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DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

CFR Citation: 50 CFR Part 648

Docket ID: [Docket No. 071130780-7564-01]

RIN ID: RIN 0648-AU32

NOTICE: PROPOSED RULES

ACTION: Fishery conservation and management:

DOCUMENT ACTION: Proposed rule; request for comments.

SUBJECT CATEGORY: Fisheries of the Northeastern United States; Atlantic Sea Scallop Fishery; Amendment 11

DATES: Public comments must be received no later than 5 p.m., eastern standard time, on January 31, 2008.

DOCUMENT SUMMARY: NMFS proposes regulations to implement measures in Amendment 11 to the Atlantic Sea Scallop Fishery Management Plan (FMP). Amendment 11 was developed by the New England Fishery Management Council (Council) to control the capacity of the open access general category fleet. Amendment 11 would establish a new management program for the general category fishery, including a limited access program with individual fishing quotas (IFQs) for qualified general category vessels, a specific allocation for general category fisheries, and other measures to improve management of the general category scallop fishery.

SUMMARY: Northeastern United States fisheries—; Atlantic sea scallop,

SUPPLEMENTAL INFORMATION

Background

The general category scallop fishery is currently an open access fishery that allows any vessel to fish for up to 400 lb (181.44 kg) of Atlantic sea scallops (scallops), provided the vessel has been issued a general category or limited access scallop permit. This open access fishery was established in 1994 by Amendment 4 to the FMP (Amendment 4) to allow vessels fishing in nonscallop fisheries to catch scallops as incidental catch, and to allow a smallscale scallop fishery to continue outside of the limited access and effort control programs aimed at the largescale scallop fishery. Over time, the overall participation in the general category fishery has increased. In 1994, there were 1,992 general category permits issued. By 2005 that number had increased to 2,950. In 1994, there were 181 general category vessels that landed scallops, while in 2005 there were over 600.

Out of concern about the level of fishing effort and harvest from the general category scallop fleet, the Council recommended that a Federal Register notice should be published to notify the public that the Council would consider limiting entry to the general category scallop fishery as of a specified control date. NMFS subsequently established the control date of November 1, 2004. In January 2006, the Council began the development of Amendment 11 to evaluate alternatives for a limited access program and other measures for general category vessels. The Council held 35 meetings open to the public on Amendment 11 between January 2006 and June 2007. After considering a wide range of issues, alternatives, and public input, the Council adopted a draft supplemental environmental impact statement (DSEIS) for Amendment 11 on April 11, 2007. Following the close of the public comment period on June 18, 2007, the Council adopted Amendment 11 on June 20, 2007.

Amendment 11 would establish criteria and authority for determining the percentage of scallop catch allocated to the general category fleet and would establish the IFQ program. However, these specific allocation amounts have been being developed by the Council as part of Framework 19 to the FMP (Framework 19) which will establish scallop fishery management measures for the 2008 and 2009 fishing years. After proposing the allowable levels of fishing based on updated survey information and fishing mortality targets, the total allowable catches (TACs) described below would be specified through a separate rulemaking for Framework 19. Framework 19 also would specify management measures for the 2008 and 2009 fishing years that would be recommended if Amendment 11 is not approved.

A Notice of Availability (NOA) for Amendment 11 was published on November 30, 2007. The comment period on the NOA ends on January 29, 2008.

Proposed Measures

The proposed regulations are based on the description of the measures in Amendment 11. NMFS has noted several instances where it has interpreted the language in Amendment 11 to account for any missing details in the Council's description of the proposed measures. NMFS seeks comments on all of the measures in Amendment 11, particularly the noted instances.
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Limited Access Program for the General Category Fishery

Amendment 11 would require vessels to be issued a limited access general category (LAGC) scallop permit in order to land scallops under general category rules. All general category permits would be limited access, requiring that a vessel owner submit an application demonstrating that the vessel is eligible for the permit. The current general category permits (1A non VMS, and 1B VMS permits) would be replaced with three types of LAGC scallop permits: IFQ LAGC scallop permit (IFQ scallop permit); Northern Gulf of Maine (NGOM) LAGC scallop permit (NGOM scallop permit); and incidental catch LAGC scallop permit (Incidental scallop permit).

A vessel would be eligible to be issued an IFQ scallop permit if the owner could document landings of at least 1,000 lb (454 kg) of scallop meats, as verified by NMFS records or documented through dealer receipts, in any fishing year between March 1, 2000, and November 1, 2004, and issuance of a general category scallop permit to the vessel during the fishing year in which the landings were made.

The owner of a vessel who cannot qualify for an IFQ scallop permit, or who elects not to apply for an IFQ scallop permit, could instead be issued a NGOM scallop permit. The NGOM scallop permit would allow the vessel to fish in the NGOM exclusively, defined as the waters north of 42[deg] 20' N. Lat. A vessel would qualify for the NGOM scallop permit if it had been issued a valid general category scallop permit as of November 1, 2004. There would be no landings eligibility criteria. Vessels issued this permit would be subject to additional restrictions outlined in the description of the NGOM Scallop Management Area below.

A vessel would qualify for an Incidental scallop permit if it had been issued a valid general category scallop permit as of November 1, 2004. There would be no landings eligibility criteria. This provision is intended to allow an incidental level of scallop catch for vessels that meet the permit eligibility, but not the landings criteria. This permit would allow such vessels to possess and land up to 40 lb (18.14 kg) of scallops per trip, and is intended to allow landing of incidental scallop catch. Some vessels that could qualify for an IFQ scallop permit may opt for the Incidental scallop permit because it permits vessels to land an incidental catch of scallops on an unlimited number of trips. In drafting the proposed rule, NMFS presumed that the limited access permit restrictions specified below apply to all three types of LAGC scallop permit, unless specifically excluded in Amendment 11.

Initial Application for a LAGC Scallop Permit

A vessel owner would be required to submit an initial application for a LAGC scallop permit or confirmation of permit history within 90 days of the effective date of the final regulations. The Council recommended the shorter than usual application period to expedite the transition to the IFQ program. The IFQ program cannot be implemented until all IFQ permits are issued because the number of vessels and the contribution factors for all qualified IFQ scallop vessels will be used to determine each vessel's IFQ share of the TAC allocated to IFQ scallop vessels (see ``IFQs for Limited Access General Category Scallop Vessels'' below).

Limited Access Vessel Permit Provisions

Amendment 11 would establish measures to govern future transactions related to limited access vessels, such as purchases, sales, or reconstruction. These measures would apply to all LAGC scallop vessels. Except as noted, the provisions proposed in this amendment are consistent with those that govern most of the other Northeast region limited access fisheries; there are some differences in the limited access program for American lobster.

