9 Changes in QS holdings by Type of Person
Under the new sablefish IFQ program, individuals, partnerships, solely owned corporations, corporations, and other types of entities are defined as "persons" who may hold QS. This section examines the distribution of QS during 1995 and 1996 by the type of person holding the QS.
Table 9-1 summarizes information on the distribution of sablefish QS by management area and type of person. Table 9-2 provides similar information on the numbers of persons holding QS. Tables 9-3 and 9-4 provide similar information, but break the data out by vessel category and management area.
These tables provide information on the following types of QS holders:
Corporate: QS held by corporations (other than solely owned corporations, or restricted owners).
New Corporation: Corporations that were not initial QS recipients that subsequently acquired freezer vessel QS
Estates: QS held by estates of initial QS recipients or other owners.
Individual: QS held by natural persons (other than crew) who were initial QS recipients.
Partnership: QS held by partnerships (other than restricted owners).
Restricted: QS held by organizations (possibly partnerships or corporations) that do not have the right to fish with it.
One-owner corp: QS held by solely-owned corporations. In some cases individuals exercised an IFQ program option to transfer the QS to their solely-owned corporation.
Crew: QS held by natural persons who were not initial QS recipients and who entered the system for the first time as IFQ crew and met the qualifications to buy QS.
The sablefish IFQ program contains restrictions on the ability of corporations and partnerships to hold and use sablefish catcher vessel QS. The intent of these restrictions appears to be to assign QS to corporations and partnerships that qualified as initial issuees, but to impose restrictions on the ability of corporations and partnerships to expand their positions in the fishery. These restrictions were somewhat more strict in the Southeast area than elsewhere.
Corporations and partnerships that are not initial catcher vessel QS recipients can use the QS and IFQ and (except in the Southeast area) can buy and use additional QS. The QS must be used on a vessel owned by the corporation or partnership and operated by one of its employees. In the Southeast area, corporations and partnerships can only use catcher vessel QS that they received as an initial allocation.1
Corporations and partnerships that are not initial catcher vessel QS recipients cannot acquire catcher vessel QS by transfer. If a corporation or partnership that is not an initial issuee comes into possession of catcher vessel QS, perhaps following a default on a loan, it will not be able to fish with QS.2
A corporation or partnership, except for a publicly held corporation, loses the rights to fish its initial catcher vessel QS allocation and to buy additional QS if a new shareholder or partner is added (except for court appointed trustees acting on behalf of shareholders or partners who become incapacitated). In these cases, QS must be transferred to an individual before it can be fished again.3
Corporations and partnerships that are not initial issuees may purchase freezer vessel QS.4
An IFQ crew person is defined in the IFQ program as one who has at least 150 days experience working as part of a harvesting crew in any United States commercial fishery or any individual who receives an initial allocation of QS.5 An individual must meet these requirements to buy catcher vessel QS.
Table 9-1 shows the initial and year-end 1996 distribution of QS by IFQ area and type of person. The information is primarily organized by management area. Data are supplied on the initial QS issued to each type of owner in each management area, the QS held at year- end 1996 by each type of owner, the change in QS held, the percent change, and the percentage of area QS held by each type of owner at initial issuance and at year-end 1996.
The table shows that:
The proportion of QS initially allocated to corporate holders varied considerably among IFQ areas. Initial allocations of QS to corporations ranged from 13.0% of the total QS in the Southeast area to 62.2% of the total QS in the Bering Sea area.
Corporations held the highest proportions of QS at initial allocation in the Western Gulf, Bering Sea, and Aleutian Islands areas.
The percentage of an area's QS held by corporations ("corporate" plus "new corporations") increased modestly from initial allocation to year-end 1996 in the West Yakutat, Central Gulf, Western Gulf, and Bering Sea areas.
Initial allocations to individuals (that is, natural persons who were initial QS recipients) also varied widely between areas, ranging from 23.1% of the QS in the Aleutian Islands to 80.1% in the Southeast area. Individuals held the highest percentage of initial QS in the Southeast, West Yakutat, and Central Gulf areas.
