[Federal Register Volume 60, Number 238 (Tuesday, December 12, 1995)]
[Rules and Regulations]
[Pages 63654-63659]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-30139]



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DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

50 CFR Parts 672 and 675

[Docket No. 950905226-5282-02; I.D. 083095A]
RIN 0648-AH00


Groundfish of the Gulf of Alaska; Groundfish Fishery of the 
Bering Sea and Aleutian Islands Area; Extension of Allocations to 
Inshore and Offshore Components

AGENCY: National Marine Fisheries Service (NMFS), National Oceanic and 
Atmospheric Administration (NOAA), Commerce.

ACTION: Final rule.

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SUMMARY: NMFS is implementing Amendment 38 to the Fishery Management 
Plan (FMP) for the Groundfish Fishery of the Bering Sea and Aleutian 
Islands Area (BSAI) and Amendment 40 to the Fishery Management Plan for 
Groundfish of the Gulf of Alaska (GOA). Amendment 38 implements an 
allocation of pollock for processing by the inshore and offshore 
components in the BSAI management area from January 1, 1996, through 
December 31, 1998. Amendment 40 implements an allocation of Pacific cod 
for processing by the inshore and offshore components, and an 
allocation of pollock for processing by the inshore component in the 
GOA from January 1, 1996 through December 31, 1998. It also continues 
the Western Alaska Community Development Quota (CDQ) Program for 
pollock for the same period of time. This action is necessary to 
continue the management measures that were contained in Amendments 18 
and 23 to the BSAI and GOA FMPs, respectively. The intended effect of 
this final rule is to promote management and conservation of 
groundfish, enhance the stability in the fisheries, and further the 
goals and objectives contained in the FMPs that govern these fisheries.

EFFECTIVE DATE: January 1, 1996.

ADDRESSES: Copies of Amendments 38 and 40, and the environmental 
assessment/regulatory impact review/final regulatory flexibility 
analysis (EA/RIR/FRFA) prepared for Amendments 38 and 40 are available 
from the North Pacific Fishery Management Council, 605 West 4th Avenue, 
room 306, Anchorage, AK 99501-2252; telephone: 907-271-2809.

FOR FURTHER INFORMATION CONTACT: David Ham, 907-586-7228.

SUPPLEMENTARY INFORMATION: The groundfish fisheries in the exclusive 
economic zone (EEZ) off Alaska are managed under the BSAI and GOA FMPs. 
Both FMPs were prepared by the North Pacific Fishery Management Council 
(Council) under authority of the Magnuson Fishery Conservation and 
Management Act (Magnuson Act). The BSAI FMP is implemented by 
regulations appearing at 50 CFR 611.93, 50 CFR part 675, and 50 CFR 
part 676; for the GOA FMP, regulations are found at 50 CFR 611.92, 50 
CFR part 672, and 50 CFR part 676. General regulations that also 
pertain to U.S. fisheries appear at 50 CFR part 620. The fisheries for 
pollock (Theragra chalcogramma) and Pacific cod (Gadus macrocephalus) 
and the affected human environment are described in the FMPs, in the 
environmental impact statements prepared by the Council for each FMP, 
and in the EA/RIR/FRFA prepared for this action.
    Amendments 38 and 40 will extend the provisions of Amendment 18 to 
the BSAI FMP and Amendment 23 to the GOA FMP, respectively.
    Amendments 18 and 23 and their implementing regulations expire on 
December 31, 1995. The Council has not yet completed development of its 
comprehensive plan to address problems caused by the open access nature 
of the Alaska groundfish fisheries. Therefore, the Council voted 
unanimously at its June 1995 meeting to extend the provisions of the 
expiring amendments through December 31, 1998, by Amendments 38 and 40. 
A notice of availability of Amendments 38 and 40 was published at 60 FR 
46572 (September 7, 1995).
    Amendments 38 and 40 are essentially the same as amendments 18 and 
23, with minor changes. A full discussion of these changes is listed in 
the proposed rule for amendments 38 and 40 (60 FR 48087, September 18, 
1995).
    Amendments 38 and 40 were approved by NMFS on November 28, 1995, 
under section 304(b) of the Magnuson Act. Upon reviewing the reasons 
for Amendments 38 and 40 and the comments on the proposed rule to 
implement it, NMFS has determined that this final rule extending the 
allocation between inshore and offshore components is necessary for 
fishery conservation and management.