1. Initial Eligibility

Initial eligibility for an LAGC scallop permit would have to be established during the first year after the implementation of Amendment 11. A vessel owner would be required to submit an application for an LAGC scallop permit or CPH within 90 days of the effective date of the final regulations.

2. Landings History

Amendment 11 specifies landings and permit history criteria that a vessel would have to meet to qualify for LAGC permits. It also specifies that an IFQ scallop vessel would be allocated IFQ based on its best year of scallop landings and the number of fishing years active during the qualification period of March 1, 2000, through November 1, 2004. Amendment 11 specifies that qualifying landings would have to be from the same scallop fishing year (March 1 through February 28/29) that a vessel was issued a general category scallop permit during the qualification period. Therefore, this proposed rule requires that, for any landings to be used in determining eligibility, best year of fishing, years active, and the resulting contribution factor, the vessel must have been issued a general category scallop permit in the fishing year the landings were made.

The best year of scallop landings would be the scallop fishing year during the qualification period with the highest amount of scallop meats landed, provided the vessel was issued a general category scallop permit. Years active would be the number of scallop fishing years during the qualification period that the vessel landed at least 1lb (0.45 kg) of scallops provided the vessel was issued a general category scallop permit. Inshell scallop landings would be converted to meat weight using the formula of 8.33 lb (3.78 kg) of scallop meats for each U.S. bushel of inshell scallops, for qualification purposes.

NMFS landings data from dealer reports would be used to determine a vessel's eligibility for an IFQ scallop permit, a qualified IFQ scallop vessel's best year of scallop landings, and years active in the general category scallop fishery. The NMFS permit database would be used to determine permit criteria eligibility for all LAGC scallop permits. Applicants would be allowed to dispute the denial of an LAGC permit, or contribution factor (based on best year and years active), through the eligibility appeals process described below.

3. Confirmation of Permit History (CPH)

A person who does not currently own a fishing vessel, but who has owned a qualifying vessel that has sunk, or been destroyed, or transferred to another person, would be required to apply for and receive a CPH if the fishing and permit history of such vessel has been retained lawfully by the applicant. Such an application would have to be made within 90 days of the effective date of the final regulations for Amendment 11. The CPH provides a benefit to a vessel owner by securing limited access eligibility through a registration system when the individual does not currently own a vessel. To be eligible to obtain a CPH, the applicant would have to show that the qualifying vessel meets the eligibility requirements for the applicable LAGC permit, and that all other permit restrictions described below are satisfied. Issuance of a valid CPH would preserve the eligibility of the applicant to apply for an LAGC permit for a replacement vessel based on the qualifying LAGC scallop vessel's fishing and permit history at a subsequent time. A CPH would have to be applied for in order for the applicant to preserve the LAGC scallop permit eligibility of the qualifying vessel.
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Vessel owners who were issued a CPH could obtain a vessel permit for a replacement vessel based upon the previous vessel's history that would utilize the CPH. IFQ associated with a CPH would count toward a vessel owner's overall ownership of IFQ, and would be restricted under the 5 percent ownership cap.

4. Permit Transfers

An LAGC scallop permit and fishery history would be presumed to transfer with a vessel at the time it is bought, sold, or otherwise transferred from one owner to another, unless it is retained through a written agreement signed by both parties in the vessel sale or transfer.

5. Permit Splitting

Amendment 11 adopts the permit splitting provision currently in effect for other limited access fisheries in the region. Therefore, an LAGC scallop permit may not be issued to a vessel if the vessel's permit or fishing history has been used to qualify another vessel for a limited access permit. This means all limited access permits, including LAGC scallop permits, must be transferred as a package when a vessel is replaced or sold. However, Amendment 11 explicitly states that the permitsplitting provision would not apply to the transfer/sale of general category scallop fishing history prior to the implementation of Amendment 11, if any limited access permits were issued to the subject vessel. Thus, vessel owners who sold vessels with limited access permits and retained the general category scallop fishing history with the intention of qualifying a different vessel for the LAGC scallop permit would be allowed to do so under Amendment 11. This differs from the current permit splitting provisions of other limited access fishery regulations, and specifically the Atlantic herring limited access permit splitting provision recently implemented under Amendment 1 to the Atlantic Herring FMP. A vessel with an existing limited access scallop permit (i.e., fulltime, parttime, or occasional) that also qualifies for an LAGC scallop permit could not split the LAGC scallop permit from the existing limited access scallop permit.

6. Qualification Restriction

Consistent with previous limited access programs, no more than one vessel would be able to qualify, at any one time, for a limited access permit or CPH based on that or another vessel's fishing and permit history, unless more than one owner has independently established fishing and permit history on the vessel during the qualification period and has either retained the fishing and permit history, as specified above, or owns the vessel at the time of initial application under Amendment 11. If more than one vessel owner claimed eligibility for a limited access permit or CPH, based on a vessel's single fishing and permit history, the NMFS Regional Administrator would determine who is entitled to qualify for the permit or CPH.

7. Appeal of Permit Denial

Amendment 11 specifies an appeals process for applicants who have been denied an LAGC scallop permit. Such applicants would be able to appeal in writing to the Regional Administrator within 30 days of the denial, and any such appeal would have to be based on the grounds that the information used by the Regional Administrator was incorrect.

The appeals process would allow an opportunity for a hearing before a hearing officer designated by the Regional Administrator. The owner of a vessel denied an LAGC scallop permit could fish for scallops under the applicable general category scallop regulations, provided that the denial has been appealed, the appeal is pending, and the vessel has on board a letter from the Regional Administrator authorizing the vessel to fish under the LAGC scallop permit category. The Regional Administrator would issue such a letter for the pendency of any appeal. If the appeal was ultimately denied, the Regional Administrator would send a notice of final denial to the vessel owner; and the authorizing letter would become invalid 5 days after receipt of the notice of denial, but no longer than 10 days after the date that the denial letter is sent.

8. Vessel Upgrades

A vessel issued an LAGC scallop permit would not be limited by vessel size upgrade restrictions if the owner wished to modify or replace the vessel. However, if that vessel has also been issued limited access permits under Sec. 648.4 that have upgrade restrictions (i.e., all other limited access permits issued in accordance with Sec. 648.4), the upgrade restrictions for that fishery would apply to any modification or replacement, unless the permit with the restrictions were permanently relinquished as specified under ``voluntary relinquishment of eligibility,'' below.

