INNOVATIVE APPROACHES FOR FOSTERING CONSERVATION IN MARINE FISHERIES

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1 February 1998 FOSTERING FISHERIES CONSERVATION S139 Ecological Applications, 8(1) Supplement, 1998, pp. S139 S by the Ecological Society of America INNOVATIVE APPROACHES FOR FOSTERING CONSERVATION IN MARINE FISHERIES RODNEY M. FUJITA, 1 TIRA FORAN, 2 AND IANTHE ZEVOS 1 1 Environmental Defense Fund, 5655 College Avenue, Oakland California USA 2 Department of Environmental Science, Policy, and Management, University of California, Berkeley, California USA Abstract. Many modern fisheries management systems create incentives to overfish, leading to negative economic and environmental consequences for human welfare and marine ecosystem health. In this paper, we review problems faced by many fisheries managers, including overcapitalization, by-catch of nontarget species, and alteration of marine food webs. We recommend the formulation of alternative fisheries management goals based on risk-averse, multispecies management. We discuss alternative fisheries management systems, including transferable fishing privileges, community development quotas, and individual transferable quotas (ITQs). We argue that fostering fisheries conservation will require combining stringent performance criteria with alternative fisheries management designed to create incentives for sustainability. Key words: by-catch; ecosystem integrity; ecosystem management; fisheries management institutions; individual transferable quotas; marine conservation. INTRODUCTION Conservation means different things to different people. Fishermen often think of themselves as conservationists in that they want to conserve fisheries so that their children can have the opportunity to fish. Fishery managers may conceive of conservation as leaving enough fish in the water each season to ensure, with some reasonable probability, that yield will be maximized year after year. Environmentalists often define conservation in the context of fishery management more broadly: leaving enough fish in the water to ensure the maintenance of ecosystem health. In this paper, we describe some ideas for reforming fishery management regulations and institutions with the aim of achieving conservation defined as a combination of these definitions: to ensure that fishery yields are sustainable on a long-term basis while simultaneously protecting ecological health. Our examples are weighted toward contemporary North American fisheries. ECOLOGICAL HEALTH Ecological health has been difficult to define in theoretical terms. However, operational definitions that can be quantified have been developed to guide a number of attempts to restore large natural systems, including Germany s Rhine River and Florida s Ever- Manuscript received 20 February 1996; revised 15 December 1996; accepted 15 April 1997; final version received 9 July For reprints of this Special Issue, see footnote 1, p. S1. glades Florida Bay Coral Reef system. An ongoing process to establish ecological health goals and indicators for the San Francisco Bay Delta River system has resulted in some preliminary operational definitions. Ecological health has been defined in this process as the structural (e.g., extensive wetlands that exhibit some degree of connectivity) and functional (e.g., peak flows and sufficient instream flows) attributes that allow the system to maintain itself without unusually high extinction rates, population declines, or other adverse changes. The overall goal of San Francisco Bay Delta River ecosystem restoration efforts was expressed as the reestablishment of a healthy, functional system that supports a diversity of habitat types along with their resident communities of plants and animals, and is selfsustaining (requiring minimal intervention) and resilient to stresses (Levy et al. 1996). Specific objectives include the protection and restoration of various biodiversity parameters, ecological processes, and ecosystem services (e.g., sustainable fisheries, aesthetics, recreational opportunities, etc.; Levy et al. 1996, CalFed 1995; Delta Protection Act of 1992, California Public Resources Code Section and Division 19.5). The restoration paradigm emerging from this definition of health emphasizes the restoration and/or maintenance of certain key processes that have shaped and maintained the system over time (e.g., peak flows, sediment transport, etc.). CONSERVATION OF FISH POPULATIONS What is the goal of fishery management? Is it to maximize physical yield or net revenues? Is the goal S139

2 S140 RODNEY M. FUJITA ET AL. Ecological Applications Special Issue to attain a particular size distribution of fish (e.g., to improve the sport fishing experience)? Does conservation simply mean leaving sufficient numbers of fish in the water each year to provide a reasonable probability that maximum yield will be realized next year, or over the long term? Should ecosystem protection be another goal or guiding principle of fishery management? Historically, different goals have been adopted by various fishery management regimes. Traditional marine tenure systems often afford protection for spawning aggregations and control harvest rates so as to increase the likelihood of a sustainable fishery, without an explicit attempt to extract the maximum yield possible. Conventional fishery management in developed countries tends to focus on the problem of maximizing yield. At first, Maximum Sustainable Yield (MSY) was based on the notion that fish populations should be cropped from their natural population levels down to lower densities that would allow the population to yield the largest number of fish possible. This MSY was thought to be sustainable year after year somewhat like the periodic thinning of a forest stand. Management based on the idea of extracting MSY every year, however, largely failed, resulting in numerous fishery declines and collapses (Larkin 1977). One of the key factors in the failure of the MSY concept appears to have been the fact that MSY did not adequately address natural variability. Models that simulate fish variability indicate that MSY levels of fishing mortality are risky and can lead to stock collapse (Sissenwine 1978). Fishery scientists and managers have greatly improved the concept of MSY by aiming