Massachusetts Aquaculture Strategic Plan Chapter III - Regulatory Reform

Introduction

The overriding mission of the Regulatory Reform Working Group (RRWG) was to identify the major regulatory issues which inhibit the development of the aquaculture industry and to propose a streamlined process which protects public and private rights and environmental quality. In order to accomplish this mission, the RRWG reviewed both existing and proposed aquaculture activities in the Commonwealth.

The three major issues identified for review by the committee included regulatory coordination and streamlining, long-term security for capital investments, and state support for the aquaculture industry. These findings, and the associated recommendations, are designed to provide the short-term framework for improving aquaculture permitting. The RRWG contemplates that long-term statutory amendments, consistent with the below recommendations, will also be pursued in order to effectively address the needs of the aquaculture industry.

Based on a review of applicable laws and regulations, the RRWG proposes a series of recommendations which would improve the interagency coordination and management of aquaculture activities in the Commonwealth. As a relatively new industry in Massachusetts, aquaculture activities have rarely been considered in the course of statute or regulation development. As a result, the aquaculture industry faces an uncoordinated, and at times overlapping, regulatory framework for the review and permitting of aquaculture projects. In addition to the uncertain review processes affecting aquaculture, the industry is not afforded an interagency coordinated review processes or a lead state agency with adequate expertise to advise and promote the industry. This lack of a comprehensive and certain review process represents a significant impediment to the development of the aquaculture industry within the Commonwealth.

The recommendations of the RRWG are designed to streamline the regulatory processes for aquaculture activities in Massachusetts. At the outset, a principal recommendation calls for the establishment of a state Aquaculture Coordinator. This position will serve a variety of critical roles. The Aquaculture Coordinator could assist the industry by providing a single point of contact for all aquaculture related issues. The Coordinator should also serve to provide educational material regarding the permit requirements, review time frames, application fees, agency contact person, necessary application materials, and review processes for the different types of aquaculture.

In order to further minimize regulatory bottlenecks in the review and permitting of aquaculture, aquaculture should be jointly coordinated by the Division of Marine Fisheries ("DMF") and the Division of Fisheries and Wildlife ("DFW"). DMF should be the lead regulatory agency for marine aquaculture and hatcheries. DFW should be the lead regulatory agency for inland aquaculture and hatcheries. Each agency should develop one-stop permit process incorporating concerns of all other relevant state and federal agencies. The Department of Food and Agriculture ("DFA") should be the lead agency for the promotion and marketing of aquaculture products.

Finally, state and federal agencies should aggressively pursue the development of general permits for aquaculture activities (inland and marine). Such "general permits" for certain classes of activities could eliminate the need for individual detailed permit processing. A project would automatically qualify for a permit if the conditions of the general permit are complied with. Projects qualifying for a general permit would still be required to apply for a permit, but the processing would be expedited. The use of general permits for aquaculture activities would greatly improve the predictability and efficiency of permitting procedures and significantly reduce permitting time. Concurrent filing will also improve coordination between the various reviewing bodies and public hearings and comment periods should be able to be coordinated.

The second issue of concern to the aquaculture industry is the long-term security of capital investments. Due to the significant capital investments associated with aquaculture, security in the duration of the lease is a major consideration. The lack of such stability in leasing intertidal and Commonwealth tidelands has proven to be a financing obstacle. Lease security is critical to the industry and involves balancing private land use with public interests in tidelands. Several recommendations are provided to clarify ownership of tidelands; terms and transferability of leases; and the role of local, state, and federal agencies in developing lease agreements.

The third principal issue addressed was the development of state support for the aquaculture industry and local shellfish managers. Specific interest was expressed for the reactivation of the Municipal Shellfish Propagation program. Shellfish aquaculture licensing fees should reflect the economic value of public tidelands, be dedicated to municipalities, and be used for public shellfish propagation and/or restoration of shellfish beds. Interest has also been expressed in DMF developing a pilot program of authorizing shellfish nurseries in restricted areas. Finally, a standardized method for reporting aquaculture production should also be developed to provide the Commonwealth and the industry with the ability to monitor the success of the industry.

