Changes proposed to NJ's Commercial Crab Fishery

[Ron]

NJ DEP is proposing the following changes to the commercial crab rules (summarized:)

The department is proposing the reduce the number of commercial crab pot/trotline license and commercial crab dredge licenses in both the DE Bay and Atlantic Coastal zones.    This is to better reflect the number of active licenses that are in use.  Currently NJ has 312 licenses , but less than half of those licenses are active or submit the required harvest reports,

The department is also proposing to allow licenses to be transferred to individuals other than immediate family members.   Currently, licenses can only be transferred to immediate family members.    Under this proposal, once licenses are below a certain # threshold, license holders will be able to transfer (sell) their commercial crabbing business to any other interested party.   

Here are excerpts of the text:

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The number of commercial crab pot/trot line licensees and crab dredge licensees who actively harvest crabs has been in decline in New Jersey for a number of years. Because of this decline, the Department is proposing to amend N.J.A.C. 7:25-14.4 to reduce the number of commercial licenses available for crab dredges, in both the Atlantic Coast and Delaware Bay, and for crab pots/trot lines, to better meet the needs of the fishery and reduce the possibility that the resource will be overfished. In addition, the Department is proposing to allow transfers of commercial crab licenses outside the immediate family members currently designated as the only permissible recipients. However, the Department is proposing to limit the number of transfers to persons other than specified family members until the number of licenses in a given fishery is below the specified threshold. By limiting the number of these types of transfers, a licensee who is selling his or her crabbing business will be able to transfer the commercial license to the purchaser of the business, regardless of who that person is in relation to the licensee, without adversely impacting the crab resource.

Commercial crab pot/trot line licenses
The Department completed an analysis of the average number of commercial crab pot/trot line license holders that reported crab harvests between 2003 and 2012, and a separate analysis for every year since 2012. The average number of license holders who reported crab harvests from 2003 to 2012 was 161, and the average number of licenses with reported harvests for each year after 2012 was 144. Because the Department’s calculations are based upon licenses that have reported crab harvests, and not all license holders harvest crab every year, the threshold is intended to account for the licensees who have not reported a harvest in a given year. Further, the Department has found that although the number of licensees who harvest crabs remains consistent at about 140 licensees per year, the licensees who harvest crab in a given year are not always the same licensees. Therefore, the Council and the Department determined that in order to include all current licensees who are actively harvesting crabs, including the licensees who may not harvest crabs in a given year, the new threshold for commercial crab pot/trot line licenses should be 180. The Department has also determined that the number of licenses must be reduced because the crab populations cannot be sustainably fished if all license holders suddenly decided to harvest crabs. The current threshold of 312, the number of licenses sold in 1991, does not reflect the number of current active commercial crab pot/trot line licensees and could result in the overharvesting of the crab resource if every license holder fully utilized the license to harvest crabs.

Commercial crab dredge licenses
The Department is also proposing to reduce the number of commercial crab dredge licenses for the Delaware Bay and Atlantic Coast. The Department has determined that the average annual number of commercial crab dredge licensees that reported harvested crabs in the years 2014 through 2017 was 47 licensees for the Atlantic Coast, and 22 licensees for the Delaware Bay. The current threshold for Delaware Bay commercial crab dredge licenses is 93, or the number of licenses sold in 1997. The current threshold for the Atlantic Coast commercial crab dredge licenses is 250. The initial threshold for Atlantic Coast commercial crab dredge licenses was set in 1991 at 338, which was reduced to 250 in 2005, due to a lower number of active licensees who reported harvests. Similar to the commercial crab pot/trot line license thresholds, the thresholds for dredge licenses include the number of licensees who report crab harvests in addition to licensees who will not harvest crabs for a year while they target other species. Therefore, the proposed new threshold for Atlantic Coast commercial crab dredge licenses is 100, and the proposed new threshold for Delaware Bay commercial crab dredge licenses is 50. This reduction will reduce the number of people holding licenses who could potentially harvest crabs and, thereby, avoid severely impacting the resource. Further, the Department anticipates that the number of licenses will reduce over time through attrition.