9. Vessel Baselines

A vessel's baseline refers to those specifications (length overall, gross registered tonnage net tonnage, and horsepower) from which any future vessel size change is measured. Because there are no vessel size upgrade restrictions, a vessel issued an LAGC scallop permit would not have baseline size and horsepower specifications. However, if that vessel has also been issued limited access permits under Sec. 648.4 that have upgrade restrictions, any size change would be restricted by those baseline specification requirements, unless those permits were permanently relinquished as specified in ``Voluntary relinquishment of eligibility'' below.

10. Vessel Replacements

The term vessel replacement (vessel replacement), in general, refers to replacing an existing limited access vessel with another vessel. This rule would require that the same entity must own both the LAGC scallop vessel (or fishing history) that is being replaced, and the replacement vessel. Unlimited upgrades of vessel size and horsepower through a vessel replacement would be allowed, unless the vessel to be replaced is restricted on upgrades because it has been issued other limited access permits pursuant to Sec. 648.4. 11. Ownership Cap

A vessel issued an IFQ scallop permit could not be allocated more than 2 percent of the TAC allocated to the fleet of vessels issued IFQ scallop permits. In addition, an individual could not have ownership interest in more than 5 percent of the TAC allocated to the fleet of vessels issued IFQ scallop permits. The only exceptions to these ownership cap provisions are if a vessel's initial contribution factor results in the ownership of more than 2 percent of the overall TAC initially upon initial application for the IFQ scallop permit, or if the vessel owner owns more than 5 percent of the overall TAC initially upon initial application for the IFQ scallop permits. This restriction would not apply to existing limited access scallop vessels that also have been issued an IFQ scallop permit since such vessels are already subject to the 5percent ownership cap for limited access permits and because such vessels would not be permitted to transfer IFQ between vessels.

12. Voluntary Relinquishment of Eligibility

A vessel owner could voluntarily exit the LAGC fishery by permanently relinquishing the permit. In some
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circumstances, it could allow vessel owners to choose between different permits with different restrictions without being bound by the more restrictive requirement (e.g., lobster permit holders may choose to relinquish their other Northeast Region limited access permits to avoid being subject to the reporting requirements associated with those other permits). If a vessel's LAGC scallop permit or CPH is voluntarily relinquished to the Regional Administrator, no LAGC scallop permit could ever be reissued or renewed based on that vessel's permit and fishing history.

13. Permit Renewals and CPH Issuance

A vessel owner must maintain the limited access permit status for an eligible vessel by renewing the permits on an annual basis or applying for issuance of a CPH. All LAGC scallop permits must be issued on an annual basis by the last day of the fishing year for which the permit is required, unless a CPH has been issued. However, as a condition of the permit, the vessel may not fish for, catch, possess, or land, in or from Federal or state waters, any species of fish authorized by the permit, unless and until the permit has been issued or renewed in any fishing year, or the permit either has been voluntarily relinquished or otherwise forfeited, revoked, or transferred from the vessel. A complete application for such permits must be received no later than 30 days before the last day of each fishing year. A CPH does not need to be renewed annually. Once a CPH has been issued to an individual who has retained the LAGC scallop permit and fishing history of a vessel, it remains valid until it is replaced by a vessel permit through the vessel replacement process.

A vessel's LAGC scallop permit history would be cancelled due to the failure to renew, in which case, no LAGC scallop permit could ever be reissued or renewed based on that vessel's permit and fishing history.

Amendment 11 would implement a cost recovery program, with the payment procedures and details to be established in Framework 19. Under the IFQ program, vessels would be required to pay up to 3 percent of their revenue from scallop landings to offset the cost of managing, enforcing, and implementing the IFQ program, as required by the MagnusonStevens Act. Failure to pay cost recovery fees by the specified due date would result in NMFS action invalidating the IFQ scallop permit. If the invalidation of the IFQ scallop permit due to failure to pay for cost recovery fees is not resolved in the course of the applicable fishing year, no IFQ scallop permit could ever be reissued or renewed based on that vessel's permit and fishing history. Limited Access Scallop Vessels Fishing Under General Category Rules

A vessel issued one of the existing limited access scallop permits (i.e., a fulltime, parttime, or occasional scallop permit) may also be eligible to be issued a LAGC scallop permit if it meets the qualification criteria described above. Such a vessel would be allowed to fish under general category regulations when not fishing under the scallop DAS or Area Access programs. Existing limited access scallop vessels were not required to be issued a general category scallop permit. Therefore, to be issued an Incidental or NGOM scallop permit, the limited access vessel would have to have been issued a valid limited access scallop permit as of November 1, 2004. To be issued the IFQ scallop permit, an existing limited access scallop vessel would have to have been issued a valid limited access scallop permit during the period March 1, 2000, through November 1, 2004, and have documented landings of at least 1,000 lb (454 kg) of scallop meats when not fishing under the DAS or Area Access programs, as verified by NMFS records or documentation through dealer receipts. A limited access scallop vessel that does not qualify for a LAGC scallop permit could not fish for, possess, or retain scallops when not fishing under the scallop DAS and Area Access programs. Limited access scallop vessels that also qualify for an IFQ scallop permit would not be permitted to transfer IFQ. Therefore, the general category maximum allocation restriction or the maximum percentage ownership restriction for general category TAC would not apply. The limited access general category permit and IFQ scallop permit could not be split from the limited access scallop permit.
Allocation of the Total Annual Projected Scallop Catch to the General Category Fishery under the IFQ Program

Once the IFQ program is implemented, 5 percent of the total projected annual scallop catch would be allocated to vessels with IFQ scallop permits. This would be calculated by taking the total projected annual scallop catch, then deducting estimated catch by incidental catch general category vessels and the total allowable catch (TAC) in the NGOM. Five percent of the resultant catch would then be allocated to the IFQ scallop fishery. IFQs for IFQ scallop vessels would be derived from the 5percent TAC allocation. The 5percent allocation would not apply to current limited access vessels that also have IFQ scallop permits. Limited access scallop vessels with IFQ scallop permits would be allocated 0.5 percent of the total projected annual scallop catch after deduction of incidental catch and the NGOM TAC. IFQs for these vessels would be derived from the 0.5percent TAC allocation. The remaining 94.5 percent of the total projected annual scallop catch, after deduction of incidental catch and the NGOM TAC, would be allocated for harvest by the current limited access scallop fishery.