The final specific recommendations of the RRWG are intended to address the following classes of aquaculture activities:

1. Shellfish Bottom Culture: which involves minimal structure and no discharge;

2. Shellfish/Seaweed Water Column Culture: consisting of more substantial structures and no discharge;

3. Recirculating/Flowthrough Culture: involving structures located on land and having discharges;

4. Finfish Net Pen Culture: which involves structures in marine waters and discharges.

5. Projects in Federal Waters: involving various culturing techniques and located in part or full in federal waters.

A sixth class of projects, involving pond culture, was not addressed in the present forum because pond culturing is currently being reviewed as part of the legislatively authorized Farmland Advisory Committee.

The regulatory recommendations made in this section are directed at eliminating redundant and unnecessary permit review processes. The intent of this effort was to reduce process, while improving the integrity of vigorous, but relevant environmental review. The need for efficient, but effective environmental oversight of aquaculture activities is critical not only to protect public welfare and resources, but also to ensure the continued viability of aquaculture operations.

In addition to the recommendations presented below, the most valuable outcome from the Working Group process has been an increased understanding of the existing regulatory framework for aquaculture. This improved understanding has been enlightening not only to the regulating agencies, but to the industry as well. By identifying the existing process, the Working Group was able to effectively work toward streamlining and improvement. The existing regulatory framework for the different classes of aquaculture projects is found in Appendix A.

General Regulatory Recommendations

14. Recommendation:
State agencies should work closely with the ACOE and other federal resource agencies in amending the existing Programmatic General Permit (PGP) to directly address aquaculture thresholds. Develop conditions which ensure that only the largest projects and/or those with the greatest potential impacts require review as individual permits under Sections 404 and/or 401.

Justification:
The existing PGP covers aquaculture indirectly, by reference to a previously established Letter of Permission (LOP). The LOP which is not included within the text of the PGP, is oriented toward shellfish culture and does not address other culturing techniques. An updated PGP could incorporate the LOP and update to include other culturing techniques.

ImplementationApproach:
Amend the 404 PGP in coordination with the development of General NPDES permits for aquaculture (see Recommendation 28). Have CZM then issue consistency on the PGP and DEP certify the PGP. It is estimated that this process would take between 6-9 months to finalize.

15. Recommendation:
State agencies should make test lease or pilot projects viable by reducing regulatory requirements and facilitating joint monitoring for predetermined periods.

Justification:
The permit process for aquaculture is cumbersome. By allowing pilot projects, the state can encourage experimentation with new technology, develop project specific monitoring protocols and coordinate with industry while jointly monitoring baseline data and project impacts. Knowledge gained from pilot projects will benefit regulatory agencies, the public and industry.

Implementation Approach:
ACT should develop an expedited permit process for pilot projects.

16. Recommendation:
CZM should adopt a policy stating that aquaculture projects do not need to apply for Consistency Review unless 1.) They require an Individual permit as determined by the ACOE and/or 2.) They are sited in whole or in part in federal waters. CZM should also draft a Program Policy which directly addresses and supports aquaculture.

Justification:
This will clarify and simplify CZM's review authority over aquaculture projects. An Aquaculture Policy will provide policy guidance for Consistency Review.

Implementation Approach:
CZM should develop policy in coordination with the ACOE, notice in the Environmental Monitor and publicize.

17. Recommendation:
Amend DMF Chapter 130, Section 17 B to authorize the Director of Marine Fisheries to promulgate regulations concerning the siting, operation and monitoring of finfish aquaculture projects in the marine environment. DMF should be the lead agency in regulating ocean based aquaculture facilities and should develop a coordinated permit process for ocean based finfish projects which incorporates the concerns of all other relevant state and federal agencies.

Justification:
DMF regulations do not provide adequate guidance for the administration of finfish aquaculture licensing. There is strong desire both from industry and other regulating agencies to develop a "one-stop" permit process particularly for finfish culture.

Implementation Approach:
DMF should work with ACT to develop one-stop permit process.

18. Recommendation:
The state should maintain and assert its position that the boundary between private tidelands and state-owned subtidal land is mean low water.

