Tuesday, January 31, 2012
Assuming that it shouldn't take more than a month for the NMFS Financial Services guys to get things turned around for a vote, that would put us March 1. So expect the vote in March, unless things go as they've gone these past 10 years. Then expect a delay. But be prepared for as early as March 1. They cannot tell us a date but that is a good one to start with.
There are lots of issues surrounding the buyback that people get worked up about. Most, if not all outstanding issues relating to optimum number, bid procedures, assessment collection by the processors on the fish ticket....etc can be found in our archives or newsletters. We've had the best and brightest working on this for a decade now and doubt that there are any angles we haven't already thought about.
There will be another newsletter on the way very soon.
Apologies for not having a concrete date set for when the voting will start but that's just been the nature of this Program. It's a first of it's kind in history. Federal loan and grant (the first 36 permits were bought with federal grant funds) program for a state waters fishery that leaves the entire dominion of the proper conduct of the fishery in the hands of the state.
At the lowest interest rates the Fed has had since around WWII.
You have my number and you know the board. Call anytime with questions. And don't be afraid to comment on here as well. I know not 100% of you are supportive as we've only recently polled 85% in the spring. So there'll be 1 in 6 against the program. Meanwhile, 58 foot limit almost got taken off last Board of Fish cycle yet 4 in 6 are against changing the 58 foot limit.
Believe me, this program was instituted with the total picture of all of you in mind.
This is a program for the young guys and the average guy in the fleet.
Have a good day
btw. As most of you probably already remember us telling you, we fought NMFS for at least a year or so, delaying the program, because we did not want to do a reverse auction. We felt that everyone should get the exact same price. NMFS would not let us do this. So our apologies for not winning out on that issue. It would have made for a more even keel with all one price. Sorry we weren't able to prevail on that point.
Monday, January 23, 2012
CAPACITY REDUCTION PLAN FOR THE SOUTHEAST
ALASKA SALMON PURSE SEINE FISHERY
By Southeast Revitalization Association
The Southeast Revitalization Association (“SRA”), pursuant to Title 50 of the
Code of Federal Regulations, Section 600.1107(e)(1) submits the following
Reduction Plan (“Plan”)1 to implement a fishing capacity reduction program
(“program”) for the Southeast Alaska Purse Seine Salmon Fishery (“fishery”).
I. STATUTORY AND REGULATORY BACKGROUND
The program was established under the Consolidations Act of 2005 (Section 209
of Title II of Division B of Public Law 108-447). This federal law was subsequently
amended by Section 121 of Public Law 109-479 (the Magnuson-Stevens
Reauthorization Act of 2006) codified at 16 U.S.C. §1801 et seq. The authority
for the SRA to conduct this program is Alaska Statute 16.40.250.
Based on these federal and state measures the National Marine Fisheries
Service (“NMFS”) established regulations in the Federal Register, Vol. 76, No.
194, October 6, 2011, to administer and implement the program.
The purpose of the program and this Plan is to permanently reduce the number
of limited entry fishing permits issued by the Alaska Commercial Fisheries Entry
Commission (“CFEC”) for the fishery thereby promoting economic efficiency and
improving the conservation and management of the fishery.
The regulations established by NMFS divide the program into six phases. The
SRA has certain unique roles relating to three of these phases: (1) Enrollment;
(2) Bid Selection; and (3) Plan Submission.
1 This Plan is generally modeled under portions of “Harvester Proponents’ Implementation Plan”
as provided under the Magnuson-Stevens Act, Section 312(e).
Under the enrollment phase the SRA is required to perform four separate duties
in preparation for submittal of the Plan.
A. MAILING OF BIDS
On November 29 and 30, 2011, the SRA, pursuant to 50 CFR §600.1107 (c)(1),
sent a copy of the bid documents by certified mail to each holder of a valid entry
permit issued by CFEC to operate in the fishery.2
B. BID CLOSING DATE
Pursuant to §600.1107(c)(3), the SRA specified a bid closing date of December
C. SUBMITTAL OF BIDS
The SRA contracted with the independent accounting firm of Elgee, Rehfeld,
Mertz, LLC in Juneau, Alaska, to assist in the Enrollment phase of the program,
including the collection and compilation of all bids and other supporting
documentation submitted by permit holders wishing to relinquish their permits.
