Commission Agenda Item No. 18
Presenter:  Lance Robinson

Action
Amendments to Oyster Proclamation regarding Daily Sack Limits, Time Closures, and Shell Recovery Program and Implementation of Senate Bill 932
August 25, 2011

I.       Executive Summary:  This item presents proposed changes to rules governing daily sack limits, legal harvest hours, time closures, and the implementation of the shell recovery program authorized under Senate Bill 932 (SB 932).  The proposed rules would:

II.        Discussion:  The proposed amendment to §58.21, concerning Taking or Attempting to Take Oysters from Public Oyster Beds: General Rules, delegates authority to the executive director of the department to close an oyster area upon finding that the area is being overworked or damaged, or the area needs to be reseeded or restocked, which is authorized under the provisions of SB 932, enacted by the 82nd Texas Legislature (2011).  The proposed amendment also requires the executive director, in determining the need for a closure of an oyster area, to state the criteria used to determine that a closure is warranted, which is necessary to ensure public confidence that closures are supported by sound biological justifications.  Additionally, the proposed amendment requires the department to consult with members of the oyster industry regarding the management of oyster beds in this state.

Communications with the regulated community indicate that oyster prices decline through time each season, which is believed to be a result of high harvest levels at the beginning of the season. The department has determined that a reduction in the lawful harvest hours, combined with a possession limit reduction, could be used as a mechanism to delay a portion of the harvest, allowing the remaining oysters to take advantage of the fall spawning season, which should result in increased recruitment and promote efficiency in utilizing oyster resources by distributing the harvest over more of the season, which in turn should result in a more stable price structure over the duration of the open season.  The current lawful hours for the harvest of oysters are from sunrise to sunset.  The proposed amendment would allow the harvest of oysters from sunrise until 3:30 p.m.

The proposed amendment to §58.22 would reduce the commercial possession limit for oysters and set forth the tagging requirements for oyster sacks.  The department proposes to reduce the daily commercial possession limit to 50 sacks.  The current limit is 90 sacks.  Under the provisions of Senate Bill 932, the commission “by rule shall adopt policies and procedures for issuance of oyster shell recovery tags or other means to collect the fee”.  The department has determined that the creation of a tag is the simplest and most feasible way to collect the fee.  The proposed amendment to §58.22 also would set forth the tagging requirements that oyster fishermen would follow when harvesting oysters.  The proposed amendment would require a person who harvests oysters from Texas waters for commercial purposes to place the appropriate (green or white), properly executed harvester/shell recovery tag on the outside of each sack; stipulate that a tag is properly executed only when it is filled out with the information required on the tag; and mandate that the tag must be placed on the outside of the sack upon filling, prior to unloading, and remain until the sack is empty or retagged and thereafter kept on file for 90 days.  The amendment to §53.12 sets the price for the tag at a fee of 20 cents ($0.20) or an amount set by the commission, whichever is greater.

The proposed rules were published in the July 22, 2011, issue of the Texas Register (36 TexReg 4630-4631, 4637-4641).  A summary of public comment on the proposed rules will be presented at the time of the hearing.

III.     Recommendation:  The staff recommends the Texas Parks and Wildlife Commission adopt the following motion:

“The Texas Parks and Wildlife Commission adopts amendments to §§58.11, 58.21, and 58.22, concerning the Statewide Oyster Fishery Proclamation, and §53.12 concerning the Commercial Fishing Licenses and Tags with changes as necessary to the proposed text as published in the July 22, 2011 issue of the Texas Register (36 TexReg 4630-4631, 4637-4641).”

Attachments — 2

  1. Exhibit A – SB 932 – Oyster Shell Recovery and Replacement Program
  2. Exhibit B – Commercial Fishing Licenses and Tags

Commission Agenda Item No. 18
Exhibit A

RULES REQUIRED OR AUTHORIZED BY LEGISLATION
SENATE BILL 932
OYSTER SHELL RECOVERY AND REPLACEMENT PROGRAM
Proposal Preamble

1. Introduction.

         The Texas Parks and Wildlife Department proposes amendments to §§58.11, §58.21, and 58.22, concerning the Statewide Oyster Fishery Proclamation.

