Proposal for state buyback of Cook Inlet setnet permits advances in Legislature

Legislation aimed at easing tensions and fishing pressure in one of the state’s most popular fisheries is already on the move this session after dying in the COVID-shortened session last year.

Without objection, the Senate Resources Committee advanced Sen. Peter Micciche’s Senate Bill 29 to the Finance Committee March 8; the bill authorizes the state to buy back nearly half of the upper Cook Inlet setnet permits on the Kenai Peninsula from any members.

Micciche, a Soldotna Republican who was also selected Senate President earlier this year, said during a March 3 Resources hearing that the plan for the state to voluntarily repurchase permits from East Side Cook Inlet setnetters was initially drafted by a group of sport anglers and commercial harvesters “who have struggled to work together for many years and now feel like they have a solution moving forward.”

Resources chair Sen. Josh Revak, R-Anchorage, noted that public testimony on SB 29 generated nearly 30 mentions of support, primarily from East Side setnetters, and no opposition, which was a contrast from prior attempts to move similar legislation.

“We’re finally at the end of our rope. Fishing families that have been fishing the East Side of Cook Inlet for generations are at the end of their rope,” Micciche said to the committee. “We want some of those fishing families to remain viable and give those that choose to be bought out an opportunity to move to other fisheries or to retrain for another line of work.”

He also stressed that while SB 29 authorizes the Alaska Commercial Fisheries Entry Commission, or CFEC, to buy out up to 200 of the existing 440 East Side setnet permits via a lottery permit holders could enter if they so chose, it does not spend any state money to do it.

As it’s currently written, SB 29 would allow East Side permit holders to collect $260,000 per permit, meaning $52 million would need to come from somewhere to fund the buyback program only after it is approved through votes from the Legislature and subsequently the setnetters themselves.

Micciche and Ken Coleman, president of the Eastside Consolidation Association, said support for the buyback program among setnetters has grown in recent years as people gain a better understanding of its mechanisms and the need for it.

According to Micciche, 95 percent of respondents to a survey sent to all East Side permit holders supported the buyback. It’s a means to relieve fishing pressure not only on the Kenai and Kasilof river sockeye stocks that are the main target of the shore-based commercial fishery, but also on the rivers’ king and coho salmon that are mostly of interest to sport anglers but are occasionally intercepted by commercial nets while hopefully leaving a viable fishery for the setnetters that remain, he said.

Coleman emphasized that a provision to permanently close sites that are bought out “is a prime feature of the bill” because fewer nets in the water would provide more harvest opportunity for those that remain and prevent a repeat of the 1980s when a string of large sockeye runs to the Kenai and Kasilof and high salmon prices drew many permit holders from across upper Cook Inlet to the East Side beaches.

That shift decades ago has resulted in the majority of Inlet setnet permits being on the east side where the vast majority of personal use and sport fishing pressure occurs as well.

[Commercial fishermen outraged by state proposal to close much of Cook Inlet]

The $260,000 per permit buyback amount was generated from average gross revenue for permits over the past 10 years — just more than $20,000 per year — and $60,000 to cover likely tax liabilities, according to Coleman, who said each buyback amounts to permanently closing a small business.

It’s generally believed funding for the program could be secured through National Oceanic and Atmospheric Administration Fisheries capacity reduction programs intended to prevent or stop overfishing but the hunt for funding can’t start in earnest until SB 29 is passed.

Management changes at the Board of Fisheries in recent years have also curtailed fishing opportunity for East Side setnetters in favor of in-river users and to limit the harvest of Kenai-bound king salmon during times of low abundance, such as now.

“I think that people are frustrated and very worried about losing their entire investments,” Coleman said in an interview.

Because of that, he’s confident the 200 potential buyback lottery slots will be filled if SB 29 is approved, adding that many East Side permit holders would use the money to gear up for fishing elsewhere in the state “where there are more lucrative fisheries and a more stable Board of Fisheries management.”

“The regulatory instability and the biomass reductions over time, the competition for fish between all the user groups has made it very difficult for them to hang in and stay for the long-term so I think there’s a good appetite (for the program),” said Coleman, who is approaching 50 years of participating in the East Side fishery.

He estimated the annual gross revenue from his site near the mouth of the Kenai has fallen roughly 75 percent over the last 20 years, but said he’s unsure if he would participate in the buyback.

“If I could get 50 percent of the 75 percent back I’d be thrilled; I’d be viable again in terms of the financial picture,” Coleman said.

Alaska Department of Fish and Game spokesman Rick Green wrote via email that the department doesn’t have a position on SB 29 specifically, but department officials “see value in buyback programs such as this as another tool in our regulatory toolbox to manage fully allocated fisheries.”

The North Pacific Fishery Management Council added another complication to the longstanding Cook Inlet “fish wars” this past December when the council voted to close the federal waters — areas at least three miles offshore — of the upper Inlet to commercial salmon fishing starting in 2022 after state officials said co-management of the salmon fisheries in Cook Inlet is unworkable following a federal court order that concluded the state’s management plan does not meet federal requirements.

While the pending closure is unlikely to ultimately be enacted and would most directly impact the drift fleet, it would push the drift gillnet boats into state waters and further increase near shore fishing pressure and related conflicts.

Coleman characterized the council’s action as one that probably had some impact on fishermen deciding to either support or participate in the buyback should it materialize.

Scott Summers, a Kenai-area permit holder, testified March 3 that his son has made more money fishing as a crewmember in Bristol Bay in recent years than he has owning an East Side permit and he would participate in the lottery.

“It’s just not viable for us anymore the way it is. Something needs to change,” Summers said. “We’re sick of the politics; I think that’s why some of us support this bill.”