to maximize average yields over a number of years and by taking natural variation and scientific uncertainty into account. Some attempts are also being made to understand the role of ecological factors such as ocean productivity and predation, so that more accurate assessments of sustainable yield can be made. For example, the abundance of Oregon wild coho salmon stocks is now being projected partially on the basis of sea surface temperature, an indicator of upwelling strength, and ocean productivity (Salmon Technical Team 1997). In most cases, however, the various factors that control the abundance and distribution of fish populations are not well understood or even studied (Baumgartner et al. 1992). When fishery modelers incorporate more realistic conditions (e.g., random recruitment and/or serially correlated deviations in recruitment), their recommendations usually become more and more risk averse. Clark (1991), for example, used deterministic models to conclude that a large fraction of MSY could be attained if female spawning biomass of West coast groundfish was reduced to 35% of its unfished level. The Pacific Fisheries Management Council subsequently adopted this so-called F 35% harvest policy. When Clark (1993) incorporated large random variations in recruitment he recommended the more conservative F 40% harvest policy. Clark s (1993) use of more pessimistic Beverton-Holt stock recruitment curves only (which are more appropriate for some groundfish species than Ricker curves) raised the ideal female spawning biomass to 45% of its putative unfished level (F 45% ; Clark 1993, Ianelli and Heifetz 1995). The correct choice of harvest policy will ultimately depend on a number of other factors. First, it is important to consider the confidence decision makers have in estimates of abundance and age/size distribution. For example, given the typical cloud of uncertainty surrounding numbers at age or biomass at age (coefficients of variation typically are 30%), how confident are managers that they are fishing at, for example F 35% and not F 20%? The latter rate defines overfishing in many U.S. Pacific groundfish fisheries. Secondly, how willing are managers to tolerate large fluctuations in yield? Many fish populations show serial correlation in year class strength recruitment or sporadic recruitment, resulting in yield fluctuations. In addition, by the time MSY-based policies are adopted (e.g., F 35%, F 0.1, F M, where M natural mortality rate), fisheries have often undergone several decades of high exploitation rates (Hilborn and Walters 1992, Ludwig et al. 1993). By the time spawning biomass has been reduced to 35% of its putative unfished biomass, the fishery often has too many vessels and/or too much fishing power. Under these circumstances it has been all too tempting for some U.S. regional management councils to discount the probability of stock collapse and adopt harvest guidelines that minimize economic pain (e.g., reduced profits, imminent job loss, or bankruptcy) in the fishery in the short term. Other U.S. regional management councils such as the Alaska-based North Pacific Fisheries Management Council, blessed with higher absolute fish abundance, have been able to reduce the risk of stock collapse by establishing more conservative proxies for MSY, e.g., F 40%, and can justify this choice as a conservation buffer. A degree of insurance against stock collapse is gained for a certain amount of short-term economic cost with an expectation of increased economic benefits over the long term as a result of a more sustainable fishery. In order for all political stakeholders to understand and assess both the monetary and nonmonetary costs involved, however, more routine, explicit, and lucid trade-off analysis needs to be done (see Ianelli and Heifetz 1995). These analyses remain the exception rather than the rule. MULTISPECIES AND WHOLE ECOSYSTEM MANAGEMENT Some scientists and environmentalists have been calling for the reform of fishery management for many years. However, a rash of declining and collapsing fish-

3 February 1998 FOSTERING FISHERIES CONSERVATION S141 eries around the world in recent years has engendered a much higher level of activity by environmentalists and brought increased attention to a broad suite of ecological concerns revolving around fisheries. Environmentalists bring new goals and values to fisheries management. They not only want sustainable fisheries; they want management institutions that understand and protect ecosystem health. Environmentalists stress the need to address the ecological and evolutionary impacts of removing large proportions of fish populations each year. Only a few ecological impacts of fishing have been studied; they could be much more widespread than is currently thought to be the case. Ecological impacts may fall into three general categories: (1) direct mortality of nontarget fish and other species caused by fishing; (2) indirect impacts, e.g., through modification of the food web; and (3) impacts of fishing on habitat. BY-CATCH OF NONTARGET FISHES A serious management problem arises when many fish species and stocks with varying levels of productivity co-exist on the same fishing grounds. In the race to harvest certain target populations, other populations that grow more slowly are often overharvested. Furthermore, nontarget species are harvested along with target species to varying degrees. In some cases, this so-called by-catch constitutes large fractions of the total catch, and sometimes even exceeds the catch of the target species. For example, by-catch is several times larger than the shrimp catch in many shrimp fisheries. When by-catch is simply prohibited, however, high rates of discard often occur. The new Magnuson- Stevens Fisheries Conservation and Management Act (16 U.S. Code Section 303(a)(11) contains provisions encouraging the U.S. regional management councils to create incentives to reduce by-catch. The Magnuson- Stevens Act, which provides comprehensive mandates and guidance for U.S. fishery management, was passed by the 104th U.S. Congress in late 1996 (16 U.S. Code ). The Pacific salmon fisheries provide many examples of problems engendered by fishing on mixtures of highand low-productivity populations. Salmon raised in hatcheries mix with wild populations in the nearshore