Review of the Wreckfish Individual Transferable Quota Program of the South Atlantic Fishery Management Council August 2019 A publication of the South Atlantic Fishery Management Council pursuant to National Oceanic and Atmospheric Administration Award Number FNA10NMF4410012 Table of Contents Abbreviations ...............................................................................................................................................3 List of Tables ...............................................................................................................................................4 List of Figures ..............................................................................................................................................5 Executive Summary .....................................................................................................................................6 1 Introduction and Background ..............................................................................................................7 1.1 Legal requirements for the review ............................................................................................... 7 1.2 Pre-ITQ management ................................................................................................................... 9 1.3 ITQ program description ............................................................................................................ 10 1.3.1 ITQ Goals and Objectives ................................................................................................... 10 1.3.2 ITQ Design and Structure ................................................................................................... 13 1.3.3 Conclusions and Recommendations from Initial Review ................................................... 14 2 Data Collection and Reporting within the Wreckfish ITQ Program .................................................16 3 Environment .......................................................................................................................................17 3.1 Biological ................................................................................................................................... 17 3.2 Economic Environment .............................................................................................................. 20 3.2.1 Shareholders ........................................................................................................................ 20 3.2.2 Permits ................................................................................................................................ 22 3.2.3 Vessels ................................................................................................................................ 24 3.2.4 Dealers ................................................................................................................................ 25 3.2.5 Economic Performance Indicators ...................................................................................... 27 3.2.6 Economic Returns ............................................................................................................... 28 3.2.7 Imports ................................................................................................................................ 29 3.2.8 Economic Impacts of the ITQ Program .............................................................................. 30 3.3 Social .......................................................................................................................................... 33 4 Eligibility and Participation in the Wreckfish ITQ Program .............................................................36 4.1 Eligibility .................................................................................................................................... 36 4.2 Participation in the IFQ program ............................................................................................... 37 4.3 New Entrants/Replacement Fishermen in the Wreckfish ITQ Program .................................... 38 5 Price Analyses ....................................................................................................................................39 5.1 Overview .................................................................................................................................... 39 5.2 Analysis and discussion ............................................................................................................. 40 5.2.1 Share prices ......................................................................................................................... 40 5.2.2 ITQ Coupon prices .............................................................................................................. 40 5.2.3 Preferred Practices for the Collection of Price Data ........................................................... 43 5.2.4 Summary of key findings .................................................................................................... 44 6 Allocations, Transferability, and Caps within the Wreckfish ITQ Program .....................................45 1 6.1 Shares ......................................................................................................................................... 45 6.2 ITQ Coupons (Annual Allocation) ............................................................................................. 46 6.3 Recreational Allocation of Wreckfish ........................................................................................ 48 6.4 Distributions of Landings, Revenues, and Shares ...................................................................... 49 6.5 Market Concentration and Market Power .................................................................................. 52 7 Safety at Sea .......................................................................................................................................55 8 Monitoring and Enforcement in the Wreckfish ITQ Program ...........................................................56 9 Administration and Cost Recovery in the Wreckfish ITQ Program ..................................................56 10 Privilege Duration and Subsequent Distribution in the Wreckfish ITQ Program .............................57 11 Conclusions and Recommendations ..................................................................................................59 11.1 Progress Towards Goals and Objectives ................................................................................ 59 11.2 Review Conclusions ............................................................................................................... 64 11.2.1 Future Research Needs ....................................................................................................... 64 11.2.2 Confidentiality and Constraints .......................................................................................... 64 11.2.3 Cost Recovery ..................................................................................................................... 65 11.2.4 Migration to an Electronic System ..................................................................................... 67 11.2.5 Eliminate the Wreckfish Permit Requirement .................................................................... 69 11.2.6 Allocation Issues ................................................................................................................. 70 11.2.7................................................................................................................................................. 70 11.2.8 Mandatory economic data collection ..................................................................................... 71 11.3 AP recommendations .............................................................................................................. 71 11.4 Shareholder recommendations ............................................................................................... 72 11.5 SSC/SEP recommendations .................................................................................................... 73 11.6 Council recommendations ...................................................................................................... 73 12 List of Interdisciplinary Plan Team (IPT) Members..........................................................................75 13 References ..........................................................................................................................................76 2 Abbreviations ACL Annual catch limit ALS Accumulated Landings System Council South Atlantic Fishery Management Council CSP Catch share programs EEZ Exclusive Economic Zone EJ Environmental Justice FMP Fishery Management Plan FTE Full time equivalent HHI Herfindahl-Hirschman Index ITQ Individual Transferable Quota LAPP Limited Access Privilege Program LKE Lowest known entity Magnuson-Stevens Act Magnuson-Stevens Fishery Conservation and Management Act mp Million pounds MRFSS Marine Recreational Fisheries Statistics Survey MRIP Marine Recreational Information Program NIOSH National Institute for Occupational Safety and Health NMFS National Marine Fisheries Service NS National Standards OY Optimum yield SEFSC Southeast Fisheries Science Center SERO Southeast Regional Office SSC Scientific and