North Carolina § 113-202 - 1. Water column leases for aquaculture.

§ 113-202. 1. Water column leases for aquaculture.

To increase the productivity of leases for shellfish culture issued under G.S. 113-202, the Secretary may amend shellfish cultivation leases to authorize use of the water column superjacent to the leased bottom under the terms of this section when he determines the public interest will benefit from amendment of the leases. Leases with water column amendments must produce shellfish in commercial quantities at four times the minimum production rate of leases issued under G.S. 113-202, or any higher quantity required by the Marine Fisheries Commission through duly adopted rules. Suitable areas for the authorization of water column use shall meet the following minimum standards: Aquaculture use of the leased area must not significantly impair navigation; The leased area must not be within a navigation channel marked or maintained by a state or federal agency; The leased area must not be within an area traditionally used and available for fishing or hunting activities incompatible with the activities proposed by the leaseholder, such as trawling or seining; Aquaculture use of the leased area must not significantly interfere with the exercise of riparian rights by adjacent property owners including access to navigation channels from piers or other means of access; and Any additional standards, established by the Commission in duly adopted rules, to protect the public interest in coastal fishing waters. The Secretary shall not amend shellfish cultivation leases to authorize uses of the water column involving devices or equipment not resting on the bottom or that extend more than 18 inches above the bottom unless: The leaseholder submits an application, accompanied by a nonrefundable application fee of one hundred dollars ($100.00), which conforms to the standards for lease applications in G.S. 113-202(d) and the duly adopted rules of the Commission; The proposed amendment has been noticed consistent with G.S. 113-202(f); Public hearings have been conducted consistent with G.S. 113-202(g); The aspects of the proposals which require use and dedication of the water column have been documented and are recognized by the Secretary as commercially feasible forms of aquaculture which will enhance shellfish production on the leased area; It is not feasible to undertake the aquaculture activity outside of coastal fishing waters; and The authorized water column use has the least disruptive effect on other public trust uses of the waters of any available technology to produce the shellfish identified in the proposal. Amendments of shellfish cultivation leases to authorize use of the water column are issued for a period of 10 years or the remainder of the term of the lease, whichever is shorter. The annual rental for a new or renewal water column amendment is one hundred dollars ($100.00) an acre. If a water column amendment is issued for less than a 12-month period, the rental shall be prorated based on the number of months remaining in the year. The annual rental for an amendment is payable at the beginning of the year. The rental is in addition to that required in G.S. 113-202. Amendments of shellfish cultivation leases to authorize use of the water column are subject to termination in accordance with the procedures established in G.S. 113-202 for the termination of shellfish cultivation leases. Additionally, such amendments may be terminated for unauthorized or unlawful interference with the exercise of public trust rights by the leaseholder, agents and employees of the leaseholder. Amendments of shellfish cultivation leases to authorize use of the water column may be transferred only with the superincumbent bottom lease for the remainder of the term of the amendment at the same rental rate and term as set forth in subsection (d) of this section and so long as notice of the transfer is provided to the Secretary as required by G.S. 113-202(k). After public notice and hearing consistent with subsection (c) of this section, the Secretary may renew an amendment, in whole or in part, when the leaseholder has produced commercial quantities of shellfish and has otherwise complied with the rules of the Commission. Renewals may be denied or reduced in scope when the public interest so requires. Appeal of renewal decisions shall be conducted in accordance with G.S. 113-202(p). Renewals are subject to the lease terms and rates established in subsection (d) of this section. The procedures and requirements of G.S. 113-202 shall apply to proposed amendments or amendments of shellfish cultivation leases considered under this section