b'Internal Revenue Service Notices of Levy on Undelivered\nCommerce Department Fishing Quota Permits\nThe Department of Commerce may lawfully withhold delivery of fishing quotas or quota shares to\neligible fishermen under the federal fishery laws in order to comply with a notice o f levy served\non the Department by the Internal Revenue Service to satisfy federal tax delinquencies.\n\nJanuary 26, 1995\nM e m o r a n d u m O p in io n f o r t h e G e n e r a l C o u n s e l\nD epa r tm en t o f C o m m erce\n\nThis responds to your letter of November 4, 1994, requesting our opinion\nwhether the Department of Commerce (\xe2\x80\x9c DOC\xe2\x80\x9d ) may withhold delivery of quota\nshares or individual1fishing quotas issued to eligible fishermen under the provi\xc2\xad\nsions of federal fishery laws in order to comply with a notice of levy served\non the DOC by the Internal Revenue Service (\xe2\x80\x9c IRS\xe2\x80\x9d ), demanding that the permits\nbe surrendered to IRS to satisfy tax delinquencies.1 Upon receipt of your letter,\nwe solicited and received a submission from the IRS setting forth its views on\nthis inter-departmental dispute.2\nWe conclude that the IRS notices of levy may be lawfully applied to the\nundelivered quota shares and individual fishing quotas, and we find no legal basis\nfor the DOC to refuse to comply with them. Our analysis follows.\nI. BACKGROUND\nA. The Halibut and Sablefish Fishing Quota Programs\nThe Secretary of Commerce (\xe2\x80\x9c Secretary\xe2\x80\x9d ) is authorized to maintain limited\naccess to certain fisheries under the Magnuson Fishery Conservation and Manage\xc2\xad\nment Act, 16 U.S.C. \xc2\xa7\xc2\xa71801-1883 (\xe2\x80\x9c Magnuson Act\xe2\x80\x9d ), and the Northern Pacific\nHalibut Act of 1982, 16 U.S.C. \xc2\xa7\xc2\xa7773\xe2\x80\x94773k (\xe2\x80\x9c Halibut Act\xe2\x80\x9d ). Under the authority\nof these acts, the Secretary has instituted a system whereby the allowable catch\nof a species is divided into shares or quotas, which are then allocated among\nthe eligible fishermen.\nThe resultant system is based upon quota shares and individual fishing quotas\n(\xe2\x80\x9c IFQ\xe2\x80\x9d ). A quota share is a long-term permit to fish for a particular species\n(here, halibut or sablefish) in a particular area. These shares are issued to \xe2\x80\x9c quali\xc2\xad\n1Letter for Walter Dellinger, Assistant Attorney General, Office o f Legal Counsel, from G inger Lew, G eneral\nCounsel, U.S. Department o f Commerce (Nov. 4, 1994) ( \xe2\x80\x9c DOC Ltr.\xe2\x80\x9d ).\n2 Letter for Richard Shiffrin, Deputy Assistant Attorney General, Office of Legal Counsel, from Stuart L. Brown,\nC hief Counsel, Internal Revenue Service (Dec. 23, 1994) ( \xe2\x80\x9c IRS Ltr.\xe2\x80\x9d ). In resolving this matter, w e also considered\nthe Letter for Jay S. Johnson, Deputy General Counsel, National Marine Fisheries Service, from Arnold E. Kaufman,\nAssistant C hief Counsel, Internal Revenue Service (Oct. 12, 1994) ( \xe2\x80\x9c Kaufman Ltr.\xe2\x80\x9c ).\n\n23\n\n\x0cOpinions o f the Office o f Legal Counsel in Volume 19\n\nfied persons\xe2\x80\x9d \xe2\x80\x94 i.e., those who have owned or leased vessels which harvested\nhalibut or sablefish during the qualifying years of 1988 through 1990. Quota\nshares (which are represented by Quota Share Certificates) are transferable to other\nqualified persons, subject to approval by the National Marine Fisheries Service\n(\xe2\x80\x9c NMFS\xe2\x80\x9d ), the agency within DOC that administers the fisheries laws. See 50\nC.F.R. \xc2\xa7\xc2\xa7676.20-21 (1995).\nAn IFQ is an annual permit issued only to the owners of quota shares.3 In\nearly 1995, the NMFS plans to issue IFQ\xe2\x80\x99s for halibut and sablefish based upon\nthe ratio between a qualified fisherman\xe2\x80\x99s quota share and the total number of\nquota shares in the applicable pool for the species and area. The IFQ is represented\nby an \xe2\x80\x9c IFQ Annual Fishing Permit,\xe2\x80\x9d certifying that the bearer may take a speci\xc2\xad\nfied poundage of the indicated species in a specific area for the year in question.