Changes in the Final Rule From the Proposed Rule

    This final rule includes the following changes from the proposed 
rule:
    1. In Sec. 675.27(e)(1)(iii), the date that the annual budget 
reconciliation report 

[[Page 63655]]
is due to NMFS from each CDQ group is changed from May 15 to May 30 to 
provide more time for the CDQ groups to comply with this requirement.
    2. The definition of ``inshore component'' at Secs. 672.2 and 675.2 
is revised as follows. The requirement for an owner of a processor 
vessel to declare on the annual application for a Federal fishery 
permit (NOAA Form 88-155) whether it will be part of the inshore 
component has been deleted from paragraphs (2) and (3) of the 
definition. This definition is revised for clarity and is not 
fundamentally different from the current definition.
    3. The definitions of ``inshore component'' and ``offshore 
component'' at Secs. 672.2 and 675.2 are revised as follows. The phrase 
``any processor vessel'' that appears in both definitions is changed to 
``vessels''. This change was made to simplify and clarify the 
definition. The definition already refers to vessels that ``process'', 
therefore, further reference to a ``processor vessel'' is redundant.
    4. For clarity, NMFS revises the definitions of Community 
Development Quota Reserve and Community Development Quota at 
Sec. 675.2.
    5. For clarity, NMFS combines paragraphs (1) and (2) of 
Sec. 675.27(e)(3)(i)(F) into one paragraph 675.27(e)(3)(i)(F). Also, 
NMFS revises this paragraph (e)(3)(i)(F) of Sec. 675.27 to give the 
Secretary of Commerce (Secretary) acting through NMFS, in addition to 
the Governor of the State of Alaska, the authority to deem a change to 
a Community Development Plan (CDP) to be a material change. This will 
give NMFS the ability to make a determination that a proposed change to 
a CDP is a material change.
    6. Paragraph Sec. 675.22(g)(2) is removed. This permissive 
statement is unnecessary.
    7. The phrase ``processor vessels'' in paragraphs Sec. 675.22(g) 
(3), (4), and (5) is changed to ``vessels'' to be consistent with the 
definition of ``offshore component.''

Response to Comments

    Fourteen letters of comment were received within the public comment 
period. Two letters had no comment, eight were supportive of the 
proposed action and are summarized in comment 1, and four were received 
with comments that are summarized and responded to in comments two 
through ten below:
    Comment 1. Continuation of the inshore-offshore program through 
Amendments 38 and 40 provides the industry with stability while the 
Council proceeds with developing a comprehensive rationalization plan. 
This program is needed by fishery-dependent coastal communities to 
ensure continuing access to fisheries resources. These fishery 
resources provide revenue to local communities through raw fish taxes, 
municipal sales taxes from goods and services, fuel tax revenues from 
sales to the fishing fleet, corporate income tax revenues, and real and 
personal property tax revenues. Much of this tax revenue has gone into 
community infrastructure that has been a great benefit to rural Alaskan 
coastal communities. The inshore-offshore program slows the pace of 
harvesting activity and allows NMFS to improve its monitoring of the 
fisheries. The CDQ program has been a success and has accomplished the 
positive results that were intended.
    Response. NMFS notes this comment.
    Comment 2. Amendments 38 and 40 will not maintain stability in the 
fishery, safeguard capital investments, prevent preemption, or protect 
coastal communities that are dependent on a local fleet. The derby-
style fishing that will continue to characterize these fisheries under 
Amendments 38 and 40 is unstable. Fishing seasons will continue to 
shorten, capital investments will continue to be at risk as a result of 
