HOUSE SPECIAL COMMITTEE ON FISHERIES January 26, 1995 5:00 p.m. MEMBERS PRESENT Representative Alan Austerman, Chairman Representative Carl Moses, Vice-Chair Representative Gary Davis Representative Scott Ogan Representative Kim Elton MEMBERS ABSENT none OTHER LEGISLATORS PRESENT none COMMITTEE CALENDAR Presentation by Paul Seaton, Alliance Against Individual Fishing Quota (AAIFQ) WITNESS REGISTER PAUL SEATON, Representative Alliance Against Individual Fishing Quotas 58360 Bruce Drive Homer, AK 99603 Phone: 235-6342 POSITION STATEMENT: Provided the AAIFQ presentation SUSAN REEVES, Attorney 601 West 5th Avenue, Suite 500 Anchorage, AK 99501 Phone: 258-6866 POSITION STATEMENT: Attorney for AAIFQ ACTION NARRATIVE TAPE 95-2, SIDE A Number 000 CHAIRMAN ALAN AUSTERMAN called the meeting to order at 5:00 p.m. He noted for the record Representatives Ogan, Elton and Moses were present and that a quorum was present. CHAIRMAN AUSTERMAN introduced Paul Seaton. REPRESENTATIVE GARY DAVIS joined the committee at 5:01 p.m. PAUL SEATON, REPRESENTATIVE, ALLIANCE AGAINST IFQs, began his testimony saying, "I'm a fisherman from Homer. I represent the Alliance Against IFQs which is a statewide, very informal organization formed in 1991, when it became very obvious that the North Pacific Fisheries Management Council was going to pass the individual fishing quota management option for halibut and sablefish, even though 93 percent of all the testimony from Alaskans was opposed to this plan. The halibut fishery was a predominant driving force behind this and what the council had done was make a management plan based on the sablefish fishery which is about 10 percent the size. Then when it came to halibut fishing, they refused to look at any other options for the halibut fishery, simply directing it on the mold that they had done for sablefish. So, that's when the Alliance formed. Coastal communities knew this would be a very strong detriment, both socially and economically, to their communities and that's why you'll see in your backup information, you have a sheet there that lists a number of coastal communities, Alaska native associations, boroughs, chambers of commerce. There are 47 different resolutions that were passed opposing this program. All were ignored by the management of the council. This represented communities from the furthest in the south, out to Unalaska. All were ignored totally by the council. Also, in your packet there is the 1992 resolution by the House of Representatives that was passed unanimously opposing the IFQ plan. It was also ignored. The basis for the knowledge that this would be a very strong detriment to the coastal communities is found in the `Impact Statement' that the council used to create the IFQ plan. You just have three pages of this long document. On page 210, `There would be 288 to 376 halibut vessels and 1,500 to 1,900 fishermen, if this plan succeeds.' And these are in comparison to 3,796 vessels and 1,400 fishermen without an IFQ program. So these were not unintended consequences. These were known and this was to consolidate this fishery massively. This is why all these resolutions were passed by these cities and native associations and the House of Representatives. The other things in there give the same kinds of information such as on page 212, `As fishermen switch fisheries or occupations, their living standards may suffer. This is especially true in communities which offer few alternatives to fishing. In these communities, especially along the Alaskan coast, communities could experience reduced income and population.' This is why these communities asked for social and economic impact studies to be shared with them before this plan went forward and no such impact statement would be done by the council, and has not been done since now. There is a kind of a social impact survey, the Institute of Social and Economic Research (ISER) survey and in that, you'll find that 68 percent of the fishermen there, in Table 1, tell you that they don't think that under this plan, this allocation was done fairly. In figure three, 42 percent of all fishermen say they're going to be worse off under the plan, 14 percent don't know, and 21 percent think they're going to be the same but that was before the numbers came out." MR. SEATON continued, "The lawsuit that was enjoined by the Alliance Against IFQ, had ten points. I'm not going to go into those points tonight. The crucial thing for which we're here and want to talk to the committee about is that we are appealing to the Ninth Circuit, the findings of the court. And the most important one tonight is that the District Court ruling extends far beyond IFQ's into allowing federal regulations to apply inside of state waters and that's in total contradiction to the Magnuson Act. In other words, the judges findings said that, `Well, there's no conflict, you can apply federal regulations in state waters.' The Magnuson Act says, `Nothing in this act shall be construed as extending or diminishing the jurisdiction or authority of any state within it's boundaries.' And of course the boundaries, as far as fisheries go, are the three mile limit. If any further clarification was needed, it can be found in the administrative record of the Magnuson Act where it says, `The federal government can assert jurisdiction in the waters of any state only in those limited instances when the state action, or the state's failure to take action will substantially, as well as adversely, effect the carrying out of the plan.' There's very specific requirements that must be met. The majority of the fishery must occur in federal waters and the action must severely restrict the Secretary's ability to manage the federal fishery. And that has to be done in a public hearing and an official secretarial finding. That was not done. These actions, these federal regulations are going to apply to state waters without following the dictates of law. What happened in this case are two things: One is the judge didn't seem to look at the law. And the other is: The judge found that the state of Alaska is the only party that has the right to object. The court found that, as citizens