\nIFQ\xe2\x80\x99s may also be sold, leased, or otherwise transferred with NMFS approval.\nOnly persons with IFQ\xe2\x80\x99s are allowed to fish for halibut and sablefish.\nNMFS regulations state that quota shares and IFQ\xe2\x80\x99s are not absolute rights or\ninterests subject to the Fifth Amendment\xe2\x80\x99s Takings Clause. See 50 C.F.R.\n\xc2\xa7 676.20(g). Both DOC and IRS recognize that the quota shares and IFQ\xe2\x80\x99s are\ntemporary, revocable, and alterable permits. At the same time, it is not disputed\nthat both quota shares and IFQ\xe2\x80\x99s have monetary value and are, or will be, saleable\nin a secondary market.\nFrom the standpoint of the federal fisheries laws, the purpose of the IFQ system\nwas described as follows in commentary accompanying NMFS\xe2\x80\x99s promulgation\nof a Final Rule on this subject:\n[The IFQ] will modify the distribution of harvesting allocations\namong fishermen. Therefore, the IFQ program sustains existing\nmanagement measures that prevent overfishing. Further, the IFQ\nprogram will improve the prevention of overfishing by providing\nfor reductions in bycatch and deadloss that normally increase with\nincreased fishing effort in open access fisheries.\n58 Fed. Reg. 59,375, 59,377 (1993). The Commerce Department describes the\npurpose and effect of the IFQ system as follows:\nAn IFQ system is considered to improve fishery management by\ndecreasing fleet size and effort levels; dispersing fishing effort over\na longer season; allowing a closer monitoring of landings; amelio\xc2\xad\nrating unsafe fishing practices; reducing bycatch, deadloss, and lost\nfishing gear; enhancing the quality and price of fish landed; and\n3 As defined in the regulations at 50 C.F.R. \xc2\xa7676.11 (1995), an IFQ means:\n[T]he annual catch limit o f sablefish or halibut that may be harvested by a person who is lawfully\nallocated a harvest privilege for a specific portion o f the total aJJowable catch o f sablefish or halibut.\n\n24\n\n\x0cInternal Revenue Service Notices o f Levy on Undelivered Commerce Department Fishing Quota\nPermits\n\ngiving the participants more of a stake in the long-term health of\nthe fishery.\nDOC Ltr. at 2. Under the governing statutory criteria, allocations of these fishing\nprivileges among U.S. fishermen must be: (1) fair and equitable to all such fisher\xc2\xad\nmen; (2) reasonably calculated to promote conservation; and (3) carried out in\nsuch a manner that no individual, corporation, or other entity acquires an excessive\nshare of such privileges. 58 Fed. Reg. at 59,378.\nNMFS was prepared to issue quota shares to qualified Alaska fishermen starting\nNovember 7, 1994. However, NMFS has withheld issuance of the quota shares\nto some 300 qualifying fishermen due to the notices of levy received from the\nIRS.\nB. IR S Procedures and Actions\nOn October 11, 1994, the IRS issued a Notice of Levy (IRS Form 668A) to\nthe NMFS in Juneau, Alaska, asserting a lien for $8,793,465, in unpaid taxes,\ninterest, and penalties owed by some 250 fishermen identified as delinquent tax\xc2\xad\npayers. The Notice stated: \xe2\x80\x9c This levy requires you to turn over to us this person\xe2\x80\x99s\nproperty and rights to property (such as money, credits, and bank deposits) that\nyou have or which you are already obligated to pay this person.\xe2\x80\x9d 4 By letter to\nthe DOC dated October 12, 1994, the IRS further explained the nature of the\nlevy it is asserting:\nBased on our understanding that the Halibut EFQs at issue are\ntransferable and have value in the marketplace, we conclude that\nthey constitute property or rights to property which are subject to\nthe tax lien and levy. . . . The Service can levy on these rights\nby serving the levy on NMFS before NMFS actually transfers the\nIFQs to the delinquent taxpayers. Such a levy obligates NMFS to\nturn over to the IRS all IFQ rights of the taxpayers who are covered\nby the levy, including coupons, certificates or other documents\nwhich represent the IFQ rights.