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Saltwater Sportsman Magazine, Nov 2006



Commercial Groundfish Fleet Embarks on a Ground Breaking Buyout Proposal

By Capt. John McMurray


Over the last two decades, many New England fish stocks have been fished down to unsustainable levels as a result of “overcapacity” - in other words “too many boats chasing too many fish.”  Commercial fishermen have been facing years of increasing regulation and decreasing profits as a result.  While there have been increases in the health of several key groundfish stocks, most species are not recovering, and those that are do not appear to be recovering fast enough to sustain the historical numbers of fishing boats targeting them. 


Buying out ground fish permits and commercial trawlers has been on the table for quite some time as one possible solution to the mess the New England groundfish fleet has fished themselves into.  There were two federally funded buyouts in the New England groundfish fishery (one in 96 and one in 2000).  However, neither did much to reduce pressure on overfished stocks, partly because they were not intended to do so.  The objective was merely “financial assistance”. 


Until 2001, even in limited access fisheries, commercial permits were generally not difficult to obtain. In 2001, a lawsuit brought by a coalition of environmental groups resulted in a federal court-supervised settlement that effectively mandated the adoption of Amendment 13 to the Northeast Multispecies Fishery Management Plan.  This significantly decreased the number of fishing permits available in the affected fisheries.


Because Amendment 13 removed “latent effort,” in the form of unused permits, from the fishery, any vessels and permits that are bought out today can substantially reduce fishing fleet capacity. That was not the case prior to 2001, when unused permits were available to be sold to persons wishing to enter the fishery. With that in mind, in 2003, Sea Grant  sponsored a series of workshops up and down the New England coast to examine reducing the capacity of the New England groundfish fleet.  The need for the industry to take the lead in shaping any vessel or permit buyout program quickly became obvious. Fishermen realize that, because of increasing regulations, decreasing catches and decreasing income, the industry was inevitably going to downsize, and they can only benefit from a well-designed buyout program. 


In late 2005, a committee of active groundfish fishermen began work on a buyout proposal. Today, an industry-funded buyout program called the Northeast Multispecies Fishing Capacity Reduction Program is being developed in coordination with the Massachusetts Division of Marine Fisheries.   The program is currently in the public discussion stage, but if the current timeline is maintained, it may be implemented as soon as the fall of 2007.


If the industry is generally supportive, the Program will request a loan of between $75 and $150-million from Congress to buy out permits and vessels.  Additional lump sum payouts will be available for voluntarily electing to scrap vessels.  All loans would be repaid over a 30-year period by the groundfish permit holders who do not take advantage of the buyback program, through an additional tax on all fish sold, caught on trips made pursuant to a Multispecies Days-at-Sea permit. 


Chris Meany of MA DMF noted “We’ll meet again in the beginning of Sept and finalize the prospectus document.  Once that is done, we’ll have a mailing to all groundfish permit holders and if we get a positive response we will go ahead and summit materials to congress.”  Congress will be asked to pass legislation authorizing the loan and any other funding required by the Program.  The legislation will dictate the sequence of events for the Program, and will authorize NOAA Fisheries to issue a letter to all permit holders soliciting bids for the surrender of their fisheries permits. 


For the buyout to work, at least 30% of the fleet’s total capacity (measured by a combination of permitted fishery access, vessel length and horsepower) needs to be bought out through the program, although they admit that the 30% figure could be subject to change. The buyout will not proceed if that threshold level cannot be met.  When asked about whether that 30% number was attainable Mr. Meany of the MA DMF noted “It’s hard to tell, but we’ve had about 20% of permit holders show up at our scoping meetings requesting more info so that’s a good sign.” 


Although the program should benefit the groundfish resource, the groundfish fishery, and the fishing communities of New England, some in the angling community believe that buyouts unjustly reward some business owners for destroying a resource, and oppose them on principle. But as Pat Murray, vice president and director of conservation for Coastal Conservation Association noted, “Buyouts that right size fleet and promote resource conservation ought to be used in every fishery, instead of simply allowing the free market to find the optimal size of the commercial fleet,"


The Program, if it moves forward, creates a win/win situation that will improve the financial future of the fishermen who remain, while allowing those who would like to exit the fishery a rational way to do so.  At the same time, it should reduce fishing mortality on all groundfish stocks by taking 30% of commercial groundfishing effort out of the water, and it should reduce trawl-caused damage to important fish habitat. If the buyout removes a significant amount of fishing capacity, stock rebuilding should be accelerated and future improvements in the health of fish stocks are more likely to translate directly into better fishing for us.






In June, The Nature Conservancy, an international environmental group, completed a buyout of six federal trawling permits and four trawling vessels in Morro Bay, California.   It was the first privately financed buyout of fishing vessels for conservation purposes. The joint effort by commercial fishermen, the Conservancy and NOAA Fisheries will protect overfished bottom-fish populations and 3.8 million acres of the ocean floor.   Trawl permit owners in Monterey, Moss Landing and Half Moon Bay have expressed an interest in selling their permits and vessels to The Nature Conservancy, but any further purchases will be conditioned upon the Pacific Fishery Management Council’s passage of more collaboratively designed no-trawl zones.