         Over the past decade, many of the state’s oyster reefs have disappeared and hundreds of thousands of cubic yards of cultch (material, such as oyster shell, that furnishes a place for larval oysters to attach and grow to maturity) have been removed from the state’s public oyster reefs. The majority of the cultch removed from public reefs is not recovered and is often shipped out of state to be used as roadbed construction fill or feed additive in commercial poultry operations.

         The 82nd Texas Legislature, Regular Session (2011), enacted Senate Bill 932 (SB 932), which amended Parks and Wildlife Code, Chapter 76, by adding new §76.021 to create the Oyster Shell Recovery and Replacement Program. The provisions of SB 932 require the adoption by rule of policies and procedures for the issuance of oyster shell recovery tags and provide for the collection of a fee for each box of oysters harvested by licensed commercial oyster fishermen from the waters of the state. Senate Bill 932 also amended Parks and Wildlife Code, §76.115, to authorize the Parks and Wildlife Commission (Commission) to establish procedures and criteria by rule for closing oyster harvest areas when the commission finds that an area is being overworked or damaged or an area is to be reseeded or restocked, and to delegate that authority to the executive director of the department. The proposed amendments implement the provisions of SB 932 and alter regulations governing legal harvest hours and possession limits for commercial oyster harvest.

         The proposed amendment to §58.11, concerning Definitions, would add definitions for the terms “oyster shell recovery tag” and “director.” Under the provisions of SB 932, the Commission “by rule shall adopt policies and procedures for issuance of oyster shell recovery tags or other means to collect the fee” required by SB 932. The department has determined that the creation of a tag is the simplest and most feasible way to collect the fee and thus must define that term for purposes of compliance and enforcement. The proposed amendment would name the tag the Harvester/Shell Recovery Tag and define it as “an identifying marker that must be affixed to the outside of each sack (box) of oysters at the time of harvest, in the location of harvest, contain information required by the Department of State Health Services under the National Shellfish Sanitation Program, and remain affixed during transportation of the oysters to a dealer. Senate Bill 932 also authorizes the Commission to delegate the authority to open and close oyster reefs to the executive director of the department. The proposed amendment to §58.11 therefore adds a definition of “director” to mean the Executive Director of the Texas Parks and Wildlife Department. In another rulemaking published elsewhere in this issue of the Texas Register, the department proposes to estabablish a fee for the tag at $0.20, which is the fee established in SB 932.

         The proposed amendment to §58.21, concerning Taking or Attempting to Take Oysters from Public Oyster Beds: General Rules, would reduce the legal oystering hours, delegate to the executive director of the department the authority to open and close oyster areas, set forth the basis upon which the executive director may open or close an oyster area, prohibit the harvest of oysters from a closed area, and repeal current subsection (c)(2), which establishes a closure that will expire on its own terms on September 1, 2011.

         The current lawful hours for the harvest of oysters are from sunrise to sunset. The proposed amendment to §58.21(a)(2) would allow the harvest of oysters from sunrise until 3:30 p.m. Communications with the regulated community indicate that prices decline through time each season, which is believed to be a result of high harvest levels at the beginning of the season. Following extensive discussions with members of the regulated community, the department has determined that a reduction in the lawful harvest hours, combined with a possession limit reduction (contained in the proposed amendment to §58.22(c) in this rulemaking) could be used as a mechanism to delay a portion of the harvest, allowing the remaining oysters to take advantage of the fall spawning season, which should result in  increased recruitment (recruitment refers to the amount of young oysters that successfully attach to cultch) and promote efficiency in utilizing oyster resources by distributing the harvest over more of the season, which should also result in a more stable price structure over the duration of the open season.