\nWe note that the property interest which the Service is proposing\nto attach is only the taxpayers\xe2\x80\x99 right to receive the EFQs as deter\xc2\xad\nmined by NMFS. Upon service of the levy, the Service will merely\nbe \xe2\x80\x9c standing in the shoes\xe2\x80\x9d of the taxpayers and will be eligible\nto receive what the taxpayers were eligible to receive.\n4 Also on O ctober 11, 1994, the IRS issued a Press Release announcing its action ( \xe2\x80\x9c IRS Levies on Quota Shares\xe2\x80\x9d ),\nstating: \xe2\x80\x9c The Interna] Revenue Service (IRS) today took action which will prevent the issuance o f halibut and sable\xc2\xad\nfish quota shares to approximately 250 Alaska fishermen who owe back taxes.\xe2\x80\x9d Id. at 1. The Release further stated:\n\xe2\x80\x9c This is the first in a series o f IRS levies to NMFS [the National Marine Fisheries Service]. Subsequent levies\nwill also include those fishermen who have failed to file one or more returns and who have not responded to IRS\ninquiries.\xe2\x80\x9d\n\n25\n\n\x0cOpinions o f th e Office o f Legal Counsel in Volume 19\n\nKaufman Ltr. at 4 (footnote omitted).\nAn additional Notice of Levy issued October 19, 1994, brought the total of\ntax-delinquent fishermen covered by the notices to some 300. By letter dated\nNovember 16, 1994, IRS reiterated its demand that DOC turn over \xe2\x80\x9c all property\nand rights to property of the listed taxpayers pursuant to our levy authority under\nsection 6331 [of the Internal Revenue Code], with respect to the updated list of\ntaxpayers and tax liabilities which is attached.\xe2\x80\x9d Letter for Steven Pennoyer,\nRegional Director, NMFS, from Charles M. Stromme, Chief, Special Procedures,\nIRS at 1 (Nov. 16, 1994). The letter further explained:\nThe property and rights to property of the taxpayers in your posses\xc2\xad\nsion or control include the taxpayers\xe2\x80\x99 rights to receive permanent\nfishing allocations, known as Quota Shares, as well as the rights\nto receive annual allocations of poundage, known as Individual\nFishing Quotas, pursuant to the fishery management programs for\nhalibut and sablefish under your jurisdiction. Pursuant to section\n6332 [of the Internal Revenue Code], this demand for turnover\nrequires you to surrender this property and rights to property to\nthe Internal Revenue Service.\nId. at 1-2.\nC. Positions o f the Agencies\nAlthough the DOC and IRS have differing views on the legal effect of the\nIRS levy on the issuance of quota shares and IFQ\xe2\x80\x99s, the agencies appear to be\nin agreement on one aspect of the matter. Specifically, the DOC letter states:\nThe Department of Commerce does not question the IRS\xe2\x80\x99s\nauthority to levy upon delinquent taxpayers\xe2\x80\x99 property, nor that these\nquota shares and IFQs might constitute the sort of property to which\nan IRS lien attaches. No doubt the IRS could serve a notice of\nlevy on a permit holder, who would have to settle his debt or risk\nseizure and sale of the permit. The IRS, however, has not cited\nany precedent for enforcing a levy upon a Federal permit at the\nvery moment it is issued by the agency, before it is even in the\nhands o f the permit holder, and before any monetary value is asso\xc2\xad\nciated with it.\nDOC Ltr. at 3 (emphasis added). Consequently, the issue in dispute is not whether\nthe IRS can properly levy upon quota shares or IFQ\xe2\x80\x99s as rights to property as\n26\n\n\x0cInternal Revenue Service Notices o f Levy on Undelivered Commerce Department Fishing Quota\nPermits\n\nsuch, but whether it can do so before such rights have actually been issued and\ndelivered to the taxpayers who have otherwise qualified for them.\nII. ANALYSIS\nA. Property Interest Subject to Levy\nSection 6331(a) of the Internal Revenue Code provides that the Government\nmay collect the taxes of a delinquent taxpayer \xe2\x80\x9c by levy upon all property and\nrights to property . . . belonging to such person.\xe2\x80\x9d 26 U.S.C. \xc2\xa76331 (a). The scope\nof this authority has been broadly construed by the courts. In United States v.