except more specific provisions of this section control conflicts between the two sections. To the extent required by demonstration or research aquaculture development projects, the Secretary may amend existing leases and issue leases that authorize use of the bottom and the water column. Demonstration or research aquaculture development projects may be authorized for five years with no more than one renewal and when the project is proposed or formally sponsored by an educational institution which conducts research or demonstration of aquaculture. Production of shellfish with a sales value in excess of five thousand dollars ($5,000) per acre per year shall constitute commercial production. Demonstration or research aquaculture development projects shall be exempt for the rental rate in subsection (d) of this section unless commercial production occurs as a result of the project. The Secretary may establish Shellfish Aquaculture Enterprise Areas for water column leasing pursuant to this subsection. The Secretary may establish one or more Shellfish Aquaculture Enterprise Areas that comply with the requirements of this section, including the notice, public hearing, and public comment requirements; any other State requirements for shellfish leasing; and any applicable federal requirements. Requirements under this section include the notice, public hearing, and public comment requirements of this section. Leases issued in a Shellfish Aquaculture Enterprise Area shall be nontransferable and shall revert to the State upon relinquishment or termination. The Marine Fisheries Commission may adopt any rules necessary to implement this subsection. History (1989, c. 423, s. 1; 1989 (Reg. Sess., 1990), c. 1004, s. 4; c. 1024, s. 22; 1993, c. 322, s. 1; c. 466, s. 2; 2004-150, s. 5; 2015-241, s. 14.10C(c); 2015-268, s. 5.6; 2016-94, s. 14.11(b); 2016-123, s. 6.1(a); 2017-102, s. 33.4(a); 2019-37, s. 1(c).) Moratorium on Shellfish Leasing in the New Hanover County Area - Session Laws 2019-37, s. 7, provides: "Notwithstanding G.S. 113-202 and G.S. 113-202.1, a moratorium on new shellfish cultivation leases and new water column leases for aquaculture shall be imposed for all those waters enclosed by a line beginning at 34 ø 13.10221' N -77 ø 48.79544' W on the mainland side near Wrightsville Beach Bridge; running southeasterly to a point at 34 ø 12.51584' N -77 ø 47.81847' W on Wrightsville Beach; following the shoreline southwesterly to a point at 34 ø 11.121' N -77 ø 48.848' W at Masonboro Inlet; running southwesterly to a point at 34 ø 10.927' N -77 ø 48.771' W at Masonboro Inlet; continuing southwesterly to a point at 34 ø 05.04108' N -77 ø 52.08324' W near IWW marker #159 continuing running southwesterly to a point at 34 ø 03.64140' N -77 ø 53.41338' W on the mainland adjacent to the eastern mouth of Snow's Cut; running northeasterly along the shoreline to the point of beginning. The moratorium shall expire July 1, 2021. For purposes of this section, a new shellfish cultivation lease or water column lease shall include applications for either type of lease received by the Secretary, but not granted as of July 1, 2019." Moratorium on Shellfish Leasing In Bogue Sound - Session Laws 2019-37, s. 8, provides: "Notwithstanding G.S. 113-202 and G.S. 113-202.1, a moratorium on new shellfish cultivation leases and new water column leases for aquaculture shall be imposed for all those waters enclosed by a line beginning at 34 ø 43.24641' N -76 ø 41.68436' W; running easterly following the Highway 70 High Rise Bridge to a point at 34 ø 43.27819' N -76 ø 41.22259' W; running southerly to a point 34 ø 42.375275' N -76 ø 40.80078' W on the southern tip of Radio Island; running southerly to a point 34 ø 41.98273' N -76 ø 40.81929' W; following the shoreline westerly to the Emerald Isle Bridge at a point 34 ø 40.05410' N -77 ø 03.80531' W; running northwesterly following the bridge to a point 34 ø 40.77658' N -77 ø 04.02674' W on the mainland near the Emerald Isle High Rise Bridge; running easterly following the shoreline to the point of beginning. The moratorium shall expire July 1, 2021. For purposes of this section, a new shellfish cultivation lease or water column lease shall include applications for either type of lease received by the Secretary, but not granted as of July 1, 2019." Editor's Note. - Session Laws 2016-94, s. 14.11(d)-(g), as amended by Session Laws 2017-57, s. 13.13(a), provides: "(d) The North Carolina Policy Collaboratory at the University of North Carolina at Chapel Hill shall convene a stakeholder working group to study and advance efforts to ecologically restore and achieve economic stability of the shellfish industry, including (i) how best to spend financial resources to counter declining native oyster populations and shellfish habitats; (ii) the use of appropriate oyster species to accomplish oyster restoration; (iii) means of combating oyster disease and managing harvesting practices to balance the needs of the industry and promote long-term viability and health of oyster habitat and substrate; (iv) economically and scientifically sound mariculture methods to improve oyster stock and populations; (v) long-term, dedicated options for funding sources and water quality improvements; (vi) means to increase oyster production for both population growth and harvest, including the use of triploid oyster species; (vii) options that expand private shellfish hatchery capacity in the State; (viii) options for promoting the use of cultch planting to enhance and increase oyster habitat and population; (ix) other resources that might be leveraged to enhance reform efforts; and (x) any other issue the Collaboratory deems relevant. "(e) In the conduct of the study required by subsection (d) of this section, the Collaboratory shall convene and consult with a stakeholders group that may consist of representatives from appropriate State and federal agencies; academic institutions; nongovernmental organizations; representatives of any industry working in, or benefitting from, shellfish mariculture; and any other individuals or groups deemed by the Collaboratory as being relevant to the overall success of the study. Nothing in this subsection is intended to require a particular process or level of procedural formality for the stakeholders group." "(f) The University of North Carolina at Chapel Hill shall report the results of its study, including any recommendations and suggested legislation needed to implement the recommendations, to the Fiscal Research Division, the Environmental Review Commission, and the Joint Legislative Oversight Committee on Agriculture and Natural and Economic Resources no later than December 31, 2018. "(g) Notwithstanding any other provision of law, funds provided to the Division of Marine Fisheries of the Department of Environmental Quality for contracting with the University of North Carolina at Wilmington to develop oyster brood stock to provide seed for aquaculture shall be transferred to, and not through a contractual arrangement with, the University of North Carolina at Wilmington for that purpose. No indirect facilities and administrative costs shall be charged by the University against the funds transferred by this subsection." Session Laws 2016-94, s. 1.2, provides: "This act shall be known as the 'Current Operations and Capital Improvements Appropriations Act of 2016.'" Session Laws 2016-94, s. 39.4, provides: "Except for statutory changes or other provisions that clearly indicate an intention to have effects beyond the 2016-2017 fiscal year, the textual provisions of this act apply only to funds appropriated for, and activities occurring during, the 2016-2017 fiscal year." Session Laws 2016-94, s. 39.7, is a severability clause. Session Laws 2016-123, s. 6.1(a), as amended by Session Laws 2017-102, s. 33.4(a), provides, in part: "If House Bill 1030, 2015 Regular Session, becomes law, then G.S. 113-202.1(f), as enacted by Section 14.11(b) of that act, reads as rewritten." House Bill 1030 is Session Laws 2016-94, which, in s. 14.11(b) of that act, rewrote G.S. 113-202.1(f). Session Laws 2017-57, s. 13.13(b)-(d), as amended by Session Laws 2017-197, s. 4.1, provides: "(b) In addition to the study required by Section 14.11(d) of S.L. 2016-94, as amended by subsection (a) of this section, the North Carolina Policy Collaboratory shall also prepare and deliver a Shellfish Mariculture Plan by December 31, 2018. Except as otherwise prohibited by State or federal law, all State entities shall provide all information, resources, and support deemed relevant by the Collaboratory for the creation of the Shellfish Mariculture Plan. The plan shall be submitted to the Joint Legislative Oversight Committee on Agriculture and Natural and Economic Resources, the chairs of the House of Representatives Appropriations Committee on Agriculture and Natural and Economic Resources, the chairs of the Senate Appropriations Committee on Agriculture, Natural, and Economic Resources, and the Fiscal Research Division and shall consider the following: "(1) A summary of available and relevant information on shellfish mariculture. "(2) An analysis of existing programs, policies, rules, and laws that govern or affect shellfish mariculture operations within the State, including an examination of workforce training and marketing programs that could facilitate