         The proposed amendment to §58.21 also would alter subsection (c) by adding new paragraph (1) to delegate authority to the executive director of the department to close an oyster area upon finding that the area is being overworked or damaged, or the area needs to be reseeded or restocked, which is authorized by Section 3 of SB 932. The proposed amendment also adds new paragraph (2) to require  the executive director, in determining the need for a closure of an area, to state the criteria used to determine that a closure in warranted. The proposed new paragraph is necessary because the department recognizes that an order to close an area should be based on clearly articulated biological reasoning. The proposed amendment also adds new paragraph (3) to echo the statutory requirement, added by SB 932, that the department consult with members of the oyster industry regarding the management of oyster beds in this state. The proposed amendment also adds new paragraph (4) to stipulate that “an area will include those designated by the Department of State Health Services as ’Approved’ and ’Conditionally Approved’ or other areas based on evaluation by the department.” The proposed new paragraph is necessary to make clear that the department may close any area on the basis of resource management concerns, irrespective of determinations made by other agencies or entities. The proposed amendment also adds new paragraph (5) to prohibit the harvest of oysters in closed areas, which is necessary to provide a deterrent to unscrupulous persons and preserve the integrity of the program.

         Current §58.21(c)(2) closes a specifically demarcated area of coastal waters to the harvest of oysters until September 1, 2011. The proposed amendment to §58.21 would eliminate subsection (c)(2) because it is no longer necessary.

         The proposed amendment to §58.22 would reduce the commercial possession limit for oysters and set forth the tagging requirements for oyster sacks. As noted previously in this preamble, oyster fishermen and dealers have indicated concerns related to price declines perceived to be related to high harvest levels early in the season. After consultation with the regulated community, the department has determined that a combination of reduced harvest hours and possession limits could be effective in promoting efficiency, sustaining the resource, and stabilizing prices. Therefore, in addition to curtailing the lawful harvesting hours (discussed previously in this preamble), the department also proposes to reduce the daily commercial possession limit to 50 sacks. The current limit is 90 sacks. The department assumes that to receive the benefits of a more stable market, each fisherman’s daily harvest must be reduced from the current level of 90 sacks per day. The amendment establishes a daily possession limit of 50 sacks of oysters per day in an effort to subject the total availability of oysters in Texas to a slower rate of harvest throughout the season. This is expected to lengthen the productive part of the season and support a higher per-unit price throughout the season. In addition, the slower rate of harvest is expected to allow Texas oysters to remain in the marketing channels for longer periods of time during the year, aiding in the creation of more stable markets. The proposed amendment, if adopted, is expected to lengthen the productive (in terms of sacks landed per vessel) part of the season. The department believes that if landings can become more stable, a more stable average price throughout the season could be expected, which should create overall economic benefits for the industry.

         The proposed amendment to §58.22 also would add new subsection (c) to set forth the tagging requirements for oyster fishermen. The proposed new section would require a person who harvests oysters from Texas waters for commercial purposes to immediately place a properly executed harvester/shell recovery tag on the outside of each sack, stipulate that a tag is properly executed only when it is filled out with the information required on the tag, and mandate that the tag must be placed on the outside of the sack immediately upon filling, prior to unloading, and remain until the sack is empty or retagged and thereafter kept on file for 90 days. As noted previously in this preamble, the department has determined that a tag is the most feasible method for collecting the oyster shell recovery fee required by SB 932. Under the current regulations of the Department of State Health Services (DSHS, 25 TAC §241.57(e)), each sack  of molluscan shellfish (including oysters) transported by a harvester (oyster fisherman) or dealer is required to be tagged with a harvester’s tag or a dealer’s tag bearing information required under the federal National Shellfish Sanitation Program. Under Parks and Wildlife Code, §76.021(c)(2), as added by SB 932, the  harvester/shell recovery tag will satisfy the regulatory requirements of DSHS and function in lieu of the harvester’s or dealer’s tag. Thus, the procedure for oyster fishermen will change very little, since they are already required to tag containers of oysters, and the  harvester/shell recovery tag will simply replace the harvester’s tag required by DSHS. In order for the department to ensure that the oyster shell recovery fee is being accurately collected (i.e., that tags are being used once per sack and only once per sack), and to prevent double-counting and other potential sources of confusion, the proposed amendment would require that all information required on a tag be entered on the tag and the tag be affixed prior to unloading any cargo. The proposed amendment would stipulate that the tag must be placed on the outside of the sack immediately upon filling, prior to unloading, and remain attached until the sack is emptied or retagged. In this fashion, the department will be able to ensure that licensed commercial oyster fisherman has purchased the required tag for a sack of oysters, and that the tag cannot be used again on successive days. The requirement that tags be retained and kept on file for 90 days is intended to furnish the department with a starting point and a method for verifying activities in the event that investigations are necessary. The proposed amendment also  would stipulate that the appropriate harvester/shell recovery tag be affixed to a sack of oysters regardless of the requirements of 25 TAC §241.57, which sets forth DSHS requirement regarding refrigeration and time constraints for the handling of oysters at certain times of the year. The department’s intent is to remove any ambiguity concerning when and where the harvester/shell recovery tag is required to be used.