\nNational Bank of Commerce, 472 U.S. 713, 719-20 (1985), for example, the\nSupreme Court observed: \xe2\x80\x9c The statutory language \xe2\x80\x98all property rights and rights\nto property,\xe2\x80\x99 appearing in \xc2\xa76321 (and, as well, in \xc2\xa7\xc2\xa76331(a) and, essentially,\nin 6332(a) . . .), is broad and reveals on its face that Congress meant to reach\nevery interest in property that a taxpayer might have.\xe2\x80\x9d\nThe rights subject to IRS levy include intangible personal property. See G.M.\nLeasing Corp. v. United States, 429 U.S. 338, 350 (1977). For example, the courts\nhave upheld IRS authority to assert a levy against a delinquent taxpayer\xe2\x80\x99s state\nliquor license, Paramount Finance Co. v. United States, 379 F.2d 543, 544 (6th\nCir. 1967), or federal broadcast license, In re Atlantic Business and Community\nDevelopment Corp., 994 F.2d 1069, 1075 (3d Cir. 1993). The key issue in such\ncases is whether the right at issue is transferable and has value. See id. at 1072\n([Ljiquor license held to constitute property under \xc2\xa76321 \xe2\x80\x9c because it was alien\xc2\xad\nable and had value.\xe2\x80\x9d ); 21 West Lancaster Corp. v. Main Line Restaurant, Inc.,\n790 F.2d 354, 357 (3d Cir. 1986). Despite the recognition that licenses and permits\nare considered privileges and not rights under state law, that the state controls\ntheir alienability, and that they are beyond the reach of private creditors, the courts\nnonetheless treat them as property subject to levy within the meaning of \xc2\xa76321.\nIn re Atl. Bus., 994 F.2d at 1072; 21 West Lancaster, 790 F.2d at 356-58.\nA third party served with an IRS notice of levy is required to surrender to\nthe IRS all of the taxpayer\xe2\x80\x99s property (or rights to property) in its possession,\nexcept property subject to prior attachment or execution under judicial process.\nAs stated by the Court in the National Bank opinion, when a levy is served upon\na third party, the IRS \xe2\x80\x9c steps into the taxpayer\xe2\x80\x99s shoes\xe2\x80\x9d and acquires whatever\nrights the taxpayer himself possesses in property held by the third party. 472 U.S.\nat 725. That party\xe2\x80\x99s failure to comply with the levy results in liability to the\nIRS up to an amount equal to the value of the property that the party declines\nto surrender. 26 U.S.C. \xc2\xa7 6332(d).\nHere, the right at issue is a fisherman\xe2\x80\x99s right to be issued a quota share and\nIFQ by the NMFS, entitling him to catch certain quantities of a species of fish\nthat is otherwise protected from fishing. It does not appear to be in dispute that,\n27\n\n\x0cOpinions o f the Office o f Legal Counsel in Volume 19\n\nonce issued, the quota shares and IFQ\xe2\x80\x99s may be sold to others in a secondary\nmarket, and thus have marketable money value. The DOC has stipulated that\n\xe2\x80\x9c quota shares and IFQs might constitute the sort of property to which an IRS\nlien attaches\xe2\x80\x9d and that \xe2\x80\x9c the IRS could serve a notice of levy on a permit holder,\nwho would have to settle his debt or risk seizure and sale of the permit.\xe2\x80\x9d DOC\nLtr. at 3.\nWe find no sound basis for concluding that the quota shares or IFQ\xe2\x80\x99s do not\nqualify as \xe2\x80\x9c property or property rights\xe2\x80\x9d generally subject to IRS levy under the\ngoverning provisions. The courts have held that such intangible interests as liquor\nlicenses and broadcast licenses are subject to levy, and there appears to be no\nlogical basis for distinguishing the fishing quota permits in that regard. See gen\xc2\xad\nerally Jon David Weiss, Comment, A Taxing Issue: Are Limited Entry Fishing\nPermits Property?, 9 Alaska L. Rev. 93 (1992).\nB. Levy Asserted Against Unissued and Undelivered Permit in Government\nHands\nIn the case of a delinquent taxpayer, \xc2\xa76331(a) authorizes the IRS to collect\nthe tax due \xe2\x80\x98\xe2\x80\x98by levy upon all property and rights to property (except such property\nas is exempt under section 6334) belonging to such person or on which there\nis a lien provided in this chapter for the payment of such tax.\xe2\x80\x9d Where the DOC\nhas not yet issued or delivered a quota share or IFQ to a person, the question\narises whether the quota or share in question\xe2\x80\x94 or the right to receive it\xe2\x80\x94 falls\nwithin the coverage of \xc2\xa76331(a).