Federal Register / Vol. 73, No. 194 / Monday, October 6, 2008 / Proposed Rules 58099 

Action in the default process 

Timeframe 

(days from pmt due date) 

Collateral 

pledged 

No collateral 

pledged 

Reclamation and lender determine whether a cure is possible. If no cure can be found, the loan is in default and any collateral pledged for the loan becomes eligible for liquidation ............................................ 90 90

Lender submits a proposed method of liquidation in writing .......................................................................... 120 N/A 

Reclamation informs lender if liquidation plan is approved ............................................................................ 150 N/A 

Lender files an estimated loss claim if liquidation will exceed 90 days .......................................................... 180 N/A 

Lender files final Report of Loss ..................................................................................................................... 210 120 

Reclamation makes loss payment ................................................................................................................... 270 180 

§ 403.67 What is the process for 

liquidation of pledged collateral? 

(a) Any of the following factors may 

lead to a decision to liquidate: 

(1) The loan has been delinquent 90 

days; 

(2) Delaying liquidation will 

jeopardize recovery of the loan 

collateral; or 

(3) Borrower or lender has been 

uncooperative in resolving the default; 

(b) The lender must, within 30 days 

after a decision to liquidate, submit to 

Reclamation in writing a proposed 

method of liquidation. Reclamation will 

not make any payments for estimated or 

actual losses prior to final Report of 

Loss. 

(c) Within 30 days after receiving the 

liquidation plan, we will inform the 

lender in writing whether we concur. 

(d) The lender will discontinue 

interest accrual at the point of default, 

or 90 days after the first payment was 

missed, whichever is earlier. 

(e) When the lender conducts the 

liquidation, it must account for funds 

during the period of liquidation and 

will provide us with reports at least 

quarterly on the progress of the 

liquidation. Only expenses authorized 

by Chapter 9 plans or Chapter 11 

reorganizations, or Chapters 11 or 7 

liquidations (United States Bankruptcy 

Code) may be deducted from collateral 

proceeds, if any. 

§ 403.68 What is the timeline for filing a 

Final Report of Loss? 

Within 30 days after liquidation of all 

collateral, the lender must prepare a 

final Report of Loss and submit it to us. 

We will not guarantee interest beyond 

the point of borrower default. We will 

pay the approved loss payment within 

60 days after reviewing the final Report 

of Loss and accounting of the collateral. 

§ 403.69 [Reserved] 

§ 403.70 What interest does the lender 

have in the guaranteed loan after 

Reclamation makes a loss payment? 

When we receive a final Report of 

Loss and pay the loss claim, we are 

immediately subrogated to the lender in 

all rights with respect to the guaranteed 

loan. The lender must sign and deliver 

to Reclamation an assignment of any 

rights it may have had with respect to 

the guaranteed loan. 

§ 403.71 What will Reclamation do if a 

borrower defaults? 

If a borrower defaults, we are required 

to notify the Attorney General. The 

Attorney General will take appropriate 

action to recover the unpaid principal 

and interest due from assets of the 

defaulting non-Federal borrower 

associated with the obligation, or any 

other collateral pledged to secure the 

obligation. 

§ 403.72 When does the Loan Note 

Guarantee Agreement terminate? 

A Loan Note Guarantee Agreement 

under this part will terminate 

automatically upon: 

(a) Full Repayment of the guaranteed 

loan; 

(b) Full Payment of any loss 

obligation or negotiated loss settlement 

as described in the Lender’s Agreement; 

or 

(c) Written request from the lender to 

Reclamation, upon return of the Loan 

Note Guarantee Agreement to 

Reclamation. 

§ 403.73 What happens if the non-Federal 

party breaches the existing Loan Note 

Guarantee Agreement? 

The Federal Government reserves the 

right to prosecute both the borrower and 

the lender to the fullest extent possible 

under existing laws until full 

recompense has been made and the 

conditions of the Loan Note Guarantee 

Agreement have been fulfilled. In 

addition, if a Loan Note Guarantee 

Agreement is breached, the Borrower 

will no longer be eligible to receive a 

Federally-guaranteed loan for any of its 

future activities or projects, and may not 

be eligible for other Federal assistance. 

Furthermore, any lender in breach of a 

Loan Note Guarantee Agreement will be 

responsible for paying any additional 

fees as determined necessary to the 

Federal Government and will not be 

allowed to hold a Federal Government 

note until the United States Treasury 

has been paid in full. 

[FR Doc. E8–23444 Filed 10–3–08; 8:45 am] 

BILLING CODE 4310–MN–P 

DEPARTMENT OF COMMERCE 

National Oceanic and Atmospheric 

Administration 

50 CFR Part 697 

[Docket No. 070717357–7593–02] 

RIN 0648–AV77 

Atlantic Coastal Fisheries Cooperative 

Management Act Provisions; American 

Lobster Fishery 

AGENCY: National Marine Fisheries 

Service (NMFS), National Oceanic and 

Atmospheric Administration (NOAA), 

Commerce. 

ACTION: Proposed rule; request for 

comments. 

SUMMARY: NMFS proposes new Federal 

American lobster (Homarus 

americanus) regulations that would 

implement a mandatory Federal lobster 

dealer electronic reporting requirement, 

changes to the maximum carapace 

length regulations for several lobster 

conservation management areas 

(LCMAs/Areas), and a modification of 

the v-notch definition in certain 

LCMAs. This action responds to the 

recommendations for Federal action in 

the Atlantic States Marine Fisheries 

Commission’s (Commission) Interstate 

Fishery Management Plan for American 

Lobster (ISFMP). Implementation of a 

mandatory Federal lobster dealer 

reporting requirement would be 

consistent with the recommendations 

for Federal action by the Commission in 

Addendum X to Amendment 3 of the 

ISFMP and would assist in providing a 

more comprehensive and consistent 

coastwide accounting of lobster harvest 

data to facilitate stock assessment and 

fishery management. Additionally, this 

action intends to implement new and 

revise existing Federal lobster 

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58100 Federal Register / Vol. 73, No. 194 / Monday, October 6, 2008 / Proposed Rules 

regulations to support the Commission’s 

ISFMP by adopting v-notching and 

maximum carapace length measures 

(together referred to as broodstock 

protection measures) in several 

management areas that are, for the most 

part, identical to those already enforced 

by the states. The incorporation of these 

proposed broodstock protection 

measures would support the 

Commission’s ISFMP by reducing 

confusion and facilitating enforcement 

within and across management areas. 

Finally, the proposed action would 

expand the Commission’s recommended 

broodstock protection measures to 

include the Outer Cape Management 

Area to provide further opportunities to 

protect lobster broodstock in this 

management area. 

DATES: Comments must be received no 

later than 5 p.m. eastern standard time 

on or before November 20, 2008. 

ADDRESSES: You may submit comments, 

identified by RIN number 0648–AV77, 

by any of the following methods: 

• Electronic Submissions: Submit all 

electronic public comments via the 

Federal e-Rulemaking portal http:// 

www.regulations.gov. 

• Fax: (978) 281–9117, Attn: Peter 

Burns. 

• Mail: Harold Mears, Director, 

State, Federal and Constituent Programs 

Office, Northeast Regional Office, 

NMFS, One Blackburn Drive, 

Gloucester, MA 01930. Mark the outside 

of the envelope: ‘‘Comments on Lobster 

Proposed Rule.’’ 

Instructions: All comments received 

are part of the public record and will 

generally be posted to http:// 

www.regulations.gov without change. 

All Personal Identifying Information (for 

example, name, address, etc.) 

voluntarily submitted may be publicly 

accessible. Do not submit confidential 

business information or otherwise 

sensitive or protected information. 

NMFS will accept anonymous 

comments (enter N/A in the required 

fields if you wish to remain 

anonymous). Attachments to electronic 

comments will be accepted via 

Microsoft Word, Microsoft Excel, 

WordPerfect, or Adobe PDF file formats 

only. 

Copies of the Environmental 

Assessment (EA), including the 

Regulatory Impact Review (RIR) and the 

Initial Regulatory Flexibility Analysis 

(IRFA), prepared for this regulatory 

action may be obtained at the mailing 

address specified above; telephone (978) 

281–9327. The documents are also 

available online at http:// 

www.nero.noaa.gov. 

Written comments regarding the 

burden-hour estimates or other aspects 

of the collection-of-information 

requirements contained in this proposed 

rule may be submitted to the mailing 

address listed above and by e-mail to 

DavidlRostker@omb.eop.gov or fax to 

(202) 395–7285. 

FOR FURTHER INFORMATION CONTACT: 

Peter Burns, Fishery Management 

Specialist, phone (978) 281–9144, fax 

(978) 281–9117. 