increased inter-sector competition and capital investment. Local 
fishing fleets will continue to be preempted by other nonlocal inshore 
fleets.
    Response. NMFS recognizes some limitations of these amendments, but 
the inshore/offshore allocation is not intended to be a substitute for 
comprehensive rationalization planning. This allocation extension is a 
continuation of a temporary solution and as such will provide 3 
additional years for completing the development and implementation of a 
permanent solution.
    Comment 3. The analysis for Amendments 38 and 40 should examine 
environmental issues, such as the water quality problems that have 
continued to plague shoreside processing operations in Dutch Harbor.
    Response. Pages 214 and 215 of the EA/RIR/FRFA for Amendments 38 
and 40 address water quality problems in Dutch Harbor. The analysis 
concluded that it is unlikely that Amendments 38 and 40 will have a 
negative impact on the water quality in this area.
    Comment 4. The analysis did not evaluate the market structure in 
key seafood markets to determine whether there might be anti-
competitive effects by giving shoreside processing plants an increased 
share of the pollock resource. For example, is there a transfer pricing 
risk? Or, did the inshore-offshore allocation result in the price 
collapse of offshore surimi that occurred during the first inshore-
offshore allocation in 1993?
    Response. The EA/RIR/FRFA for inshore-offshore examined several 
issues related to this comment. Page 124 shows that the inshore price 
for surimi collapsed at about the same rate as the offshore price for 
surimi from 1992 through 1993. This overall price drop may or may not 
have been influenced by the inshore-offshore allocation at that time. 
The price drop was experienced by both sectors, though it was slightly 
more severe for the offshore sector. The analysis indicates that this 
may not have been a price collapse at all, but a return to normal 
prices after 2 years (1991 and 1992) of inordinately high prices. Pages 
119 to 123 of the analysis contain a detailed discussion of price 
factors, though the analysis is not specific to the issue of the 
collapse of 1993 surimi prices. In an issue related to the collapse of 
the 1993 surimi prices, Appendix V of the analysis contains further 
analysis of the structural breakdown of surimi prices relative to 
exvessel prices paid. The analysis in Appendix V is unable to attribute 
this phenomenon to the inshore-offshore allocation. Furthermore, the 
price collapse issue raised in this comment is more relevant to the 
original inshore-offshore decision than to Amendments 38 and 40, 
because the inshore-offshore allocations have been in place for 3 years 
and their continuance now represents the status quo.
    Comment 5. Proponents of the inshore-offshore allocation program 
claim that allocating more fish to large shoreside processors will 
provide jobs and economic opportunity for local residents. However, the 
analysis did not address this question. On the other hand, Akutan has 
petitioned the Council to be included in the pollock CDQ program 
because the Akutan Trident plant is not part of the community and local 
residents rarely work at the plant. The logic on these two issues is 
inconsistent.
    Response. The Akutan plant is not necessarily reflective of other 
shoreside plants, in terms of local employment. The social impact 
analysis focused primarily on Dutch Harbor, Kodiak, St. Paul, and 
Ballard/Seattle. The community impact study in the analysis looked at 
total and distributional income indices, of which direct employment is 
only a part. The relevant point is not just one of direct employment. 
There are other non-quantifiable benefits derived from the inshore/
offshore allocation system. The availability of alternative economic 
activity was also an important 