IFQs for Limited Access General Category Scallop Vessels

A vessel issued an IFQ scallop permit would be allocated a percentage of the TAC allocated to the IFQ scallop fishery based on the vessel's ``contribution factor.'' The contribution factor for each vessel would be determined by multiplying a vessel's best fishing year of landings during the March 1, 2000, through November 1, 2004, qualification period by an index factor based on the number of years the vessel was active in the scallop fishery during the qualification period. A vessel would be determined to be active in the scallop fishery if it landed at least 1 lb (0.45 kg) of scallops. The index factors for varying levels of participation during the qualification period are: 0.75 for 1year; 0.875 for 2 years; 1.0 for 3 years; 1.125 for 4 years; and 1.25 for 5 years. The index factor is intended to provide more weight in calculating the allocation for vessels that have been participating in the general category fishery for a longer period of time. A vessel's contribution percentage will be determined by dividing its contribution factor by the sum of the contribution factors of all vessels issued a limited access general category scallop permit. A vessel's IFQ would be determined by multiplying the TAC for IFQ scallop vessels by the vessel's contribution percentage. IFQ would be issued to owners of CPHs since that vessel's contibution would be included in the determination of IFQs as described below. IFQ associated with CPHs would be transferable.

The following is an example of how a vessel's IFQ would be determined using hypothetical values: A vessel landed 48,550 lb (22,023 kg) of scallops in its best year, and was active in the general category scallop fishery for 5 years. The vessel's contribution factor would be equal to 48,550 lb (22,023 kg)*1.25 = 60,687 lb (27,527 kg). For this example, the highest total scallop landings is assumed to be 3.8 million lb (1,724 mt), and the number of qualifying vessels is assumed to be 380. The sum
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of the contribution factors for limited access general category scallop vessels is assumed to be 4.18 million lb (1,896 mt). The contribution percentage of the above vessel would therefore be 1.45 percent (60,687 lb (27,527 kg) / 4.18 million lb (1,896 mt) = 1.45 percent). The vessel's IFQ would be the vessel's contribution percentage (1.45 percent) multiplied by the TAC allocated to all IFQ scallop vessels. Assuming a TAC equal to 2.5 million lb (1,134 mt), the vessel's IFQ would be 36,250 lb (16,443 kg) (1.45 percent x 2.5 million lb (1,134 mt)).

The IFQ program cannot be implemented until all IFQ scallop permits and CPHs have been issued because the calculation of the IFQ shares requires the contribution factors for all qualified IFQ scallop vessels to be totaled. However, eligibility, best year, and the contribution factor for each vessel would be determined upon initial application for a limited access general category scallop permit. This issue is discussed under the ``Measures for the transition period to IFQ'' description below.

IFQ Transfers

IFQ scallop vessel and CPH owners would be allowed to transfer IFQ on a temporary or permanent basis. A temporary IFQ transfer (or lease) would allow one IFQ scallop vessel to combine IFQs to increase fishing opportunity for a single fishing year. A permanent IFQ transfer would permanently move the IFQ from one vessel to another. Since a permanent IFQ transfer would require the vessel to transfer the IFQ scallop permit (and any other permits) to the transferee, the transferring vessel would not be eligible to enter into an agreement to transfer IFQ back to the vessel, unless the vessel replaced another IFQ scallop vessel. Each IFQ allocation would have to be transferred in full before it is utilized, and a vessel that used IFQ in a fishing year could not transfer its IFQ during that fishing year. An IFQ transfer would not be approved if it would result in the receiving IFQ scallop vessel having a share of more than 2 percent of the total TAC allocation to the IFQ fishery. IFQ transfers would not be permitted for existing limited access scallop vessels that also have been issued an IFQ scallop permit.

IFQ Cost Recovery

The MagnusonStevens Act requires any IFQ program to include a cost recovery program, whereby NMFS would collect up to 3 percent of ex vessel value of landed product to cover actual costs directly related to enforcement and management of an IFQ program. The authority and procedures for collection of cost recovery fees would be established in this rule. Further details of the cost recovery program will be proposed in Framework 19, in which TACs would be established for LAGC scallop vessels. As recommended in Amendment 11, the IFQs would be rounded up to the nearest 10lb unit. The cost recovery fee for an IFQ that was temporarily transferred to another IFQ scallop vessel would be the responsibility of the owner of the transferring IFQ scallop vessel, not the owner of the receiving IFQ scallop vessel.

Measures for the Transition Period to IFQ

Amendment 11 recognizes that it would take between 12 to 24 months to determine the universe of qualified vessels that would be issued an IFQ scallop permit. The time is necessary to accommodate applicants who pursue permits through the appeals process. As a result, it would not be possible to implement an IFQ program at the same time that NMFS is in the process of determining eligibility and contribution factors. Recognizing the problem, Amendment 11 specifies measures for a transition period. The transition measures include a quarterly TAC equal to 10 percent of the total projected scallop catch. Vessels that qualify for an IFQ scallop permit and vessels under appeal for an IFQ scallop permit would be authorized to fish for scallops, subject to the quarterly TAC, with all landings counted toward the TAC. When the TAC is projected to be attained, the general category fishery would close for the remainder of the quarter. Any underage or overage of the first quarter would be applied to the third quarter, and any underage or overage of the second quarter would be applied to the fourth quarter. The quarterly TACs for the 2008 fishing year, beginning March 1, 2008, will be specified in Framework 19. A quarterly TAC is proposed rather than an annual TAC due to concerns about derby fishing. This quarterly distribution of TAC is intended to reduce the negative effects of a race to take the TAC. The 10percent allocation would result in a TAC that would be consistent with recent projections for scallop mortality from the general category fishery and would account for additional effort expected from vessels under the appeals process.
Mechanism to Allow Voluntary Sectors in the General Category Fishery

The proposed action includes a mechanism to allow the owners of IFQ scallop vessels to form voluntary sectors that would manage their own fishing activity as a group. This rule outlines the procedures that would be used to form a sector, and the sector program requirements. The sector provision includes: Restrictions on participation; definition and requirements for operations plans; specifications for the review, approval, and revocation process; allocation of TAC to sectors; sector share determination; restrictions on sector membership changes; restrictions on interaction between sectors; monitoring and enforcement provisions for sectors; a prohibition on trading of allocation between sectors; restrictions on vessel movement between sectors; a 20percent maximum total allocation for a single sector. The 400lb (181.44kg) possession limit would be maintained for vessels in a sector. The formation of sectors is intended to provide greater flexibility for participants and create outcomes that are more socially and economically relevant for fishing groups within the biological limitations of the fishery (TACs). The 20percent cap on a sector's share of the IFQ is intended to prevent one sector from controlling an excessive percentage of the general category allocation. Unlike the sector program for the Northeast multispecies fishery, Amendment 11 would not allow sectors to be exempt from any scallop regulations, except that participating vessels would not be restricted by their IFQs.