Pursuant to §600.1107 (c)(2)(v)(A)&(B) the accounting firm also made an initial
determination whether the bid application conformed with the prescribed
requirements and notified bidders of non-conformity, if any.
D. RECEIPT OF BID APPLICATIONS
The accounting firm received a total of seventy (74) conforming bid applications
during the prescribed enrollment period.3 Each of the bid applications was
recorded by date of receipt, permit holder’s name, permit number and bid
amount. The information and related documentation was transmitted to the SRA.
2 See affidavit of Rachel Agent marked as Exhibit A.
3 Three (3) of the bid applications were received be the accounting firm on December 29, 2011.
However, all documentation was executed within the enrollment period and the SRA deemed
these bids were timely received. This determination was also based, in part, on the aggregate
bid amount not exceeding the maximum loan ceiling.
III. BID SELECTION
Under the bid selection phase the SRA is required to perform five separate duties
in preparation for submittal of the Plan.
A. RANKING OF BIDS
Pursuant to §600.1107(d)(3), the SRA ranked the 74 bids by using a reverse
auction format. The SRA ranked the bid with the lowest dollar amount first and
successively ranked each additional bid with the next lowest dollar amount. The
individual bid amounts ranked from a low of $175,000 to a high of $350,000. The
74 bids were in the aggregate amount of $15,817,980.
B. CONSULTATION WITH CFEC
Consistent with §600.1107(d)(1)(i), the SRA, in consultation with CFEC,
examined each of the 74 bid applications for consistency, including the validity of
the permit and whether any authorized party held a security interest in the permit.
C. ACCEPTANCE OF BIDS
Pursuant to §600.1107(d)(4), the SRA accepted sixty-four (64) ranked bids with
an aggregate bid amount of $13,133,030, or an average of $205,204.4 As
required under §600.1107(d)(4)(e), SRA certifies that each of the ten (10) bid
applications not accepted contained a bid amount higher than $240,000.5
D. NOTIFICATION TO BIDDERS
Pursuant to §600.1107(c)(4) the SRA, via certified mail, notified each of the 64
accepted bidders that their bid had been accepted and the effective date for their
agreement to relinquish a permit.
Pursuant to §600.1107(d)(4) the SRA transmitted to CFEC the Conditional Notice
form restricting the renewal and transfer of each of the 64 permits for which a bid
was accepted. The SRA also notified each of the non-accepted bidders by
4 See schedule of accepted bids marked as Exhibit B.
5 These 10 non-accepted bids totaled $2,684,500, or an average of $268,450, ranging from a low
of $248,000 to a high of $350,000. The SRA maintains acceptance of one or all of these bids
would be an excessive deviation from current fair market values, and, therefore, not costeffective.
See Section IV(A)(2)(a)(i) of the Plan. Moreover, the SRA maintains that acceptance
of bids in excess of $240,000 would result in a crucial segment of permit holders voting in the
referendum against the Plan.
IV. REQUIRED FINDINGS
Pursuant to §600.1107(e)(2), approval of the Plan requires a finding that the Plan
is (1) consistent with applicable provisions of federal law, and (2) will provide
increased harvesting productivity for post-reduction participants in the fishery.
The Plan satisfies both requirements as set forth below.
A. CONSISTENCY WITH FEDERAL LAW
There are two separate federal laws authorizing this program: 1) the amended
Consolidated Appropriation Act of 2005 and 2) portions of the Magnuson-
Stevens Act codified at 16 U.S.C. 1801 et seq. Both of these laws are further
identified in Section 1 of the Plan.