the growth of shellfish mariculture within the State. "(3) A summary of shellfish mariculture plans from other states and countries, including a comparison of how these entities (i) promote and manage shellfish mariculture, (ii) reduce barriers to entry for potential participants in shellfish mariculture, and (iii) offer incentives to encourage entry into shellfish mariculture. "(4) Analysis of siting strategies that reduce potential user conflicts impeding the siting of shellfish mariculture operations and that protect riparian property owners and the public trust uses of estuarine waters for navigation, fishing, and recreation. "(5) Evaluation and consideration of enforcement mechanisms necessary to protect shellfish mariculture operations from theft and degradation and to ensure that shellfish mariculture operations make productive and fair use of public trust coastal waters dedicated to these operations. "(6) Opportunities for local traditional fishermen to effectively compete for shellfish mariculture sites in public waters and participate in enterprises in or near their own communities. "(7) Examination of environmental policies that protect or enhance shellfish mariculture operations. "(8) Consideration of the most appropriate substrate for cultch planting, with consideration of regional differences in bottom conditions within the State that may require different substrates to maximize shellfish sustainability. "(9) Strategies to mitigate or eliminate shellfish pests such as DMX, Dermo, and boring sponges. "(10) Any other issues deemed relevant by the Collaboratory to grow and support shellfish mariculture within the State. "(c) The University of North Carolina at Chapel Hill shall not charge indirect facilities and administrative costs against the funding for the studies required by this section. "(d) The North Carolina Policy Collaboratory, in consultation with the Economic Development Partnership of North Carolina, the Department of Commerce, and the Department of Natural and Cultural Resources, and any other stakeholders the Partnership deems relevant, including the North Carolina Tourism Advisory Board, the North Carolina Restaurant and Lodging Association, the North Carolina Shellfish Growers Association, and the North Carolina Fisheries Association, shall develop conceptual plans and recommendations for economic development related to promotion of the State's shellfish harvesting heritage. The plans and recommendations shall include the creation of a North Carolina Oyster Trail and a North Carolina Oyster Festival. Plan development shall be congruent with the ongoing work of the North Carolina Policy Collaboratory and its stakeholder group as described in this section and shall include recommendations of locations, oversight, governmental support, cost, and timing of when such initiatives should be launched in the future, including, but not limited to, achieving production and acreage benchmarks, in addition to any other information deemed relevant for inclusion. The Collaboratory's recommendations shall be provided no later than December 31,, 2018, to the Joint Legislative Oversight Committee on Agriculture and Natural and Economic Resources, the chairs of the House of Representatives Appropriations Committee on Agriculture and Natural and Economic Resources, the chairs of the Senate Appropriations Committee on Agriculture, Natural, and Economic Resources, and the Fiscal Research Division. This study, as it may be subsequently amended after submission, shall be included as an appendix to the Shellfish Mariculture Plan required by subsection (b) of this section." Session Laws 2017-57, s. 1.1, provides: "This act shall be known as the 'Current Operations Appropriations Act of 2017.'" Session Laws 2017-57, s. 39.4, provides: "Except for statutory changes or other provisions that clearly indicate an intention to have effects beyond the 2017-2019 fiscal biennium, the textual provisions of this act apply only to funds appropriated for, and activities occurring during, the 2017-2019 fiscal biennium." Session Laws 2017-57, s. 39.6, is a severability clause. Session Laws 2019-37, s. 1(d), provides: "The Division of Marine Fisheries of the Department of Environmental Quality shall identify areas in waters that are under a moratorium for shellfish leasing that could potentially be established as Shellfish Aquaculture Enterprise Areas. The Division shall report its findings to the General Assembly no later than April 1, 2020." Session Laws 2019-37, s. 3(a)-(e), provides: "(a) Definitions. - For purposes of this section and its implementation: "(1) 'Extensive shellfish culture' means shellfish grown on the bottom