[[Page 63656]]
consideration. Maintenance of cultural stability, social impacts, and 
other impacts were also considered.
    Comment 6. The proposed regulations at Sec. 675.23(e)(2)(ii) 
preclude pollock catcher vessels from participating in the yellowfin 
sole fishery prior to January 26 if they want to harvest pollock roe 
for processing by the offshore component starting on January 26. 
Vessels that participate in the yellowfin sole fishery before January 
26 cannot enter the pollock fishery for processing by the offshore 
component until February 5. Yellowfin sole is an abundant species and 
its harvest should be encouraged, not discouraged. Therefore, there 
should be no restriction on fishing for yellowfin sole prior to the 
January 26 start of the pollock fishery for processing by the offshore 
component.
    Response. NMFS acknowledges that limitations on the participation 
in the yellowfin sole fishery prior to the opening of the pollock 
fishery for processing by the offshore component could reduce potential 
revenues of vessels. NMFS approved this limitation after considering 
the intent of the Council to minimize the preemptive impact on other 
fisheries that could result from the delay of the pollock roe fishery 
for processing by the offshore component until January 26. 
Additionally, if vessels were allowed to harvest yellowfin sole before 
January 26, those vessel operators could have an unfair advantage by 
potentially prospecting for pollock stocks just prior to the opening of 
the pollock fishery for processing by the offshore component.
    Comment 7. The proposed CDQ regulations require that an annual 
budget reconciliation report be submitted to NMFS by May 15 of the year 
following the year for which the annual budget applies. However, due to 
other CDQ reporting requirements during May, a burden on the CDQ groups 
would be relieved if the May 15 due date were changed to May 30. This 
would allow the CDQ groups more time to prepare the annual budget 
reconciliation report for NMFS.
    Response. NMFS concurs. The regulations at Sec. 675.27(e)(1)(iii) 
are changed to require the annual budget reconciliation report to be 
due to NMFS on May 30 instead of May 15.
    Comment 8. The focus of the CDQ program needs to remain on long-
term development projects, not short-term projects such as job 
creation. The CDQ regulations need to be more clear in describing the 
types of CDQ projects that would be acceptable. The CDQ regulations 
should direct a portion of CDQ resources to be used to construct and 
maintain public infrastructure in CDQ communities.
    Response. Job creation is part of some CDPs and is usually 
associated with training and job creation in commercial fisheries. 
Training and job creation in commercial fisheries will increase the 
number of skilled fishermen. This will enable CDQ communities to become 
more self-sufficient in regional fisheries related development, which 
is a valid long-term goal of the CDQ program. The CDQ regulations allow 
the CDQ group's board of directors, along with their constituents, to 
choose their own CDQ projects because each CDQ group is more familiar 
with the needs of its communities and would be the best judge of 
whether a project would succeed or fail due to the local conditions. 
Additionally, by choosing their own projects and succeeding or failing 
on their own business skills, the CDQ groups can best learn the skills 
for developing a viable business. This will assist the CDQ groups in 
becoming self-sufficient in the future. Viable, ongoing businesses are 
a long-term goal of the CDQ program.
    Comment 9. The proposed annual budget and annual budget 
reconciliation process is burdensome, and NMFS and State budget 
reporting requirements should be integrated so that separate reports to 
NMFS and the State are not necessary. CDQ groups should be allowed to 
submit existing business records to NMFS instead of separately prepared 
documents whose contents are based on NMFS' criteria.
    Response. The Secretary, through NMFS, is obliged to ensure that 
the funds derived from CDQ activity are used as directed in each CDP 
for the benefit of the western Alaska communities. The annual budget 
and annual budget reconciliation report requirements were developed in 
conjunction with the State of Alaska because the existing reporting 
requirements were not sufficient to track the financial transactions of 
the CDQ groups. NMFS is requesting basic business information that 
should have already been developed for the CDQ board of directors. NMFS 
requires that each CDQ group submit reports based on NMFS' criteria 
because NMFS must ensure that the report contains the necessary 
information to evaluate any financial transactions.
    Comment 10. Clarification is requested as to whether 
Sec. 675.27(e)(3)(i)(F) (1) and (2) are intended to constitute 
substantial amendments because their contents are already covered under 
paragraphs Sec. 675.27(e)(3)(i) (A) through (E). Clarification is 
requested as to the meaning of the term ``material change'' in 
paragraph Sec. 675.27(e)(3)(i)(F). The CDQ regulations should contain 
solid guidance so that a CDQ group can determine from the regulations 
whether an amendment is a substantial amendment or a technical 
amendment. The proposed requirement for written notification of 
technical amendments to be sent to NMFS before the change occurs is 
burdensome. This requirement could be met equally well with a quarterly 
reporting requirement.
    Response. Paragraphs (e)(3)(i)(F)(1) and (2) of Sec. 675.27 are 
part of the definition for a substantial amendment to a CDP. NMFS 
agrees that this is not clear and revises paragraphs (F)(1) and (2) to 
create a new paragraph (F). Paragraph (F) is necessary because it would 
be impossible to list every change to the present or future CDPs that 
could be a substantial amendment. NMFS did not want to burden the CDQ 
groups with a long list of CDP changes that would constitute 
substantial amendments. On the other hand, NMFS did not want to omit 
any change that could be a substantial amendment. NMFS decided to list 
the most important general changes that would be substantial in 
paragraphs (A) through (E), and then give the Governor of Alaska the 
discretion to recommend to the Secretary other changes to be 
substantial amendments, based on the Governor's decision as to what 
constitutes a ``material change.'' NMFS must approve the Governor's 
recommendations for substantial amendments. A technical amendment is 
any change to a CDP that is not a substantial amendment. NMFS must be 
notified of any such change before the change is effected because the 
Governor and the Secretary must ensure that the change is not a 
substantial amendment. The burden of notification is slight because it 
can be accomplished by fax, and, in most cases, the response can be 
rapid.