1. CONSOLIDATED APPROPRIATIONS ACT OF 2005
The Plan is consistent with the amended Consolidated Appropriations Act of
2005 for the following reasons: (1) total program costs identified under the Plan
do not exceed $23,476,500; (2) the Plan provides the assessment (or industry
fee) cannot exceed a maximum three percent (3.0%) of the value of the fishery;
and (3) the SRA with the submittal of this Plan has fulfilled its respective role and
duties relating to the development and implementation of the program.
2. MAGNUSON-STEVENS ACT
The enabling legislation, the Consolidated Appropriations Act of 2005,
authorizing this program waives many of the fishing capacity reduction program
requirements of the Magnuson-Stevens Act. There were a variety of reasons for
this waiver. Unlike other industry financed capacity reduction programs
undertaken by NMFS, this program involves no federal fishing permits. More
importantly, this program does not retire fishing history and places no restrictions
on the accepted bidder or how the vessel, if any, to which the relinquished permit
applies can be used in the future.
The enabling legislation does, however, provide that the program meet the
requirements of the Magnuson-Stevens Act, §312(b)(1)(C) and (2), which are:
2. Capability of repaying the loan; and
3. Achieving the maximum sustainable reduction in capacity at the least cost.
Cost-effectiveness is not defined is these regulations or the Magnuson-Stevens
Act, which complicates evaluation of this requirement. Typically, a costeffectiveness
analysis is a comparison of the relative cost-efficiencies of two or
more alternative ways achieve the objective—in this case improving the
harvesting productivity for the remaining permit holders participating in the
fishery. The SRA does not have a range of alternatives from which to select the
most cost-effective approach; and NMFS considered no other alternative other
than a no action alternative. By definition this program and the related Plan
provides only one approach to achieve a sustainable reduction in fishing
capacity. Without an alternative method, the analysis of cost-effectiveness
hinges solely on the question of whether the number of permits relinquished and
related costs under the Plan is worth doing.
The SRA maintains the answer to this fundamental question requires a two-part
analysis. First, is the total amount of accepted bids rationally related to the
current fair market value of permits? Secondly, is the reduction in fishing
capacity sufficient to warrant the cost and duration of the loan?
i. FAIR MARKET VALUE
According to advertisements in commercial fishing trade journals and permit
broker websites, the current offering price for a permit ranges from $130,000 to
$135,000.6 State of Alaska records show for the period 2007-2010 the average
permit price has increased from $59,700 to $87,400.7 The SRA expects the
average 2012 permit price published by the State of Alaska will closely
approximate the average accepted bid amount of $205,204.
The recent increase in permit values is a function of four factors: (1) relatively
stable salmon production; (2) rising prices for Alaska salmon especially pink and
chum salmon; (3) reduced number of inactive permits8; and, (4) the upward
speculation fueled by the potential approval and ultimate implementation of the
The present fair market value is predicated on a total of 379 permits. If the Plan
is approved and subject to a successful referendum, 315 permits or 83.1% of the
existing permit total will remain eligible to participate in the fishery. The SRA
maintains this reduction will result in a substantial increase in the fair market
value of the remaining permits to a level equal or greater than the average
accepted bid amount.
6 Pacific Fishing Magazine, December 2011 and websites of vessel/permit brokers, Dock Street
Brokers and GSI Company, based in Seattle , Washington.
7 See CFEC Basic Information Table—www.cfec.state.ak.us/bit/X_SO1A
8 The SRA previously purchased 35 permits under a 2008 State of Alaska program with federal
grant funds. The average accepted bid amount was $82,020.
ii. LOAN COST AND DURATION
(a) Loan Terms
The Plan will utilize a principal loan amount of $13,133,030. The loan will bear
interest at an estimated initial rate of 5.125% per annum. 9 The final interest rate
will be fixed at the end of the 2012 federal fiscal year and will not vary over the
remainder of the loan term. The SRA maintains this very favorable interest rate,
which will be the lowest ever provided under a NMFS funded reduction program,
is a major factor supporting the cost effectiveness of the program. As authorized
under the enabling legislation, the loan shall be amortized over a forty (40) year
term. The annual debt service would be $778,513.