of the state, we do not have standing to raise the preemption issue. And that's what this is, it's preempting state management by applying federal regulations in state waters. And the problem is, some people don't like the word `precedent,' it's a federal district court ruling and we know what's going to happen. If they can do it here, they can do it in any other situation. The judge found that unless the state raises a conflict, there's no problem with exerting federal regulations. The only way that a state can exert a conflict, as far as the district court is concerned, is to take the federal government to District Court. This is the creeping federalism that you've been dealing with it all day today and yesterday: The problem of the federal government taking over fish and game management in state waters. That was specifically on subsistence, this is the same issue on the federal takeover of commercial fisheries in the state of Alaska. We would sincerely hope that the House, or this committee, would recommend that the Governor use his full resources to defend the state's exclusive rights to manage the fisheries within state waters. The (fisheries) transition team, that met over in Kodiak, one of the things they identified for immediate action was `to defend the state management of fisheries and prepare to make legal responses as necessary to maintain state authority of fisheries.' We hear it from the Governor's Office, we hear it from the transition team, we hear it from the House and the Senate, the only problem was that, in court, the state of Alaska had filed an amicus brief and had raised the problem of this, but there was nobody from the state in court. And they asked, `Is there anyone here from the state of Alaska to respond to the preemption issue, and there wasn't. We really need someone from the state of Alaska, the Attorney General, to be present and to expand their amicus brief on the taking over of state waters by the federal government at the Ninth Circuit Court of Appeals. So that's what I would really urge you to consider and that's the main thing, why we are right now with this. There are four points that we're going to appeal. This is the main one, the important one right now that we really need the state's help with. The state is the only one that has standing to raise the issue." Number 250 MR. SEATON concluded, "I am thoroughly familiar with the IFQ regulations, if you have any questions on those. The other points that we're litigating on is the Bellingham issue where the Secretary, outside of the purview of law, expanded the primary ports to allow Bellingham and every other state to be landing ports for fish. That's a technical argument, as well as, without enforcement you have resource degradation. Not considering the present participation of individuals and the fact that administrative convenience was used as the sole reason for giving all IFQ's to vessel owners, cutting out the crew and others. Once we say that, administrative convenience is an adequate reason for taking actions under the Magnuson Act, it's all over. I mean, if that can be your reasoning for taking action then there's severe problems for any of the public to have any input at all." CHAIRMAN AUSTERMAN thanked Paul Seaton for his presentation. Number 283 REPRESENTATIVE GARY DAVIS said, "You mentioned that the state had filed an amicus brief. Have you followed up on that? So they must have been concerned that they weren't there. Who did that? Which administration? Why weren't they there?" MR. SEATON replied, "The Hickel Administration are the ones that became very concerned on the issue of preemption and we talked to them quite a bit. They finally decided, it was kind of at the last minute, that they needed to respond in federal court. Otherwise, preemption was going to take the state's rights away. The argument was on the 19th of December. The Attorney General who had written that opinion was no longer employed there. Also, in the amicus opinion they were saying, `Well, we're supporting IFQ's, we're supporting CDQs, but we're opposed to preemption of state management in state waters, essentially. I don't know why they weren't there. We were talking to them. I don't think that anybody was really up to speed. There was quite a bit of confusion on CDQs, IFQs. The CDQ section, I might say, was being challenged in our ten points that they were only being allocated to native communities in Bristol Bay. The judges ruling said that there is basis for giving that kind of an allocation solely based on economic and social hardships in any community. So we are not challenging the CDQ regulations. I don't know if there was a conflict between people wanting parts of it and not wanting parts of it. We haven't been able to find out exactly what happened." Number 320 SUSAN REEVES, ATTORNEY, ALLIANCE AGAINST IFQ'S, interjected saying, "I want to make sure that you have an accurate picture here. You asked what the position of the Attorney General's Office was now. We have spoken to them and they're considering this. They haven't told us that they won't be involved. They haven't told us that they will but they are aware that the issue is on appeal and they are looking at it right now." Number 333 REPRESENTATIVE KIM ELTON asked, "I haven't seen the full opinion, and it's probably very difficult to make an interpretation based on a half a page of an eleven page opinion, but it seems to me that there's nothing that precludes the state at any time in the future to raising the issue of state control of its fisheries. He then referred to last page of the District Court Judge's Findings where it says, "If the state of Alaska later enacts legislation contrary to these regulations, in waters not specifically excluded from coverage, the issue may then be ripe for review," He concluded, "It seems to me that that means that at anytime in the future, if indeed there is a conflict between state law and state regulations and the IFQ Program, that the state can raise the issue at that time." MR. SEATON replied, "The big problem is, what this court has allowed is to say, `Oh, there isn't any conflict, therefore, you can apply