\nInitially, the mere fact that the right to property at issue is in the hands of\na government agency does not prevent the IRS from asserting a tax levy against\nit. As recognized by the court in United Sand and Gravel Contractors, Inc. v.\nUnited States, 624 F.2d 733, 736 (5th Cir. 1980):\n[TJhere is nothing in the general levy authorization statute, I.R.C.\n\xc2\xa7 6331, excepting from its reach property which is in the hands\nof an agency of the United States. The authorization to collect\nunpaid taxes by levy applies to \xe2\x80\x9c all property and rights to property\n(except . . . property . . . exempt under section 6334),\xe2\x80\x9d id.\n(emphasis added), of the tax delinquent. See Field v. United States,\n263 F.2d 758, 763 (5th Cir. 1959).\n(Footnote omitted).\nThe more significant question is whether the undelivered fishing permits con\xc2\xad\nstitute property or rights to property \xe2\x80\x9c belonging to\xe2\x80\x9d the subject taxpayers, such\nas to fall within the coverage of 26 U.S.C. \xc2\xa7\xc2\xa76321 (tax lien authority) and 6331\n(tax levy authority). We believe that a government permit can be said to \xe2\x80\x9c belong\xe2\x80\x9d\nto a person for IRS collection purposes when all the necessary preconditions to\n28\n\n\x0cInternal Revenue Service Notices o f Levy on Undelivered Commerce Department Fishing Quota\nPermits\n\nthe issuance of the permit to that person have been fulfilled and all that remains\nis for the issuing agency to issue and deliver the permit. Under the analysis in\nthe National Bank opinion, for example, the organization receiving a notice of\nlevy must comply unless it is neither \xe2\x80\x9c in possession of\xe2\x80\x9d nor \xe2\x80\x9c obligated with\nrespect to\xe2\x80\x9d the property or \xe2\x80\x9c rights to property\xe2\x80\x9d in issue. 472 U.S. at 721-22\n(emphasis added). This opinion also stressed that the language of \xc2\xa7 6331(a) was\nbroadly intended by Congress \xe2\x80\x9c to reach every interest in property that a taxpayer\nmight have.\xe2\x80\x9d Id. at 719-20. Once a government agency becomes legally \xe2\x80\x9c obli\xc2\xad\ngated\xe2\x80\x9d to issue a license or permit to the taxpayer, we think the license can be\nsaid to \xe2\x80\x9c belong to\xe2\x80\x9d the taxpayer for purposes of IRS lien and levy authority.\nThese fishing quota permits constitute a right to intangible property \xe2\x80\x94 i.e., a\nvaluable and transferable legal right to catch and land certain quantities of halibut\nor sablefish. Under 50 C.F.R. \xc2\xa7 676.20(a) (1995), once a person\xe2\x80\x99s status as a\n\xe2\x80\x9c qualified person\xe2\x80\x9d is established, the NMFS Regional Director is obligated to\nassign such person a quota share. As that section states: \xe2\x80\x9c The Regional Director\nshall initially assign to qualified persons . . . halibut and sablefish fixed gear\nfishery QS [quota shares] that are specific to IFQ regulatory areas and vessel\ncategories.\xe2\x80\x9d Id. (emphasis added). Similarly, the regulations provide for the\nallocation of IFQ\xe2\x80\x99s to qualified persons in mandatory terms: \xe2\x80\x9c The Regional\nDirector shall assign halibut or sablefish IFQs to each person holding unrestricted\nQS for halibut or sablefish, respectively, up to the limits prescribed at \xc2\xa7 676.22(e)\nand (f).\xe2\x80\x9d Id. \xc2\xa7 676.20(f) (emphasis added).\nIn that regard, we have been advised by the DOC that the fishermen identified\nin the notices of levy have satisfied all requirements to be classified as \xe2\x80\x98\xe2\x80\x98qualified\npersons\xe2\x80\x9d by NMFS and are therefore entitled to be issued quota shares and the\nassociated IFQ\xe2\x80\x99s.5 In other contexts, it is recognized that an IRS levy attaches\nto all rights of the taxpayer which are fixed and determinable at the time of the\nlevy, even though such rights have not been fully perfected or matured. See St.\nLouis Union Trust Co. v. United States, 617 F.2d 1293, 1302 (8th Cir. 1980)\n(\xe2\x80\x9c The unqualified contractual right to receive property is itself a property right\nsubject to seizure by levy, even though the right to payment of the installments\nhas not matured at the time of the levy.