The SRA concedes this analysis is limited in scope and is inherently
complicated.10 The three key components employed by the SRA in projecting
the duration of the loan are (1) future harvest volumes; (2) species composition;
and (3) ex-vessel price. Each of these components can and do vary from year to
year, especially harvest volumes. The SRA has attempted to consider each of
these components and the related commonalities in making its projection.
(b) Prior Harvest Volumes and Future Harvest Projections
The SRA maintains the recent 12 year period 2000-2011 is the most appropriate
measurement of time to project future harvest for the duration of the loan period.
The average annual harvest during this period was approximately 175 million
pounds. Annual harvest during this period ranged from a low of 95 million
pounds, to a high of almost 264 million pounds this past fishing season. The
SRA projection was favorably influenced by poundage falling below 100 million
pounds in only two of the years. This indicates that although annual production
may fluctuate, the collapse of the Southeast salmon populations is highly
9 The interest rate is the U.S. Treasury’s cost of borrowing equivalent maturity funds plus two
percent. A thirty (30) year treasury, which is the nearest equivalency, currently is paying 3.125%.
10 The volatility of such projections is most clearly evidenced by the 2005 report on projected exvessel
earnings for the fishery prepared by the McDowell Group in Juneau, Alaska and funded by
NOAA Fisheries, Alaska Region. This report projected a 40-year average pink and chum exvessel
price of $0.16 and $0.21, respectively.
Year Total Pounds
Annual Average 175,135,690
(c) Prior Harvest Composition by Specie and Future Composition Projections
In terms of poundage, pink salmon are the single largest component of harvest in
the fishery. Chum salmon comprise the second largest component followed by
sockeye, coho and chinook salmon. Estimating the future harvest composition is
challenging given that pink salmon harvest is based on production within literally
thousands of watersheds throughout the Southeast region, while most chum
production comes from enhanced hatchery-reared fish. For consistency
purposes, the SRA draws upon the most recent 12 year average (2000-2011) to
project the following future harvest composition by specie and poundage.11
Pink Chum Sockeye Coho Chinook
76.0% 20.0% 2.0% 1.6% 0.4%
Based on these projections the SRA estimates the annual harvest will be
distributed as set forth in the following table:
Specie Percentage Poundage
Pink 76.0% 133,300,000
Chum 20.0% 35,000,000
Sockeye 2.0% 3,500,000
Coho 1.6% 2,800,000
Chinook 0.4% 700,000
TOTALS 100.0% 175,000,000
11 See 2010 Alaska Fish & Game Annual Management Report; Table 1, page 58. See also Fish
& Game 2011 salmon harvest estimates by gear in the Southeast Alaska fisheries.
(d) Ex-Vessel Price Projections
Unlike the future harvest and species composition projections set forth above,
the SRA maintains it is not appropriate to consider the most recent 12 year
average to project future ex-vessel prices. Alaska salmon prices have seen
considerable appreciation during the last five years (2007-2011), especially pink
and chum. Over this time period the ex-vessel price of pink and chum in the
fishery have increased from $0.21 and $0.39 to $0.45 and $0.90, respectively.12
This increase has occurred despite record harvest levels.13 The SRA maintains
the reason for this continued upward trend despite an increasing supply is that
Alaskan pink and chum salmon are the most cost-effective salmon options in the
The traditional high-value species make up only four percent (4%) of the harvest.
During the last five years the ex-vessel price per pound of sockeye has average
$1.25 while the coho and Chinook price has averaged $1.00 and $3.00 per
Based on these averages and future market conditions, the SRA maintains that
the ex-vessel price per pound for the fishery will stabilize for the duration of the
loan period at the following levels. The SRA projection further assumes inflation
will have a zero impact on ex-vessel values.16
Pink Chum Sockeye Coho Chinook
$0.40 $0.75 $1.25 $1.00 $3.00
(e) Projected Ex-Vessel Value of the Fishery
Based on the foregoing, the SRA projects the average annual value of the fishery
for the duration of the loan period will be $80,430,000 as set forth in the following
12 See Alaska Department of Fish & Game website www.adfg.state.ak.us Information by Fishery.
13 The 2009 Russian pink salmon harvest reached a record 924 million round pounds. For
context, Alaska’s average harvest of pink salmon for the period 2007-2011 was 386 million
pounds The 2011 Russian pink harvest is estimated at nearly 900 million pounds with a 395
million pound harvest in Alaska.
