Original Notice.

Preproposal statement of inquiry was filed as WSR 01-01-022.

Title of Rule: Salmon license buy-back.

Purpose: Establish and conduct a Puget Sound salmon license buy-back.

Statutory Authority for Adoption: RCW 77.12.047.

Statute Being Implemented: RCW 77.12.047.

Summary: Reduce number of purse seine, Puget Sound gill net and reef net licenses to reduce fishing effort.

Reasons Supporting Proposal: Overcapitalization of the Puget Sound net fishery.

Name of Agency Personnel Responsible for Drafting: Evan Jacoby, 1111 Washington Street, Olympia, 902-2930; Implementation: Jim Lux, 1111 Washington Street, Olympia, 902-2444; and Enforcement: Bruce Bjork, 1111 Washington Street, Olympia, 902-2927.

Name of Proponent: Washington State Department of Fish and Wildlife, governmental.

Rule is not necessitated by federal law, federal or state court decision.

Explanation of Rule, its Purpose, and Anticipated Effects: State and federal funding are available for a Puget Sound salmon license buy-back program. This program will concentrate on the net licenses that have not been reduced in the last two buy-backs. The program will work on a fixed-sum purchase amount, with priority in application date for gill and reef nets, and priority in fishing activity for purse seines. There will be a three phase approach as funds become available. Successful applicants will not be allowed to reenter the fishery unless they already have multiple licenses. The program will benefit those fishers who have lost or will lose fishing opportunity as a result of an agreement between the United States and Canada on division of Fraser River sockeye stocks as well as reduced opportunity on other stocks because of Endangered Species Act listings and less salmon harvest available.

Proposal Changes the Following Existing Rules: Modifies coastal harbor salmon buy-back rules to apply concept to Puget Sound.

A small business economic impact statement has been prepared under chapter 19.85 RCW.

2. Professional Services Required by the Rule: None.

3. Costs of Compliance, Including Costs of Equipment, Supplies, Labor, and Increased Administrative Costs: None, as compliance is not required with this voluntary program.

4. Will Compliance Cost Businesses to Lose Sales or Revenue? No.

5. Comparison of Costs for the 10% of Businesses that are the Largest Businesses Required to Comply with the Proposed Rule: There is no required compliance.

6. Steps Taken by the Agency to Reduce the Costs of the Rule on Small Businesses: The department has created a simplified application form. No catch data need be supplied.

7. Description of How the Agency will Involve Small Businesses in Rule Development: The program was developed in concert with industry. Representatives of the net fishery groups have met with department personnel to fashion the cost of license purchase, operation of the program relative to funding, and ranking of offers.

8. List of Industries Required to Comply with the Rule: No compliance requirement. Puget Sound salmon net fishers may participate.

A copy of the statement may be obtained by writing to Evan Jacoby, Rules Coordinator, 600 Capitol Way North, Olympia, WA 98504-1091, phone (360) 902-2930, fax (360) 902-2942.

Section 201, chapter 403, Laws of 1995, does not apply to this rule adoption. Not hydraulics rules.

Hearing Location: Ramada Inn, Spokane International Airport, Spokane, Washington, on April 6-7, 2001, at 8:00 a.m.

Assistance for Persons with Disabilities: Contact Debbie Nelson by March 16, 2001, TDD (360) 902-2207, or (360) 902-2226.

Submit Written Comments to: Evan Jacoby, 600 Capitol Way North, Olympia, WA 98501, fax (360) 902-2942, by April 5, 2001.

Date of Intended Adoption: April 6, 2001.

February 21, 2001

Evan Jacoby

Rules Coordinator

OTS-4687.2

AMENDATORY SECTION(Amending Order 00-148, filed 8/16/00, effective 9/16/00)

WAC 220-95-013   ((2000 Coastal)) 2001-2002 Puget Sound salmon license buy-back program established -- Fund allocation -- Expiration.   (1) The legislature ((has)) and the federal government have allocated funds and anticipate allocating additional funds to buy back salmon licenses from commercial license holders. The department hereby designates (($923,400)) $33,834,689 of these funds as the ((2000 coastal)) 2001-2002 Puget Sound salmon license buy-back program (program). The licenses eligible to participate in the program are ((salmon charter, salmon delivery, salmon troll, Grays Harbor)) purse seine, Puget Sound salmon gill net, and ((Willapa Harbor salmon gill)) reef net.

(2) The goal of the program is to provide economic relief to Washington commercial salmon fishers, and to reduce the number of Washington commercial salmon licenses. To accomplish this, the department is proposing a ((two-step)) three-step process, ((first an open)) all three steps of which are purchase of licenses for a fixed sum (((Phase One), then, if any funds remain available, an income-based purchase plan (Phase Two))).

(3) The department will allocate the (($923,400)) funds available for ((coastal salmon fishery licenses)) the program as follows:

(((a) Program administration - $23,400.

(b) Salmon charter - $300,000.