NGOM Scallop Management Area

The NGOM scallop management area would be waters north of 42[deg]20' N. Lat. The NGOM scallop management area would be managed separately, because the Council concluded that it has unique characteristics such as smaller vessels and sporadic fishable resource. The NGOM scallop management area would establish scallop fishing controls appropriate for the fishery while protecting the resource in the area from overharvest, if and when scallops are present in the area. Measures include the separate NGOM general category scallop permit and qualification criteria; a TAC based on historical landings from Federal waters in the NGOM; a possession limit of 200 lb (90.72 kg) of scallops per trip, with one trip per calendar day allowed; a provision that an IFQ vessel fishing in the NGOM scallop management area would have scallop landings deducted from its IFQ
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and the NGOM scallop management area TAC; and a prohibition on possession of scallops by any vessel, once the NGOM scallop management area TAC is harvested. Amendment 11 does not include specific restrictions for vessels fishing under scallop DAS in the NGOM, except that such vessels could not continue fishing in the NGOM once the TAC for the area has been reached.

Monitoring

All LAGC scallop vessels would be required to install and operate a VMS unit and would be required to declare a general category trip or other fishing activity code, as appropriate. In addition, IFQ and NGOM scallop vessels would be required report scallop landings through VMS. This provision would improve monitoring of an IFQ program by requiring vessels to report their catch, approximate time of landing, and port of landing before crossing the VMS demarcation line in order to enhance enforcement of the IFQ program and NGOM scallop fishery. The report submitted through VMS would include the VTR serial number, amount of scallops onboard, the port of landing, and the approximate time of arrival in port. This monitoring requirement would enable NMFS to monitor the TAC and IFQs on a more realtime basis.

Change Issuance Date of General Category Permit

The issuance date of general category permits would be changed from May 1 to March 1 of each year to be consistent with the scallop fishing year. Synchronizing the issuance of general category scallop permits with the scallop fishing year would make this permit consistent with the existing limited access scallop permit issuance date.

Other Measures

This action would clarify that vessels that are fishing under a Northeast multispecies or monkfish DAS would not be restricted to the 144ft (43.9m) net sweep restriction at Sec. 648.52 that currently specifies that a vessel using a net with a sweep greater than 144 ft (43.9 m) cannot fish for, possess, retain, or land more than 40 lb (18.14 kg) of shucked or 5 bu (1.76 hL) of inshell scallops. The Council recommended this change because the 144ft (43.9m) restriction was not intended to apply to vessels fishing for other species that would have an incidental catch of scallops, provided the vessel is issued the appropriate LAGC scallop permit.

Amendment 11 proposes to allow an IFQ scallop vessel to possess up to 100 bu (35.24 hL) of inshell scallops seaward of the VMS demarcation line only. Once shoreward of the VMS demarcation line, a vessel could possess only 50 bu (17.62 hL) of inshell scallops. This measure is proposed because scallop vessel owners and operators testified that it often takes more than 50 bu (17.62 hL) of inshell scallops to yield 400 lb (181.44 kg) of scallop meats. NMFS notes that similar increases were not specified by the Council for the NGOM possession limits of 200 lb (90.72 kg) of shucked or 25 bu (8.8 hL) in shell scallops or the 40 lb (18.14 kg) of shucked or 5 bu (1.76 hL) of inshell scallops. However, given the rationale for the increased possession limit, it would be inconsistent to apply the increased possession limit for only one LAGC scallop permit category or declared fishing activity. Therefore, this proposed rule specifies that vessels fishing for scallops up to 200 lb (90.72 kg) or 25 bu (8.80 hL), or up to 40 lb (18.14 kg) or 5 bu (1.76 hL), could possess up to 50 bu (17.62 hL) or 10 bu (3.52 hL), respectively, seaward of the VMS Demarcation Line.

Finally, this proposed rule would clarify the ownership cap restriction on current limited access vessels specified at Sec. 648.4(a)(2)(i)(M). The ownership cap restriction was implemented through Amendment 4 (59 FR 2757, January 19, 1994). Currently, the regulation states that an individual may not own, or have an ownership interest in, more than 5 percent of limited access scallop vessels. The provision in Amendment 4 is as follows: ``No entity or individual may have ownership interest in more than 5 percent of the total number of scallop permits issued at implementation and through the appeal process.'' However, the current regulations are not clear whether this cap applies to CPHs. Provisions for CPH were implemented in 1995 (60 FR 62224, December 5, 1995), after the 5percent cap provision in Amendment 4 was implemented. The current regulation does not mention CPHs, which represent sunken or destroyed vessels, or vessels that were sold without fishing and permit history, that are eligible for limited access scallop permits. In terms of future ownership, a CPH is equivalent to a limited access permit. Since it is clear that the Council intended the ownership cap to restrict an owner to having an ownership interest in no more than 5 percent of all limited access scallop permits, this proposed rule would clarify that an individual cannot own more than 5 percent of the limited access permit eligibilities in the form of a limited access permit or CPH. This clarification would make the regulations consistent with the Council's original intent under Amendment 4.

Public comments are solicited on Amendment 11 and its incorporated documents through the end of the comment period, January 29, 2008, stated in the NOA for Amendment 11 (72 FR 67691, November 30, 2007). Public comments on this proposed rule must be received by January 29, 2008, the end of the comment period specified in the NOA for Amendment 11, to be considered in the approval/disapproval decision on the amendment. All comments received by January 29, 2008, whether specifically directed to Amendment 11 or the proposed rule, will be considered in the approval/disapproval decision on Amendment 11. Comments received after that date will not be considered in the decision to approve or disapprove Amendment 11, but will be responded to in the final rule.

Classification

At this time, NMFS has not determined that the amendment this proposed rule would implement is consistent with the national standards of the MagnusonStevens Fishery Conservation and Management Act and other applicable laws. NMFS, in making that determination, will take into account the data, views, and comments received during the comment period.

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

The Council prepared an FSEIS for Amendment 11; an NOA was published on October 19, 2007. The FSEIS describes the impacts of the proposed Amendment 11 measures on the environment. Since most of the measures would determine whether or not fishers can continue fishing for scallops, and at what level in the future, the majority of the impacts are social and economic. Although the impacts may be negative in the short term, particularly at an individual fisher level, the longterm benefits of a sustainable scallop fishery would be positive. Elimination of the open access fishery is expected to have positive impacts on the biological and physical environment.

