Maine Department of Marine Resources to tinker with proposed lobster marketing fees

Posted March 18, 2013, at 7:28 p.m.

AUGUSTA, Maine — A legislative committee on Monday tabled discussion on a bill that would raise $3 million in lobster industry licensing fees so that state regulators could have time to tinker with the proposed fee schedule.

The bill, LD 486, would increase surcharges on each kind of license — harvester, dealer or processor — that would be used to fund the state’s efforts to generically market Maine lobster across the country and the globe. The new surcharges would increase over a three year period and, by 2016, would raise $3 million a year for Maine lobster promotional campaigns.

Currently, DMR raises about $350,000 each year to promote Maine lobster, which most state and industry officials agree is insufficient.

Maine Department of Marine Resources Commissioner Patrick Keliher told the Legislature’s Marine Resources Committee that the department will work on coming up with new, more proportional surcharges for dealers and processors. Tailoring surcharges for fishermen to reflect their fishing activity, he added, might not be practical.

The committee did not indicate when it might reconvene to consider the revised surcharge schedule.

Lobster industry license surcharges that fishermen and dealers currently pay toward marketing efforts range from more than $30 to $250, depending on the kind of license. But LD 486 proposed increasing fees by 2016 to a range of $240 to $2,600, with processors facing the highest fees.

Some people in the industry have said the proposed surcharges aren’t fair. Some have argued that, as proposed, most of the marketing funds would come from fishermen but most of the resulting financial benefit would go to dealers and processors.

Others have criticized the proposal for requiring all holders of any one type of license to pay the same surcharge amount, regardless of the scope of their business. For someone who fishes for only four or five months a year with a couple hundred traps, paying a surcharge of several hundred dollars can be more of a burden than it is for someone who uses the legal maximum of 800 traps and fishes year round.

Likewise for dealers. For a small dealer with one or two employees who transports tens or hundreds of thousands of pounds a year, a $2,000 surcharge is more onerous than it is for a dealer who employs dozens of drivers and trucks millions of pounds.

Keliher told the committee that any person or company that holds more than one type of license is expected to pay the highest resulting surcharge but not any lower surcharges associated with other licenses.

Bill Anderson, a fisherman from Trescott, told the committee that he has both a fishing license and a dealer license. The amount of lobster he trucks to buyers is the same as the amount he hauls from the sea, he said, which is a relatively small amount compared to other dealers.

“I’m probably the smallest dealer in the state because I only handle my own product,” Anderson said.

One member of the committee, Rep. Wayne Parry of Arundel, suggested that the surcharges paid by fishermen could be adjusted by zone. Some of the seven lobster management zones along the coast have higher landings than others, he reasoned, so fishermen in those zones could afford to pay more.

Keliher countered that there is a wide variety of fishing activity within each zone, so setting it simply by which zone someone fishes in wouldn’t be fair either. Plus, fishermen are not required to file landings reports, so determining what would be fair for each individual fishermen would be a challenge. And even if it could be done, Keliher added, it would present a significant and costly additional administrative burden on DMR.

The commissioner said it may be possible, however, to tailor dealer and processor surcharges to the scope of those businesses. Dealers and processors have to file reports with the state and there are fewer of them, he said, so making proportional adjustments to those surcharges is more feasible.

But adjusting those numbers still won’t resolve the debate over whether all the surcharges are fair, he said.

“You have all kinds of business sizes in this scenario,” Keliher said.

In a separate work session Monday, the committee voted unanimously to recommend that LD 182 ought to pass. That bill would raise $1 million from the General Fund and make it available for marketing efforts right away.

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