SUPPLEMENTARY INFORMATION: 

Statutory Authority 

The proposed regulations would 

modify Federal lobster regulations in 

the Exclusive Economic Zone (EEZ) 

under the authority of section 803(b) of 

the Atlantic Coastal Fisheries 

Cooperative Management Act (Atlantic 

Coastal Act) 16 U.S.C 5101 et seq., 

which states, in the absence of an 

approved and implemented Fishery 

Management Plan under the MagnusonStevens Fishery Conservation and 

Management Reauthorization Act 

(Magnuson-Stevens Act) (16 U.S.C. 1801 

et seq.) and, after consultation with the 

appropriate Fishery Management 

Council(s), the Secretary of Commerce 

may implement regulations to govern 

fishing in the EEZ, i.e., from 3 to 200 

nautical miles (nm) offshore. The 

regulations must be (1) compatible with 

the effective implementation of an 

ISFMP developed by the Commission 

and (2) consistent with the national 

standards set forth in section 301 of the 

Magnuson-Stevens Act. 

Purpose and Need for Management 

One purpose of this action is to 

improve the availability and utility of 

fishery-dependent lobster data to meet 

the need for a more comprehensive 

baseline for assessing the status of 

lobster stocks coastwide. Additionally, 

this proposed action would enhance 

lobster broodstock protection and 

facilitate enforcement of lobster 

measures by revising American lobster 

maximum carapace size and v-notch 

requirements, consistent with the 

recommendations of the Commission in 

the ISFMP. Finally, this proposed action 

would expand the curtain of protection 

on broodstock lobster traveling among 

lobster management areas by extending 

the revised maximum carapace size and 

v-notch requirements to the Outer Cape 

Management Area. 

The need for action is rooted in the 

most recent American lobster stock 

assessment and in recommendations in 

a subsequent peer review panel report. 

The findings of the stock assessment 

and peer review panel prompted the 

Commission to take action by adopting 

measures to address the need for 

improved fishery data collection and 

broodstock protection. The Commission 

took action to address these issues 

through the adoption of Addendum X 

and Addendum XI to Amendment 3 of 

the ISFMP. The focus of this rulemaking 

is on the mandatory dealer reporting 

requirements in Addendum X and the 

broodstock protection measures of 

Addendum XI. As explained in greater 

detail later in this document and the 

associated draft environmental 

assessment completed for this action, 

NMFS analyzed three alternatives for 

each of the three regulatory actions 

proposed: mandatory dealer reporting 

requirements; the maximum carapace 

size; and, revisions to the v-notch 

requirements. The three alternatives for 

each of the three proposed regulatory 

actions included: a status quo (no 

action) alternative; an alternative that 

would implement the Commission’s 

ISFMP recommendations in Addendum 

X and XI; and a third modified 

alternative that would vary in certain 

aspects from the Commission 

recommendations, but would be 

compatible with the Commission’s 

ISFMP. 

Background 

American lobsters are managed 

within the framework of the 

Commission. The Commission serves to 

develop fishery conservation and 

management strategies for certain 

coastal species and coordinates the 

efforts of the states and Federal 

Government toward concerted 

sustainable ends. The Commission, 

under the provisions of the Atlantic 

Coastal Act, decides upon a 

management strategy as a collective and 

then forwards that strategy to the states 

and Federal government, along with a 

recommendation that the states and 

Federal government take action (e.g., 

enact regulations) in furtherance of this 

strategy. The Federal government is 

obligated by statute to support the 

Commission’s ISFMP and overall 

fishery management efforts. 

In support of the ISFMP, the National 

Marine Fisheries Service (NMFS) 

proposes to revise Federal American 

lobster regulations in response to the 

Commission’s recommendations for 

Federal action in Addenda X and XI. 

The addenda were themselves a 

response, at least in part, to conclusions 

contained in the most recent lobster 

stock assessment. More specifically, the 

2005 stock assessment and peer review 

process identified the dearth of landings 

data in the American lobster fishery as 

an inhibitor to the effective evaluation 

of the status of the lobster resource, that 

available data are woefully inadequate 

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Federal Register / Vol. 73, No. 194 / Monday, October 6, 2008 / Proposed Rules 58101 

to fulfill the management needs of the 

resource, and that a mandatory catch 

reporting system is needed. Such 

conclusions provided the impetus for 

Addendum X’s mandatory reporting 

requirements, which has spawned the 

proposed Federal dealer reporting 

requirement described in this proposed 

rule. 

This same assessment and peer 

review process concluded that the 

Southern New England (SNE) lobster 

stock is suffering from depleted stock 

abundance and recruitment with high 

dependence on new recruits. The SNE 

stock component is in poor shape with 

respect to spawning, recruit and fullrecruit abundance indices. The 

assessment results also indicated that 

the Georges Bank (GBK) lobster stock, 

although in a stable state with respect to 

abundance and recruitment, is also 

dependent on new entrants to the 

fishery a cause for concern that the 

fishery is too reliant on newly recruited 

lobster. Accordingly, the Commission 

adopted Addendum XI, which sought to 

protect SNE and GBK broodstock by 

creating new maximum carapace 

lengths and implementing a more 

restrictive definition of a v-notch in 

certain Lobster Management Areas. 

Accordingly, NMFS proposes three 

independent regulatory actions: 

(1) Requiring all Federal lobster 

dealers to electronically report trip-level 

lobster landings to NMFS on a weekly 

basis; 

(2) Implementing a maximum 

carapace length restriction for lobster in 

Area 2, Area 3, Area 6, and the Outer 

Cape Management Area and revising the 

maximum carapace length requirements 

for Areas 4 and 5; and 

(3) Revising the Federal definition of 

a standard v-notched lobster, applicable 

to lobster in all areas, with the 

exception of Area 1. 

Proposed Changes to the Current 

Regulations 

NMFS proposes to amend the Federal 

lobster regulations by expanding 

reporting requirements to all Federal 

lobster dealers, and revising the 

maximum carapace length regulations 

and v-notch definition for several 

LCMAs. 

Mandatory Federal Lobster Dealer 

Electronic Reporting 

Consistent with the Commission’s 

recommendations in Addendum X, 

NMFS proposes to implement 

regulations to extend mandatory 

reporting coverage to all Federal lobster 

dealers. Currently, if a Federal dealer 

holds a lobster dealer permit and no 

other Federal seafood dealer permits, 

that dealer is not required to report 

lobster or other seafood purchases to the 

Federal government. Based on the 

analysis completed for this action, 148 

Federal lobster dealers (29 percent of all 

Federal lobster dealers) fall in this 

category and, therefore, are not 

currently subject to Federal reporting 

requirements. The remaining 71 percent 

of Federal lobster dealers hold another 

Federal seafood dealer permit that 

requires routine reporting. Such dealers 

are mandated to report all species 

purchased, including lobster. 

Accordingly, this proposed action 

would affect only those Federal lobster 

dealers not currently required to report 

lobster sales based on reporting 

requirements mandated by other 

federally-managed fisheries. Under this 

requirement, all Federal lobster dealers 

would complete trip-level reports and 

submit them electronically each week, 

consistent with current Federal dealer 

reporting requirements. This proposed 

measure differs from the Commission’s 

recommendations because this proposed 

measure would mandate electronic 

dealer reporting and would collect the 

data in a timelier manner (weekly vs. 

monthly). 

The Commission’s Expanded 

Coastwide Data Collection Program set 

forth in Addendum X is intended to 

increase the quality and quantity of 

fisheries-dependent and fisheriesindependent data collected at the state 

and Federal level. Federal fisheryindependent data collection programs, 

such as sea sampling and port sampling 

activities, are longstanding and 

underway as implemented by NMFS, 

contributing substantially to the pool of 

information used for lobster stock 

assessments, as are the trawl surveys 

conducted by the Northeast Fisheries 

Science Center. NMFS believes that 

these Federal fisheries-independent data 

collection activities exceed those as 

identified in Addendum X. Further, 

with respect to fishery-dependent data 

collection, Addendum X mandates 

participating states, and recommends 

that NMFS, require at least 10 percent 

of all lobster harvesters to report their 

catch. Currently, approximately 61 

percent of all Federal lobster vessels 

report their catch through the NMFS 

Vessel Trip Report (VTR) program, 

exceeding the reporting threshold under 

the ISFMP. Since these fisherydependent and fishery-independent 

activities in place already exceed those 

recommended in Addendum X, NMFS 

intends to take no further action in this 

rulemaking to modify the current level 

of harvester reporting. Consequently, 

the harvester reporting and fisheryindependent elements of Addendum X 

are not part of this proposed 

rulemaking. 

Both NMFS and the states acquire 

dealer and harvester data, although the 

frequency and reporting requirements 

vary across state and Federal 

jurisdictions. In an effort to achieve a 

common forum for collecting and 

assessing coastwide fishery data, NMFS 

and its Atlantic states partners 

developed the Atlantic Coastal 

Cooperative Statistics Program (ACCSP). 