2. Fiscal Note.

         Lance Robinson, Coastal Fisheries Division Regional Director, has determined that for each of the first five years that the proposed rules are in effect, there will be no fiscal implications to state or local governments as a result of administering or enforcing the proposed rules.

3. Public Benefit/Cost Note.

         Mr. Robinson also has determined that for each of the first five years the rules as proposed are in effect:

         (A) The public benefits anticipated as a result of enforcing or administering the rules as proposed will be increased oyster recruitment, a more stable average price of oysters throughout the season, and the recovery and enhancement of public oyster reefs.

         (B) Under the provisions of Government Code, Chapter 2006, a state agency must prepare an economic impact statement and a regulatory flexibility analysis for a rule that may have an adverse economic affect on small businesses and micro-businesses. As required by Government Code, §2006.002(g), the Office of the Attorney General has prepared guidelines to assist state agencies in determining a proposed rule’s potential adverse economic impact on small businesses. Those guidelines state that an agency need only consider a proposed rule’s “direct adverse economic impacts” to small businesses and micro-businesses to determine if any further analysis is required. For that purpose, commission considers “direct economic impact” to mean a requirement that would directly impose recordkeeping or reporting requirements; impose taxes or fees; result in lost sales or profits; adversely affect market competition; or require the purchase or modification of equipment or services.

         The department has determined that there will be adverse economic effects on small businesses, microbusinesses, and persons required to comply with the amendments as proposed; however, those effects will be minimal, and short-term in nature. The department has determined that most if not all businesses affected by the proposed rule qualify as small or microbusinesses.  To the extent that the proposed regulations reflect the provisions of SB 932, there would be no small business impact beyond the impact of SB 932.  However, to provide a complete understanding of the possible impacts, the following is provided.

         Under DSHS regulations (25 TAC §241.57(e)), each bag or container of molluscan shellfish (including oysters) transported by a harvester (oyster fisherman) or dealer is required to be tagged with a harvester’s tag or a dealer’s tag bearing information required under the federal National Shellfish Sanitation Program. Under Parks and Wildlife Code, §76.021(c)(2), as added by SB 932, the oyster shell recovery tag will satisfy the regulatory requirements of DSHS and function in lieu of the harvester’s or dealer’s tag. Thus, there will be no adverse economic impact on oyster fishermen other than the tag fee of $0.20. The department consulted with representatives of the oyster industry to determine the current cost of compliance with DSHS tagging requirements, who reported that the current cost of compliance was in the range of $0.06 to $0.08 per tag.  Subtracting the current fee expense for the harvester’s tag from the proposed fee for the oyster shell recovery tag yields a net increase in cost of compliance of between $0.12 and $0.14 per tag. Using the average number of sacks harvested over the last three years (757,198), the net increase in cost to license holders would range from $90,864 to $106,008, which, when divided by the number of license holders (638), yields an average increase in cost per license holder of between $139 and 169.