ocean fishery. Hatchery populations can sustain very high harvest rates (perhaps 90%) because their abundance is not strongly related to spawner abundance (eggs are stripped from a limited number of females) or inland habitat conditions. However, wild salmon populations cannot sustain such high harvest rates; thus, because they mix with hatchery populations, they are sometimes overharvested. Careful shaping of ocean salmon season openings and closures to avoid impacts on sensitive wild populations are fairly effective measures, but sometimes result in fishery shutdowns. For example, the Oregon wild coho fishery has been severely restricted for several years, resulting in reduced catches of other salmon populations as well. In addition, the output of salmon assessment models is often not precise or accurate enough for management needs (perhaps due to inaccurate stock assessments and errors in estimates of various components of mortality), which involve the establishment of rather precise quotas for specific populations. Conventional approaches to managing mixed-population fisheries are often time-consuming, costly, and arduous. Several approaches have been tried to solve the problem of catching high-productivity populations that coexist with lower productivity populations, and the related problem of by-catch. One alternative approach that is being considered for salmon is to mark all hatchery-raised fish, and then to require fishermen to release wild fish. This may result in high rates of discard mortality, especially if individual wild fish are caught repeatedly in an effort to catch the marked hatchery fish mixed with them. Another approach is to move salmon fisheries away from the ocean and toward river mouths, mainstems, and even tributaries. This approach is sometimes referred to as terminal fisheries. Fishing closer to river systems makes it likely that the fishers will catch salmon as they segregate by race, and thereby may facilitate the design of fishing seasons aimed at protecting a subset of sensitive populations. For some fishermen, terminal salmon fisheries may increase total yields, since they are likely to catch more of the hatchery fish. However, instituting terminal salmon fisheries would dislocate the investment that has already been made into ocean salmon boats and gear. Some opponents of terminal salmon fisheries also argue that product quality declines as salmon migrate in to spawn. Ideally, salmon management entities would define stringent criteria that describe desirable attributes of the fishery. They would then implement these criteria, challenging various kinds of fisheries to either find ways to comply with the criteria, or be phased out. Criteria could include: management costs relative to economic and other benefits, selectivity, impacts on sensitive populations, robustness to errors in assessment and projection of abundance, conservative escarpment goals for salmon, and conservative catch rate targets. Another approach to reduce by-catch involves the use of observers on fishing vessels. The Pacific whiting fishery, for example, is the largest volume fishery on the coast of Washington and Oregon. Some whiting fishermen feel that observers once worked effectively with fishermen to rapidly assess by-catch rates, allowing skippers to move vessels when by-catch became excessive. These fishermen note, however, that once observers began to withhold data from fishermen to facilitate enforcement actions, this system broke down. Observer programs coupled with a mechanism to give

4 S142 RODNEY M. FUJITA ET AL. Ecological Applications Special Issue skippers access to real-time data analysis and to provide guidance to fishermen on the water holds potential for avoiding by-catch, which should be the first priority of by-catch management. To reduce by-catch and prevent overfishing, the Pacific Fishery Management Council (PFMC) attempts to shut down its multispecies groundfish fishery off Washington, Oregon, and California whenever the harvest guideline or allowable catch limit is reached for one of the species. While the PFMC has a good record of compliance with this policy, difficulties have arisen because some populations (particularly rockfish) have been difficult to assess, so reliable harvest guidelines cannot be developed. This was, in part, responsible for the PFMC s failure to shut down the valuable sablefish fishery when the allowable catch of shortspine thornyheads was exceeded during the 1995 season; there was so little confidence in the proposed catch limit that arguments for an expensive shutdown were not sufficiently compelling. The consequences of overfishing the shortspines are unknown, again due to the paucity of data. Another approach to managing the problems associated with multispecies fisheries is to establish no-take zones to enable subpopulations and nontarget populations to escape fishing, grow to large sizes, and replenish the fishery (Rowley 1994). The new Florida Keys National Marine Sanctuary contains one of these zones, which have been demonstrated to be quite effective in coral reef ecosystems (e.g., Roberts 1995, Bohnsack 1993, Roberts and Polunin 1991). The difficulty lies in determining the size and boundaries of such zones, which often infringe on traditional fishing grounds. Noncontroversial areas may be so because they do not contain good habitat. Rotating zones to ensure that all fishermen share equally in the conservation burden may work for some populations, but not for many others such as rockfish, which tend to have relatively small home ranges and long life-spans. Despite these difficulties, no-take zones have considerable potential. Time and area restrictions, which are commonly used, can be considered short-term versions of no-take zones. The Alaska Marine Conservation Council, a nongovernmental organization, has proposed another promising idea for addressing by-catch: establish harvest priority for fishermen (for example, by allowing them to start their season early) who can demonstrate that they can fish with low by-catch. A similar approach can be incorporated into Individual Transferable Quota systems; greater initial allocations of shares in the total allowable harvest could be granted to clean fishermen. Transferable by-catch allowances may be a way to give fishermen the