ACCSP is a state and Federal fisheries 

statistical data collection program. The 

data are compiled into a common 

management system to facilitate fishery 

management and meet the needs of 

fishery managers, scientists and the 

fishing industry. To more specifically 

address the need for real-time landings 

data to assist in fisheries management, 

the ACCSP established the Standard 

Atlantic Fisheries Information System 

(SAFIS). Since 2003, SAFIS has evolved 

to handle the fisheries data from statepermitted dealers from participating 

states along the Atlantic coast. Since 

May 2004, SAFIS has incorporated 

Federal seafood dealer data. 

Although SAFIS was intended to be 

the overall entry point and warehouse 

for state and Federal dealer data, NMFS 

relies on its Commercial Fisheries 

Database System (CFDBS), managed by 

the Northeast Fisheries Science Center, 

as the official warehouse for Federal 

dealer data even though all Federal and 

state data are, ultimately, available on 

the SAFIS database. The proposed 

Federal dealer reporting requirements 

would be implemented consistent with 

those reporting requirements currently 

in place for Federal lobster dealers and 

other Federal seafood dealers who are 

already subject to mandatory electronic 

reporting requirements for fisheries 

managed under the authority of the 

Magnuson-Stevens Act. The mandatory 

electronic reporting requirements for 

fisheries managed under the authority of 

the Magnuson-Stevens Act are set forth 

in 50 CFR 648.6 and 50 CFR 648.7 of the 

Federal fisheries regulations and specify 

the data elements and technological 

requirements needed for electronic 

reporting. As such, Federal lobster 

dealers who would be affected by the 

proposed reporting regulations would 

be required to submit their weekly 

reports into SAFIS. 

Federal lobster dealers affected by the 

proposed action, similar to Federal 

dealers already required to report, 

would be required to submit electronic 

reports to NMFS by selecting one of 

three methods: direct real-time, online 

data entry into SAFIS; off-line data 

entry using software provided by NMFS, 

followed by file upload to SAFIS; or 

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58102 Federal Register / Vol. 73, No. 194 / Monday, October 6, 2008 / Proposed Rules 

proprietary record-keeping software 

which could be uploaded to SAFIS. 

Those entering the data directly into the 

SAFIS system could do so with a 

personal computer and Internet access. 

Those who choose to enter the data 

using a file upload system would also 

need a computer and Internet access. 

However, these respondents may be 

eligible to obtain the file upload 

software through a NMFS contractor, at 

no cost to the impacted dealer. The nocost option could mitigate some of the 

financial impact to Federal lobster 

dealers who would be subject to 

mandatory dealer reporting. However, 

all impacted lobster dealers would still 

be required to maintain a personal 

computer and Internet connection to 

upload the data to NMFS. 

Maximum Carapace Length 

Requirements 

In support of the Commission’s 

measures in Addendum XI to address 

the recommendations contained in the 

stock assessment and peer review 

process, NMFS proposes to implement a 

maximum size of 51⁄4 inches (13.34 cm) 

on all (male and female) lobsters in Area 

2 wherein there is currently no 

maximum size requirement in the 

Federal regulations. In Area 4, the 

current Federal requirement of 51⁄4

inches (13.34 cm) pertains to female 

lobster only. This proposed regulatory 

action would broaden the scope of the 

maximum size to include all lobsters 

(male and female). In Area 5, the current 

Federal requirement is 51⁄2 inches (13.97 

cm), applicable only to female lobster. 

This proposed regulatory action would 

reduce the maximum size to 51⁄4 inches 

(13.97 cm) for both male and female 

lobster. Currently, the Federal lobster 

regulations for Area 4 and Area 5 allow 

recreational fishermen to retain one 

female lobster that exceeds the 

maximum size requirement as long as 

such lobster is not intended for 

commercial sale. This so-called 

‘‘trophy’’ lobster allowance in Area 4 

and Area 5 would be eliminated. In 

Area 6, this proposed action would 

establish a maximum size of 51⁄4 inches 

(13.34 cm) for all lobster harvested by 

Federal vessels in this area. 

Additionally, this regulatory action 

would establish a maximum carapace 

size requirement in Area 3. The 

Commission’s plan requires the states to 

have implemented a lobster maximum 

carapace length of 7 inches (17.78 cm) 

by July 1, 2008, reduced by 1⁄8 inch 

(0.32) during each of two successive 

subsequent years until a terminal 

maximum size of 63⁄4 inches (17.15 cm) 

is in place in July 2010. Given the 

timing associated with Federal 

rulemaking on this proposed action, the 

earliest NMFS would establish a 7–inch 

(17.78 cm) maximum size would be July 

1, 2009. Therefore, to be consistent with 

the Commission and States’ 

recommended time frame for 

implementation and fully complement 

state regulations, this proposed action 

would implement the maximum size 

recommended by the Commission for 

the second year of the three-year 

implementation schedule and 

implement the 6 7/8–inch (17.46 cm) 

maximum size in July 2009. Consistent 

with the ISFMP, the terminal maximum 

size for Area 3 of 63⁄4 inches (17.15 cm) 

would take effect on July 1, 2010. The 

aforementioned measures would be 

consistent with the Commission’s plan. 

The Commission’s plan does not 

include a maximum size requirement 

for the Outer Cape Area, the only Area 

without a maximum size requirement 

under the Commission’s ISFMP. NMFS, 

however, in this regulatory action 

proposes to adopt a maximum carapace 

length requirement for the Federal 

waters of the Outer Cape Area, 

consistent with the sizes and 

implementation time-line proposed for 

Area 3. It is anticipated that such action 

would provide additional conservation 

benefits for lobster migrating through 

this area from the other stock areas. 

Modified Definition of V-Notch 

As approved by the Commission in 

Addendum XI, NMFS proposes to revise 

the v-notch definition in Areas 2, 3, 4, 

5 and 6 to apply to any female lobster 

that bears a notch or indentation in the 

base of the flipper that is at least as deep 

as 1⁄8 inches (0.32 cm), with or without 

setal hairs. In the proposed revision, vnotched lobster also pertains to any 

female which is mutilated in a manner 

which could hide, obscure, or obliterate 

such a mark. Under the Commission’s 

ISFMP, the zero tolerance v-notch 

definition for Area 1 would remain 

unchanged, and the Outer Cape Area 

would maintain the current definition of 

a v-notch (at least 1⁄4 inch (0.64 cm) in 

depth, without setal hair). NMFS 

however, proposes in this regulatory 

action to also include the Outer Cape 

Management Area under the revised vnotch definition as specified in the 

Commission’s ISFMP for Areas 2, 3, 4, 

5 and 6. 

Comments and Responses 

In response to the Commission’s 

recommendations for Federal action in 

Addenda X and XI, NMFS published an 

Advance Notice of Proposed 

Rulemaking (ANPR) on September 21, 

2007 (72 FR 53978), to inform the public 

that the agency is considering 

implementing several management 

measures including a mandatory 

electronic reporting requirement for 

Federal lobster dealers and changes to 

the v-notch and maximum size 

regulations in several LCMAs. The 

comment period closed on October 22, 

2007. 

A total of eight entities commented in 

response to the ANPR. Some of the 

comments spoke to more than one of the 

proposed actions. The comments can be 

categorized as follows: Six 

commentators wrote in opposition of 

the mandatory electronic Federal lobster 

dealer reporting requirement; One 

commentator commented in favor of the 

proposed maximum size and v-notch 

requirements; Two commentators 

opposed the maximum size 

requirements. 

The dealer reporting comments were 

received from three lobster dealers, the 

State of Maine Department of Marine 

Resources, and two lobster fishermen’s 

organizations. The general theme of 

these comments was that mandatory 

weekly electronic reporting would add 

more administrative burden to lobster 

dealers and it would be redundant since 

many dealers are already providing the 

data to their respective state fisheries 

agency. There were no comments in 

favor of this measure. Two comments 

opposing the maximum size 

requirements were received by a mobile 

gear fishermen’s group and a 

recreational diving group. The 

comments and the NMFS response to 

each comment are provided here. 

Comment 1: Three lobster dealers 

from Maine wrote in opposition to the 

mandatory electronic dealer reporting 

requirement, generally stating that this 

measure would unnecessarily add to the 

reporting burden already mandated by 

the state. One dealer is concerned that 

this additional burden would cause the 

business to have to hire additional office 

staff. 

Response: NMFS understands that 

there might be a small amount of 

seeming redundancy for those Federally 

permitted dealers who also have a state 

dealer permit and who are thus already 

bound to report by virtue of their state 

permit. On balance, however, NMFS 

believes that the utility of electronic 

reporting outweighs the minor burden 

associated with the minority of dealers 

who would have to report both 

electronically and by paper. More 

specifically, the majority of Federal 

lobster permit dealers, approximately 71 

percent, already have to report 

electronically. Collection and assembly 

of the requisite data likely the most time 

intensive task is a one-time event that 

must occur regardless of the format in 

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which the data is ultimately reported 

(and such data is undoubtedly being 

collected by the business in some form 

as part of the dealer’s regular business 

practices). Although there might be 

some start-up costs associated with 

electronic reporting (See NMFS 

Response to Comment 4), computer 

reporting is intuitively more efficient 

and less time intensive than having to 

write the data out and submit it in paper 

format. Whether computer reporting 

would ultimately result in new 

efficiencies in every case is difficult to 

gauge and might be dependent on 

individuals on a case by case basis. 