Justification:
Private/public ownership of tidelands in Massachusetts has a complex history and there is a need to clarify the legal boundary of state ownership. The recent Pazolt decision held that because aquaculture is more like farming than fishing, the landowners permission must be received before aquaculture is practiced on private tidelands. The precise delineation between private and public lands (i.e. mean low water or extreme low water) remains uncertain.

Implementation Approach:
The Executive Office of Environmental Affairs Legal Counsel and possibly the Attorney Generals' Office should coordinate with DMF, CZM, DEM and DEP staff attorneys in searching for a case in which the delineation between public and private tidelands is the central issue, and put it before the Supreme Judicial Court of Massachusetts. In addition, counsel should review the issue of municipal propagation on private property.

19. Recommendation:
The existing fee structure for the Waterways Program (Chapter 91) should be reevaluated and revised for all aquaculture operations. The fee structure should reflect the nature of the facility and some of the benefits which aquaculture provides to the public (e.g. supplementing the wild stock, cleansing the water). Fees should adequately reflect the economic value and productivity of the operation.

Justification:
Existing Waterways licensing regulations do not address aquaculture specifically and the existing fee structure (based on displacement) is both illogical and prohibitive for aquaculture activities. The fees charged by the state for private use of public land should reflect both the economic value of the activity and the loss of land to the public.

Implementation Approach:
DEP, in the course of revising Chapter 91 regulations should develop specific appraisal techniques for aquaculture activities. CZM will assist DEP by analyzing other state aquatic land leasing processes and fee structures. See Appendix B for state leasing survey.

20. Recommendation:
The MEPA unit should review the adequacy of existing thresholds as they apply to aquaculture facilities. When considering these thresholds, MEPA should focus its limited resources on projects that will benefit from coordinated review and comment by both private and public interests. Additionally, this review should consider limiting MEPA jurisdiction through "limited project" general permit provisions, utilizing the categorical inclusion threshold, Memoranda of Understanding and/or developing a Generic Environmental Impact Report for aquaculture.

21. Recommendation:
EOEA (DEM and CZM) should review the existing Coastal Areas of Critical Environmental Concern (ACEC's) and existing state regulations to evaluate how the ACEC designation will affect new aquaculture facilities. If it is determined that the higher regulatory standards that accompany ACEC designation will adversely affect aquaculture operations that are compatible with the ACEC, then consideration should be given to amending the relevant state regulation.

Justification:
Any aquaculture activity proposed within an ACEC may be required to file an Environmental Notification Form (ENF). The more stringent review standards that are triggered within an ACEC should be balanced against the benefits of aquaculture projects within the coastal zone.

Implementation Approach:
The relationship between the ACEC designation process, MEPA and DEP regulations and other regulations should be evaluated. DEM and CZM should review existing coastal ACEC's and work with ACEC communities, preferably in the context of preparing ACEC resource management plans to develop recommendations for the Secretary of EOEA as to the compatibility of aquaculture projects to existing ACEC's. Longer Term - Future ACEC designations and ACEC resource management plans should specifically reference aquaculture projects and their relationship with the ACEC and, when appropriate, include language to allow or encourage aquaculture projects.

22. Recommendation:
DEM should issue a policy stating that the interests of Ocean Sanctuaries regulations are presumed to be met provided that DMF, Chapter 91 and CZM have approved or signed off on the project proposal. A longer term recommendation is for DEM to amend the existing regulations to build on the other programs as outlined above.

Justification:
The Ocean Sanctuaries Act and regulations specifically permit "the harvesting and propagation of fish and shellfish in all forms," so long as DEM and DMF "are satisfied that such activities are carried on in accordance with sound conservation practices" (defined as "practices designed to maintain, increase or restore existing finfish or shellfish stocks by the management of resources").

Implementation Approach:
DEM, in addition to writing a policy stating that their regulations are presumed to be satisfied, should be actively involved in the Interagency Aquaculture Permit Review Group.

23. Recommendation:
Aquaculture licenses should be subject to performance criteria set by individual towns. Such criteria or license conditions shall be valid for the term of the license. It is recommended that initial license terms should be a minimum of five years with 15 year renewals. Renewal of the license shall be authorized by the licensing authority provided that the license holder meets the performance criteria. Renewals shall also be contingent upon a determination that there have been no unacceptable adverse impacts from the initial license period.