14 There are growing markets for frozen pink and chum salmon, particularly pin-boned fillets and
other value-added products. Shifting demographics and better access to food information is
driving consumers to buy salmon. Consumers emphasize cost and ease of preparation, which is
a favorable position for frozen pink and chum salmon from Alaska. Alaska Seafood Marketing
Institute, Seafood Market Bulletin, Summer 2011.
15 See footnote 11.
16 This is a very conservative component of the projection given inflationary trends and the rise in
commodity prices and demand for salmon in the world’s developed nations.
Specie Poundage Price Ex-Value
Pink 133,300,000 $0.35 $46,655,000
Chum 35,000,000 $0.70 $24,500,000
Sockeye 3,500,000 $1.25 $4,375,000
Coho 2,800,000 $1.00 $2,800,000
Chinook 700,000 $3.00 $2,100,000
TOTALS 175,000,000 $80,430,000
(f) Projected Annual Assessment or Industry Fee
Based on the projected ex-vessel prices and a maximum three percent (3.0%)
assessment, the fishery will on average annually generate $2,412,900.
(g) Projection of Loan Amortization and Pay-Off
Annual assessment revenue of $2,213,012, which is almost $200,000 less than
the amount estimated by SRA for the fishery, will allow for repayment of the loan
in six (6) years, or by October 2018.17 The projected amortization schedule is set
forth in the following table:18
Date Payment Principal Interest Balance
06/01/2012 -0- -0- -0- $13,133,000
10/01/2012 -0- -0- $224,355 $13,357,355
10/01/2012 $2,213,012 $2,213,012 -0- $11,144,343
10/01/2013 $2,213,012 $1,628,256 $584,756 $9,516,087
10/01/2014 $2,213,012 $1,713,692 $499,320 $7,802,395
10/01/2015 $2,213,012 $1,803,611 $409,400 $5,998,784
10/01/2016 $2,213,012 $1,898,249 $314,763 $4,100,534
10/01/2017 $2,213,012 $1,997,852 $215,160 $2,102,682
10/01/2018 $2,213,012 $2,102,682 $110,330 -0-
TOTALS $15,491,084 $13,357,35519 $2,133,729
17 Pink salmon are the single largest harvest component in the fishery. The year-to-year harvest
of pink salmon varies widely and the variation has a predictable pattern based on the two-year life
cycle of the fish. The harvest in odd-numbered years is typically much stronger than in evennumbered
years, owing to the abundance of the parent year fish. For example, the offspring of
the large pink salmon numbers that spawned in 2011 will return to the spawning grounds in 2013,
their off-spring return in 2015. The first year of the assessment will be 2012—an even numbered
year. Consequently, the 2012 harvest poundage and ex-vessel value of the fishery will likely fall
below the average projected under the Plan. For this reason, the amortization schedule applies a
number less than the SRA projection to offset this likely first year shortfall.
18 The schedule assumes reduction payments will be received by accepted bidders on June 1,
2012 and the first year assessment will be transmitted by October 1, 2012.
19 This principal amount includes$224,355 in additional interest from the projected date of the
reduction payments to transmittal of the 2012 assessment.