Nevertheless, NMFS has received no 

information to suggest that its proposed 

electronic reporting would be a 

significant additional burden to the 29 

percent of the dealers who do not 

presently report in such a format, much 

less that the burden would cause the 

need to hire additional office staff. 

In proposing electronic Federal 

lobster dealer reporting, NMFS balances 

the relatively small additional burden 

against the utility gained by the 

proposed action. First, there is great 

utility for managers having access to, 

and thus having their decisions guided 

by, up-to-date harvest information. 

Electronic reporting allows for far more 

speedy collection of data than can be 

accomplished through a paper reporting 

system. The submission of paper reports 

is cumbersome and the data are not 

consistently loaded by the states into 

the SAFIS system in a timely manner. 

Some states require trip-level dealer 

reports be submitted on a monthly basis 

at which time, state employees enter in 

the data. Consequently, the data may 

not reach the SAFIS system until six 

weeks or more after a particular lobster 

fishing trip which could hamper 

fisheries management and assessment 

efforts. Conversely, under the proposed 

electronic reporting process, once 

received, the data is already in the 

system, with no data entry or handling 

of paper reports needed. Some states 

may even eliminate their paper-based 

reporting requirements for those state 

dealers who would be required under a 

Federal mandatory reporting program to 

report to NMFS on an electronic basis, 

although such an outcome is 

speculative. 

Second, NMFS believes that data 

received through different systems can 

undermine the integrity and usefulness 

of the data. NMFS finds it advantageous 

for its data to be collected in consistent 

fashion, not only for administrative 

efficiencies (NMFS already has a 

successful and tested electronic 

reporting system in place for other 

species), but for the statistical integrity 

of collecting similar data sets for a 

single species by the same means. 

Further, NMFS’s experience suggests 

that while overall compliance with 

Commission plans is excellent, states do 

not always interpret, and are not always 

able to implement, the plans 

consistently and uniformly. 

Accordingly, NMFS believes it more 

prudent in this instance to mandate a 

single uniform Federal lobster dealer 

reporting system rather than rely on the 

eleven states on the Lobster Board to 

submit data for certain Federal dealers 

according to the individual state’s 

reporting program. 

Comment 2: One dealer wrote that he 

purchases lobster from fishermen who 

drop off their catch on a floating lobster 

car. The lobster are dropped off by 

fishermen when the dealer is not there, 

complicating the ability to garner 

specific data on where and when the 

lobster where harvested. 

Response: The Commission’s plan 

recommends that the dealer provide the 

statistical area where the lobster were 

harvested. NMFS has considered but 

rejected this recommendation and, at 

this time, does not propose that Federal 

dealers provide data on where the 

lobster they purchase were harvested. 

NMFS is aware that some lobster dealers 

in Maine acquire lobster without 

interacting directly with the harvester as 

lobster are collected by the dealers from 

the harvesters’ lobster cars. NMFS 

believes that lobster harvesting 

information is best provided by the 

harvester, not the dealer. 

Comment 3: One lobster cooperative 

manager commented that dealer 

reporting for lobster is not necessary 

since lobster is not a quota-managed 

species. 

Response: Although the lobster 

fishery is not managed by a quota 

system, the benefits of consistent 

fishery-dependent data in effectively 

managing the resource cannot be 

overstated. The lobster fishery is the 

most economically lucrative in the 

Northwest Atlantic, with ex-vessel 

revenues totaling nearly $395 million in 

2006, sustaining numerous fishing 

communities. Yet, only 61 percent of 

Federal lobster harvesters and only 71 

percent of Federal lobster dealers 

provide landings data to NMFS. The 

most recent peer-reviewed lobster stock 

assessment indicated that improvements 

to the quality and quantity of fisherydependent data, including dealer data, 

are needed to facilitate the assessment 

of the lobster stocks. In the absence of 

a mandatory Federal harvester reporting 

program NMFS is proposing to act on 

the Commission’s recommendation to 

implement a mandatory dealer reporting 

program to complement the actions of 

the states in enhancing the quality and 

quantity of lobster fishery data to assist 

in the management of this important 

fishery. 

Comment 4: The State of Maine 

Department of Marine Resources 

responded in opposition to the 

proposed mandatory dealer reporting 

measure, indicating that it would 

impact about 86 small dealers in Maine. 

The Maine Department of Marine 

Resources is already collecting trip-level 

data from dealers on a monthly basis 

and believes that electronic reporting 

requirements would be too burdensome 

on dealers who do not have access to 

the Internet or to a computer and are 

now able to provide this data on paper 

trip tickets to fulfill state requirements. 

The State of Maine believes this Federal 

action could jeopardize the relationship 

that Maine has fostered with its dealers 

to facilitate the receipt of lobster landing 

data. 

Response: Maine’s industry outreach 

to establish the cooperation and trust 

needed to acquire this important data is 

laudable, as is the commitment of the 

lobster industry to provide invaluable 

fishery-dependent data for management 

purposes. This relationship embodies 

the concept of cooperative management 

that is vital to the management 

framework for the lobster fishery. It is 

not clear, however, how a Federal 

reporting requirement would undermine 

industry cooperation at the state level. 

Integration of an electronic reporting 

program may enhance the relationship 

between industry and public agencies 

by reducing the time and costs of both 

providing and acquiring the data over 

time. 

NMFS realizes that although a Federal 

electronic dealer reporting requirement 

would only impact a minority of lobster 

dealers (estimated to be 29 percent of all 

Federal lobster dealers), a large portion 

of the 29 percent come from Maine (88 

of the 148 non-reporting Federal lobster 

dealers are based in Maine, based on 

NMFS permit data). At the same time, 

36 dealers in Maine are successfully 

reporting on an electronic basis. 

However, as the largest lobster 

harvesting state by far, Maine harvest 

data is critical to ensure the responsible 

management of the fishery. 

It is evident, both anecdotally and 

from some of the comments received 

that some dealers, especially in more 

remote areas, may not use computers as 

part of their business operations. 

Therefore, it is assumed that the State of 

Maine and other states allow dealers the 

option of submitting either paper or 

electronic reports to maintain current 

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58104 Federal Register / Vol. 73, No. 194 / Monday, October 6, 2008 / Proposed Rules 

up and maintenance costs associated 

with acquiring the technological means 

to conduct business in an electronic 

format. For the purposes of this 

proposed rulemaking, NMFS estimates 

that the initial costs to dealers would be 

about $580 for an adequate computer 

and approximately $652 annually to 

support Internet access for those dealers 

that currently do not have a computer 

or Internet service. The potential impact 

that the cost of acquiring a computer 

and maintaining Internet access would 

have on affected Federal dealer business 

income is uncertain. However, potential 

impacts to lobster dealers with no other 

Federal permits could be assumed to be 

similar to Federal dealers who are 

currently subject to mandatory reporting 

whose business is solely or primarily 

comprised of lobster sales. Under this 

assumption, the estimated first-year cost 

of purchasing equipment and Internet 

access would represent 0.47 percent of 

gross net sales assuming a 40 percent 

markup (based on a NMFS economic 

analysis conducted on lobster fishery 

transactions) and median purchases of 

134,000 pounds (60,909 kg) with net 

gross sales valued at $245,000 during 

2007. These estimates are based on 

dealer reports for all Federal lobster 

permit holders who were subject to 

mandatory reporting during 2007. At 

these values, the annual cost of 

maintaining Internet access would be 

0.27 percent of net gross sales. The 

expected costs would be lower for any 

dealer who already has Internet access 

and a computer meeting the minimum 

specifications. Further, the computer 

and Internet service, having been 

purchased, would have great utility and 

application to improve other aspects of 

the dealer’s business in ways not 

associated with data reporting. 

Put another way, based on the 

assumed markup of 40 percent, dealers 

would receive $1.83 per pound over the 

cost of purchasing lobster from 

harvesters. This translates into sales of 

673 pounds (305.3 kg) of lobster to cover 

the cost of purchasing equipment and 

Internet access in year 1 and 356 

pounds (161.8 kg) of lobster sales to 

cover the cost of Internet access on an 

ongoing basis. 

Electronic dealer reporting, as 

proposed in this regulatory action, 

despite the initial costs, could save time 

and money for dealers affected by this 

requirement. Additionally, it has the 

potential to save time for state agencies 

now devoting staff to hand-enter these 

paper reports for submission into the 

SAFIS system. In addition to the 

potential benefits to industry 

participants, reporting consistency with 

all other Federal dealers in possession 

of limited access permits, and 

timeliness of electronic dealer reports 

represent additional benefits associated 

with this proposed electronic dealer 

reporting action. NMFS also analyzed 

an option to allow dealers one year to 

acquire the means necessary to provide 

electronic reports, however, it appears 

that this approach would merely defer 

the costs associated with acquiring the 

necessary technology to the following 

year, with savings limited to the 

uncommitted costs of Internet service. 

