvesting and/or processing privileges promotes
consolidation in the fishing fleet and the processor sector, which can improve efficiency, but can also
result in skippers, crew members, and processing workers bearing the costs of consolidation without
fully sharing in the related benefits; and
WHEREAS, while rationalization can create opportunities and incentives to produce more
and higher value products, it can also change the distribution of fishery revenues among participants
by altering the balance of market power between fishermen and processors, with potentially
disruptive effects on the communities in which they live; and
WHEREAS, by awarding harvesting and/or processing privileges, fishery allocations make
possible orderly harvesting and processing, but can also facilitate the migration of landings to
communities with infrastructure advantages (such as road system access) and create barriers to entry
for later generations of fishery participants; and
WHEREAS, it is essential that the potential adverse affects of Gulf groundfish rationalization
be identified and analyzed and that adjustments be made to mitigate the potential adverse effects of
Gulf groundfish rationalization on Kodiak prior to implementation; and
WHEREAS, it is in the interest of the City of Kodiak and the Kodiak Island Borough to
facilitate a full and frank exchange of information and opinions concerning Gulf groundfish
rationalization among the constituencies of the community that will be most directly affected by such
program, if adopted, and to facilitate, to the extent possible, development of consensus among those
constituencies concerning the preferred elements and options of such program.
Resolution No. 06-2
Page 1 of 2
NOW, THEREFORE, BE IT RESOLVED, BY THE COUNCIL OF THE CITY OF
KODIAK that the following individuals are appointed to a City of Kodiak/Kodiak Island Borough
Gulf groundfish rationalization task force, and these individuals are hereby respectfully requested
to accept such appointment:
Peter Allan
Duncan Fields
Matt Moir
Dana Reid
Joe Sullivan
Norm Wooten (Facilitator)
A member of the Fish and Game Advisory Committee
BE IT FURTHER RESOLVED THAT:
Julie Bonney
Julie/Ron Kavanaugh
Theresa Peterson
Gabriel Saravia
Jay Stinson
Steve Branson/Terry Haines
Linda Kozak
Cecil Ranney
Jeff Stephan/Jerry Bongen
John Whiddon
(1) Such appointees serve on the task force at the pleasure of the City Council/Kodiak Island
Borough Assembly, and any member may be removed at any time, or the entire task force may be
disbanded at any time, as the City Council/Borough Assembly deem appropriate in their sole
discretion.
(2) Appointment to the Ad Hoc Kodiak Gulf of Alaska groundfish rationalization task force
provides no specific rights or authorities other than to make recommendations to the City
Council/Borough Assembly concerning Gulf of Alaska groundfish rationalization from time to time,
which the City Council/Borough Assembly may accept or reject in their sole discretion.
(3) Appointment to the task force is conditioned on the appointees acknowledging and
agreeing that service on such Gulf groundfish rationalization task force is voluntary and without any
compensation.
(4) The charge to the task force is to bring forward a consensus recommendation for a gulf
rationalization solution that works best for the Kodiak community, fishermen and processors, and
their employees.
Resolution No. 06-2
Page 2 of 2
CITY CLERK
ATTEST:
R aAytf-A"- -
CITY OF KODIAK
Adopted: January 26, 2006