Classification

    The Director, Alaska Region, NMFS, determined that these FMP 
amendments are necessary for the conservation and management of the 
BSAI and GOA fisheries and that they are consistent with the Magnuson 
Act and other applicable laws.
    This final rule has been determined to be not significant for 
purposes of E.O. 12866.
    Notwithstanding any other provision of law, no person is required 
to respond to nor shall a person be subject to a penalty for failure to 
comply with a collection of information subject to the requirements of 
the Paperwork 

[[Page 63657]]
Reduction Act unless that collection of information displays a 
currently valid OMB control number. This rule contains a collection-of-
information requirement subject to the Paperwork Reduction Act. The 
collection of information has been approved by The Office of Management 
and Budget (OMB), OMB control number 0646-0269. The public reporting 
burden for each year of this collection is estimated to average 40 
hours per response for completing annual reports, 40 hours per response 
for completing annual budget reconciliation reports, 30 hours per 
response for completing substantial amendments, and 4 hours per 
response for completing technical amendments. For the first year of the 
CDQ program, completion of CDP applications is estimated to average 160 
hours per response. For each of the last 2 years of the program, 
completion of annual budget reports is expected to average 40 hours per 
response. OMB approval has been obtained under OMB control number 0648-
0269 for the CDQ-managing organization representative requirement to 
inform NMFS within 24 hours after the CDQ has been reached and fishing 
ceased. This requirement has an estimated response time of 2 minutes 
per response.
    All reporting burden estimates include the time for reviewing 
instructions, searching existing data sources, gathering and 
maintaining the data needed, and completing and reviewing the 
collection of information.
    The Assistant Administrator for Fisheries, NOAA (AA) finds, good 
cause, pursuant to authority at 5 U.S.C. 553(d)(3), to waive the 30-day 
delay in effective date of this final rule. The inshore-offshore and 
CDQ programs have been in effect for the last 3 years, and the fishing 
industry is relying upon their continuation. A lapse in the effective 
regulations for these programs would confuse and destabilize the 
industry. Further, to the extent that this final rule continues 
regulations that currently are in effect, a delayed effectiveness 
period is unnecessary because the fishing industry does not need 
additional time to plan or prepare for compliance with these 
regulations. Therefore, the AA is waiving the 30-day delayed 
effectiveness period and making these regulations effective January 1, 
1996, to coincide with the start of the fishing year.

List of Subjects in 50 CFR Parts 672 and 675

    Fisheries, Reporting and recordkeeping requirements.

    Dated: December 6, 1995.
Gary Matlock,
Program Management Officer, National Marine Fisheries Service.

    For the reasons set out in the preamble, 50 CFR parts 672 and 675 
are amended as follows:

PART 672--GROUNDFISH OF THE GULF OF ALASKA

    1. The authority citation for 50 CFR part 672 continues to read as 
follows:

    Authority: 16 U.S.C. 1801 et seq.

    2. In Sec. 672.2, the definitions of ``Inshore component'' and 
``Offshore component'' are revised to read as follows:


Sec. 672.2  Definitions.

* * * * *
    Inshore component (applicable through December 31, 1998) means the 
following three categories of the U.S. groundfish fishery that process 
pollock harvested in a directed fishery for pollock, or Pacific cod 
harvested in a directed fishery for Pacific cod in the Gulf of Alaska, 
or both:
    (1) Shoreside processing operations;
    (2) Vessels less than 125 ft (38.1 m) in length overall, that 
process no more than 126 mt per week in round-weight equivalents of an 
aggregate amount of those fish; and
    (3) Vessels that process those fish at a single geographic location 
in Alaska State waters (waters adjacent to the State of Alaska and 
shoreward of the EEZ) during a fishing year. For the purposes of this 
definition, NMFS will determine the single geographic location in a 
fishing year for an individual processor from the geographic 
coordinates the vessel operator reports on the check-in notice 
(Secs. 672.5(c)(1) and 675.5(c)(1)) of this chapter when that vessel 
first engages in processing those fish.
* * * * *
    Offshore component (applicable through December 31, 1998) means all 
vessels in the U.S. groundfish fisheries not included in the definition 
of ``inshore component'' that process pollock caught in directed 
fisheries for pollock, or Pacific cod caught in directed fisheries for 
Pacific cod in the Gulf of Alaska, or both.
* * * * *
    3. In Sec. 672.7, paragraph (h) heading, and paragraph (h)(2) are 
revised to read as follows:


Sec. 672.7  Prohibitions.

* * * * *
    (h) Applicable through December 31, 1998. * * *
    (2) Operate any vessel under both the ``inshore component'' and 
``offshore component'' definitions at Secs. 672.2 and 675.2 of this 
chapter during the same fishing year.
* * * * *


Sec. 672.20  [Amended]

    4. In Sec. 672.20, the headings of paragraphs (a)(2)(v), 
(c)(1)(ii), and (c)(2)(ii) are revised to read: ``Applicable through 
December 31, 1998.''.
    5. In Sec. 672.20, the headings of paragraphs (c)(1)(i) and 
(c)(2)(i) are revised to read: ``Applicable after December 31, 1998.''.

PART 675--GROUNDFISH OF THE BERING SEA AND ALEUTIAN ISLANDS AREA

    6. The authority citation for 50 CFR part 675 continues to read as 
follows:

    Authority: 16 U.S.C. 1801 et seq.