flexibility they need to respond to variations in by-catch rates by acquiring sufficient bycatch allowance from other fishermen or from the government (e.g., by exchanging allowance for a target species for allowance for a by-catch species), thereby avoiding the need to discard prohibited species. Such a program helps some small-scale fishermen in New Zealand avoid by-catch problems (Boyd and Dewees 1992). Difficulties include developing an equitable initial allocation formula and monitoring transfers. In addition, rational measures to reduce by-catch and achieve other conservation objectives are often difficult to implement because they are interpreted as favoring one gear type over another. A certain level of by-catch may be unavoidable in some fisheries. In these cases, measures to improve the survival of discards (which can include undersized fish of the target population) can be implemented. Measures include primarily gear restrictions (e.g., bans on hook extractors that result in excessive damage to the fish). Full utilization, or the landing and processing of all fish that are caught, is also under consideration in some circles. Problems with this approach include uncertainty about the ecological effects of extracting the large amounts of biomass and energy contained in bycatch from ocean ecosystems and the availability of markets. PROTECTING ECOSYSTEMS Most of the approaches for reducing by-catch in use today are motivated by the rather limited goal of allowing fishing for target species to continue. The broader goal of whole ecosystem protection is only beginning to be addressed in a small number of fisheries. Fishing has both direct and indirect effects on marine and freshwater ecosystems. One example of a direct ecosystem effect is seabird mortality. Recently, alarming reports of seabird mortality caused directly by longline fisheries have generated a certain amount of attention to the ecological impacts of fishing. About hooks are set annually in the Japanese Southern Ocean tuna fishery alone (Brothers 1990). Seabirds, including albatross and petrels, are attracted by bait and are killed when they are hooked. About albatrosses and petrels are killed each year in longline fisheries (Bartle 1990, Close 1994). Impacts on these birds are projected to be especially severe owing to their low reproductive potential. Relatively simple and effective measures can be employed to reverse the tragic decline in albatross and petrel populations, such as deploying streamers and adopting measures to ensure that bait sinks quickly (Brothers 1991, Murray et al. 1993). INDIRECT EFFECTS OF FISHING ON ECOSYSTEMS The removal of large quantities of fish may have important implications for marine food webs. For example, the removal of predatory fish may increase the abundance of planktivorous fish, perhaps reducing the availability of plankton for other species (Parsons

5 February 1998 FOSTERING FISHERIES CONSERVATION S ). Large catches of pollock in the Bering Sea may have resulted in drastic declines in Steller sea lions (NMFS 1995a), Pribilof fur seals, murres, and kittiwakes (Parsons 1992). Fledging success of puffins nesting on the coast of Norway has been drastically reduced due to overfishing of herring; nearly all chicks have starved to death in most years since the herring population crashed in 1968 (Vader 1990a, b). Some fishing practices have rather serious impacts on marine habitat. For example, concentrated use of fishing gear degrades seagrass meadows, rock piles, outcroppings, and reefs (Dayton et al. 1995). Until recently, the effects of fishing on marine habitat were not routinely considered when conservation, management, and allocation decisions were made. The new Magnuson-Stevens Act, however, requires that U.S. regional management councils, in conjunction with National Marine Fisheries Service, identify and minimize human impacts to so-called essential fish habitat for all species they manage (16 U.S. Code Sec. 305(b)). As of this writing, it is not clear whether adequate funding and political will exist to do justice to this important and ambitious undertaking. There has been much more progress toward the protection and restoration of the freshwater habitats of salmon, where the impacts are much more apparent than in marine habitats. Grassroots groups, environmental organizations, governmental agencies, and industries are making efforts to protect the entire range of salmon habitats, from spawning gravels in river tributaries to ocean habitat. Fishermen are strong advocates and important players in salmon habitat protection. In addition, the interaction between salmon fishery management and habitat protection is becoming clearer. It is critically important to ensure that sufficient numbers of salmon escape the fishery to seed existing habitat. Furthermore, recent research indicates that allowing larger numbers of salmon to escape the fishery (once thought to be a waste, since MSY would not be maintained at such large escapement levels) may contribute importantly to the survival and productivity of young salmon. The decomposition of the carcasses of adult spawners enriches relatively depauperate freshwater streams with stores of nutrients and energy built up during their years at sea (Cederholm et al. 1989, Bilby et al. 1996). Thus far, we have reviewed a wide range of fisheries management problems, ranging from overcapitalized fishing fleets, to MSY-based harvest policies, to direct and indirect food web and habitat impacts. Important and diverse attempts to address these problems are now underway. REFORMING FISHERY MANAGEMENT STRATEGIES At times, even the best scientific assessments and yield calculations have been disregarded by some fishery management entities because strong economic and social pressures for unsustainable catches persist. Until very recently, U.S. regional management councils had the discretion to allow fishing mortality to exceed MSY or even to reach an overfishing threshold (e.g., F 20% ) if short-term social and economic conditions warranted. After years of lobbying by conservation groups, strong language that removes the discretion of Councils to allow any so-called optimum yield fishing level to exceed that associated with MSY was incorporated into the Magnuson-Stevens Act (16 U.S. Code 1802). If this goal