federal regulations.' This could be extended to observer coverage, to reporting coverage, to taxing coverage. As long as there's not a problem with taxes, they could extract taxes out of state waters. They could say, `Okay, we want to have federal observer requirements on all the vessels in state waters.' There wouldn't be any conflict there. That's the big problem. What's happening is that unless there is a significant conflict, this judge is saying, `There's nothing to review, there's no problem.' And what the Magnuson Act says is, `The only time that you can extend federal regulations in state waters is if there is so large a conflict, that the state regulations prevent the Secretary from being able to manage the federal fishery. Significantly and adversely effect the Secretary's ability to manage the federal fishery. So, by this huge leap, what we've done is we've said, `Okay, federal regulations can apply to state waters.' That's what this judge has said. When right now the Magnuson Act says, `Federal regulations cannot apply in state waters unless the state's action or inaction so impairs the Secretary's ability that he can't manage the federal fishery. And they have to make certain findings are that the majority of the fishery takes place in federal waters and that this is going to impair the ability of the Secretary to manage the federal fishery. And he has to make that a specific finding. Part of this problem becomes, if the state would later enact legislation contrary to the regulation and then the federal government would then come in and preempt. Sure, then it could come back to court. One thing under the Magnuson Act which is really peculiar is that there is a 30 day window on a fisheries management plan. When a management plan is passed, you have to, after it is published in the federal register, you have to file a lawsuit within 30 days in federal court, otherwise you can never challenge that fisheries management plan. You can challenge on a constitutional grounds or something, but you can't challenge the fisheries management plan." REPRESENTATIVE ELTON said, "But I'm reading this as saying, `There is no problem unless there's a problem in the future and if there's a problem in the future, the state then has standing to address it in federal court.' You're saying, `Why not address it now so that there's never a future problem.'" MR. SEATON replied, "What this court is saying is, `There is no problem, unless there's a conflict.' The law, the Magnuson Act says, `Nothing in this act allows the federal government to extend its jurisdiction into state waters, unless there is a conflict, and that conflict has to be so severe that it impairs the Secretary's ability to manage the federal fishery. Then the Secretary, under very specific conditions in the Magnuson Act, can preempt state management. What this judge has said is that, `Without any conflict, without any preemption, federal regulations can apply in state waters. That means it's going to happen all the time because it's much easier for the feds to pass a regulation going right up to the shore and talk about all of the fish. What else they did in this is they preempted, effectively, state management because they allocated 100 percent of the total allowable catch (TAC) to the IFQ fishery. The state fishery can still occur but there's no fish to catch, because they've allocated 100 percent under these regulations of the total allowable catch to the IFQ fishery. It's going to be a huge problem. What does the state do? Does the state close its waters and say, `Oh well, you can't catch any IFQ or non-IFQ fish here.' Because a person without any IFQ's can fish in state waters. A state vessel (which) doesn't have a federal fisheries permit can go out and fish in state waters. But there's no fish to catch unless you go beyond the biological limit because the total allowable catch, under these regulations, has been given to the federal IFQ fishery. So, there's huge problems when you allow these federal regulations to be applied to state waters. Biological problems as well. State management doesn't know what to do. They don't know whether to open the fishery or close the fishery. If they open the fishery, there's going to be fish taken that aren't counted in the TAC because the federal regulations allocate all of the fish personally to people with IFQ's and yet you're going to have this other fishery occurring. If the state says, `Oh, we can't have that,' they have to close the waters and those federal permits can't be used in state waters, because the waters are closed. So people who fish in small boats and fish in close are going to be, `Oh what do we do, well we sell out or go out where it's dangerous.'" Number 451 REPRESENTATIVE SCOTT OGAN thanked Mr. Seaton and committed to study this issue further. REPRESENTATIVE DAVIS said, "It is my understanding that this whole thing came about because of a perceived need to control the harvest of certain species. Was that a valid concern? Would these species get over harvested?" MR. SEATON said, "It was a totally invalid concern. These fish are now, and they will be in the future, harvested on a quota basis. In other words, the amount of fish is set each year as to how much will be caught and this an economic allocation issue. It had nothing to do with the biological health of the resource." CHAIRMAN AUSTERMAN said, "I would suggest maybe that either myself as chairman of the committee, or this committee itself, encourage the Governor to take a hard look at the issue to see whether we should be back in court." Number 473 REPRESENTATIVE DAVIS said, "I would appreciate that. It sounds like he's looking at it. It would be nice to inquire at his office and find out when and if he does make a decision, if he'd let you know and then you could copy us on that." REPRESENTATIVE ELTON said, "If you do that, you may wish to ask about the other facets of the issue. You heard about the socio- economic impact, but it would be interesting to know about the market and safety impacts also before we have that discussion." Number 485 CHAIRMAN AUSTERMAN thanked his guest and adjourned the meeting at 5:27 p.m.