This proposed rule contains collectionofinformation requirements subject to review and approval by OMB under the Paperwork Reduction Act (PRA). Public reporting burden for these collections of information are estimated to average as follows:

1. Initial application for an IFQ scallop permit 30 min per response;

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2. Initial application for an NGOM or Incidental scallop permit 15 min per response;

3. Completion of ownership cap form for IFQ scallop vessel owners 5 min per response;

4. Appeal for an LAGC scallop permit and IFQ scallop vessel contribution factor 2 hr per response;

5. Application for a vessel replacement or confirmation of permit history 3 hr per response;

6. Purchase and installation of a VMS unit for general category scallop vessels2 hr per response;

7. IFQ scallop vessel VMS trip notification requirements2 min per response;

8. NGOM scallop fishery VMS trip notification requirements2 min per response;

9. Incidental catch vessel VMS trip notification requirements2 min per response;

10. Prelandings VMS notification requirements5 min per response;

11. Application for an IFQ transfer10 min per response;

12. Electronic payment of cost recovery payment2 hr per response;

13. LAGC scallop fishery sector applications150 hr per response; and

14. Sector operations plans100 hr per response.

These estimates include the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection information.

Public comment is sought regarding: Whether this proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; the accuracy of the burden estimate; ways to enhance the quality, utility, and clarity of the information to be collected; and ways to minimize the burden of the collection of information, including through the use of automated collection techniques or other forms of information technology. Send comments on these or any other aspects of the collection of information to the Regional Administrator as specified in ADDRESSES above, and by email to David_Rostker@omb.eop.gov or fax to (202) 3957285.

Notwithstanding any other provision of the law, no person is required to respond to, and no person shall be subject to penalty for failure to comply with, a collection of information subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB control number.

An IRFA was prepared, as required by section 603 of the Regulatory Flexibility Act (RFA). The IRFA describes the economic impact this proposed rule, if adopted, would have on small entities, with data analyzed on a fishing year basis (March 1 through February 28/29). A description of the action, why it is being considered, and the legal basis for this action are contained at the beginning of this section of the preamble and in the SUMMARY. A summary of the IRFA follows: Description and Estimate of Number of Small Entities to Which the Rule Would Apply

The vessels in the Atlantic sea scallop fishery are considered small business entities because all of them grossed less than $4.5 million according to the dealer's data for the 2004 and 2005 fishing years. Therefore, there are no differential impacts between large and small entities. According to this information, annual total revenue averaged about $940,065 per limited access vessel in 2004, and over $1 million per limited access vessel in 2005. Total revenues per vessel, including revenues from species other than scallops, exceeded these amounts, but were less than $4.5 million per vessel. Average scallop revenue per general category vessel was $35,090 in 2004 and $88,702 in 2005 fishing years. Average total revenue per general category vessel was higher, exceeding $240,000 in 2004 and 2005. According to the preliminary estimates, average revenues per vessel were lower in the first 11 months of 2006 for all permit categories, because of lower scallop landings and prices.

The measures proposed in Amendment 11 would affect vessels with limited access scallop and general category permits. Section 4.4 (Fisheryrelated businesses and communities) of the Amendment 11 document provides extensive information on the number and size of vessels and small businesses that will be affected by the proposed regulations, by port and state. These affected entities are the owners of 318 vessels that were issued fulltime permits in 2006, (including 55 smalldredge and 14 scallop trawl permits); 32 parttime; and 1 occasional limited access permit. In addition, 2,501 permits were issued to vessels in the open access General Category, and more than 500 of these vessels landed scallops during the last 2 years. Description of Projected Reporting, Recordkeeping, and Other Compliance Requirements

This action contains several new collectionofinformation, reporting, and recordkeeping requirements. The following describes these requirements.

1. Application Process

NMFS estimates that there would be 500 applicants for an IFQ scallop permit, 200 applicants for a NGOM scallop permit, and 500 applicants for an Incidental scallop permit. Each IFQ scallop permit application would take approximately 30 min per application, while each NGOM and Incidental scallop permit application would take approximately 15 min to process. Consequently, the total time burden for the initial applications would be 425 hr. Amendment 11 estimates that 370 IFQ scallop permit, 190 NGOM scallop permit, and 465 Incidental scallop vessels are expected to qualify and consequently renew their application each year. Permit renewal is estimated to take 15 min per application, on average, for a total burden of 256 hr per year. The 3 year average total public time burden for IFQ, NGOM, and Incidental scallop permit initial applications, and permits renewals would be 312 hr. The labor cost, at an hourly rate of $15, would be $4,680.

To implement the 5percent IFQ ownership cap, vessel owners would be required to submit an ownership form with each permit renewal. Since there would be an estimated 370 IFQ permits, there would be 370 ownership forms each year. NMFS estimates that it would take 5 min to complete each ownership form; therefore, the annual reporting burden would be 31 hr, or 21 hr, averaged over the first 3 years. At an hourly rate of $15, the annualized time burden would be approximately $315.

About 80 applicants are expected to appeal the denial of their permit application over the course of the 3month application period. The appeals process is estimated to take 2 hr per appeal, on average, for a total burden of 160 hr. The burden of this onetime appeal, annualized over three years, would be 54 hr. At an hourly rate of $15, the time burden would be approximately $810.
2. Vessel Replacement, Upgrade, and Permit History Applications

A standard form for vessel replacements, upgrades, and permit history applications (RUPH application) would be used for LAGC scallop permits, although vessel upgrades would not apply for LAGC scallop vessels unless the vessel is issued other limited access fishery permits that have upgrade restrictions. With the exception of upgrade restrictions, LAGC scallop vessels would be subject to similar replacement and permit history
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restrictions as other Northeast Region limited access fisheries. Completion of an RUPH application requires an estimated 3 hr per response. It is estimated that 100 RUPH applications would be received annually. The resultant burden would be up to 300 hr. At an hourly rate of $15 per hour, the total public cost burden for RUPH applications would be $4,500 per year.

3. New VMS Requirements

This action would require vessels issued any of the LAGC scallop permits to install VMS. Most vessels that qualify for an IFQ scallop permit would have been participating in the directed general category scallop fishery, which already has VMS requirements prior to the implementation of Amendment 11. Therefore, it is likely that most vessels that will qualify for an IFQ permit already have VMS. Vessels that qualify for an Incidental or NGOM scallop permit would not likely be participating in the directed general category scallop fishery. However, vessels that qualify for an Incidental or NGOM scallop permit may already have VMS reporting requirements through other fisheries, particularly the Northeast multispecies fishery. It is possible that some new permit holders would decide to purchase and install new VMS units in order to participate in one of these fisheries. Therefore, NMFS estimates that up to 10 vessels would purchase and install VMS units as a result of Amendment 11. NMFS estimates that it would take 2 hr to purchase each unit, for a total time burden of 20 hr; annualized over 3 years, the burden would be about 7 hr per year. NMFS anticipates that a vessel owner would hire a VMS technician to install the VMS unit; therefore there would be no installation time burden for the vessel owner. At an hourly rate of $15 per hour, the total public cost burden for VMS purchases would be $105 per unit. Since position polling is automated, there is no associated time burden with this reporting requirement.