is to be achieved, it will be essential to address the root causes of pressure for unsustainable catches. ADDRESSING THE ROOT CAUSES OF FISHERY DECLINES More than 40% of the U.S. fish stocks that have been assessed are overexploited (NMFS 1993), resulting in vast economic losses as well as in untold ecological damage. Conflicts of interest on fishery management bodies, inadequate stock assessments, the development of extremely efficient fishing technology, failure to heed the best available scientific evidence, and other factors have contributed to fishery declines and collapses. Many of these are symptoms of an underlying problem caused by the fact that most modern American fisheries have, until recently, been open to all comers. When access is unlimited ( open access ), fish do not have any economic value until they are landed, and any fish left in the water can be caught by someone else. This dynamic results in the race for fish. To win the race for fish, it makes sense to invest heavily in fishing equipment and vessels. This often creates economic and political pressure for unsustainable yields (Hilborn and Walters 1992). Limiting access can be effective, especially if it is done early in the evolution of a fishery, before too many fishermen enter it. Unfortunately, limited access has usually been implemented late in the evolution of U.S. fisheries, precipitated by economic difficulties resulting from overcapitalization. Managers often grant excessive numbers of licenses in order to avoid making the difficult decision of who stays in the fishery and who must leave (Townsend 1992). Even when limited access is successfully implemented, incentives to catch as many fish as quickly as possible persist, because the remaining fishermen still do not have a guaranteed share of the total allowable catch; hence, they often engage in capital stuffing (increasing fishing power on the vessels remaining in the limited-access fishery) and other methods to circumvent efforts to limit fishing effort (Townsend 1992). Vessel buy-out programs, carefully designed to reduce both present and latent fishing capacity and to prevent a return to overcapitalization, can be effective but costly. Government-aided buyouts are currently underway in New England and the Gulf of Mexico. In-

6 S144 RODNEY M. FUJITA ET AL. Ecological Applications Special Issue dustry-funded programs are currently being discussed by the Pacific Fishery Management Council. ALTERNATIVE MANAGEMENT INSTITUTIONS AND ARRANGEMENTS No matter what fishery management strategy is adopted, strong institutions that create incentives for resource stewardship are needed for effective management. Some analysts have argued that deficiencies within existing fishery management institutions have contributed importantly to fishery declines and collapses (e.g., Townsend 1992, 1995b). U.S. regional fishery management councils vary widely in their conservation performance. Conflicts of interest on these councils may contribute to decisions that compromise long-term sustainability (Bevan et al. 1992, WWF 1994). Greater representation on the councils by nonfishermen, more comprehensive financial disclosure, and more stringent recusal provisions would help dilute the effect of conflicts of interest. Other kinds of institutions could be developed that incorporate a more diverse array of stakeholders, making management more community based. New kinds of institutions that are being developed and/or debated currently include: regional institutions to address problems associated with straddling and highly migratory stocks; market-based property rights systems; community-based organizations, for example, for-profit and nonprofit corporations set up to manage Community Development Quotas; and institutions that are structured to create economic incentives for long-term stewardship and ecosystem protection. INSTITUTIONAL ARRANGEMENTS TO PROTECT FISH THAT STRADDLE OR MIGRATE ACROSS JURISDICTIONAL BOUNDARIES Some fishes, such as salmon and tuna, cross the jurisdictional boundaries of state agencies, federal agencies, and sometimes countries. In these cases, fisheries management must be coordinated, lest one or more parties suffer lost fishing opportunities as a result of overfishing by another party or parties. Regional fisheries agreements have, by and large, been relatively unsuccessful, as evidenced by recent conflicts over turbot populations in the North Atlantic and salmon populations in the Pacific that straddle national jurisdictions. The new United Nations agreement on straddling and highly migratory populations creates an opportunity to strengthen protections for these fish. The strong measures set out in the United Nations agreement to reduce by-catch and to take a more precautionary approach when setting allowable catch limits should be incorporated into existing regional fishery agreements. Successful implementation will depend, of course, on sufficient funding and enforcement. In addition, tuna and billfish fisheries in the Pacific Ocean represent a tremendous challenge: management regimes are fragmented, and thus there is no overarching management entity that can implement the United Nations agreement or other measures that would protect migratory and straddling populations throughout their range. Fishing pressure is increasing on many of these populations; Indian Ocean catches more than doubled between the early 1980s and 1989 (FAO 1994). As of 1990, 14 of the 20 principal market tuna species were fully or overexploited (FAO 1994). In some cases, transfers of fishing privileges can facilitate conservation and/or reduce conflict. In 1993, U.S. private and government funds were used to compensate commercial salmon fishermen in Greenland for not fishing for two years, with the aim of helping to restore depleted Atlantic salmon in the northeastern United States (1993). Japan compensated Australian tuna fishermen for not catching juvenile tuna in nearshore waters between 1986 and 1989 to aid in the recovery of southern bluefin tuna populations, which were critically depressed (Neave 1993). Transferable catch allowances could conceivably be employed to allow fishermen from different countries or regions who exploit migratory and/or straddling populations to adjust to changes in fish abundance and distribution. Such changes have caused considerable conflict in recent years. For example, when salmon that originate in Canadian watersheds became especially abundant in Alaskan fishing grounds during the 1994 season, Alaska fishermen either had to forgo opportunities to harvest populations originating in Alaska that were mixed with Canadian populations in order to fulfill treaty by-catch avoidance obligations, or they could (as they did) refuse to forgo these opportunities, creating a conflict with Canada. This conflict escalated in 1995 and 1996: Canadian officials levied transit fees on Alaskan vessels and allowed a fishery that adversely affected U.S.