    7. In Sec. 675.2, a definition for ``Catcher vessel operational 
area'' is added, in alphabetical order, and the definitions for 
``Community Development Plan,'' ``Community Development Quota,'' 
``Community Development Quota Program,'' ``Community Development Quota 
Reserve,'' ``Inshore component,'' and ``Offshore component'' are 
revised to read as follows:


Sec. 675.2  Definitions.

* * * * *
    Catcher vessel operational area (CVOA) (applicable through December 
31, 1998) means that part of the Bering Sea subarea south of 56 deg.00' 
N. lat. and between 163 deg.00' and 167 deg.30' W. long.
    Community Development Plan (CDP) (applicable through December 31, 
1998) means a plan for a specific Western Alaska community or group of 
communities approved by the Governor of the State of Alaska and 
recommended to NMFS under Sec. 675.27.
    Community Development Quota (CDQ) (applicable through December 31, 
1998) means a percentage of the CDQ reserve for a BSAI subarea or 
district as defined at Sec. 675.20(a)(3)(ii) that is allocated to a 
CDP.
    Community Development Quota Program (CDQ Program) (applicable 
through December 31, 1998) means the Western Alaska Community 
Development Program implemented under Sec. 675.27.
    Community Development Quota Reserve (CDQ Reserve) (applicable 
through December 31, 1998) means one half of the pollock TAC that is 
placed into the reserve for each subarea and district of the BSAI as 
specified at 

[[Page 63658]]
Sec. 675.20(a)(3) and that is set aside for the CDQ program.
* * * * *
    Inshore component (applicable through December 31, 1998) means the 
following three categories of the U.S. groundfish fishery that process 
pollock harvested in a directed fishery for pollock, or Pacific cod 
harvested in a directed fishery for Pacific cod in the Gulf of Alaska, 
or both:
    (1) Shoreside processing operations;
    (2) Vessels less than 125 ft (38.1 m) in length overall, that 
process no more than 126 mt per week in round-weight equivalents of an 
aggregate amount of those fish; and
    (3) Vessels that process those fish at a single geographic location 
in Alaska State waters (waters adjacent to the State of Alaska and 
shoreward of the EEZ) during a fishing year. For the purposes of this 
definition, NMFS will determine the single geographic location in a 
fishing year for an individual processor from the geographic 
coordinates the vessel operator reports on the check-in notice 
(Secs. 672.5(c)(1) of this chapter and 675.5(c)(1)) when that vessel 
first engages in processing those fish.
* * * * *
    Offshore component (applicable through December 31, 1998) means all 
vessels not included in the definition of ``inshore component'' that 
process pollock caught in directed fisheries for pollock, or Pacific 
cod caught in directed fisheries for Pacific cod in the Gulf of Alaska, 
or both.
* * * * *
    8. In Sec. 675.7, paragraph (i) heading, paragraph (i)(2), and 
paragraph (j) heading are revised to read as follows:


Sec. 675.7  Prohibitions.

* * * * *
    (i) Applicable through December 31, 1998. * * *
    (2) Operate any vessel under both the ``inshore component'' and 
``offshore component'' definitions at Sec. 672.2 of this chapter and 
Sec. 675.2 during the same fishing year.
    (j) Applicable through December 31, 1998.
* * * * *
    9. In Sec. 675.20, the headings of paragraphs (a)(2)(iii), 
(a)(3)(i), (a)(3)(ii), and (a)(3)(iii) are revised to read as follows:


Sec. 675.20  General limitations.

    (a) * * *
    (2) * * *
    (iii) Applicable through December 31, 1998.
* * * * *
    (3) * * *
    (i) Applicable through December 31, 1998. * * *
    (ii) Applicable through December 31, 1998. * * *
    (iii) Applicable through December 31, 1998; application for 
approval of a CDP and CDQ allocation. * * *
* * * * *
    10. In Sec. 675.22, paragraphs (g) and (h)(2) are revised to read 
as follows:


Sec. 675.22  Time and area closures.