License transfers
In addition to lowering the license thresholds for each fishery, the Department is proposing to limit the transfer of licenses to persons other than specified family members until the number of licenses is below the proposed new threshold. Because there are active crab pot/trot line licensees, or those who annually harvest 200 or more bushels of hard crabs or 2,000 or more “peeler” crabs (crabs that are molting), and there are inactive crab pot/trot line licensees, or those who annually harvest less than 200 bushels of hard crabs or 2,000 peeler crabs, the Department has determined that active license holders should have more opportunities to transfer the license to non-family members than an inactive license holder. The Department is proposing to allow active licensees holding crab pot/trot line licenses, as a group, up to 20 transfers in a calendar year, and inactive licensees, as a group, up to five transfers in a calendar year, as long as those transfer applications are submitted to the Department by February 28, or the date by which the Department has received all of the prior year crab harvest data from each licensee. If the number of transfer requests in a given year exceeds 20 for active licensees and five for inactive licensees, the Department will enter the transfer applications into a lottery in order to prioritize the transfer requests. The processing of license transfer applications will continue, at 20 for active licenses and five for inactive licenses, each year until the number of licenses reaches the proposed threshold of 180 licenses. When this threshold is reached, licensees will be allowed to transfer their licenses to non-family members at any time. Licensees may also transfer a license to a spouse, father, mother, son, daughter, brother, or sister at any time.

The Department is proposing to restrict the transfer of Atlantic Coast crab dredge licenses to individuals other than a licensee’s spouse, father, mother, son, daughter, brother, or sister until the number of licenses is below the proposed threshold of 100. The Atlantic Coast crab dredge fishery is not as active as the Delaware Bay crab dredge fishery, and licensees cease participation in the fishery at higher rates than in the Delaware Bay fishery. The Department expects that with the high rate of attrition a license will be available for purchase by anyone within a few years. The high rate of attrition will also help reduce the number of license holders to only those who are actively dredging for crabs in the Atlantic coastal waters.

In contrast, there is a low attrition rate among Delaware Bay crab dredge licensees due to high demand. Therefore, the Department is proposing to limit transfers of a Delaware Bay crab dredge license to non-family members to five per year, with or without a lottery, to determine the priority of the processing of the applications.

Additional summaries from the proposal
The Department’s proposed amendments at N.J.A.C. 7:25-14.4(a)7 allowing for crab pot/trot line and crab dredge licensees to transfer their licenses to anyone as opposed to certain family members, will allow an employee of a commercial fisherman to buy a fisherman’s commercial crabbing business, thereby ensuring the future of the commercial crabbing business, and allow that employee to enter a limited-entry crab fishery. Licensees have been concerned with the unfair exclusion of non-familial crab fishermen and see the existing rules as supporting nepotism instead of allowing a licensee to determine to whom the licensee wants to transfer or sell the licensee’s commercial business. In addition, the lottery system proposed at N.J.A.C. 7:25-14.4(a)7v will ensure fairness in the transfer of licenses to someone other than a spouse, father, mother, son, daughter, brother, or sister when there are more than 20 active crab pot/trot line license transfer requests, five inactive crab pot/trot line license transfer requests, or five Delaware Bay crab dredge license transfer requests. Licensees have an equal chance of having their transfer request completed by the Department under a lottery system.
The proposed requirement that a crab fisherman can only transfer a license if the licensee has no pending court action of revocation order at N.J.A.C. 7:25-14.4(a)7 allows only law-abiding fishermen to transfer their licenses. Licensees who are under a revocation order or have a license violation pending in court may attempt to transfer the license to someone who has no violations, thereby allowing the crabbing business to continue. The person who received the transferred license could then transfer the license back to the original crab fisherman, and the original crab fisherman could, thereby, avoid the revocation or court action. By requiring that there be no pending revocation order or court action in order to transfer a license, the Department can assure fairness within the crab fisheries and that a licensee who violated the rules will not be allowed to avoid the fines and potential license revocation due to a violation.

The proposed amendments at N.J.A.C. 7:25-14.19, 18.1(p), 18.5(i), and 18.12(r), will allow the Department to modify fishery management measures by notice and maintain consistency throughout the various marine fisheries regulations. The amendments will result in a positive social impact because commercial fishermen, regardless of which fisheries they participate in, will receive notice of any changes by email, through the Department’s commercial regulation publication, and through the Department’s website. This will help fishermen avoid license suspension or revocation and the other penalties associated with violations. In addition, these changes allow the Department to better manage each fishery through the timely closure and, if necessary, timely reopening to ensure the quota is not exceeded, while still allowing the optimal use of available quota in any given year to ensure each marine fishery resource is available in the future.