         The purpose of the oyster shell recovery program is to generate funds to return shell to public oyster reefs, where the oyster shell will function as cultch for additional oyster production, which should result in increased availability of oysters for commercial harvest. Studies from Louisiana and Florida show that every dollar spent on restoration results in a $20 economic benefit (Dugas 1988; Berrigan 1990); thus, the economic impact to small and microbusinesses should be positive over time. Also, as noted above, SB 932 requires a minimum fee of $0.20 per tag; thus, the proposed tag fee could be set higher, but not lower, and it cannot be eliminated. In another rulemaking published elsewhere in this issue of the Texas Register, the department proposes to estabablish the fee for the tag at $0.20.

         The rules as proposed would reduce the daily limit on harvest of oysters from 90 sacks to 50 sacks per day. This is expected to reduce the total number of sacks harvested during the early portion of the season but should increase the number of sacks available for harvest during the later months. The effect of the proposed possession limit reduction, along with the curtailment of lawful harvesting hours, should provide a more stable and consistent price structure as well as an increased harvest opportunity over the course of the season by reducing the impacts caused by large numbers of fishermen converging on reef areas during the months of November and December.

         Participation in the department’s trip ticket reporting system is required for all commercial licensees, and furnishes accurate records of all commercial fishing activity, including in the oyster fishery. Using the reported daily landings per trip for the first three months of this year’s season (November 2010 – January 2011), had a 50-sack daily possession limit been in effect this year, it would have resulted in a 24%, 25% and 33% reduction per month, respectively, in harvest.  The corresponding average price per sack for this period fell by over 16%, from $22.91 per sack in November to $19.12 per sack in January, while the total number of trips dropped by more than 17% during the same time period. This year, over 52,000 sacks were harvested above the 50-sack level; under the rules as proposed, those oysters would have been available for harvest later in the season.

          Implementation of a closure under the provisions of the proposed amendment to §58.21(c) could cause fishermen to relocate to other areas that are open, which might necessitate increased fuel costs to some fishermen but may be offset by the increased production and availability of oysters that would be expected when the closed area reopens.

         (C) The department has determined that the proposed rule will have very little impact upon local employment at the macro or micro level.  As noted in the discussion of economic impacts to small and microbusinesses, the average per-license increase in cost as a result of the proposed fee for oyster shell recovery tags ranges from $139 to $168 per license-holder per year, which the department believes would not cause measurable changes in local employment. The department also notes that the proposed amendments should result in the increased harvest of more marketable oysters over time, which should more than compensate for increased costs of compliance associated with the proposed tag fee and any additional cost associated with increased effort.

         (D) The department has determined that Government Code, §2001.0225 (Regulatory Analysis of Major Environmental Rules), does not apply to the proposed rules.

         (E) The department has determined that there will not be a taking of private real property, as defined by Government Code, Chapter 2007, as a result of the proposed rules.

         (F) The department has determined that the proposed rules are in compliance with Government Code, §505.11 (Actions and Rules Subject to the Coastal Management Program) and §505.22 (Consistency Required for New Rules and Rule Amendments Subject to the Coastal Management Program).

4. Request for Public Comment

         Comments on the proposed amendments may be submitted to Jeremy Leitz, Texas Parks and Wildlife Department, 4200 Smith School Road, Austin, Texas 78744; (512) 389-4333; email: jeremy.leitz@tpwd.state.tx.us.

5. Statutory Authority

         The amendments are proposed under the provisions of Senate Bill 932, as enacted by the 82nd Texas Legislature, Regular Session (2011), which amended Parks and Wildlife Code, Chapter 76, by adding new §76.021 to require the adoption by rule of policies and procedures for the issuance of  harvester/shell recovery tags and provide for the collection of a fee for each box of oysters harvested by licensed commercial oyster fishermen from the waters of the state; authorize the Parks and Wildlife Commission to establish procedures and criteria by rule for closing oyster harvest areas when the commission finds that an area is being overworked or damaged or an area is to be reseeded or restocked; and to delegate that authority to the executive director of the department. The amendments are also proposed under Parks and Wildlife Code, §76.301, which authorizes the commission to regulate the taking, possession, purchase, and sale of oysters.