Justification:
Currently, potential lenders are reluctant to finance aquaculture ventures as they have no assurance that licenses will continue beyond the initial period. The uncertainty surrounding aquaculture leases translates into risk and lack of collateral. The Steering Committee recognizes this issue to be one of the most critical to the industry as well as potentially the most controversial to local municipalities and the citizenry of the state. The issue of balancing private use with public interests will continue to need additional study and input from a variety of public and private stakeholders for both the short and long term.

Implementation Approach:
The Steering Committee should assist legislators in public outreach on this issue prior to any proposed resolution or change to lease terms. The duration and terms of leases or licenses of other states should be investigated to evaluate how other states have balanced the issue of public rights with private use. Refer to state leasing survey found in Appendix B.

24. Recommendation:
Shellfish aquaculture licenses should be transferable during the license period with the approval of the licensing authority. Denial of transfer shall only be authorized if the performance criteria set by the town was not met.

Justification:
same as 23

Implementation Approach:
same as 23

25. Recommendation:
Municipalities should be given the option to preapprove areas (with DMF, DEP, Conservation Commissions, CZM and ACOE) of its jurisdiction for aquacultural uses.

Justification:
Ad hoc or site by site decision-making on aquaculture licensing is time consuming and not advantageous to good management. By affording municipalities the option to pre-approve large areas of town waters for aquaculture, the municipality could have better control over long term planning. Additionally, by preapproving large areas, administrative costs and delays of individual reviews could be minimized.

Implementation Approach:
At the request of a municipality, DMF could survey a large section of town waters and identify areas which are non-productive and have no overarching natural resource constraints. DMF would establish criteria for pre-approving areas. Once these areas are identified, the municipality could apply to DEP and the ACOE for authorization of aquacultural activities under the jurisdiction of Chapter 91 and Section 10 respectively. The municipality would then know which area could be used for aquaculture, hold the proper authorizations and make siting decisions accordingly. Applicants would then apply to municipality only. Conservation Commissions and licensing authorities could also become involved in pre- approval utilizing resource conservation plans.

26. Recommendation:
The state should provide written guidance to towns regarding the legal requirements relating to the administration of shellfish licenses. This guidance should include the appropriate scope of review, relevant issues and criteria and public hearing formats.

Justification:
A need has been identified to establish criteria for the appropriate scope of review for shellfish licenses both for the benefit of aquaculturist and licensing bodies. This guidance is also intended to standardize administration of shellfish licensing from town to town, without compromising ultimate home rule authority.

Implementation Approach:
Review all municipal aquaculture licensing bylaws and statutes and develop a generic model for towns to review.

27. Recommendation:
WPA application should be filed concurrently with 404 Army Corps of Engineers permit applications, Section 10 (Rivers and Harbors) applications and Section 57 permit application, if required.

Justification:
Concurrent filing will improve coordination between the various reviewing bodies and public hearings and comment periods should be able to be coordinated. While there is currently a joint ACOE and WPA application for aquaculture projects it is still necessary for applicants to send copies separately to the ACOE and the Conservation Commission.

Implementation Approach:
Long Range - Consider amending the WPA regulations (310 CMR 10.00) to eliminate the need for individual permit review by creating a presumption that interests under the WPA are met provided that conditions imposed by DMF are adhered to. This will require additional coordination and conditioning between DEP, Conservation Commissions and DMF to ensure adequate protection, particularly in cases where upland access is a consideration. Coordination with municipal by-laws regulating aquaculture is also necessary.

28. Recommendation:
Shellfish aquaculture licensing fees paid by aquaculturists to towns should be increased to reflect their economic value and productivity. DMF should also evaluate the necessity to charge a (one time) application fee which covers the costs of surveying an area. License fees paid to municipalities should be directed to Shellfish programs for use in public shellfish propagation and/or restoration. Municipalities should provide an option to culturists to pay fees and/or provide seed for public propagation.