(c) Salmon troll and salmon delivery - $300,000.

(d) Willapa-Columbia River and Grays Harbor-Columbia River gill net - $300,000.)) (a) Spring, 2001: $25,959,689 available.

(i) Program administration - $750,689.

(ii) Purse seine - 166 licenses at $82,200 - $13,645,200.

(iii) Gill net - 430 licenses at $24,100 - $10,363,000.

(iv) Reef net - 19 licenses at $63,200 - $1,200,800.

(b) Fall, 2001: $2,500,000 if appropriated in state biennial budget.

(i) Program administration - $176,600.

(ii) Purse seine - 15 licenses at $82,200 - $1,233,000.

(iii) Gill net - 40 licenses at $24,100 - $964,000.

(iv) Reef net - 2 licenses at $63,200 - $126,400.

(c) Spring 2002 - $5,375,000 if appropriated in federal fiscal year 2002 budget.

(i) Program administration - $158,400.

(ii) Purse seine - 34 licenses at $82,200 - $2,794,800.

(iii) Gill net - 90 licenses at $24,100 - $2,169,000.

(iv) Reef net - 4 licenses at $63,200 - $252,800.

Program administration funds that will not be used will be reallocated to license purchases.

(4) The program expires upon the distribution of all available funds.

[Statutory Authority: RCW 77.12.047. 00-17-105 (Order 00-148), 220-95-013, filed 8/16/00, effective 9/16/00. Statutory Authority: RCW 75.08.080. 98-20-052 (Order 98-206), 220-95-013, filed 10/1/98, effective 11/1/98; 95-07-012 (Order 95-20), 220-95-013, filed 3/3/95, effective 4/3/95.]

(1) For phase one applicants, the person)) who possessed or ((was)) were eligible to possess in ((1999)) 2000 a salmon ((troll or delivery license, a Grays Harbor salmon gill net license, a Willapa Harbor salmon gill net license or a salmon charter)) gill net -- Puget Sound license, a salmon purse seine license, or a salmon reef net license issued pursuant to RCW ((75.28.095)) 77.65.160, and is eligible to possess the same license in ((2000)) 2001.

(((2) For phase two applicants:

(a) The person possessed or was eligible to possess in 1999 one of the Washington state salmon fishing licenses listed in subsection (1) of this section, is eligible to possess the same license in 2000, and had income derived under the license from 1986 through 1991;

(b) The person had a salmon income loss greater than $0, computed as follows:

The salmon income loss under the program is the difference between the highest gross income derived from Washington state and offshore salmon fishing activity (including incidental catch provided that some salmon are shown on the fish receiving ticket documenting the catch) during any calendar year 1986 through 1991 (the base year), less the sum of the least amount of gross income derived from the same salmon fishing activity during any calendar year from 1992 through 1999 (the comparison year), multiplied by 2.5. For purposes of calculating income, the license holder must and may only use income from salmon fisheries in the coastal waters of Washington, the waters of Grays Harbor, Willapa Bay, and the Columbia River. Income that was used in calculating uninsured loss in the 1995 salmon disaster relief license buy-back program, salmon decline impact in the 1996 Washington salmon license buy-out program or salmon income loss in the 1998 salmon license buy-back program may not be used to calculate salmon income loss in the 2000 coastal salmon license buy-back program if the license offered in the 1995, 1996, or 1998 program was purchased and retired.))

[Statutory Authority: RCW 77.12.047. 00-17-105 (Order 00-148), 220-95-018, filed 8/16/00, effective 9/16/00. Statutory Authority: RCW 75.08.080. 98-20-052 (Order 98-206), 220-95-018, filed 10/1/98, effective 11/1/98; 95-07-012 (Order 95-20), 220-95-018, filed 3/3/95, effective 4/3/95.]

(2) ((Income used in the calculation of offers that are accepted may not be used in the calculation of any other offer.

(3) Phase one applications:

(a) Phase one)) Applications must be submitted to the department's licensing division on a department offer form. A completed offer form must contain the following information:

The applicant's name, Social Security number, mailing address during the offer period, telephone number (if applicable), and the license type and license number being offered((;

(b) The offer amounts for phase one are:

(i) Salmon troll and salmon delivery: $7,500.

(ii) Grays Harbor-Columbia and Willapa Bay-Columbia gill net: $12,500.

(iii) Salmon charter: $1,000 per angler permit not to exceed $10,000, and including all angler permits currently on the license or all angler permits on the license as of December 31, 1999, whichever is the lesser number)).

(((c) Phase one)) (3) Applications for all phases will be accepted through 5:00 p.m., ((September 1, 2000. Any amounts remaining in the gear category from phase one will be used in phase two, unless the department deems that there are insufficient funds remaining to conduct a phase two plan.

(4) Phase two applications:

(a) Phase two applications must be made on department forms and must be received by the department's licensing division by 5:00 p.m., October 6, 2000.