-bound sensitive wild stocks; Alaskan officials adopted a unilateral chinook allowable catch limit that was seen as too high by other parties. Efforts to re-negotiate the Pacific Salmon Treaty broke down in 1995 and 1996; parties to the Treaty are still trying to resolve equity issues as of this writing. If transferable catch allowances are established, perhaps future conflicts could be prevented. In this example, Alaskan fishermen would lease, trade, or purchase catch allowances from Canadian fishermen to allow Alaskans to prosecute their fishery while compensating Canadians for lost opportunities (Chan and Fujita 1994). Implementation challenges would include: identifying the right entities to receive catch allowances (e.g., individual fishermen or fishermen s associations); initial allocation of catch allowances; and protecting social values, such as the basic character of Alaskan and Canadian fleets, perhaps by restricting transfers (by placing caps on the amount of catch al-

7 February 1998 FOSTERING FISHERIES CONSERVATION S145 lowance that can be accumulated by a single firm or individual, by limiting the term of the transfer, etc.). MARKET-BASED PROPERTY RIGHTS: INDIVIDUAL TRANSFERABLE QUOTA REGIMES The provision of a guaranteed share of the available catch is seen by many as the key to alleviating overcapitalization and its attendant problems, such as the race for fish and pressure for unsustainable catches. One way to achieve these goals is to allocate transferable guaranteed percentages of the total allowable catch to individual fishermen. These percentage shares are called Individual Transferable Quotas, or ITQs. Under ITQ management, the total allowable catch (TAC) is capped each season at a biologically safe level recommended by scientists. A percentage of the TAC is allocated to each boat or individual in the fishery. The shares may be used, leased, or sold. Because ITQs are transferable, fleet size is reduced as some fishermen buy others out. Capital expenses and equipment are also matched more closely to the productivity of the fish population, since individual fishermen know how many fish they are allowed to catch, and therefore have no incentive to overinvest in order to catch as many fish as possible. Leaving fish in the sea for conservation purposes may make economic sense to an individual fisherman with an ITQ. Because quota shares are a percentage of the total allowable catch, the shares should, over time, increase in value if enough fish are left in the water to increase the reproductive capacity of the population. Opponents of ITQs often argue that while ITQs are attractive in theory, they have not been proven (e.g., Greenpeace 1995). Indeed, ITQ systems are less than two decades old. However, it is abundantly clear that ITQs have successfully ended the race for fish in almost all cases. To cite just a few of many examples, ITQs ended the race for fish in the British Columbia halibut/ sablefish fishery (EB Economics 1992a, b), the North Pacific Fishery Management Council s halibut/sablefish ITQ fishery (NMFS 1995b), the Australian abalone fishery (Muse and Schelle 1989), and in several Canadian Great Lakes fisheries (Muse and Schelle 1989). While the effectiveness of ITQs in ending the race for fish and improving the economic sustainability of fisheries should be relatively noncontroversial based on results to date, two other aspects of ITQs are being hotly debated: conservation performance and social implications. CONSERVATION PERFORMANCE OF ITQS Critics of ITQ systems argue that these systems create strong incentives to fish illegally and to discard small or lower grade fish ( high-grading ). We argue, however, that the context of law enforcement and economic conditions specific to a fishery equally influences its conservation performance. Fishing continues to be structured by the role of the state and the market. ITQs may exacerbate poor conservation but are not, logically, its sole cause. The potential of ITQs to reduce the environmental impacts of fishing appeals to some conservation groups. For example, by reducing fleet size and improving profitability, ITQs facilitated a dramatic 30% cut in Australia s total allowable catch of southern bluefin tuna in response to conservation concerns. This cut, in conjunction with further evidence of a conservation crisis, helped to trigger a 77% cut in global catch limits (Neave 1993). The efficacy of this cut in rebuilding the population remains to be seen. In the U.S. wreckfish fishery (a small fishery on the Southeast coast), ITQs helped quell opposition to a precautionary 50% reduction in catch, and also helped eliminate destructive fishing practices that had persisted despite an attempt to ban them (Gauvin et al. 1994). Wreckfish catch has been below the Total Allowable Catch (TAC) since ITQs were implemented. In British Columbia, ITQs were directly responsible for a very significant improvement in compliance with the TACs for sablefish and halibut (violations of the TACs have virtually disappeared), as well as a 46% reduction in by-catch and a 50% reduction in waste due to ghost fishing (fish mortality caused by discarded gear) and mortality of sublegal fish that are thrown back (EB Economics, 1992a, b). It is too early to definitively judge the North Pacific Fishery Management Council s ITQ program for sablefish and halibut: the first season ended 15 November 1995 (Alaska Commercial Fisheries Entry Commission 1996). It is clear, however, that the race for fish has ended. The season increased in length to 8 mo from openings that lasted only h. No deaths were reported during the 1995 season. This is in stark contrast to the dangerous