* * * * *
    (g) Catcher vessel operational area (applicable through December 
31, 1998). (1) The Catcher Vessel Operational Area is established 
annually from the beginning of the second season of directed fishing 
for pollock (defined at Sec. 675.23(e)) until either the date that NMFS 
determines that the pollock quota for processing by the inshore 
component has been harvested or December 31, whichever is earlier.
    (2) Vessels in the offshore component are prohibited from 
conducting directed fishing for pollock in the CVOA unless they are 
operating under a CDP approved by NMFS.
    (3) Vessels in the offshore component that do not catch groundfish 
but do process pollock caught in a directed fishery for pollock may 
operate within the CVOA to process pollock.
    (4) Vessels that catch or process groundfish in directed fisheries 
for species other than pollock may operate within the CVOA.
    (h) * * *
    (2) If the Regional Director determines that 42,000 nonchinook 
salmon have been caught by vessels using trawl gear during August 15 
through October 14 in the CVOA, NMFS will prohibit fishing with trawl 
gear for the remainder of the period September 1 through October 14 in 
the Chum Salmon Savings Area defined under paragraph (h)(1) of this 
section.
    11. In Sec. 675.23, paragraph (e)(2) heading is revised to read as 
follows:


Sec. 675.23  Seasons.

* * * * *
    (e) * * *
    (2) Applicable through December 31, 1998. * * *
* * * * *
    12. In Sec. 675.27, the section heading is revised, introductory 
text is added, and paragraphs (b)(1)(i), (b)(1)(vii), (b)(2)(vii), 
(b)(3)(ii)(B), (e), and the heading of paragraph (f) are revised to 
read as follows:


Sec. 675.27  Western Alaska Community Development Quota Program 
(applicable through December 31, 1998).

    The goals and purpose of the CDQ program are to allocate pollock 
from the CDQ reserve to eligible Western Alaska communities to provide 
the means for starting or supporting commercial seafood activities that 
will result in ongoing, regionally based, commercial seafood or related 
businesses.
* * * * *
    (b) * * *
    (1) * * *
    (i) A description of the CDP projects that are proposed to be 
funded by the CDQ and how the CDP projects satisfy the goals and 
purpose of the CDQ program;
* * * * *
    (vii) Description of how the CDP would generate new capital or 
equity for the applicant's fishing and/or processing operations;
* * * * *
    (2) * * *
    (vii) A general budget for implementing the CDP. A general budget 
is a general account of estimated income and expenditures for each CDP 
project that is described at paragraph (b)(1)(i) of this section for 
the total number of calendar years that the CDP is in effect. An annual 
budget is required to be submitted with a CDP as described at paragraph 
(e)(1)(ii) of this section;
* * * * *
    (3) * * *
    (ii) * * *
    (B) Documentation of a legal relationship between the CDP applicant 
and the managing organization (if the managing organization is 
different from the CDP applicant), which clearly describes the 
responsibilities and obligations of each party as demonstrated through 
a contract or other legally binding agreement; and
* * * * *
    (e) Monitoring of CDPs--(1) CDP reports. The following reports must 
be submitted to NMFS:
    (i) Annual progress reports. CDP applicants are required to submit 
annual progress reports to the Governor by June 30 of the year 
following allocation. Annual progress reports will include information 
describing how the CDP has met its milestones, goals, and objectives. 
On the basis of those reports, the Governor will submit an annual 
progress report to NMFS and recommend whether CDPs should be continued. 
NMFS must notify the Governor in writing within 45 days of receipt of 
the Governor's annual progress report, accepting or rejecting 