In general, the proposed measures are 

based upon the lobster ISFMP that was 

created and overseen by the states. 

Further, the measures are the result of 

addenda that were unanimously 

approved by the states, including the 

State of Maine, and are consistent with 

regulations already in place at the state 

level. 

Comment 5: A commercial lobster 

fishing industry association commented 

in favor of the proposed maximum size 

and v-notching requirements as 

described in the ANPR. 

Response: NMFS agrees and believes 

that the implementation of the proposed 

measures would be compatible with the 

Commission’s recommendations for 

Federal action and would reduce 

confusion on the part of the participants 

and regulatory agencies, and facilitate 

enforcement by aligning state and 

Federal lobster management measures. 

Additionally, by expanding the scope of 

this action to include the Outer Cape 

LCMA under the maximum size and vnotching requirements as proposed, 

some unknown level of protection to 

transient lobster moving among 

different management areas may be 

realized. Further, this action could 

reduce the potential for more directed 

fishing effort into the Outer Cape LCMA 

that could occur if that area remained 

the only LCMA not governed by a 

maximum size requirement and bound 

to a less restrictive definition of a legal 

v-notch . 

Comment 6: A commercial fishing 

industry group whose membership 

includes vessels participating in the 

non-trap lobster fishery sector wrote to 

oppose the proposed maximum size 

requirements in the ANPR. The 

commentator adds that the non-trap 

sector has a comparatively negligible 

impact on lobster mortality although the 

lobster bycatch of this sector provides 

an essential contribution to the 

groundfish fleet. The commentator 

requests that NMFS justify the 

biological need for this restriction as 

well as the economic analysis of its 

impacts. 

Response: With the exception of the 

Outer Cape Area, NMFS action would 

not further impact lobster vessels since 

they are already subject to the new 

maximum sizes under state regulations. 

NMFS has proposed to implement the 

recommended maximum sizes for Area 

2, Area 3, Area 4, Area 5 and Area 6 

consistent with the Commission’s plan 

to diminish confusion that could occur 

with differing state and Federal 

regulations in these areas and to support 

the intent of these measures to provide 

additional broodstock protection as 

advised through the most recent 

American lobster stock assessment peer 

review process. Consistent with this 

conservation premise, NMFS is 

proposing to extend the Area 3 

maximum size requirement to the Outer 

Cape Area. The intent of this proposed 

action would be to provide further 

protection for lobster broodstock in this 

area which is known to be a corridor for 

lobster moving between inshore and 

offshore areas and between stock and 

management areas. In other words, there 

is the potential to undermine the 

maximum size broodstock protection 

benefits of these proposed measures if 

lobster are protected in one area (i.e., 

caught, but released back to the sea), 

only to have that lobster caught and 

kept while transiting another area. In 

addition, at-sea enforcement would be 

significantly enhanced if the proposed 

broodstock measures were implemented 

in all LCMAs. 

The commentator has asked that the 

economic impacts of this proposed 

action to the non-trap sector be 

addressed. Given previous state action 

to adopt the new maximum size 

requirements with the exception of the 

Outer Cape Area, the proposed Federal 

action would only impact non-trap 

lobster harvest of lobster greater than 6 

3/4 inches (17.15 cm) taken from the 

Outer Cape Area. Based on NMFS 

observer data, approximately 5.7 

percent of the lobster taken by the nontrap fleet in Area 521, used as a proxy 

for the Outer Cape Area, exceeded 63⁄4

inches (17.15 cm). Based on this 

information and in consideration of 

average lobster price, NMFS estimates 

that the three-year average value of 

reduced lobster landings for non-trap 

vessels fishing in the Outer Cape Area 

would range from less than $1 to under 

$1,000 annually. The estimated median 

loss of foregone lobster value would be 

about $117 annually per affected vessel. 

In terms of impacts on total fishing 

revenue for affected non-trap vessels, 

these values translate into losses ranging 

from less than 0.01 percent to 1.2 

percent. Therefore, the relative change 

in total fishing income is much less than 

the expected change in Outer Cape Area 

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landings since non-trap vessels may fish 

for lobster in other areas and because 

they earn the majority of their fishing 

income from species other than lobster. 

However, a survey of lobster vessels 

indicates that increased fuel costs have 

caused a reduction in the profit margin 

for some fishing businesses. In the Outer 

Cape Area the added effect of reduced 

revenue potential could compound the 

economic stress on the financial 

viability of lobster businesses operating 

in the area. 

Comment 7: A representative of a 

recreational diving club wrote to 

express concerns over the passage of 

Addendum XI wherein the Commission 

adopted the revised maximum sizes to 

include both male and female lobster. 

This group submitted a proposal before 

the Commission’s Lobster Management 

Board after adoption of Addendum XI to 

request the recreational take of one 

oversized lobster per trip by divers. 

Although discussed at several Board 

meetings, both prior to and after 

approval of Addendum XI, the proposal 

was not approved by the Board. 

Response: Although NMFS 

acknowledges that the proposed rule 

might have some impact on recreational 

divers seeking so-called ‘‘trophy sized’’ 

lobster, NMFS believes that, on balance, 

applying maximum sizes consistently to 

male and female lobster is prudent. As 

a preliminary matter, maximum size 

restrictions are known to protect larger 

lobsters which, according to the best 

available scientific information, are 

more prolific breeders. Further, 

application of the standard to both male 

and female lobsters would make the 

regulation more consistent, 

understandable, and enforceable. 

Additionally, the maximum size 

restriction of 51⁄4 inches (13.34 cm) 

would still allow for the capture of large 

lobsters and NMFS has received no 

information to suggest that divers 

currently diving for oversized lobster 

would not dive for lobsters in excess of 

5 inches (12.7 cm) which would still 

remain legal under this proposed rule. 

Regardless of Federal action, 

recreational divers are already bound by 

the proposed maximum size revisions 

by virtue of the states having approved 

the restrictions of the Commission’s 

Addendum XI. 

Classification 

This proposed rule has been 

determined to be not significant for the 

purposes of Executive Order (E.O.) 

12866. 

This proposed rule does not contain 

policies with Federalism implications as 

defined in E.O. 13132. The proposed 

measures are based upon the lobster 

ISFMP that was created and is overseen 

by the states. The proposed measures 

are the result of addenda that were 

unanimously approved by the states, 

have been recommended by the states 

through the Commission, for Federal 

adoption, and are in place at the state 

level. Consequently, NMFS has 

consulted with the states in the creation 

of the ISFMP which makes 

recommendations for Federal action. 

Additionally, these proposed 

regulations do not pre-empt state law 

and do nothing to directly regulate the 

states. 

This proposed rule contains a 

collection of information requirement 

subject to review and approval by the 

Office of Management and Budget 

(OMB) under the Paperwork Reduction 

Act (PRA). This requirement has been 

submitted to OMB for approval. Public 

reporting burden for the Mandatory 

Federal Lobster Dealer Electronic 

Reporting requirement is estimated to 

average four minutes per response, 

including the time for reviewing 

instructions, searching existing data 

sources, gathering and maintaining the 

data needed, and completing and 

reviewing the collection information. 

Public comment is sought regarding: 

whether this proposed collection of 

information is necessary for the proper 

performance of the functions of the 

agency, including whether the 

information shall have practical utility; 

the accuracy of the burden estimate; 

ways to enhance the quality, utility and 

clarity of the information to be 

collected; and ways to minimize the 

burden of the collection of information, 

including through the use of automated 

collection techniques or other forms of 

information technology. Send comments 

on these or any other aspects of the 

collection of information to the State, 

Federal and Constituent Programs Office 

at the ADDRESSES above, and by e-mail 

to David_Rostker@omb.eop.gov or fax to 

(202) 395–7285. 

Notwithstanding any other provision 

of the law, no person is required to 

respond to, and no person shall be 

subject to penalty for failure to comply 

with, a collection of information subject 

to the requirements of the PRA, unless 

that collection of information displays a 

currently valid OMB control number. 

NMFS prepared an Initial Regulatory 

Flexibility Analysis (IRFA) as required 

by section 603 of the Regulatory 

Flexibility Act (RFA). The IRFA 

describes the economic impact this 

proposed rule, if adopted, would have 

on small entities. A description of the 

action, the reason for consideration, and 

the legal basis are contained in the 

SUMMARY section of the preamble in this 

proposed rule. A summary of the IRFA 

follows: 

The proposed (preferred) action 

would implement a mandatory 

electronic Federal lobster dealer 

reporting requirement. In addition, it 

would revise the current lobster 

maximum carapace length restrictions 

in Area 4 and Area 5 and establish a 

maximum size in Areas 2, 3, and 6. 