         The proposed amendments affect Parks and Wildlife Code, Chapter 76.

         §58.11. Definitions.  The following words and terms, when used in the subchapter, shall have the following meanings, unless the context clearly indicates otherwise.

                 (1) — (14) (No change.)

                 (15) Harvester/Shell Recovery Tag—An identifying marker that must be affixed to the outside of each sack of oysters at the time or harvest, in the location of harvest, contain information required by the Department of State Health Services under the National Shellfish Sanitation Program, and remain affixed during transportation of the oysters to a dealer.

                 (16) Director – The executive director of the department.

         §58.21. Taking or Attempting to Take Oysters from Public Oyster Beds: General Rules.

                 (a) Seasons and Times.

                         (1) (No change.)

                         (2) Legal oystering hours — sunrise to 3:30 p.m.[sunset].

                 (b) (No change.)

                 (c) Area Closures.

                         [(1)] There is no open public season for oysters from areas declared to be restricted or prohibited by the [Texas] Department of State Health Services or areas closed by the commission.

                         (1) The director may close an area to the taking of oysters upon finding that the area is being overworked or damaged or the area is to be reseeded or restocked, and may re-open the areas as provided in Parks and Wildlife Code, §76.115.

                         (2) An order to close an area shall state the criteria used by the director to determine that the closure is warranted.

                         (3) The department shall consult with members of the oyster industry regarding the management of oyster beds in the state.

                         (4) For the purposes of this section an area will include those designated by the Department of State Health Services as “Approved” and “Conditionally Approved” or other areas based on evaluation by the department.

                         (5) No person may harvest oysters in an area closed by order of the commission or the executive director.

                         [(2) Until September 1, 2011, the area eastward of a line beginning at the Intracoastal Waterway Channel Marker 4 at Sievers Cove (29° 25’ 51.3", 94° 42’ 46.2"), to Galveston Shellfish Marker A (29° 26’ 17.2", 94° 43’ 28.9"), to Galveston Shellfish Marker B (29° 26’ 32.7", 94° 43’ 54.5"), to Galveston Shellfish Marker C (29° 26’ 57.5", 94° 44’ 35.5"), to Galveston Shellfish Marker D (29° 27’ 17.2", 94° 45’ 07.9"), to Galveston Shellfish Marker E (29° 27’ 39.0", 94° 45’ 44.0"), to Galveston Shellfish Marker F (29° 28’ 01.2", 94° 46’ 20.7"), to Galveston Shellfish Marker G (29° 28’ 19.7", 94° 46’ 51.2"), to Galveston Shellfish Marker H (29° 28’ 42.0", 94° 47’ 28.0"), to Galveston Shellfish Marker I (29° 29’ 13.2", 94° 46’ 59.3"), to Galveston Shellfish Marker J (29° 29’ 45.4", 94° 46’ 29.6"), to Galveston Shellfish Marker K (29° 30’ 14.6", 94° 46’ 02.8"), to Galveston Shellfish Marker L (29° 30’ 45.3", 94° 45’ 34.5"), to the Smith Point Tide Gauge Piling (29° 31’ 17.9", 94° 45’ 04.5") will be closed to the harvest of oysters from public oyster bed (reef) during the open public season.]

         §58.22. Commercial Fishing.

                 (a) — (b) (No change.)

                 (c) Possession Limits.  It is unlawful to take in one day, for pay or the purpose of sale, barter, or exchange, or any other commercial purpose, or to have on board any licensed commercial oyster boat more than:

                         (1) 50[90] sacks of culled oysters of legal size; or

                         (2) 6 sacks of unculled oysters while on the reef.