[[Page 63659]]
the annual progress report and the Governor's recommendations on 
multiyear CDQ projects. If NMFS rejects the Governor's annual progress 
report, NMFS will return it for revision and resubmission. The report 
will be deemed approved if NMFS does not notify the Governor in writing 
within 45 days of the report's receipt.
    (ii) Annual budget report. An annual budget report is a detailed 
estimation of income and expenditures for each CDP project as described 
in paragraph (b)(1)(i) of this section for a calendar year. The first 
annual budget report shall be included in the CDP. Each subsequent 
annual budget report must be submitted to NMFS by December 15 preceding 
the year for which the annual budget applies. Annual budget reports are 
approved upon receipt by NMFS unless disapproved in writing by December 
31. If disapproved, the annual budget report may be revised and 
resubmitted to NMFS. NMFS will approve or disapprove a resubmitted 
annual budget report in writing.
    (iii) Annual budget reconciliation report. A CDQ group must 
reconcile each annual budget by May 30 of the year following the year 
for which the annual budget applied. Reconciliation is an accounting of 
the annual budget's estimated income and expenditures with the actual 
income and expenditures, including the variance in dollars and variance 
in percentage for each CDP project that is described in paragraph 
(b)(1)(i) of this section. If a general budget as described at 
paragraph (b)(2)(vii) of this section is no longer correct due to the 
reconciliation of an annual budget, then the general budget must also 
be revised to reflect the annual budget reconciliation, and the revised 
general budget must be included in the annual budget reconciliation 
report.
    (2) CDQ increase. If an applicant requests an increase in a CDQ 
under a multiyear CDP, the applicant must submit a new CDP application 
for review by the Governor and approval by NMFS as described in 
paragraphs (b) and (c) of this section.
    (3) Substantial amendments. A CDP is a working business plan and 
must be kept up to date. Substantial amendments to a CDP will require 
written notification to the Governor and subsequent approval by the 
Governor and NMFS before any change in a CDP can occur. The Governor 
may recommend to NMFS that the request for an amendment be approved. 
NMFS may notify the Governor in writing of approval or disapproval of 
the amendment within 30 days of receipt of the Governor's 
recommendation. The Governor's recommendation for approval of an 
amendment will be deemed approved if NMFS does not notify the Governor 
in writing within 30 calendar days of receipt of the Governor's 
recommendation. If NMFS determines that the CDP, if changed, would no 
longer meet the criteria under paragraph (d) of this section, or if any 
of the requirements under this section would not be met, NMFS shall 
notify the Governor in writing of the reasons why the amendment cannot 
be approved.
    (i) For the purposes of this section, substantial amendments are 
defined as changes in a CDP, including, but not limited to, the 
following:
    (A) Any change in the applicant communities or replacement of the 
managing organization;
    (B) A change in the CDP applicant's harvesting or processing 
partner;
    (C) Funding a CDP project in excess of $100,000 that is not part of 
an approved general budget;
    (D) More than a 20 percent increase in the annual budget of an 
approved CDP project;
    (E) More than a 20 percent increase in actual expenditures over the 
approved annual budget for administrative operations; or
    (F) A change in the contractual agreement(s) between the CDP 
applicant and its harvesting or processing partner, or a change in a 
CDP project, if such change is deemed by the Governor or the Secretary 
to be a material change.
    (ii) Notification of an amendment to a CDP shall include the 
following information:
    (A) The background and justification for the amendment that 
explains why the proposed amendment is necessary and appropriate;
    (B) An explanation of why the proposed change to the CDP is an 
amendment according to paragraph (e)(3)(i) of this section;
    (C) A description of the proposed amendment, explaining all changes 
to the CDP that result from the proposed amendment;
    (D) A comparison of the original CDP text with the text of the 
proposed changes to the CDP, and the changed pages of the CDP for 
replacement in the CDP binder;
    (E) Identification of any NMFS' findings that would need to be 
modified if the amendment is approved along with the proposed modified 
text; and
    (F) A description of how the proposed amendment meets the 
requirements of this Sec. 675.27. Only those CDQ regulations that are 
affected by the proposed amendment need to be discussed.
    (4) Technical amendments. Any change to a CDP that is not a 
substantial amendment as defined at paragraph (e)(3)(i) of this 
section, is a technical amendment. It is the responsibility of the CDQ 
group to coordinate with the Governor to ensure that a proposed 
technical amendment does not meet the definition for a substantial 
amendment. Technical amendments require written notification to the 
Governor and NMFS before the change in a CDP occurs. A technical 
amendment will be approved when the CDQ group receives a written notice 
from NMFS announcing the receipt of the technical amendment. The 
Governor may recommend to NMFS in writing that a technical amendment be 
disapproved at any time. NMFS may disapprove a technical amendment in 
writing at any time with the reasons therefor. Notification should 
include:
    (i) The pages of the CDP with the text highlighted to show 
deletions and additions; and
    (ii) The changed pages of the CDP for replacement in the CDP 
binder.
    (5) It is the responsibility of the CDQ-managing organization to 
cease fishing operations once its respective CDQ pollock allocation has 
been reached. Total pollock harvests for each CDP will be determined by 
observer estimates of total catch and catch composition as reported on 
the daily observer catch message. The CDQ-managing organization must 
arrange for processors to transmit a copy of the observer daily catch 
message to it in a manner that allows the CDQ-managing organization to 
inform processors to cease fishing operations before the CDQ allocation 
has been exceeded. CDQ-managing organization representatives must also 
inform NMFS within 24 hours after the CDQ has been reached and fishing 
has ceased. If NMFS determines that the observer, the processor, or the 
CDQ-managing organization failed to follow the procedures described in 
paragraph (h) of this section for estimating the total harvest of 
pollock, or violated any other regulation in this part, NMFS reserves 
the right to estimate the total pollock harvest based on the best 
available data.
    (f) Suspension or termination of a CDP.
* * * * *
[FR Doc. 95-30139 Filed 12-11-95; 8:45 am]
BILLING CODE 3510-22-W