without the use of cages, racks, bags, or floats. "(2) 'Intensive shellfish culture' means shellfish grown on the bottom or in the water column using cages, racks, bags, or floats. "(3) 'Shellfish Production and Planting Requirements Rule' means 15A NCAC 03O.0201 (Standards and Requirements for Shellfish Bottom Leases and Franchises and Water Column Leases) for purposes of this section and its implementation. "(b) Shellfish Production and Planting Requirements Rule. - Until the effective date of the revised permanent rule that the Marine Fisheries Commission is required to adopt pursuant to subsection (d) of this section, the Commission shall implement the Shellfish Production Requirements Rule as provided in subsection (c) of this section. "(c) Implementation. - Shellfish leases shall be terminated unless they comply with the following requirements: "(1) Franchises recognized pursuant to G.S. 113-206 and shellfish bottom leases shall be terminated unless: "a. They produce a minimum of 20 bushels of shellfish per acre averaged over the previous three-year period beginning in year five of the lease; or "b. For intensive culture bottom operations, the holder of the lease provides evidence of purchasing a minimum of 23,000 shellfish seed per acre annually and for extensive culture bottom operations, the holder of the lease plants a minimum of 15,000 shellfish seed per acre per year. "(2) Water column leases shall be terminated unless: "a. They produce a minimum of 50 bushels of shellfish per acre averaged over the previous three-year period beginning in year five of the lease; or "b. The holder of the lease provides evidence of purchasing a minimum of 23,000 shellfish seed per acre annually. "(d) Additional Rule-Making Authority. - The Commission shall adopt a rule to amend the Shellfish Production Requirements Rule consistent with subsection (c) of this section. Notwithstanding G.S. 150B-19(4), the rule adopted by the Commission pursuant to this section shall be substantively identical to the provisions of subsection (c) of this section. Rules adopted pursuant to this section are not subject to Part 3 of Article 2A of Chapter 150B of the General Statutes. Rules adopted pursuant to this section shall become effective as provided in G.S. 150B-21.3(b1), as though 10 or more written objections had been received as provided in G.S. 150B-21.3(b2). "(e) Applicability and Sunset. - This section and rules adopted pursuant to this section apply to all new and renewal shellfish leases granted after July 1, 2019. This section expires when permanent rules adopted as required by subsection (d) of this section become effective." Session Laws 2019-37, s. 13(a), is a severability clause. Effect of Amendments. - Session Laws 2004-150, s. 5, effective July 1, 2005, rewrites subsection (d). Session Laws 2015-241, s. 14.10C(c), effective July 1, 2015, in subsection (c), substituted "uses of the water column involving devices or equipment not resting on the bottom or that extend more than 18 inches above the bottom" for "use of the water column." Session Laws 2015-268, s. 5.6, effective July 1, 2015, substituted "10 years" for "five years" in the first sentence of subsection (d). Session Laws 2016-94, s. 14.11(b), effective July 1, 2016, rewrote subsection (f), which formerly read "Amendments of shellfish cultivation leases to authorize use of the water column are not transferrable except when the Secretary approves the transfer after public notice and hearing consistent with subsection (c) of this section"; and, in subsection (i), substituted "five years" for "two years" preceding "with no more than one renewal" in the second sentence, and substituted "five thousand dollars ($5,000)" for "one thousand dollars ($1,000)" preceding "per acre per year" in the next-to-last sentence. Session Laws 2016-123, s. 6.1(a), as amended by Session Law 2017-102, s. 33.4(a), effective August 1, 2016, substituted "only with the superincumbent bottom lease" for "with a bottom lease" in subsection (f). Session Laws 2019-37, s. 1(c), effective July 1, 2019, added subsection (j). Opinions of Attorney General Lease for Shellfish Cultivation for Personal Consumption or Use. - The Division of Marine Fisheries and the Marine Fisheries Commission do not have authority to grant leases or similar exclusive proprietary rights to the water column beneath docks and piers to individuals for the cultivation of shellfish for personal consumption or use. See opinion of Attorney General to Mr. Preston P. Pate, Jr., Director, North Carolina Division of Marine Fisheries, and Mr. James A. Johnson, Jr., Chairman, North Carolina Marine Fisheries Commission, 2003 N.C.A.G. 13 (9/22/03).