derby fishery it replaced, which claimed many lives. TAC levels serve as the major conservation goals in these fisheries. Sablefish TACs were reduced for the ITQ season in response to conservation concerns (P. Smith, Chief, Restricted Access Management Division, National Marine Fisheries Service, personal communication). The record so far indicates that TACs are not being reached, leaving buffers for conservation. Between 8 and 13% of the TACs were left unfished from 1995 to 1997 (NMFS 1995b, P. Smith, personal communication). In addition to excellent compliance with conservative TACs, the North Pacific ITQ program appears to have resulted in a number of other conservation benefits. Anecdotal evidence indicates that ghost fishing (resulting from discarded gear) has been dramatically reduced. This is not surprising: British Columbia s ITQ system resulted in a very substantial reduction in ghost fishing, due primarily to the end of the race for fish (EB Economics 1992a, b). By-catch discards in the North Pacific ITQ fisheries decreased from 24% (prior

8 S146 RODNEY M. FUJITA ET AL. Ecological Applications Special Issue to ITQs) to 10% of total catch (P. Smith, personal communication). In general, ITQ systems (as well as trip limits) would be expected to exacerbate high-grading (the discarding of small or lower grade fish), if the price differential for different sizes or grades of fish were substantial. In the case of the North Pacific ITQ system, the price difference amounts to only U.S. $ /kg. Anecdotal reports indicate that there was not much evidence of high-grading in these fisheries during the first season managed under ITQs. Where and when a higher price differential exists, it may be appropriate to establish transferable dynamic stock rights or other mechanisms that would create incentives for individual fishermen to protect all size and year classes of fish (Townsend 1995a). TAILORING ITQ PROGRAMS TO MEET SOCIAL OBJECTIVES If an ITQ system allows fishermen to sell out of an overcapitalized fishery, those who remain may enjoy increased profits. That is to say, their costs may decrease from less competition, or their gross revenues may conceivably increase (if quota rights lead to increased bargaining rights in the market or increased value). Assuming they are not burdened by debt, fishermen who earn more money are in a better position to invest in the future, including in conservation. While it is too early to say whether the new ITQ programs will produce durable conservation benefits to society, ITQ systems at least have the potential to make participants think more about the future. At the same time, however, ITQ regimes raise legitimate social equity concerns that must be addressed (McCay 1995, Dewees 1998). Some oppose ITQ management based on two principal fears: (1) that some fishermen will lose out in the initial allocation of quotas and (2) that ITQs will cause excessive consolidation or corporatization of their fishing fleets, changing fishing communities in undesirable ways. Establishing initial allocations is usually the most contentious part of any new ITQ program, and of any fishery management regime, for that matter. Allocation based on recent catch history and/or vessel size tends to discriminate against small but efficient fishing operations. Narrow time windows defining eligibility may unfairly exclude past participants. Fairer alternatives exist, however, that can reflect many factors, including historic participation in the fishery, efficiency regardless of vessel size, and conservation performance. Fishermen who can demonstrate cleaner fishing practices (e.g., reduced by-catch) could be rewarded with increased quota share. Quota set asides for crew members who do not own vessels and auctions may also be appropriate, so as to reward captains and crew who have invested heavily of their time and labor in the fishery. Interestingly, 285 crew members bought into the North Pacific ITQ fisheries (NMFS 1995b), indicating that crew members are not excluded from the ITQ fishery (as some opponents of the program claimed). Low interest loans or other kinds of financial assistance could be provided to facilitate the transfer of quota shares to crew members. By limiting the market to participants in the fishery, at least initially, perhaps prices can be kept low enough to provide a reasonable opportunity for captains and crew to buy into the fishery. Careful, consensus-based development of a fair initial allocation formula will likely require a great deal of effort, but this effort would be expected to increase the likelihood of acceptance over the long term. In addition, once the initial allocation formula is agreed upon, ITQs greatly reduce the time and effort that must be devoted to allocation, since allocation is largely determined by market forces. Market forces may also result in undesirable levels of fleet consolidation and/or control by large firms if left completely unconstrained. Where fears that excessive fleet consolidation will disrupt fishing communities serve as a barrier to acceptance of ITQs, it makes sense to address these legitimate concerns by designing ITQ plans to restrict excessive consolidation. For example, it may be feared that a fleet dominated by independent owner/operators could be bought out by a few large corporations. ITQ systems now operating around the world include a number of measures to address these concerns, including: the issuance of quota shares according to distinct vessel categories, issuance of quota shares in distinct management areas, provisions that restrict transfers of quota share after the initial allocation to individuals (no quota share can be transferred to firms or partnerships), and provisions to ensure that no entity may hold more than a certain percentage of the TAC. While the North Pacific halibut and sablefish ITQ system may have failed, in the eyes of some, to address adequately the issue of allocating initial quota shares equitably, it is one of the few ITQ systems that incorporates all of the measures in the list immediately above to limit consolidation. By the end of 1995, the first year of the ITQ program for North Pacific sablefish, the number of vessels making landings declined 20%. Corporations increased their share of the TAC by 0.5%; the share held by individuals and partnerships declined by 1.8% (Alaska Commercial Fisheries Entry Commission 1996:85). Higher levels of consolidation have occurred in ITQ fisheries with high quota accumulation caps (e.g., New Zealand ITQ fisheries) and/or no caps at all (e.g., the U.S. surf clam/ ocean quahog fishery; McCay et al. 1995). It is important to stress that ITQs are no panacea for the entire range of problems that beset fishery management. Conservative TACs based on good science are a prerequisite for ITQ programs not all fisheries pass muster in this regard. ITQs do not automatically reduce by-catch or discards: these will continue to be