The SRA maintains reduction in fishing capacity is necessary. The Plan is costeffective
for two overriding reasons: (1) The average price of the 64 accepted
bids is reasonably related to current market valuations and the fair market price
the SRA maintains will exist post-implementation of the Plan. (2) The projected
duration and cost of the loan, considering the interest rate and current value of
the fishery, is consistent with the reduction in fishing capacity achieved under the
b. CAPABILITY OF REPAYING LOAN
The Magnuson-Stevens Act, §312(b)(ii)(C) requires a showing that the program
is “prospectively capable of repaying any debt obligation” incurred under the
Plan. This requirement is fully satisfied considering the projected loan
amortization and pay-off analysis contained in Section IV(A)(2)(a)(ii)(g) of the
Plan. In fact, reducing the rate from 3.0% to only 0.97% would still generate an
annual assessment sufficient to repay the loan within the prescribed term.20
Moreover, the Plan utilizes only 55.9% of the maximum loan ceiling.
c. MAXIMUM SUSTAINED REDUCTION IN FISHING CAPACITY
The Magnuson-Stevens Act, §312(b)(2) requires the program to achieve the
maximum sustained reduction in a minimum period of time. The SRA maintains
this requirement is satisfied by the very nature of the program and that fishing
permits are permanently relinquished. Unlike other federal capacity reduction
programs, under this Plan there is no buyback of fishing history or quota and
there is no restriction on the vessel, if applicable, to which the relinquished permit
applies. Therefore, each permit, including currently inactive or latent permits,
constitutes additional, if not equal, fishing capacity. The only constant
measurement of fishing capacity in the fishery is the fishing permit. By definition,
therefore, relinquishing 64 of the 379 permits is equal to a 16.9% permanent and
sustainable reduction in fishery capacity.21The Plan does not immediately
achieve maximum sustainable reduction in capacity. To achieve that objective,
without consideration of cost-effectiveness, the SRA would need to accept the
ten (10) non-accepted bids described in Section III(C) of the Plan. 22
20 This reduced rate would generate an annual assessment of $778,513. See Section
IV(A)(2)(a)(ii)(a) of the Plan.
21 CFEC may issue additional permits in the future if the fishery becomes too exclusive. This
would require CFEC to conduct an “optimum number” study before any decision could be made
on whether the fishery had become too exclusive. The SRA thoroughly considered this possibility
before electing to submit the Plan.
22 The Plan provides for a $13,133,030 loan amount. The remaining $10,343,470 would be
available for future reduction payments as part of a later, separate Reduction Plan. See 50 CFR
Section 600.1107(f)(1). The Plan does not consider what percentage of additional reduction can
be achieved with the remaining funds.
B. INCREASE HARVEST PRODUCTIVITY FOR POST-REDUCTION
PARTICIPANTS IN THE FISHERY
As is the case with cost-effectiveness, increased harvest productivity is not
defined in these regulations or the Magnuson-Stevens Act. As a rule, harvest
productivity would be defined as the volume or pounds of salmon harvested in
the fishery divided by the fishing time required to harvest the salmon. Under
such a definition productivity would be measured by the volume of fish available
and the efficiency of the harvesting vessel. There is no question that the size and
design of today’s purse seine vessel is resulting in greater “harvest” efficiency.
However, the “productivity” of the vessel is more closely related to the volume of
fish available to harvest rather than the number of permits participating in the
fishery. For these reasons, the term “increased harvest productivity” may not
properly capture the primary objective of the program. Rather, the pivotal
question is whether after implementation of the program will the individual permit
holder participating in the fishery have the opportunity to catch a relatively
greater percentage of the available salmon harvest?
This can be a complicated and somewhat subjective question since it requires
future forecasting in an industry that is historically fraught with uncertainty. The
SRA again starts from the proposition that each fishing permit represents a
potentially equal increment of fishing capacity.23 The SRA analysis also
considered a review of participation in the fishery for the 1997-2011 time period
as set forth in the following table combined with a projection of future
Year Permits Issued Permits Fished
1997 415 351
1998 415 377
1999 415 359
2000 415 356
2001 414 345
2002 413 273
2003 416 235
2004 414 209
2005 415 232
2006 414 230
2007 415 237
2008 380 212
2009 379 256
2010 379 235
2011 379 277
23 This proposition is further supported by the program containing no limitation or restriction on
the rights of an accepted bidder to relinquish a permit and then purchase another permit to
participate in the fishery.