\xe2\x80\x9d ). Here, a qualified fisherman\xe2\x80\x99s right\nto be issued a quota share, as well as an associated IFQ, is recognized in the\nprovisions of 50 C.F.R. \xc2\xa7 676.20(a). The full extent of that right, to be determined\non an annual basis when IFQ\xe2\x80\x99s are issued, need not be fixed with precision in\norder for it to fall within the coverage of \xc2\xa76331.\nConsequently, we conclude that the quota shares and IFQ\xe2\x80\x99s which the fishermen\nare entitled to receive under 50 C.F.R. \xc2\xa7676.20 constitute rights to property\n5 The NMFS regulations define a \xe2\x80\x98\xe2\x80\x98qualified person\xe2\x80\x9d as follows:\n(1) Qualified person. A s used in this section, a \xe2\x80\x9c qualified person\xe2\x80\x9d means a \xe2\x80\x9c person,\xe2\x80\x9d as defined in\n\xc2\xa7 676.11 o f this part, that owned a vessel that made legal landings o f halibut or sablefish, harvested with\nfixed gear, from any IFQ regulatory area in any QS qualifying year.\n50 C.F.R. \xc2\xa7 676.20(a)( 1X1994).\n\n29\n\n\x0cOpinions o f the Office o f Legal Counsel in Volume 19\n\n\xe2\x80\x9c belonging to\xe2\x80\x9d them within the meaning of \xc2\xa76331(a). Absent a countervailing\nlegal requirement, DOC/NMFS would therefore be obligated to comply with the\nIRS Notice of Levy.\nC. Interference with the Statutory Fisheries Programs\nDOC\xe2\x80\x99s request for opinion suggests that the notices of levy at issue are legally\ninvalid because they would unduly interfere with the performance of DOC\xe2\x80\x99s\nobligations under the Magnuson Act and the Halibut Act. As the DOC\xe2\x80\x99s letter\nstates: \xe2\x80\x9c Although the IRS\xe2\x80\x99s novel collection action may be helpful in accom\xc2\xad\nplishing its statutory goals, it is detrimental to our efforts to implement our own\nstatutory mandate. We doubt that Congress intended such a result in enacting the\nauthority cited by the IRS in this matter.\xe2\x80\x9d DOC Ltr. at 4.\nThis contention calls into play the provisions of 26 U.S.C. \xc2\xa7 6334(c), which\nstate: \xe2\x80\x98\xe2\x80\x98Notwithstanding any other law o f the United States . . . no property or\nrights to property shall be exempt from levy other than the property specifically\nmade exempt by subsection (a).\xe2\x80\x9d (emphasis added). Federal permits or licenses\nsuch as those at issue are not among the categories of property or property rights\nthat are itemized and exempted from levy under \xc2\xa7 6334(a). Moreover, courts have\nheld that the list of exemptions enumerated in \xc2\xa7 6334(c) is exclusive and definitive.\nSea-Land Service, Inc. v. United States, 622 F. Supp. 769, 772-73 (D. N.J. 1985);\nUnited States v. Offshore Logistics I n f I, Inc., 483 F. Supp. 1055, 1057 (W.D.\nLa. 1979).\nAs noted above, the courts have recognized that the IRS\xe2\x80\x99s levy authority extends\nto property or entitlements that are held by federal government agencies. United\nSand and Gravel, 624 F.2d at 736; Simpson v. Thomas, 271 F.2d 450, 452 (4th\nCir. 1959). Thus, there is no implied exception from the levy authority for prop\xc2\xad\nerty, interests, or rights to property that are in the government\xe2\x80\x99s possession or\ncontrol. Additionally, the legislative history of \xc2\xa7 6334(c) indicates that Congress\nintended the IRS levy authority to prevail over other provisions of federal law\nin the case of conflicting provisions.6 This view has been confirmed in court\ndecisions. E.g., Sea-Land, 622 F. Supp. at 773; Offshore Logistics, 483 F. Supp.\nat 1056-57.\nIn any event, it is not evident that DOC\xe2\x80\x99s compliance with the levies at issue\nwould significantly undercut the purposes and policies of the applicable federal\nfisheries statutes. The general purpose of those statutory schemes is to preserve\nthe viability of the covered fish species and the health of dependent fishing indus6 See H.R. Rep. No. 83-1337, at A409 (1954), reprinted in 1954 U.S.C.C.A.N. 4017, 4556, which states:\nSubsection (c) o f this section states that no property or rights to property, other than the properties\nspecifically made exem pt in this section, shall be exem pt from levy by reason o f any other law o f the\nUnited States. . . . [TJhis subsection m akes it clear that no other provision o f Federal law shall exempt\nproperty fro m levy.