Beyond the scope of the ISFMP, the 

proposed Federal action would expand 

the Area 3 maximum size requirement 

to the Outer Cape Area wherein the 

Federal regulations do not currently 

limit lobster harvest based on a 

maximum carapace length. 

Additionally, it would include the 

Outer Cape Area under the more 

restrictive 1/8–inch (0.32 cm) v-notch 

requirement. 

The proposed management measures 

would affect small entities engaged in 

several different aspects of the lobster 

fishery. The affected entities include 

lobster dealers, party/charter vessel 

operators, and commercial fishers using 

trap and non-trap gears. The proposed 

action would implement a mandatory 

electronic reporting program for Federal 

lobster dealers, a maximum carapace 

length limitation and a change in the 

definition of a standard v-notched 

lobster. Specifically, the latter two 

measures, intended for lobster 

broodstock protection, would impact 

Federal vessels that fish in the Outer 

Cape Area. 

Economic Impacts of the Proposed Rule 

on Small Entities 

Mandatory Federal Lobster Dealer 

Electronic Reporting 

Federal lobster dealers are the entity 

that would be most affected by this 

proposed requirement. According to the 

Small Business Administration (SBA), 

lobster dealers are considered small 

entities when they employ less than 100 

people. NMFS does not collect 

employment data from Federallypermitted lobster dealers in the 

Northeast region. However, based on 

review of data reported in the U.S. 

Census Bureau’s County Business 

Patterns it is estimated that all regulated 

entities that specialize in lobster 

wholesale trade, as well as those entities 

that may not specialize in the lobster 

trade yet would be required to comply 

with the proposed action, are presumed 

to be small entities for purposes of the 

Regulatory Flexibility Act (RFA). 

The proposed action would require all 

federally-permitted lobster dealers to 

report all seafood purchases, including 

lobster, through an electronic reporting 

system. This action would only affect 

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58106 Federal Register / Vol. 73, No. 194 / Monday, October 6, 2008 / Proposed Rules 

regulated lobster dealers who are not 

already required report by virtue of 

holding at least one other Federal dealer 

permit requiring mandatory reporting. 

During 2007 there were 511 lobster 

dealers issued a Federal permit to 

purchase lobster. Of these dealers the 

majority (71 percent) were already 

required to report leaving 148 regulated 

small entities that would be required to 

comply with the proposed action. 

To comply with the electronic 

reporting requirements, dealers would 

need a personal computer and Internet 

service. The required specifications for 

the personal computer are such that any 

recently purchased computer, and most 

older computers would meet the 

minimum specifications. For this 

reason, any dealer that currently owns 

a computer would not likely be required 

to purchase new equipment. The 

number of regulated lobster dealers who 

do not now own a computer is uncertain 

but is expected to be low. Those who 

already have Internet access and a 

computer would not have any specific 

costs associated with this new reporting 

requirement. It is estimated that the 

average start-up costs for those lobster 

dealers who do not have a computer 

would be about $580 to purchase a 

personal computer and monitor that 

would meet or exceed the specifications 

needed to participate in the electronic 

dealer reporting program. Preliminary 

estimates of additional costs of about 

$652 per year for Internet access would 

bring the total start-up costs to 

approximately $1,232, with annual costs 

for Internet access continuing annually. 

The unknown number of dealers 

impacted by the proposed dealer 

reporting program, whom already own a 

computer but are not connected to the 

Internet, would assume the estimated 

annual fees for this service at about 

$652 annually. Based on data from 

dealers who are currently required to 

report, these costs were estimated to be 

0.47 percent of gross net sales (i.e. sales 

less the cost of purchasing lobster) in 

the first year for the one-time cost of 

purchasing a computer and the first year 

of Internet service. Ongoing costs were 

estimated to represent 0.27 percent of 

gross net sales. 

Changes to Maximum Carapace Length 

Requirements and Revision to V-Notch 

Definition 

Since the states have already 

implemented the maximum size and vnotch requirements for the affected 

areas, with the exception of the Outer 

Cape Area as proposed in this 

rulemaking action, the small entities 

impacted by the maximum size and vnotch provisions proposed herein 

would be limited to the Federal 

commercial lobster fishing vessels and 

party/charter dive vessels that fish, or 

are permitted to fish, in the Outer Cape 

Area. The Outer Cape Area has been 

characterized as fishing on a population 

of transient lobsters migrating between 

inshore and offshore areas. 

Party/Charter Vessels. Party/Charter 

operators are classified with businesses 

that offer sightseeing and excursion 

services where the vessel departs and 

returns to the same location within the 

same day. Relevant to this proposed 

action, these businesses include party/ 

charter recreational fishing vessels 

which offer SCUBA divers recreational 

opportunities to harvest lobsters for 

personal use. The SBA size standard for 

this sector is $7 million in gross sales. 

Although sales data are not available, 

party/charter operators in the lobster 

fishery tend to be small in size and do 

not carry a large number of passengers 

on any given trip. For these reasons it 

is expected that all regulated party/ 

charter operators holding a Federal 

lobster permit would be classified as a 

small entity for purposes of the RFA. All 

Federal lobster party/charter permit 

holders are already required to abide by 

all state regulations under the most 

restrictive rule of the ISFMP. This 

means that the proposed action would 

only affect party/charter operators that 

take passengers for hire in the Outer 

Cape Area since this is the only area in 

the proposed Federal action not 

included for a maximum size or a more 

restrictive v-notch in the ISFMP and 

therefore, not under such restrictions by 

any state. 

During 2007 there were a total of 31 

Federal permit holders with a party/ 

charter lobster permit. Of these vessels 

all but one held at least one other 

Federal party/charter permit (for 

another species), while the majority (24) 

held four or more other Federal party/ 

charter permits in addition to the lobster 

permit. These data indicate nearly all 

lobster party/charter permit holders 

have at least one other Federal permit 

requiring mandatory reporting. 

Available logbook (VTR) data show that 

only 3 of the 31 lobster party/charter 

permit holders reported taking 

passengers for hire during trips when 

lobster were kept during the 2007 

fishing year. Of the trips that did report 

landing lobsters none took place within 

NMFS statistical area 521, used a proxy 

for the Outer Cape Area. In fact, all forhire recreational trips took place in 

statistical areas in the Mid-Atlantic 

region. Although the number of 

participating for-hire vessels was larger 

in Fishing Year (FY) 2005 (6 vessels) 

and FY 2006 (7 vessels), these vessels 

also took recreational lobster fishing 

trips only within the Mid-Atlantic area. 

None took a for-hire trip in the Outer 

Cape Area. 

These data suggest that participating 

for-hire lobster permit holders would 

not be affected by the proposed action 

in the Outer Cape Area although these 

permit holders may have been affected 

by action already taken by individual 

states. While the magnitude of any 

impact associated with state action is 

uncertain, it is likely to have been 

relatively small. In the areas where 

recreational lobster fishing was reported 

(corresponding to Area 4 and/or 5) a 

maximum size for female lobsters has 

already been in place for several years. 

Despite the state action and proposed 

Federal action to reduce the maximum 

size from 51⁄2 inches (13.97 cm) to 51⁄4

inches (13.34 cm) in Area 5 and expand 

it to provide additional protection for 

male lobsters in Areas 4 and 5, these 

areas represent the southern terminus of 

the lobster resource. Therefore, 

eliminating the exemption for a trophy 

lobster would have little impact on the 

recreational fishery since the encounter 

rate with lobsters of that size is expected 

to be very low. 

Federal Commercial Lobster Vessels. 

The SBA size standard for commercial 

fishing businesses is $4 million in gross 

sales. According to dealer records, no 

single lobster vessel would exceed $4 

million in gross sales. Therefore, all 

operating units in the commercial 

lobster fishery are considered small 

entities for purposes of analysis. The 

economic impacts of the change in 

maximum size in the Outer Cape Area 

are uncertain since all vessels are not 

required to report their landings to 

NMFS. Survey data collected during 

2005 by researchers at the Gulf of Maine 

Research Institute and made available to 

NMFS included information on lobster 

business profitability for vessels 

operating in Areas 1, 2, and 3. Operators 

in the Outer Cape Area were not 

specifically sampled. However, it is 

likely that these entities are of similar 

scale to operators that were sampled 

and fish on a lobster stock that bear 

some similarities to operators in Area 1 

although the size composition of catch 

tends to be larger than would be the 

case in Area 1. Subject to these caveats, 

it was assumed that the cost and 

earnings profile for Area 1 survey 

participants would be a suitable proxy 

for financial performance of Outer Cape 

Area trap participants. 

