In 1973, the Alaska State Legislature enacted Alaska's Limited Entry law (AS 16.43) for commercial fisheries. The law provided for the creation of a new agency, the Commercial Fisheries Entry Commission (CFEC), to administer a program regulating entry into commercial fisheries under state jurisdiction. Limited Entry was implemented in most of the salmon fisheries in 1974. By year-end 1994, permanent permits had been issued in a total of 46 fisheries (50 permit types): twenty-six salmon fisheries, fourteen roe herring/herring fisheries, three crab fisheries, and three sablefish fisheries.
A legal prerequisite of the Limited Entry Act was that permits not be locked in the hands of those who were originally issued them (i.e.,"initial issuees").1 After much study and debate, the legislature finally chose free transferability as the method for allowing orderly entry and exit from the fisheries.
Free transferability allows transfer of permits from parents to their children. It also provides for inheritance upon the death of the permit holder, entry and exit of fisheries at opportune times, and obviates the need for an expensive and time consuming bureaucratic process to handle permit reallocation. Free transferability also facilitates permit exchange and promotes overall efficiency. Many other transfer options were considered and were found lacking with respect to these criteria.
In 1983, the Alaska Supreme Court ruled on a challenge to the constitutionality of the Limited Entry Act in general and the free transferability provisions in particular in State of Alaska v. Ostrosky, 667 P.2d 1184 (1983). The Alaska State Supreme Court upheld the constitutionality of both the Act and of free transferability and also affirmed the legislative objectives in adopting the transferability option. The decision was subsequently allowed to stand by the United States Supreme Court when it dismissed the Ostrosky appeal in Ostrosky v. State, 104 S. Ct. 2379 (1984), rehearing denied 104 S. Ct. 3572 (1984).
Despite the benefits of free transferability, many persons remain concerned that permit transfers may eventually result in undesirable consequences with regard to permit distribution. There is a concern that permits will leave the state, or that permits will disappear from isolated fishing communities which are "local" to a limited fishery, thereby eroding the economic base. The legislature has twice ordered studies of transferability options, first upon initial passage of the Act2 and again in 1980.3
Because of these concerns about free transferability, CFEC has produced this report so that the legislature, the administration, and other interested parties will be kept accurately apprised of the facts. CFEC hopes to periodically update this report as the budget allows.
This twelfth edition covers the 46 limited fisheries (50 permit types) for which permanent permits had been issued in the period 1975 through 1994. It contains detailed information on transfer incidence, the initial geographic distribution of permit holders, changes in permit distribution due to permanent transfers of permits and migration of permit holders, and the year-end 1994 geographic distribution of permit holders. Extensive information is also provided on the age distribution of permit holders, age differences between transferors and transferees, rates and characteristics of intra-family and business partner transfers, permit price levels, and permit acquisition and financing methods.