Economic Impact
from the Department would have the opportunity to enter the limited-entry crab fishery by receiving a transferred license from a current commercial crab fisherman, thereby ensuring the future of the crabbing business, the continued employment of the employees of that business, and the continued benefits to the local economy and the State in the form of taxes as the employer and employees spend their earnings. These commercial crab businesses can continue even if there is no spouse, father, mother, son, daughter, brother, or sister interested in taking over the business from the licensee.
The reduction in the number of crab pot/trot line and crab dredge licenses at proposed N.J.A.C. 7:25-14.4(a)2, 4, and 7, will result in less license revenue for the Department. However, the reduction will also result in the need for less manpower and resources to monitor license reporting compliance on behalf of the Department. The Department has calculated that the decrease in commercial license revenue will be approximately $32,000 per year. New Jersey residents pay $100.00 per license each year, and out-of-State residents pay $500.00 per year for each license type (crab pot/trot line license or crab dredge license). The decrease in the number of crab pot/trot line licenses will cost the Department approximately $13,200 per year, the decrease in the number of Atlantic Coast crab dredge licenses will cost the Department approximately $15,000 per year, and the decrease in the number of Delaware Bay crab dredge licenses will cost the Department approximately $4,300 per year for a total loss of approximately $32,000 in revenue, depending on whether more licenses of New Jersey residents or out-of-State residents lapse. The Department will offset the loss in revenue by a reduction in the number of man-hours required to monitor the various commercial crab licensees and their reporting. There will be fewer license applications to process, less report monitoring, and less data entry for the Department staff to handle.

The proposed reduction in the number of crab pot/trot line and crab dredge licenses, at N.J.A.C. 7:25-14.4(a)2, 4, and 6, is anticipated to have no effect upon the number of jobs in the commercial crab fishery. The licenses will be retired due to attrition. Typically, a license retired through attrition is due to the commercial crab licensee being inactive and either uninterested in transferring the license or unable to find a family member interested in the license. The Department anticipates that no jobs will be lost due to the reduction in the number of licenses.
The proposed transferability of crab licenses to non-family members at N.J.A.C. 7:25-14.4(a)7 will not create nor reduce the number of jobs in the commercial crab fisheries. The proposed rules will ensure that there is no reduction in the number of jobs in the crab fisheries as commercial crab fishermen who wish to sell their businesses can do so to any person and not rely solely upon a family member to be interested in continuing the business.

Environmental Impact
The proposed amendments to the caps on the number of commercial crab licenses will have a positive environmental impact. The blue crab population naturally undergoes periodic spikes and declines due to their life history traits, and New Jersey’s commercial blue crab landings have reflected these fluctuations. Although blue crabs are prolific breeders, they are sensitive to environmental factors, such as cold, harsh winters, which can lead to high overwintering mortality. The viability of the crab resource has largely depended on the lack of fishing effort by nearly half of the commercial blue crab license holders. The reduction of the total number of licenses, as proposed at N.J.A.C. 7:25-14.4(a)2, 4, and 6, would help ensure that inactive licensees would not start harvesting crabs and overfish the blue crab resource.


Here is a full link to the proposed rule changes:
https://www.nj.gov/dep/rules/proposals/20210301b.pdf?utm_medium=email&utm_source=govdelivery

[Capt. Frank]

Ron,

Do you think this will become like NYC Taxi Medalions with prices floating higher and higher with an open market on Licenses?

[rdbeard]

if the state decides to take away lic  that are not reporting catch or reporting low catch numbers, the state will see a rise in # of crabs being reported on most lic. A couple years back md dnr made a simple statement which read all crab regs in the future will be based on a lic. reported catch, which looked like  md was making a move to implement catch shares, reports went up a good bit.

[crewstation]

I'm confused.  The current threshold is 312.  I assume that is the total of all pot/trotline licenses issued and currently valid, whether the licensee is active or not.  In other words, there are 312 people out there paying the annual fee to keep their license active, whether they are actually crabbing or not.  How does the State propose to get that number down to 180 licensees?  Are they relying solely on future non-payments of renewal fees to eventually reduce the number of valid licenses to that level?  Are they predicting that those who try to transfer their license, but do not get picked in the lottery, will just let their license expire? 

It seems to me it would take decades to get to that 180 number.

Or am I missing something?



   

[Ron]

Mike,

Apparently only 140 +/- people are actually crabbing and reporting catches on the 312 licenses.    In other words, less than half...   They are likely not going to allow people to not utilize them as a pocket license for more than a year or two before retiring a license.

[Ron]

if the state decides to take away lic  that are not reporting catch or reporting low catch numbers, the state will see a rise in # of crabs being reported on most lic. A couple years back md dnr made a simple statement which read all crab regs in the future will be based on a lic. reported catch, which looked like  md was making a move to implement catch shares, reports went up a good bit.

Pretty sure they are sharing catch info with the Department of Taxation.   People sending in fake crab catch numbers just to keep their license active should be guided accordingly.

[Ron]

Ron,

Do you think this will become like NYC Taxi Medalions with prices floating higher and higher with an open market on Licenses?

Considering you can't sell a license now, this will at least set a value on a crab license.

[crewstation]

They are likely not going to allow people to not utilize them as a pocket license for more than a year or two before retiring a license.

Retiring pocket licenses would be critical to shrinking the total number of licensees down to that target of 180.  Without that forced retirement, there's nothing to stop a current licensee from continuing to renew (and not crab).  As the proposal reads right now, I don't think the number of licensees changes. 