(b) The licensee may offer the license for any amount up to the salmon income loss incurred under the license or $75,000, whichever is the lesser amount.

(c) An offer is not made unless a complete offer is received by the department. In order for an offer to be complete, the following must be received:

(i) A complete offer sheet, showing:

(A) The applicant's name, Social Security number, mailing address during the offer period and telephone number (if applicable);

(B) The license type and license number that is being offered;

(C) The offer amount;

(D) The base year income (1986-1991);

(E) The comparison year income (1992-1999); and

(F) The offer ratio, defined as the offer amount divided by the salmon income loss.

(ii) Salmon income supporting documents other than salmon charter are defined as official state fish receiving tickets documenting landings under a Washington license, or computer generated landing lists that have been certified by the department or the Pacific States Marine Fisheries Commission to be true and correct copies of Washington or Columbia River landings. All landings count in calculation of base and comparison year incomes.

(iii) For salmon charter license fishing activity, acceptable supporting documents are trip tickets identifying the species targeted, the number of anglers, and the date of the trip or, if such tickets are unavailable, the department will accept a letter of endorsement from a charterboat association or charterboat booking office indicating salmon fishing was a major component of earnings, and, if such a letter is provided, will review the total income of the applicant for the base and comparison years.

Note:

Commercial salmon licensee applicants who submitted complete offers in the 1998 Washington salmon license buy-out program need not resubmit supporting documents for offers based on the same base and comparison years if all landings are from Washington state. Such persons must submit a new offer sheet to participate in the 2000 program, but the offer amount may differ from the 1998 offer amount, provided it does not exceed the 2000 program limits.

(iv) Records disclosure authorization that allows the department to receive copies of the applicant's Internal Revenue Service returns for the base and comparison years and to receive landing information from the Pacific States Marine Fisheries Commission.

(v) A signed statement certifying that all information provided is true and correct)) May 11, 2001. Only those applications received by this deadline will be eligible for the Phase 1 buyback. Applications received after this date will be ranked for Phase 2 or Phase 3 as detailed under the procedures for ranking offers.

[Statutory Authority: RCW 77.12.047. 00-17-105 (Order 00-148), 220-95-022, filed 8/16/00, effective 9/16/00. Statutory Authority: RCW 75.08.080. 98-20-052 (Order 98-206), 220-95-022, filed 10/1/98, effective 11/1/98; 95-07-012 (Order 95-20), 220-95-022, filed 3/3/95, effective 4/3/95.]

(12) The department will tender the amount of the offer upon receipt of a valid acknowledgment and upon resolution of all appeals that affect the ranking of licenses to be purchased.

[Statutory Authority: RCW 75.08.080. 98-20-052 (Order 98-206), 220-95-027, filed 10/1/98, effective 11/1/98; 95-07-012 (Order 95-20), 220-95-027, filed 3/3/95, effective 4/3/95.]

(5) Persons who sell a license in phase two of the program cannot purchase or operate a commercial license listed in RCW 75.28.110 or 75.28.113 or a salmon charter license listed in RCW 75.28.095 for ten years, beginning January 1, 2001, except that persons may operate such a license if the license was owned or operated by that person in 1999.)) (1) The purchase of Puget Sound gill net and reef net licenses will be based upon a random drawing of all applicants for a specific license type.

(2) The random drawing will continue until all applicants who offered to sell at the department's offered price have been rank-ordered. The order of ranking will apply to all phases of the buyback.

(3) Persons selected will be notified by the department that a license offer has been accepted by registered mail to the address provided on the offer form. The enclosed acknowledgment sent with the acceptance letter must be signed and returned to the department within ten days of the department's mailing date. Any acknowledgment received after the ten-day period is void and the acceptance will be withdrawn. Final rankings of all licenses will be available upon request to applicants when all appeals have been settled.

(4) Persons not selected in Phase 1 will be sent an acceptance by mail to the address provided on the offer form that their ranking will continue to apply for a Phase 2 and Phase 3 buyback when they should occur.

(5) Persons who apply after 5:00 p.m. on May 11, 2001, will be ranked at the bottom of the ranked list in the order that the applications were received. Applications received on a single day will be ranked by random draw.

(6) Persons who wish to appeal their ranking must appeal within ten days of the mailing date of the registered letter of acceptance. Any appeal received after the ten-day period is void and the ranking will stand. Appeals will be referred to an adjudicative proceeding resolution.

(7) The department will tender the amount of the offer upon receipt of a valid acknowledgment and upon resolution of all appeals that affect the ranking of licenses to be purchased.

[Statutory Authority: RCW 77.12.047. 00-17-105 (Order 00-148), 220-95-032, filed 8/16/00, effective 9/16/00. Statutory Authority: RCW 75.08.080. 98-20-052 (Order 98-206), 220-95-032, filed 10/1/98, effective 11/1/98; 95-07-012 (Order 95-20), 220-95-032, filed 3/3/95, effective 4/3/95.]

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Washington State Code Reviser's Office