The survey data indicate that the 

majority of Area 1 lobster businesses 

were able to cover operating costs with 

gross sales. However, net earnings for 

the majority of businesses were below 

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median personal income for the New 

England region and only about 20 

percent of lobster businesses earned a 

positive return to invested capital. Since 

2005, fuel costs have more than doubled 

cutting average net return by about 30 

percent; this is before taking into 

account the opportunity cost of the 

owner’s labor or capital. Thus, profit 

margins have shrunk significantly since 

2005 and even small changes in revenue 

streams could place lobster businesses 

in financial risk. However, as the 

following analysis describes, few vessels 

rely exclusively on the Outer Cape Area 

for lobster fishing revenue. Further, only 

a small percentage of the catch in the 

trap sector is expected to be impacted 

by the proposed measures. 

Trap Gear Vessels. The proposed 

Federal action would directly affect 

only those Federal lobster vessels that 

selected the Outer Cape Area. For the 

2007 fishing year, 184 Federal lobster 

trap vessels selected the Outer Cape as 

one of the potential trap fishing areas. 

Federal Fisheries Observer data suggest, 

in consideration of the terminal 

maximum size proposed in the 

preferred alternative of 6 inches (17.15 

cm), trap vessels operating in this area 

would expect a reduction in catch of 

approximately 0.5 percent. Note, 

however, that a price premium is paid 

for larger lobsters such that the realized 

economic impact on lobster fishing 

businesses is likely to be proportionally 

larger than the expected change in 

catch. 

Non-Trap Gear Vessels. Based on a 

three-year average (2005–2007) overall 

dependence on lobster for non-trap 

vessels ranged from 0.03 percent to 30.6 

percent in terms of annual value and 

from 0.01 percent to 10.6 percent in 

volume. Few vessels relied exclusively 

on the Outer Cape Area for lobster 

fishing revenue. Using statistical area 

521 as a proxy for the Outer Cape during 

the 2005–2007 period, dependence on 

lobster in value ranged from 0.01 

percent to 19.4 percent, averaging 1.4 

percent of overall value. In volume, 

lobster harvested from area 521 ranged 

from 0.002 percent to 5.7 percent, 

averaging 0.4 percent of overall volume. 

The maximum expected annual 

economic impact of the 6-inch (17.15– 

cm) maximum size in the Outer Cape 

Area on non-trap vessels is estimated to 

be about $1,000, while the median 

annual impact was estimated to be $117 

per vessel. These values are reflective of 

the relatively low dependence on the 

Outer Cape Area for lobster fishing 

revenue and the low encounter rate 

suggested by observer data of lobsters 

above the 6-inch (17.15 cm) proposed 

maximum size. In terms of total fishing 

revenue these estimated revenue 

impacts represent between 0.01 percent 

and 1.2 percent of total fishing revenue 

for participating regulated non-trap gear 

small entities. 

The added economic impact of the 

change in v-notch definition across all 

areas is highly uncertain. Although this 

change would result in an unknown 

level of reduced opportunities to retain 

legal lobsters it seems likely that this 

additional impact would have less 

impact on non-trap than trap vessels 

since non-trap vessels earn only a 

portion of total fishing revenue from 

lobsters. The added effect on trap 

vessels is difficult to assess, but would 

reduce potential revenue in addition to 

that which may be associated with 

either changes in existing maximum 

size or implementation of new 

maximum size regulations. Available 

sea sampling data from the 

Commonwealth of Massachusetts 

indicate that between 2 percent and 4 

percent of females encountered in the 

Outer Cape Area were v-notched. A 

substantial portion of the Outer Cape 

Area legal harvest is comprised of 

females (64 percent), an unknown 

proportion of which would be illegal 

under the preferred alternative. 

Economic Impacts of Non-Preferred 

Alternatives to the Proposed Action 

Mandatory Federal Dealer Electronic 

Reporting 

NMFS analyzed two alternatives in 

addition to the proposed alternative for 

this action: a no action alternative and 

a one-year delay in the implementation 

of mandatory lobster dealer electronic 

reporting. With the no action 

alternative, there would be no expected 

economic impacts to Federal lobster 

dealers. Those who are not required to 

report under the current Federal 

requirements would not be required to 

report lobster purchases to NMFS and 

would not suffer any associated 

economic impacts. Specifically, 148 

Federal lobster dealers would not be 

required to submit electronic trip-level 

reports to NMFS on a weekly basis. This 

could impede the availability of an upto-date, comprehensive data set of triplevel lobster landings from Federal 

dealers on a coastwide basis. NMFS 

believes that the optimal situation from 

a fishery monitoring and data 

management perspective would be one 

wherein all Federal dealers report 

electronically to NMFS, making this 

trip-level data available in a single 

format on a weekly basis. 

If the one-year delay in 

implementation is selected, this 

alternative would provide some 

temporary relief to affected regulated 

entities, but would only put off the cost 

of coming into compliance with the 

proposed action for one year. Consistent 

with the proposed action, it would 

allow for the receipt of all trip-level 

lobster data by all Federal lobster 

dealers in a consistent and more timely 

fashion. However, it would allow the 

industry more time to comply with the 

requirements. It would postpone the 

start-up and maintenance costs 

associated with the purchase of a 

computer ($580) in cases where the 

dealer does not currently own one, and 

would postpone the costs of Internet 

service ($652 per year), as applicable. 

Maximum Carapace Length Measures 

As with the dealer reporting 

requirement, NMFS analyzed a no 

action alternative and the Commission’s 

alternative in addition to the proposed 

alternative selected for this rulemaking 

action. Essentially, all Federal permit 

holders possess either a landing permit 

or lobster fishing license from a state of 

landing. Under the Federal lobster 

regulations (50 CFR part 697), Federal 

lobster vessels are subject to the most 

restrictive of either state or Federal 

regulations, regardless of where the 

vessels fish. Therefore, in the absence of 

Federal rules that mirror revised state 

regulations based on the Commission’s 

plan, Federal vessels will be held to the 

new state regulations for the respective 

lobster management areas, even if 

fishing in Federal waters. So, the impact 

is, theoretically, the same to Federal 

vessels and to the resource, regardless of 

whether the no action alternative or the 

Commission’s alternative is selected, 

assuming that states remain in 

compliance with the ISFMP. However, 

in choosing the no action alternative, 

differences in the state and Federal 

regulations across multiple management 

areas could cause some confusion 

among the industry and managers and 

may inhibit effective enforcement of 

fisheries regulations. This could occur 

since, without complementary Federal 

action, nearly all the lobster 

management areas within the scope of 

this action would have inconsistent 

Federal and state maximum size 

requirements within each area. 

Conversely, implementation of the 

Commission recommendations, the 

second alternative that NMFS analyzed 

an has rejected in favor of the proposed 

measures, would negate any 

inconsistencies between state and 

Federal regulations. With the 

Commission’s alternative, the industry 

would not be impacted since they are 

already complying with these measures 

under state law. Under either of these 

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58108 Federal Register / Vol. 73, No. 194 / Monday, October 6, 2008 / Proposed Rules 

rejected alternatives, Outer Cape lobster 

vessels would not be impacted and 

could, with some exceptions, harvest 

lobster in the Outer Cape Area without 

regard to maximum carapace lengths. 

Revision to V-notch Definition 

The consequences associated with the 

Federal implementation of the v-notch 

definition as recommended in the 

Commission’s alternative and set forth 

in the respective state regulations are 

the same, in most respects, as no 

Federal action. The measures adopted 

by the states would impact the Federal 

permit holders since they are more 

restrictive than the current Federal 

regulations. Implementing these 

measures at the Federal level would not 

subject Federal lobster vessels to any 

further economic burden since they 

would already be subject to these 

restrictions by standing state laws in the 

absence of Federal action. However, 

there are benefits to Federal action in 

implementing the Commission’s 

recommended measures compared to 

the no action alternative because 

consistent state and Federal regulations 

would limit confusion as to the 

enforceable standards among 

jurisdictions and management areas and 

would facilitate the enforcement of 

these measures and foster their utility in 

augmenting egg production through 

broodstock protection. Therefore, on 

balance, the Commission’s alternative 

would provide additional benefits to 

industry participants and would allow 

for more effective enforcement than the 

no-action alternative. 

Socio-economic impacts would not be 

expected by choosing to maintain the 

current Federal v-notching standards or 

by implementing the Commission’s 

recommendations which would not 

include a revised v-notch for the Outer 

Cape Area. Federal vessels will be 

subject to the more restrictive v-notch 

measures in place at the state level even 

if NMFS maintains the status quo. Outer 

Cape lobster fishers would not be 

impacted by a more restrictive v-notch 

under either non-preferred alternative 

and could continue to harvest lobster 

under the current 1⁄4-inch (0.64–cm) vnotch requirement, while vessels in 

other management areas would remain 

subject to the stricter 1⁄8–inch (0.32–cm) 

v-notch standard. 

List of Subjects in 50 CFR Part 697 

Fisheries, Fishing. 

Dated: October 1, 2008. 

James W. Balsiger, 

Acting Assistant Administrator for Fisheries, 

National Marine Fisheries Service. 