Another issue is the resale of unused licenses.  Today, there are 140 comms crabbing and reporting.  There are 172 pocket licenses.  If the state allows 5 inactive licenses to transfer every year, and 5 transfers actually happen (in essence, there are 5 new active commercial crabbers in NJ each year), we will reach that 180 in just 8 years, and the number of active commercial crabber will have increased by 28%. 

Although I agree with the anti-nepotism spirit of the proposal, I don't like the idea of the transfers of currently inactive licenses.

 

[jmjral]

"if the state decides to take away lic  that are not reporting catch or reporting low catch numbers, the state will see a rise in # of crabs being reported on most lic. A couple years back md dnr made a simple statement which read all crab regs in the future will be based on a lic. reported catch, which looked like  md was making a move to implement catch shares, reports went up a good bit.

Pretty sure they are sharing catch info with the Department of Taxation.   People sending in fake crab catch numbers just to keep their license active should be guided accordingly."

I suspect that alot of these "Pocket Licenses" would begin to report 1 bushel caught and sold for $100.  And for tax purposes report $99 in fuel and bait expenses.

[rdbeard]

by md state law mdnr cannot use report catches for any other reason then statisicle resons used to manage the fishery. by law they can not send catch reports for any crab lic. to irs.

[Capt. Frank]

If they take back the surplus un-used, do you see them opening it up to others and the paid but dead licenses out to real crabbers to use.

I think them being family heirlooms is bizarre.  Maine does that same [curd] with lobster licenses.

[rdbeard]

in md you also can keep your lic. till death as long as you follow the rules.  you can also put a family member as a benif. after your gone.

[samiam]

If they take back the surplus un-used, do you see them opening it up to others and the paid but dead licenses out to real crabbers to use.

I think them being family heirlooms is bizarre.  Maine does that same [curd] with lobster licenses.

Possibly some licensees maintain an unused license just to leave it to an heir, on the theory that the total license supply is limited, and a license could have some intrinsic economic value?  I have to confess, I take a bait net license every year, but don't always take advantage of it. In the past, I have taken a commercial shellfish license some years so that I could exceed the daily rec clam limit, and been pretty lax in utilizing that license. I will say that I did always submit reports, even when those showed zero catch (although there were times when I "caught up" on several months at a time I had skimmed through those proposed reg changes to see if there was any impact on rec crabbing or fishing, which there is not. After reading this thread and giving i more thought, it seems to me that the motivation for the changes is probably sound. Whether the results would would match the objectives seems somewhat questionable.

[Mikie]

Let me see if I've got this right. The State issues 312 licenses, of which about 1/2 are actually used. The license holders currently have two options, maintain the license and pass it on to a family member or let it expire and lose it. The State is now, all of a sudden, concerned that if EVERYONE that holds a license begins harvesting crabs it will deplete the crab population. The State's solution is to force the people with unused licenses to sell them to people who WILL use them or lose them in the long run. Does anyone else see a problem with this? The State is creating a solution (not really) to a PERCEIVED problem that they created with their license rules that doesn't actually exist. Having MORE licenses being active actually creates the problem they claim to be trying to solve. The odds that everyone having an inactive license would start harvesting crabs is virtually non-existent UNLESS the Government destroys the economy to the point where people have no other choice, at which time the population won't have the funds to purchase the product anyway. The current system actually maintains the status quo and not necessarily to the benefit of the current license holders. Another example of the State bureaucracy run amuck.

[Dann86]

They should do what the feds did with groundfish permits....no history no permit.

[Capt. Frank]

They should revoke the pocket licenses.  Let someone else use them if you're not!

And the state should offer the revoked licenses to the public for someone who plans on using it to crab.  That's the idea.  Not some inactive clown doing estate planning for his kid to do nothing with it too.
 

Let me see if I've got this right. The State issues 312 licenses, of which about 1/2 are actually used. The license holders currently have two options, maintain the license and pass it on to a family member or let it expire and lose it. The State is now, all of a sudden, concerned that if EVERYONE that holds a license begins harvesting crabs it will deplete the crab population. The State's solution is to force the people with unused licenses to sell them to people who WILL use them or lose them in the long run. Does anyone else see a problem with this? The State is creating a solution (not really) to a PERCEIVED problem that they created with their license rules that doesn't actually exist. Having MORE licenses being active actually creates the problem they claim to be trying to solve. The odds that everyone having an inactive license would start harvesting crabs is virtually non-existent UNLESS the Government destroys the economy to the point where people have no other choice, at which time the population won't have the funds to purchase the product anyway. The current system actually maintains the status quo and not necessarily to the benefit of the current license holders. Another example of the State bureaucracy run amuck.