\n(Em phasis added).\n\n30\n\n\x0cInternal Revenue Service Notices o f Levy on Undelivered Commerce Department Fishing Quota\nPermits\n\ntries by maintaining limited and orderly fishing access. See generally United States\nv. Cameron, 888 F.2d 1279, 1280-81 (9th Cir. 1989) (Halibut Act); Lovgren v.\nByrne, 787 F.2d 857, 861 (3d Cir. 1986) (Magnuson Act). If DOC surrenders\nthe targeted quota shares and IFQ\xe2\x80\x99s in accordance with the levies, there is no\nreason to believe that any excessive take of the covered species will result, or\nthat beneficial management of the halibut and sablefish fisheries will be signifi\xc2\xad\ncantly disrupted or impaired.\nDOC\xe2\x80\x99s most specific contention regarding the adverse effect of the levies on\nthe fisheries programs is the following: \xe2\x80\x9c The Secretary of Commerce cannot man\xc2\xad\nage fisheries in a responsible manner if one of our most effective techniques \xe2\x80\x94\nallocating harvesting privileges by assignment of individual quotas \xe2\x80\x94 is com\xc2\xad\npromised by our having to serve as a collection arm of the IRS.\xe2\x80\x9d DOC Ltr. at\n4.\nInitially, an agency\xe2\x80\x99s compliance with a lawful federal tax levy does not, with\xc2\xad\nout more, render it a \xe2\x80\x9c collection arm of the IRS.\xe2\x80\x9d As shown by cases cited above,\nother departments and agencies have complied with such levies without apparent\ndamage or compromise to their statutory mandates.\nMoreover, the mere desire to avoid possible \xe2\x80\x9c compromise\xe2\x80\x9d of one regulatory\napproach chosen by an agency to comply with a general statutory mandate does\nnot provide a justification for disregarding \xc2\xa76334(c)\xe2\x80\x99s provision that compliance\nwith federal tax levies takes primacy over other statutory obligations.7 Although\nDOC has not provided a detailed explanation of how compliance with the IRS\nlevies would adversely affect its implementation of the relevant statutory require\xc2\xad\nments, it might be argued that one potential consequence would be some delay\nor disruption in the planned utilization of a small percentage of overall IFQ\xe2\x80\x99s.8\nThis might conceivably have some marginal affect on the overall planned catch\nof the subject fisheries during this season. Even that prospect appears conjectural,\nhowever, inasmuch as quota shares and IFQ\xe2\x80\x99s levied by IRS and not reclaimed\nby the delinquent taxpayer would likely be sold to other qualified persons who\nwould then utilize them. We do not consider such a conjectural and marginal\ndisruption to the fishing quota systems to be of sufficient magnitude to override\n\xc2\xa7 6334(c)\xe2\x80\x99s provision that its levy requirements trump the provisions of other laws.\nNo other adverse consequence that would provide a basis for a different conclu\xc2\xad\nsion has been demonstrated.\nGiven all the foregoing considerations, we find no persuasive basis for recog\xc2\xad\nnizing an implied exception from 26 U.S.C. \xc2\xa76334(c)\xe2\x80\x99s straightforward declaration\n7 Significantly, neither the Magnuson Act nor the Halibut Act requires DOC to utilize a quota share system in\nmanaging limited access to the protected fisheries. DOC has merely settled on that system as its chosen method\no f complying with the statutory requirements.\n8 According to the IRS submission, the approximately 300 fishermen-taxpayers affected by the levies represent\nonly about 3.9% of the total applicant pool (about 7,600 applicants) for quota shares. IRS Ltr. at 18.\n\n31\n\n\x0cOpinions o f the Office o f Legal Counsel in Volume 19\n\nthat all property is subject to IRS levy except those categories enumerated in sub\xc2\xad\nsection 6334(a).\nRICHARD L. SHIFFRIN\nDeputy Assistant Attorney General\nOffice o f Legal Counsel\n\n32\n\n\x0c'