For the reasons set out in the 

preamble, 50 CFR chapter VI, part 697, 

is proposed to be amended as follows: 

PART 697—ATLANTIC COASTAL 

FISHERIES COOPERATIVE 

MANAGEMENT 

1. The authority citation for part 697 

continues to read as follows: 

Authority: 16 U.S.C. 5101 et seq. 

2. In § 697.2(a), the definition for 

‘‘Standard v-shaped notch’’ is revised to 

read as follows: 

§ 697.2 Definitions. 

(a) * * * 

* * * * * 

Standard V-shaped notch means a 

straight-sided triangular cut, with or 

without setal hairs, at least 1⁄8 inch (0.32 

cm) in depth and tapering to a point. 

* * * * * 

3. In § 697.6, paragraphs (n) through 

(s) are added to read as follows: 

§ 697.6 Dealer permits. 

* * * * * 

(n) Lobster dealer recordkeeping and 

reporting requirements—(1) Detailed 

report. All Federally-permitted lobster 

dealers must submit to the Regional 

Administrator or to the official designee 

a detailed report of all fish purchased or 

received for commercial purposes, other 

than solely for transport on land, within 

the time periods specified in paragraph 

(q) of this section, or as specified in 

§ 648.7(f) of this chapter, whichever is 

most restrictive, by one of the available 

electronic reporting mechanisms 

approved by NMFS, unless otherwise 

directed by the Regional Administrator. 

The following information, and any 

other information required by the 

Regional Administrator, must be 

provided in each report: 

(i) Required information. All dealers 

issued a Federal lobster dealer permit 

under this part must provide the 

following information, as well as any 

additional information as applicable 

under § 648.7(a)(1)(i) of this chapter: 

Dealer name; dealer permit number; 

name and permit number or name and 

hull number (USCG documentation 

number or state registration number, 

whichever is applicable) of vessel(s) 

from which fish are purchased or 

received; trip identifier for each trip 

from which fish are purchased or 

received from a commercial fishing 

vessel permitted under part 648 of this 

chapter with a mandatory vessel trip 

reporting requirement; date(s) of 

purchases and receipts; units of measure 

and amount by species (by market 

category, if applicable); price per unit by 

species (by market category, if 

applicable); port landed; disposition of 

the seafood product; and any other 

information deemed necessary by the 

Regional Administrator. If no fish are 

purchased or received during a 

reporting week, a report so stating must 

be submitted. 

(ii) Exceptions. The following 

exceptions apply to reporting 

requirements for dealers permitted 

under this part: 

(A) Inshore Exempted Species, as 

defined in § 648.2 of this chapter, are 

not required to be reported under this 

part; 

(B) When purchasing or receiving fish 

from a vessel landing in a port located 

outside of the Northeast Region (Maine, 

New Hampshire, Massachusetts, 

Connecticut, Rhode Island, New York, 

New Jersey, Pennsylvania, Maryland, 

Delaware, Virginia and North Carolina), 

only purchases or receipts of species 

managed by the Northeast Region under 

this part (American lobster), and part 

648 of this chapter, must be reported. 

Other reporting requirements may apply 

to those species not managed by the 

Northeast Region, which are not affected 

by the provision; and 

(C) Dealers issued a permit for 

Atlantic bluefin tuna under part 635 of 

this chapter are not required to report 

their purchases or receipts of Atlantic 

bluefin tuna under this part. Other 

reporting requirements, as specified in 

§ 635.5 of this chapter, apply to the 

receipt of Atlantic bluefin tuna. 

(2) System requirements. All persons 

required to submit reports under 

paragraph (n)(1) of this section are 

required to have the capability to 

transmit data via the Internet. To ensure 

compatibility with the reporting system 

and database, dealers are required to 

utilize a personal computer, in working 

condition, that meets the minimum 

specifications identified by NMFS. The 

affected public will be notified of the 

minimum specifications via a letter to 

all Federal lobster dealer permit 

holders. 

(3) Annual report. All persons issued 

a permit under this part are required to 

submit the following information on an 

annual basis, on forms supplied by the 

Regional Administrator: All dealers and 

processors issued a permit under this 

part must complete all sections of the 

Annual Processed Products Report for 

all species that were processed during 

the previous year. Reports must be 

submitted to the address supplied by 

the Regional Administrator. 

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Federal Register / Vol. 73, No. 194 / Monday, October 6, 2008 / Proposed Rules 58109 

(o) Inspection. All persons required to 

submit reports under this section, upon 

the request of an authorized officer, or 

by an employee of NMFS designated by 

the Regional Administrator to make 

such inspections, must make 

immediately available for inspection 

copies of the required reports and the 

records upon which the reports are or 

will be based. 

(p) Record retention. Records upon 

which trip-level reports are based must 

be retained and be available for 

immediate review for a total of 3 years 

after the date of the last entry on the 

report. Dealers must retain the required 

records at their principal place of 

business. 

(q) Submitting dealer reports. (1) 

Detailed dealer reports required by 

paragraph (n)(1)(i) of this section must 

be received by midnight of the first 

Tuesday following the end of the 

reporting week. If no fish are purchased 

or received during a reporting week, the 

report so stating required under 

paragraph (n)(1)(i) of this section must 

be received by midnight of the first 

Tuesday following the end of the 

reporting week. 

(2) Dealers who want to make 

corrections to their trip-level reports via 

the electronic editing features may do so 

for up to 3 business days following 

submission of the initial report. If a 

correction is needed more than 3 

business days following the submission 

of the initial trip-level report, the dealer 

must contact NMFS directly to request 

an extension of time to make the 

correction. 

(3) Price and disposition information 

may be submitted after the initial 

detailed report, but must be received 

within 16 days of the end of the 

reporting week. 

(4) Annual reports for a calendar year 

must be postmarked or received by 

February 10 of the following year. 

Contact the Regional Administrator (see 

Table 1 to § 600.502) for the address of 

NMFS Statistics. 

(r) Additional data and sampling. 

Federally permitted dealers must allow 

access to their premises and make 

available to an official designee or the 

Regional Administrator any fish 

purchased from vessels for the 

collection of biological data. Such data 

include, but are not limited to, length 

measurements of fish and the collection 

of age structures such as otoliths or 

scales. 

(s) Additional dealer reporting 

requirements. (1) All persons issued a 

lobster dealer permit under this part are 

subject to the reporting requirements set 

forth in paragraph (n) of this section, as 

well as §§ 648.6 and 648.7 of this 

chapter, whichever is most restrictive. 

(2) [Reserved] 

4. In § 697.20, paragraphs (b)(3) 

through (b)(7), and paragraph (g)(3) are 

revised, and paragraph (b)(8) is added, 

to read as follows: 

§ 697.20 Size, harvesting and landing 

requirements. 

* * * * * 

(b) * * * 

(3) Effective July 1, 2009, the 

maximum carapace length for all 

American lobster harvested in or from 

one or more of the EEZ Nearshore 

Management Areas 2, 4, 5, and 6 is 51⁄4

inches (13.34 cm). 

(4) Effective July 1, 2009, the 

maximum carapace length for all 

American lobster landed, harvested, or 

possessed by vessels issued a Federal 

limited access American lobster permit 

fishing in or electing to fish in one or 

more of EEZ Nearshore Management 

Areas 2, 4, 5, and 6 is 51⁄4 inches (13.34 

cm). 

(5) Effective July 1, 2009, the 

maximum carapace length for all 

American lobster harvested in or from 

EEZ Offshore Management Area 3 or the 

Outer Cape Lobster Management Area is 

67⁄8 inches (17.46 cm). 

(6) Effective July 1, 2009, the 

maximum carapace length for all 

American lobster landed, harvested, or 

possessed by vessels issued a Federal 

limited access American lobster permit 

fishing in or electing to fish in EEZ 

Offshore Management Area 3 or the 

Outer Cape Lobster Management Area is 

67⁄8 inches (17.46 cm). 

(7) Effective July 1, 2010, the 

maximum carapace length for all 

American lobster harvested in or from 

EEZ Offshore Management Area 3 or the 

Outer Cape Lobster Management Area is 

63⁄4 inches (17.15 cm). 

(8) Effective July 1, 2010, the 

maximum carapace length for all 

American lobster landed, harvested, or 

possessed by vessels issued a Federal 

limited access American lobster permit 

fishing in or electing to fish in EEZ 

Offshore Management Area 3 or the 

Outer Cape Lobster Management Area is 

63⁄4 inches (17.15 cm). 

* * * * * 

(g) * * * 

(3) No person may possess any female 

lobster possessing a standard v-shaped 

notch harvested in or from the EEZ 

Nearshore Management Area 2, 4, 5, 6, 

and the Outer Cape Lobster 

Management Area or the EEZ Offshore 

Management Area 3. 

* * * * * 

[FR Doc. E8–23568 Filed 10–3–08; 8:45 am] 

BILLING CODE 3510–22–S 

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