The percentage of an area's QS held by individuals fell somewhat in most areas, although it did rise from 23.1% to 24.0% in the Aleutian Islands. The percentages of QS held by one-owner corporations were small. There were only slight changes during 1995-1996. One-owner corporations rose to 0.7% of total QS holdings in the Southeast area, and were zero at the end of 1996 in all other areas.
The percentages of total area QS held by "crew," meaning new entrants who are individuals, increased in all areas over the two year period. Crew holdings at the end of 1996 ranged from 5.0% of the total area QS in the Southeast area to 0.1% in the Bering Sea area.
Table 9-2 provides similar information on the number of persons holding QS by area and type of entity. In all sablefish areas, the number of persons declined or remained unchanged for all types of entities except new individuals entering into the fishery for the first time as "IFQ crew" and for "new corporations." The number of entities classified in these categories increased in all sablefish areas during 1996.
The declines in QS holders were largely due to the consolidation of QS holdings that occurred in 1995 and 1996. The declines in QS holders led to only minor changes in the percentage distribution of total QS holders in most areas by type of entity. The most noticeable changes were the decline in the percentage of individuals who were initial issuees and the increase in the percentage of crew who were new individuals entering the system.
In Tables 9-3 and 9-4 the categories of estates, individuals, one owner corporations, and crew are reported as a single, consolidated "effective individual" category. The categories of "corporate" and "new corporations" have likewise been consolidated. These tables show the management areas and vessel classes in which corporate, partnership, and effective individual QS holdings are most common. Table 9-3 looks at the amount of QS held and Table 9-4 looks at the numbers of persons holding QS. These tables are sorted by type of QS holder, vessel category, and management area.
Table 9-3 provides the total initial QS, the total year-end 1996 QS, the change and the percentage change in QS during 1995 and 1996 for each person type, vessel category, and management area combination. It also shows the percentage of total QS for the vessel category and area that was held by each person type at initial issuance and at year-end 1996.
The table shows that:
Corporate owners held a majority of the freezer vessel class sablefish QS in the Central Gulf, Western Gulf, Aleutian Islands, and Bering Sea areas at initial issuance and at year-end 1996.
Corporations held a majority of the "greater than 60 feet" catcher vessel class QS in the West Yakutat, Central Gulf, and Bering Sea areas at both initial issuance and at the end of 1996. They held the majority of the QS in the Aleutian Islands at initial issuance but fell below 50% by the end of 1996.
Corporations held a majority of the "less than or equal to 60 feet" in the Bering Sea area at the end of 1996. The rise in corporate holdings in this area was large. Corporate holdings rose from 37.3% to 57.7% of the area's QS holdings.
"Effective individuals" held a majority of the freezer QS in West Yakutat at initial issuance but not at the end of 1996. They held half of the QS in the Southeast area at the end of 1996.
"Effective individuals" held a majority of the "greater than 60 feet" catcher vessel class QS in the Southeast and Western Gulf areas at initial issuance, and in the Southeast, Western Gulf, and Aleutians Islands areas at the end of 1996.
The "effective individuals" held a majority of the QS in the "less than or equal to 60 feet" catcher vessel classes in the Southeast, West Yakutat, Central Gulf, and Western Gulf areas at initial issuance. They held majorities in all of these areas except the Western Gulf at the end of 1996.
Partnerships generally held smaller portions of the QS than corporations or effective individuals in most vessel classes and areas. However partnership holdings did exceed individual holdings in the freezer fleet in the Western Gulf, Aleutian Islands, and Bering Sea areas at initial issuance and year-end 1996.
Table 9-4 shows the numbers of QS holders classified into each of the aggregated person-types. Data are provided by aggregated person-type, vessel category, and management area both at initial issuance and at year-end 1996.
Table 9-1. Sablefish QS by Area and Type of Holder
Table 9-2. Sablefish QS Holders by Area and Type of Person
Table 9-3. Sablefish QS By Type of Holder, Vessel Category, and Area
Table 9-4. Sablefish QS Holders By Holder Type, Vessel Category, and Area