4. Trip Notification Requirements

Each time a LAGC scallop vessel leaves port or is moved from the dock or mooring, the operator must submit a VMS trip declaration code to notify NMFS of the vessel's fishing activity.

According to 2007 VMS trip declaration data for 1B scallop vessels, approximately 40 percent of the time general category 1B vessels declare a general category scallop trip; the remainder are codes for other activities (if a vessel leaves port, general category regulations require it to declare a trip, regardless of the fishing activity). The 2008 scallop harvest specifications have not yet been finalized, but the proposed IFQ quota is 2.5 million lb (1,134 mt). Assuming each trip harvests the 400lb (181.4kg) possession limit, there would be an estimated 6,250 IFQ trip declarations per year, with an additional 9,375 trip declarations for some activity other than scallop fishing, for a total of 15,625 trip declarations. Following each trip, NMFS assumes that the vessel operator would submit a powerdown code to reduce polling costs and conserve battery power. NMFS estimates that it takes approximately 2 min to submit a trip declaration or powerdown code. NMFS estimates that the IFQ fleet would submit 31,250 VMS declaration codes (15,625 trip declarations and 15,625 corresponding powerdown code submissions); therefore, the annual IFQ trip declaration time burden would be 1,042 hr per year. At an hourly rate of $15, this burden would be $15,630.

5. NGOM Notification Requirements

The proposed NGOM TAC is expected to be 64,000 to 100,030 lb (29,030 to 45,373 kg) each year. Assuming each trip lands the 200lb (90.72kg) possession limit, and using the upper limit of the proposed TAC, it is projected that there would be up to 500 NGOM trip declarations per year. For economic purposes it is unlikely that a vessel owner would incur the cost of a VMS unit solely to have a NGOM permit. Therefore, assuming these vessels already have VMS reporting requirements for other fisheries, VMS declaration reporting requirements for activities other than NGOM activity have already been accounted for in other PRA collections. The increased reporting burden resulting from the NGOM permit category would be approximately 500 trip declarations and 500 powerdown declarations. Assuming each declaration takes approximately 2 min, the annual NGOM trip declaration time burden would be approximately 34 hr. At an hourly rate of $15, this burden would be $510.

6. Incidental Scallop Vessel VMS Notification Requirements

In 2004 and 2005, dealer data indicated that the percent of scallops landed in quantities of 40 lb (18.14 kg) or less was 0.02% and 0.06%, respectively, of the total scallop landings. The average scallop landings on these trips in 2004 and 2005 was 19,363 lb (8,783 kg). Using this average, NMFS estimates that there were approximately 500 general category trips that landed scallops incidental to other fishing. Assuming this rate would remain approximately the same, there would be an estimated 500 Incidental trip declarations made annually. As previously noted, for economic purposes it is unlikely that a vessel owner would incur the cost of a VMS unit solely to have an Incidental scallop permit. Therefore, assuming these vessels already have VMS reporting requirements for other fisheries, VMS declaration reporting requirements for activities other than Incidental scallop permit activity have already been accounted for in other PRA collections. The increased reporting burden resulting from the Incidental scallop permit category would be approximately 500 trip declarations and 500 power down declarations. Assuming each trip declaration takes approximately 2 min, the annual Incidental scallop trip declaration time burden would be approximately 34 hr. At an hourly rate of $15, this burden would be $510.

7. Prelanding Notification Requirements

VMS prelanding notification forms would be required for each IFQ and NGOM scallop trip. Therefore, there would be 6,250 IFQ and 500 NGOM scallop vessel prelanding notification forms submitted annually. NMFS estimates that it would take 5 min for each of the 6,750 reports, for an annual prelanding notification time burden of 563 hr. At an hourly rate of $15, this burden would be $8,445.

8. State Waters Exemption Program Requirements

The state waters exemption program enrollment form is estimated to take 5 min to submit through the VMS, the same amount of time as it has taken to enroll through interactive voice response system currently used. State waters exemption program trip declaration requirements are already accounted for in an approved collection under OMB Control No. 06480202. Therefore, this burden would not increase the cost to vessel owners declaring into the state waters exemption program.

9. IFQ Transfers

IFQ transfers would apply to IFQ scallop vessels, except that current limited access scallop vessels that also have been issued an IFQ scallop permit would not be permitted to transfer IFQ. Using the Northeast Region's Northeast Multispecies DAS leasing program (OMB Control No. 06480475) as a proxy for the response rate for the IFQ transfer program, NMFS anticipates that there would be approximately 75 temporary transfers annually. Each
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application would include information from both parties involved in the temporary transfer; therefore there would be two responses per application. NMFS estimates that it would take 5 min per response, or 10 min per temporary IFQ transfer application. Therefore, the estimated burden would be 13 hr. At an hourly rate of $15 / hour, the total public cost burden for temporary IFQ transfer applications would be $195.

The Northeast Multispecies DAS Permanent Transfer Program cannot be easily correlated with the general category permanent transfer program because the Northeast Multispecies Program has a 20percent conservation tax on all transfers, while there would be no conservation tax on scallop IFQ transfers. Although NMFS anticipates that there would be more IFQ transfers than DAS transfers, IFQ transfers would be restricted by the requirement that no IFQ vessel owner could have an ownership interest in more than 5 percent of the total TAC for IFQ scallop vessels, and no vessel could have more than 2 percent of the total TAC for IFQ scallop vessels at any time. NMFS anticipates that there would be approximately 10 permanent IFQ transfers per year. Each application would include information from both parties involved in the transfer; therefore there would be two responses per application. It is estimated that it would take 5 min per response, or 10 min per permanent transfer application. Therefore, the estimated permanent IFQ transfer burden would be 2 hr. At an hourly rate of $15 per hour, the total public cost burden for permanent quota transfer applications would be $30.

10. Cost Recovery

Since cost recovery for the scallop IFQ program is new, and there are no other current cost recovery programs in Northeast Region fisheries, the burden per response used by the Alaska Region's Alaska Individual Fishing Quota CostRecovery Program Requirements (OMB Control No. 06480398) was used as a proxy for the scallop IFQ program. Each IFQ permit holder would be required to submit a cost recovery payment once annually, which would take 2 hr per response. Therefore, 370 payments would take 740 hr. At an hourly rate of $15 / hour, the total public cost burden for cost recovery would be $11,100. 11. LAGC Sector Program

NMFS estimates that there could be up to nine sector proposals received over the next three years (20082009); five in the first year, two in the 2nd year, and two in the 3rd year. The earliest that the sectors proposed in the 2008 year could be implemented would be the 2009 fishing year. Therefore, these sectors would be required to submit operation plans for the 2010 fishing year.