24 See CFEC Basis Table Information, footnote 7.
Participation has trended upwards since 2005 with greater increases occurring in
the odd number years. Participation increased by 2.2% from 2005 to 2007; 8.0%
from 2007 to 2009 and 8.2% from 2009 to 2011. This increased participation is
directly related to rising ex-vessel prices. However, other factors are promoting
There is an ever growing demand for wild Alaska salmon. Not until 2008 did
salmon processing companies and other buyers stop restricting their purchases
of pink and chum salmon in the fishery. The SRA assumes this was in response
to processing capacity limitations or depressed prices resulting from oversupply.
Today these same processing companies and new entrants are increasing
processing capacity. There is now excess processing capacity in the fishery.
Consequently, these companies are aggressively seeking to introduce more
harvesting capacity into the fishery reasoning the need to have more harvesting
vessels to maintain their current share of the available harvest.25
Fishermen are diversifying. Participation in multiple fisheries has become a
simple economic fact. Fishermen generating solid revenue in one fishery are
constantly analyzing the cost and benefit of investing and participating in a new
fishery. SRA maintains many fishermen with no prior participation in the fishery
are preparing to invest and periodically participate in the fishery.
The fishery is biologically strong. For the past 20 years, escapements have been
at historical high levels for pink salmon. Harvest is rarely constrained by poor
escapement. Today, annual production is dependent mostly on over-wintering
and climate ocean conditions. Although salmon runs will fluctuate, the collapse
of a stock is unlikely because of intense in-season management requiring
adequate escapement before commercial harvest. Moreover, freshwater rearing
habitat is intact and will remain that way given the Alaska’s current regulatory
The SRA maintains that within the next 3-5 years every now inactive or latent
permit will be owned by an active fishermen or otherwise controlled by a
processing company or other fishery related entity. The SRA cannot maintain
with certainty that reducing the total number of permits by 16.9% will result in an
immediate increase in the percentage of harvest taken by those remaining
participants in the fishery. The SRA does, however, maintain that the 16.9%
reduction will lessen the possibility that latent permits will be activated thus
minimizing further reductions in harvest levels or percentages to be enjoyed by
remaining participants in the fishery.
25 This can take variety of forms. Processing companies are now offering loans to new
fishermen seeking to enter the fishery or providing financing to existing participants for vessel
improvements. Companies are now more closely examining regional salmon forecasts and
encouraging fishermen to operate in areas where they believe more production is available.
Companies may also encourage or require participation in the fishery as a condition to offering
those fishermen markets in other regions or for other seafood harvest.
EXHIBIT A—AFFIDAVIT OF RACHEL AGENT PURSUANT TO
CFR TITLE 50, SECTION 600.1107(c)(1) and (4)
STATE OF WASHINGTON )
COUNTY OF KING )
Rachel Agent being first duly sworn upon oath, deposes and says:
I am over the age of 18 years and presently employed by Seine Management
Services, Inc., (SMS) a Washington corporation doing business at 1900 West
Nickerson Street, Suite 320, Seattle, Washington 98119. SMS has entered into
a contract with the Southeast Revitalization Association (SRS) to provide certain
clerical and administrative services relating to the development of a fishing
capacity reduction program for the Southeast Alaska purse seine salmon fishery.
On or about November 29th and 30th, 2011, I placed in an envelope a true and
correct copy of each of the following documents:
1. Bid--Appendix A
2. Relinquishment Contract—Appendix B
3. Conditional Notice —Appendix C
4. Conditional Relinquishment—Appendix D
5. Self-addressed return envelope
6. Explanatory letter to complete the documents.
The SRA provided me with the foregoing documents and instructions to contact
the Alaska Commercial Fisheries Entry Commission (CFEC), which provided me
with the current name and address of each of the 379 permit holders. The CFEC
provided me with an electronic version of the names and address from which I
generated mailing labels.