Justification:
DMF's statute (Chapter 130, section 64) currently caps shellfish aquaculture fees at $25/acre/ per year. However, the fee varies from town to town. There is concern that there may be an imbalance between the fee paid for private use of public land for aquaculture and the potential loss of public access to this land. The fees should be evaluated to reflect an appropriate balance. Once in place, the revenues generated should be directed to public shellfish enhancement. With enhancement of public resources, it is hoped that municipalities will likewise be encouraged to permit some level of private aquaculture.

Implementation Approach:
DMF should review license fees and consider adjustments. Statute should be amended to direct license revenues to Shellfish Department budgets. Refer to Appendix B for state leasing review.

29. Recommendation:
DMF requirements for reporting shellfish production should be improved. All reporting requirements (town and state) should be coordinated. Productivity thresholds (for keeping license) should be evaluated and increased. All reports to towns and state involving production and/or financial disclosure should be made confidential. (Amend Ch. 130, section 65)

Justification:
Existing reporting procedures are redundant and do not result in an accurate representation of the aquaculture industry.

Implementation Approach:
DMF, Massachusetts Aquaculture Association, and the Massachusetts Shellfish Officers Association should cooperatively develop a standardized reporting process and amend DMF regulations accordingly.

30. Recommendation
DMF should develop a pilot program of authorizing towns to lease restricted areas for use as shellfish nursery areas. Pilot projects would only be initiated at the request of and with the cooperation of, individual municipalities.

Justification:
Many contaminated areas are either naturally productive or have the capacity to be productive. By not allowing aquaculture for seed production, a resource is forfeited.

Implementation Approach:
Short term - Policy change. DMF should work with Municipal Shellfish Officers to develop procedures to allow a limited amount of leases within restricted areas. The implementation of this program should be closely tracked to evaluate the viability of expansion. Longer term - After evaluation of pilots, DMF should consider making regulatory changes to authorize this activity.

31. Recommendation:
DEP and EOEA, in conjunction with the EPA, should aggressively pursue the development of NPDES general permits for aquacultural activities (inland and marine). An initial estimate of 6 - 9 months has been suggested as the time period needed to draft, public notice and publish these two permits. In order to accomplish this goal considerable effort and coordination with EOEA, EPA, Mass Aquaculture Association and interested environmental groups must be dedicated in order to complete the project.

Justification:
Creating "general permits" for certain classes of activities would essentially eliminate the need for individual projects to go through a detailed and individual permitting process. A project would automatically qualify for a permit if the conditions of the general permit are complied with. The overall goal is to establish a general permit that would provide adequate protection while reducing individual project review and application processing delays. A screening provision, similar to the PGP, may be an effective way to allow timely review of individual projects. A recommended approach to a screening provision is to have a reporting requirement that automatically approves the project if the state does not require an individual permit review within 21 days of receipt of the project notice.

The establishment of general NPDES permits for aquaculture activities will greatly improve the predictability and efficiency of the regulatory process and will reduce permitting time significantly.

32. Recommendation:
DEP's Office of Watershed Management should issue a policy outlining the procedures for water withdrawals in brackish or saline waters from either surface or groundwater. The policy should also indicate that no individual permit is needed for salt water withdrawals from surface or groundwater.

Justification:
There is significant confusion among both regulators and the regulated community regarding the necessity of authorization for water withdrawals.

Implementation Approach:
DEP should simply issue a written policy on what types of projects require water withdrawal permits and which do not. DEP should further outline the process and requirements for projects which do require such authorization.

33. Recommendation:
The state should work with the New England Fisheries Management Council (NEFMC) and other federal agencies to develop a clear and coordinated administrative process for authorizing aquaculture activities in the Exclusive Economic Zone (EEZ). CZM Consistency Review will be linked to this process. The state should ensure that federal regulatory processes and actions are compatible with state interests.

Justification:
The NEFMC has the authority to designate special management areas in the EEZ for activities such as aquaculture. There is not presently an established process for authorizing such uses despite industry interest in siting in federal waters. At least two bills are being proposed in Congress to delineate federal aquaculture responsibilities.

Implementation Approach:
The state should become involved in the NEFMC Aquaculture Subcommittee as well as review proposed congressional aquaculture legislation.

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Published: September 1995