Any person could submit a sector allocation proposal for a group of LAGC scallop vessels to the Council at least 1 year in advance of anticipated start of a sector program, and request that the sector be implemented through a framework procedure specified at Sec. 648.55. Based upon consultations with the Northeast multispecies sector program, it is estimated it would take 150 hr to prepare and submit a sector proposal. Therefore, the 3year average annualized time burden for sector proposals would be 450 hr per year. At an hourly rate of $15 per hour, the total public cost burden for sector proposals would be $6,750.

A sector is required to resubmit its operations plan to the Regional Administrator no later than December 1 of each year, whether or not the plan has changed. Based upon consultations with the Northeast multispecies sector program, each operations plan takes approximately 100 hr. The earliest sector operation plans would be submitted in 2010 for the proposals submitted in 2008. Therefore, NMFS estimates it would take 500 hr to submit 5 operation plans. The 3year average annualized time burden would be 167 hr per year. At an hourly rate of $15 per hour, the annual time burden cost would be approximately $2,500.
Economic Impacts of the Proposed Action Compared to Significant Non Selected Alternatives
1. Summary of the Combined Economic Impacts of the Limited Access Measures

In summary, the proposed limited access program could have negative economic impacts in the shortterm on the estimated 373 vessels that would not qualify for a LAGC scallop permit, with adverse impacts compared to 2005 scallop revenue estimated to be less than 5 percent for 119 vessels, 5 to 49 percent for 58 vessels, and 50 percent or more for 196 vessels. The measures would also have negative impacts on about 153 out of 369 vessels that are estimated to qualify for the IFQ scallop permit, with adverse impacts compared to 2005 scallop revenue estimated to be less than 5 percent for 26 of these vessels, 5 to 50 percent for 70 vessels, and over 50 percent for 57 vessels. Altogether, the proposed measures could reduce total revenues of 381 vessels of more than 5 percent in the shortterm. There are several measures in the proposed action, however, to help mitigate and reduce the potential negative impacts on these vessels, as discussed above. Qualifying vessels would be permitted to stack allocation up to 2 percent of the entire general category allocation and to transfer (i.e., lease or buy) IFQ on a permanent or temporary basis. This would enable vessel owners who do not receive an adequate amount of allocation to increase their scallop revenue to mitigate negative impacts. Furthermore, there is a provision to allow the formation of voluntary sectors. It may be beneficial for a group of vessels from a fishing community, for example, to organize and apply for a sector in the general category fishery. Negative impacts on some vessel owners may be mitigated if a vessel would qualify for a NGOM scallop permit that authorizes it to fish for scallops at a reduced level. In addition, many of the vessels that would not qualify for the IFQ scallop permit would qualify for an Incidental scallop permit that would authorize the vessel to land up to 40 lb (18.14 kg) of scallops per trip.

Continuation of the open access fishery under the no action alternative would not guarantee that the affected vessel owners would get more scallop revenue than they could with the proposed limited access program. With continued open access, there would always be the risk of more vessels entering the fishery, with the potential for overfishing of the scallop resource. Overfishing would likely cause a reduction in landings per unit effort, an increase in fishing costs per pound of scallops, and dissipation of the profits for all limited access and general category vessels.

There were also possible future negative effects on the existing limited access scallop vessels with the continuation of the open access program because the need to prevent an increase in overall fishing mortality would at some point reduce the DAS allocations for the limited access fleet to compensate for projected general category catcth. Assuming a scallop harvest of 50 million lb (22,680 mt), an increase in the share of general category landings to 20 percent of the total scallop landings would result in a decline of 17 percent to 21 percent of the net vessel share (as a proxy for profits) for the limited access vessels. Given that, in 2005, the general category landings increased to 14 percent of the total landings from about 5 percent in 2004, a further increase in general category effort could occur without a limited access program. Section 5.4.17.1
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and Table 166 of the Amendment 11 document provide details about these impacts.

Because it would prevent further expansion of the general category fishery, the economic impacts of the proposed measures on the 351 existing limited access vessels would be positive both in the short and the long term. Reducing the general category catch from recent levels could increase the total DAS allocations for those vessels, resulting in approximately a 7percent increase in their revenues compared to the status quo levels. Similarly, the general category limited access program would benefit the current limited access vessels that qualify for an IFQ permit, although the proposed 0.5percent allocation of the total scallop TAC could lower their landings compared to recent levels (1.5 percent and 0.75 percent of overall scallop landings in 2005 and 2006, respectively).

The overall economic impacts of the limited entry in the medium to long term are expected to be positive for the sea scallop fishery as a whole, compared to taking no action. The proposed action would restrict the estimated number of participants in the general category fishery to 369 vessels that meet the IFQ permit qualification criteria. The allocation of a 5percent TAC for the general category would cap the fishing mortality from this component of the fleet. The limited access program would also prevent the profits of the qualifiers and limited access vessels from dissipating due to an increase in fleet capacity that would likely occur with continued open access.
2. Summary of the Economic Impacts of the Individual Measures

Two alternatives to the proposed landings qualification criteria were considered: Cumulative annual landings of 100 lb (45.4 kg); and 5,000 lb (2,268 kg). The 100lb (45.4kg) landing qualification criteria is estimated to qualify more vessels (548) for limited access and have a lower negative impact on the recent participants than the proposed alternative. On the other hand, by increasing the number of participants, this alternative would result in a lower share of general category TAC for each qualifier and would thus have a negative impact on individual vessels, especially on vessel onwers that have a high dependence on scallop revenue as a source of income. For example, the average allocation per vessel would decline from 5,429 lb (2,462 kg) to 3,650 lb (1,656 kg) per vessel if the poundage criterion was set at 100 lb (45.4 kg) instead of at 1,000 lb (454 kg) for a general category TAC of 2 million lb (907 mt). The alternative 5,000lb (2,268kg) landings qualification criterion is estimated to qualify only 188 vessels for limited access and, thus, would increase the share of each qualifier in general category TAC. As a result, average allocation per vessel would increase to 10,638 lb (4,825 kg) with a 2millionlb (907mt) general category TAC. Although this alternative would have positive economic impacts on the vessels that had a much higher historical dependence on scallops as a source of their income,

FOR FURTHER INFORMATION CONTACT Peter Christopher, Fishery Policy Analyst, phone 9782819288, fax 9782819135.