                 (d) Harvester/Shell Recovery Tag.   A person who harvests oysters from Texas waters for commercial purposes shall, immediately upon harvest, attach a properly executed harvester/shell recovery tag to the outside of the sack in which the oysters are placed.                  

                         (1) A Harvester/Shell Recovery Tag is properly executed when all required information has been entered on the tag. 

                         (2) The tag must be placed on the outside of the sack immediately upon filling, prior to unloading, and remain until the sack is empty or retagged and thereafter kept on file for 90 days.

                         (3) The appropriate harvester/shell recovery tag (green or white) must be affixed to the sack regardless of the season or whether the requirements of 25 TAC §241.57 (relating to Molluscan Shellfish Harvesting and Handling) apply.

                 (e)[(d)] Reporting Requirements.  A dealer who purchases or receives oysters directly from any person other than a licensed dealer must file a report with the department each month as prescribed under Parks and Wildlife Code, §66.019(c).

         This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency’s legal authority to adopt.

         Issued in Austin, Texas on

Commission Agenda Item No. 18
Exhibit B

RULES REQUIRED OR AUTHORIZED BY LEGISLATION
SENATE BILL 932
OYSTER SHELL RECOVERY AND REPLACEMENT PROGRAM FEES
PROPOSAL PREAMBLE

1. Introduction.

         The Texas Parks and Wildlife Department proposes an amendment to §53.12, concerning Commercial Fishing Licenses and Tags. The proposed amendment would create a fee of $0.20 for a harvester/shell recovery tag.

         The proposed amendment would implement provisions of Senate Bill 932 (SB 932), enacted by the 82nd Texas Legislature, Regular Session (2011). Senate Bill 932 amended Parks and Wildlife Code, Chapter 76, by adding §76.021 to require the Texas Parks and Wildlife Commission (Commission) to collect a fee of 20 cents ($0.20) or an amount set by the commission, whichever is greater, from a licensed commercial oyster fisherman for each box of oysters harvested by the fisherman from the water if this state. The statute also requires the issuance of tags or other means to collect the fee. In another rulemaking published elsewhere in this issue of the Texas Register, the department proposes to require oyster fishermen to affix an oyster shell recovery tag to each sack of harvested oysters. The proposed amendment to §53.12 establishes the fee for the tag at the statutory minimum of $0.20.

2. Fiscal Note.

         Lance Robinson, Coastal Fisheries Division Regional Director, has determined that for each of the first five years that the proposed rule is in effect, there will be no fiscal implications to state or local governments as a result of administering or enforcing the proposed rule.

3. Public Benefit/Cost Note.

         Mr. Robinson also has determined that for each of the first five years the rule as proposed is in effect:

         (A) The public benefits anticipated as a result of enforcing or administering the rules as proposed will be increased oyster recruitment, a more stable average price of oysters throughout the season, and the recovery and enhancement of public oyster reefs.

         (B) Under the provisions of Government Code, Chapter 2006, a state agency must prepare an economic impact statement and a regulatory flexibility analysis for a rule that may have an adverse economic affect on small businesses and micro-businesses. As required by Government Code, §2006.002(g), the Office of the Attorney General has prepared guidelines to assist state agencies in determining a proposed rule’s potential adverse economic impact on small businesses. Those guidelines state that an agency need only consider a proposed rule’s “direct adverse economic impacts” to small businesses and micro-businesses to determine if any further analysis is required. For that purpose, commission considers “direct economic impact” to mean a requirement that would directly impose recordkeeping or reporting requirements; impose taxes or fees; result in lost sales or profits; adversely affect market competition; or require the purchase or modification of equipment or services.

         The department has determined that there will be adverse economic effects on small businesses, microbusinesses, and persons required to comply with the amendments as proposed; however, those effects will be minimal. The department has determined that most if not all businesses affected by the proposed rule qualify as small or microbusinesses.  In addition, since the fee is no higher than the fee established by SB 932, the fee would result in no small business impact beyond the impact of SB 932.  However, to provide a understanding of the possible impacts, the following is provided.