9 February 1998 FOSTERING FISHERIES CONSERVATION S147 influenced, respectively, by the species composition in fishing grounds and the prices offered fishermen. ITQs are expensive to set up and, at least in the short term, costly to monitor and enforce. Limited access with effort controls may achieve economic and conservation goals at lower cost to society for some fisheries, particularly fisheries that have not yet become overcapitalized. However, the flexible nature of ITQs does make them a promising fishery management tool. Given sufficient participatory input and insightful socioeconomic analysis, ITQs can be adapted to the specific environmental and economic circumstances of particular fisheries, and to the values held by their associated fishing communities (see Young and McCay 1995). COMMUNITY DEVELOPMENT QUOTAS IN U.S. FISHERIES In 1994, the North Pacific Fishery Management Council instituted a Community Development Quota program to foster economic development in native Alaska coastal villages in 1994 (CDQ Report 1994). Similar programs are underway in the U.S. Western Pacific. Community Development Quotas (CDQs) are portions of the total allowable catch (TAC) that are allocated to eligible communities. The primary purpose is to foster economic development in these communities, whether they have a history of participation in the fishery or not. The communities can form for-profit or nonprofit corporations to manage the CDQ. According to program proponents, indigenous fishermen operating under CDQs exhibit a greater conservation ethic than fishermen in other fisheries; for example, they claim that by-catch rates are generally lower (CDQ Report 1994). These claims merit further study. The major difficulties in implementing CDQs seem to have been in setting aside part of the TAC for the CDQ program, determining which communities were eligible, and determining what entities should receive the CDQ. CDQs have the potential for involving a more diverse array of stakeholders in fishery management, spurring the development of innovative fishery management institutions, and possibly facilitating consideration of a wider set of the economic impacts of fishery management. NEW INSTITUTIONS FOR MANAGEMENT Concepts such as co-management, community-based management, and self-governance are generating considerable interest because of the failure of many government-based fishery management regimes (Pinkerton 1989, Townsend 1995b), and because many traditional community-based fishery management institutions have been successful in maintaining sustainable harvests. Also, antagonistic relationships between fishermen and fishery managers in government-based management regimes sometimes create an unproductive atmosphere. Ideally, local communities would develop and administer their own fishery regulations (consistent with conserving fish populations over their entire ranges), creating buy-in and incorporating the broadest possible spectrum of values and knowledge. Many different kinds of institutional structures can be envisioned to achieve this goal. The problem becomes one of choosing a structure that creates incentives for stewardship and ecosystem protection. The structures of many fishery management councils, cooperatives, collectives, and other types of fishery management institutions appear to create more incentives for unsustainable fishing than for long-term sustainability and ecosystem protection. Participants do not have well-defined rights to catch fish; allocations are negotiated and voted on. This type of structure generates a large financial stake in realizing short-term profits at the expense of a longer term stream of revenue; even fishermen who are conservation-minded are reluctant to reduce their catch, because the economic returns on such behavior to these individuals are uncertain. Greater accountability and more effective enforcement could be considered to be one type of incentive for stewardship. Monitoring and enforcement by a wide spectrum of community residents could both improve compliance with regulations and improve the regulations themselves to reflect economic and social concerns in the wider community. Several accountability mechanisms set up by fishermen or fishing communities exist. The Maine lobster fishery is widely recognized as an example of how effective informal social sanctions and traditions can be (Bowles and Bowles 1989, Palmer 1993). Informal sanctions and traditions have not evolved in most modern U.S. fisheries, however, so more formal institutions may be required. To create positive incentives for long-term stewardship of fishery resources, Townsend (1995b) has proposed a new kind of institution in which the allocation of costs and benefits are clearly defined. Votes would be proportional to the number of shares held by a participant. Participants would be able to sell the future stream of benefits associated with the fishing quota by selling shares. Various hybrid institutions are possible; for example, ITQs could be issued by the institution, with quota shares being distributed in proportion to share ownership. If this type of fishery management institution provided participants with well-defined catch privileges, and if participants could vote in proportion to the shares they held, conservation-minded fishermen could buy shares from participants who do not favor, for example, a reduction in total allowable catch to allow for stock rebuilding. In this way, some fishermen would assume all of the economic risk of conservation in exchange for an anticipated future benefit that would accrue only to them, and other participants are compensated financially for lost fishing opportunities.