Our postage supplier, Pitney-Bowles, provided me 378 sequentially numbered
certified mailing labels starting with 91 7108 2133 3939 3866 8750. I placed a
single label on 378 separate envelopes. I deposited 375 of the envelopes with
sufficient postage for certified mailing in the United States Mail. I deposited two
(2) envelopes with sufficient postage for mailing to two (2) permit holders who are
Canadian residents. I personally delivered the remaining envelope to a dual
On January 20, 2012 the SRA supplied a list of the 64 permit holders identified in
Exhibit B of the Plan and a letter notifying of acceptance and the effective date of
the Bid agreement.. I and my co-workers deposited the letters with sufficient
postage for certified mailing in the United States Mail to each of these 64 permits
holders at the address listed in their bids. The SRA also provided us with a list of
EXHIBIT B--SCHEDULE OF ACCEPTED BIDS PURSUANT TO
CFR TITLE 50, SECTION 600.1107(d)(4)
Last Name First Name Permit No.
1 Krigbaum Michael S01A58031W 175,000
2 Jensen Douglas S01A59714N 180,000
3 DeGroen Johnny S01A58505S 185,000
4 Michael Mercury S01A55386C 185,000
4 Reimnitz Hartmut S01A578995 185,000
6 Zuanich Michelle S01A57849F 185,000
7 Veerhusen Daniel S01A56638X 189,000
8 Hansen William S01A55442A 191,000
9 Svensson John S01A56492N 191,000
10 Gruenheit Michael S01A55083V 193,000
11 Jolibois Timothy Larry S01A56018A 194,000
12 Spearin James S01A59372G 194,973
13 Jurlin Marie S01A58547R 195,000
14 Nash Paul S01A57907M 195,000
15 Reifenstuhl Ivan S01A55171A 195,000
16 McGee Gary S01A56559 196,000
17 Christensen Dale S01A60803V 196,500
18 Finney Paul S01A64933S 197,000
19 Haldane Robert S01A56620L 197,000
20 Kvernvik Carolyn S01A55231R 197,000
21 McLean John S01A56270P 197,000
22 Tarabochia Dominick S01A56600P 197,000
23 Wills Charles S01A58070V 197,000
24 Zuanich Michelle S01A568811 197,000
24 Beritich Mitchell S01A58923M 197,200
26 Barrett Davis S01A58501W 197,202
27 Marrese Andrew S01A57909W 197,202
28 Markusen Kenneth S01A55584K 198,000
29 Scudder Bradley SO1A56000N 198,000
30 Schonberg Peter S01A56601I 199,000
31 Bill David S01A58338U 199,500
32 Manos Andrew S01A59222I 199,990
33 Nugent Matthew S01A55689G 199,999
34 Hanson Jeff S01A57976 200,000
35 Johns Justna S01A55403 200,000
36 MacDonald Clifford S01A55545L 200,000
37 Olney Virginia S01A57720 200,000
38 Suydam Antril S01A57910N 200,000
39 Kohlase Ernest S01A56199V 201,500
40 Mann Bruce SO1A56187 205,000
41 Haltiner Fred S01A55617L 207,000
42 Marvin-Denkinger Victoria S01A58429X 209,000
43 Krieger Kenneth S01A59613M 209,000
44 Rocheleau Rick S01A58478 209,000
45 Menten Erik Keller S01A57726X 209,500
46 Fanning Christine S01A60909J 209,800
47 Wallace Bruce S01A55827B 214,000
48 Thorstenson Peder S01A59806J 215,000
49 Alfieri Joe S01A60791I 220,000
50 Sorensen Paige S01A58511U 223,000
51 Demmert Nicholas S01A56948W 223,875
52 Wamser William S01A60071B 224,000
53 Buschmann Ronn S01A55479D 224,500
54 Dontos Larry S01A59705K 224,900
55 Botsford Wallace S01A63175B 224,989
56 Manos Thomas S01A60642C 225,000
57 Schonberg Mart S01A56882A 225,000
58 Alfieri Anthony S01A55646M 229,000
59 Maricich Timothy S01A59569W 229,900
60 Selivanoff Douglas S01A57856A 230,000
61 Pfundt Michele S01A56392F 235,000
62 Peterman Chad S01A55986F 237,000
63 Haynes Bradley S01A574950 237,500
64 Blair Andrew S01A59085F 240,000