         Under regulations of the Department of State Health Services (DSHS, 25 TAC §241.57(e)), each bag or container of molluscan shellfish (including oysters) transported by a harvester (oyster fisherman) or dealer is required to be tagged with a harvester’s tag or a dealer’s tag bearing information required under the federal National Shellfish Sanitation Program. Under Parks and Wildlife Code, §76.021(c)(2), as added by SB 932, the oyster shell recovery tag will satisfy the regulatory requirements of DSHS and function in lieu of the harvester’s or dealer’s tag. Thus, there will be no adverse economic impact on oyster fishermen other than the tag fee of $0.20. The department consulted with representatives of the oyster industry to determine the current cost of compliance with DSHS tagging requirements, who reported that the current cost of compliance was in the range of $0.06 to $0.08 per tag.  Subtracting the current fee expense for the harvester’s tag from the proposed fee for the oyster shell recovery tag yields a net increase in cost of compliance of between $0.12 and $0.14 per tag. Using the average number of sacks harvested over the last three years (757,198), the net increase in cost to license holders would range from $90,864.00 to $106,008.00, which, when divided by the number of license holders (638), yields an average increase in cost per license holder of between $139 and $169.

         The purpose of the oyster shell recovery program is to generate funds to return shell to public oyster reefs, where the oyster shell will function as cultch, or spawning beds, for additional oyster production, which should result in increased availability of oysters for commercial harvest. Studies from Louisiana and Florida show that every dollar spent on restoration results in a $20 economic benefit (Dugas 1988; Berrigan 1990.); thus, the economic impact to small and microbusinesses should be positive over time. Also, as noted above, SB 932 requires a minimum fee of $0.20 per tag; thus, the proposed tag fee is required by statute and cannot be less than $0.20 per tag.

         (C) The department has determined that the proposed rule will have very little impact upon local employment at the macro or micro level.  As noted in the discussion of economic impacts to small and microbusinesses, the average per-license increase in cost as a result of the proposed fee for oyster shell recovery tags ranges from $139 to $168 per license-holder per year, which the department believes would not cause measurable changes in local employment. The department also notes that proposed amendments to oyster harvest regulations published elsewhere in this issue of the Texas Register should result in the increased harvest of more marketable oysters over time, which should more than compensate for increased costs of compliance associated with the proposed tag fee.

         (D) The department has determined that Government Code, §2001.0225 (Regulatory Analysis of Major Environmental Rules), does not apply to the proposed rules.

         (E) The department has determined that there will not be a taking of private real property, as defined by Government Code, Chapter 2007, as a result of the proposed rules.

         (F) The department has determined that the proposed rule is in compliance with Government Code, §505.11 (Actions and Rules Subject to the Coastal Management Program) and §505.22 (Consistency Required for New Rules and Rule Amendments Subject to the Coastal Management Program).

4. Request for Public Comment

         Comments on the proposed rule may be submitted to Jeremy Leitz, Texas Parks and Wildlife Department, 4200 Smith School Road, Austin, Texas 78744; (512) 389-4333; email: jeremy.leitz@tpwd.state.tx.us.

5. Statutory Authority

         The amendment is proposed under the provisions of Senate Bill 972, as enacted by the 82nd Texas Legislature, Regular Session (2011), which amended Parks and Wildlife Code, Chapter 76, by adding new §76.021 to provide for the collection of a fee for each box of oysters harvested by licensed commercial oyster fishermen from the waters of the state.

         The proposed amendment affects Parks and Wildlife Code, Chapter 76.

         §53.12. Commercial Fishing Licenses and Tags.

                 (No change.)

                 (b) Oystering licenses.

                         (1) – (3) (No change.)

                         (4) Tags. Harvester/shell recovery tag — $0.20.

                 (c) – (e) (No change.)

         This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency’s legal authority to adopt.

         Issued in Austin, Texas on


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