The Crab Rationalization Program is a way to allocate crab harvest among participants in the fishery. The term “rationalization program” is synonymous with individual fishing quotas (IFQ), catch shares, and limited access privilege programs (LAPP) - all terms often used in fisheries management referring to programs to allocate fisheries resources among a limited group of users.
The Crab Rationalization Program (Program), first implemented in 2005, allocates Bering Sea and Aleutian Islands (BSAI) crab resources among harvesters, processors, and coastal communities. Because the crab resource is shared among harvesters, processors, and coastal communities, it is sometimes referred to as a “three pie system.”
The Program was developed at a time when snow crab stocks were nearing a collapse and overcapacity in BSAI crab fisheries had resulted in a frenzied race for crab. Harvesting and processing capacity had expanded to accommodate highly abbreviated seasons, and significant portions of that capacity operated in an economically inefficient manner or were idle between seasons. At industry’s urging, the North Pacific Fishery Management Council (Council) developed the Program over a 6-year period (1999-2005) to accommodate the specific dynamics and needs of the BSAI crab fisheries.
The Program took an Act of Congress to implement. HR 2673, the Consolidated Appropriations Act 2004, was signed into law by President George W. Bush in January of 2004. This legislation was the foundation of the Crab Rationalization Program and amended Section 313 of the Magnuson-Stevens Act to require the Program, later implemented in 2005 through federal regulations by the National Marine Fisheries Service (NMFS or NOAA Fisheries).
The Program addresses the race for fish (also called derby fishing), high bycatch and associated discard mortality, safety, economic efficiency and product quality issues. It also includes an economic data collection component to assist managers as they review the Program's implementation and a cost recovery component where resource users have to pay back the government for up to 3% of the costs of management, data collection, and enforcement of the Program.
In tandom with the development of the Crab Rationalization Program to better address the overcapacity in the fishery, the industry requested government assistance in an industry-funded limited access permit buyback system to reduce the number of vessels and permits with access to the crab resource. Through NOAA Fisheries' Fishing Capacity Reduction Program, a $97 million loan from the government bought 25 fishing vessels and 62 permits permanently out of the fishery to reduce capacity one year before implementation of the Crab Rationalization Program. The industry is in the process of paying back the 30-year loan (called the buyback loan) through a tax on landings of crab.
Before the Crab Rationalization Program, the Council had developed and NOAA Fisheries implemented a moratorium permit program for crab fisheries in 1992, followed by a traditional limited entry permit program implemented in January 2000. These steps to limit the number of participants in the fishery first began in 1987 through public scoping meetings to better understand the issues in the crab fishery and stakeholders’ concerns. Even with these efforts to limit participation, the crab fishery was overcapitalized with too many vessels and permits compared to the amount of crab resources available. Paired with this was the near collapse of snow crab stocks around 2000, driving the industry to pull together to develop the Crab Rationalization Program from 1999 through 2005 to further balance fishing capacity with resource availability.