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Case Study
Reducing Regulatory Risks for Shellfish Growers in Humboldt Bay

Location
Humboldt Bay, Humboldt County, California

Timeframe
2009 - ongoing

Summary
Shellfish have been farmed in Humboldt Bay for more than 100 years. Currently, the bay produces 70% of the live oysters eaten in California. The state legislature recognized the bay’s economic and cultural importance in 2009 when it was designated the Oyster Capitol of California. After an extensive review of economic development opportunities in and around Humboldt Bay, the public agency charged with managing the bay decided to explore expanding commercial aquaculture activities in Humboldt Bay as a way to create jobs and improve the local economy, while also increasing local and sustainable seafood production. During their deliberations, they determined that a significant deterrent to commercial expansion is the lengthy regulatory process, and associated costs, that growers must endure, and assume, to obtain aquaculture permits. They devised an innovative “pre-permitting” approach whereby the public agency, instead of individual growers, would obtain permits on a landscape scale (and assume the regulatory risk) and then lease the pre-permitted tidelands to growers. This approach will not only help achieve local goals, but also the state and federal goal to expand commercial aquaculture in the nation’s waters to meet future seafood demands.

Transferability
In practice, though some of the enabling conditions that have allowed for success in Humboldt Bay are somewhat unique, similar entities and circumstances do exist elsewhere that could provide for similar approaches. They include: (1) a public management and regulatory entity (the Humboldt Bay Harbor, Recreation and Conservation District), (2) an engaged industry (the shellfish growers), (3) a funding mechanism (the Humboldt Bay Headwater Fund), and (4) research capacity (Humboldt State University and locally-based consultancies). One intangible, and often ephemeral element of success, which was strongly evident in Humboldt Bay, was a certain “aligning of forces” or synergy, as well as the high degree of contribution, involvement, and expertise provided by each of the above entities. While the functions provided by the Humboldt Bay Harbor, Recreation and Conservation District (the District) – the only one of its kind in California – are performed by public entities elsewhere, more often than not these functions are spread across multiple entities, thus making success all the more difficult. In addition, the District exhibits a relatively high degree of involvement and leadership in Humboldt Bay. Without these qualities, it seems doubtful the effort would be successful. Equally important was the high degree of cooperation and engagement exhibited by the local aquaculture industry; particularly, their openness to providing commercial opportunities to other growers. One grower said: “There've never been that many of us. There could be more." One case study element not readily available elsewhere is a robust and well-endowed funding mechanism such as the Humboldt County Headwater Fund. In nine years, the Fund has infused $16 million into the local economy and its financial contributions to this project were vital. That said, while the structure and mandate of the Fund may be unique to Humboldt Bay, other communities often have sources of economic development funds available to them.

Best Practices
Leadership/Champions: The project benefits from numerous leaders and champions in the form of the commissioners and staff of the Humboldt Bay Harbor, Recreation and Conservation District and the businessmen who farm Humboldt Bay tidelands. For example, one grower stated: "All the shellfish producers are friends and we all work together." The high degree of interaction, collaboration, and synergy between these individuals and entities was readily apparent and important to project success. P>Leverage Funding Mechanisms: Grant funds provided by the Humboldt County Headwater Fund were instrumental to the project.

Work with Local University: Humboldt State University has a long history of working on initiatives important to the local community, including their involvement in this project.

Community Buy-In: The community sees this current activity as a value, including local environmental organizations that understand the industry’s need for clean water and stormwater protection.

Extensive Public Input: The District provided numerous opportunities for public input at each stage of the project.

Full Case Study Description

Background
Global seafood demand is expected to increase by up to 27 million metric tons by 2030 and, as capture fisheries have plateaued since the mid-80s, regulators and growers see aquaculture as a growth industry that can help meet demand (Coomber 2015). This is evidenced by the NOAA National Shellfish Initiative, established in 2011 to increase populations of bivalve shellfish in our nation’s coastal waters. The California Shellfish Initiative, a companion effort, was established in the same year.

In Humboldt Bay, located on the north coast of California, commercial mariculture has been an important activity for more than 100 years and efforts are in progress to increase its footprint on the bay and its contribution to the local economy. Humboldt Bay, the state’s second-largest enclosed bay and the biggest port between San Francisco and Coos Bay, Oregon, boasts the largest oyster production operations on the West Coast. Humboldt Bay oysters are ranked as a "best-choice" seafood by the Monterrey Aquarium Seafood Watch rating system and the Blue Ocean Institute rates them positively.

Aquaculture is also an important component of the local community and economy. The City of Eureka, the county seat, is the largest city on the bay, followed by Arcata, the home of Humboldt State University. The combined population of Eureka and Arcata, along with numerous other named communities situated around the bay, totals some 80,000 people, representing about 60% of Humboldt County’s population. Oyster growers are involved in community events and often supply oysters at benefits. Local events that celebrate Humboldt Bay’s aquaculture traditions include the Arcata Oyster Festival, which was initiated in 1990 and currently attracts about 12,000 people each year and contributes about $750,000 to the community in one weekend. In 2007, the five mariculture businesses operating on the bay had sales totaling $6 million, employed 56 people, and spent $1.5 million on payroll. This economic activity stemmed from cultivation on 325 acres of bay tidelands, which is less than one third of the acreage historically cultivated in the bay and about 10% of the acreage certified for culture.

Goals and Priorities
The expansion of commercial aquaculture activities in Humboldt Bay, to create jobs and improve the local economy, while also increasing local and sustainable seafood production.

Challenges and Issues
Regulatory Framework and Costs. Aquaculture takes place on public lands and resources held in trust by the state of California. The cities of Eureka and Arcata and the Humboldt Bay Harbor, Recreation and Conservation District (the District) handle leases of trust lands within Humboldt Bay. In addition to leases, local growers must get permits from their leasing authority, as well as from the U.S. Army Corps of Engineers, the California Coastal Commission, the California Water Quality Control Board and Humboldt County. Their operations also must meet the requirements of a number of local, state and federal entities, such as the state Department of Fish and Game and the National Marine Fisheries Service. Negotiating this permitting and review process can take growers many years and require significant financial outlays on their part. For example, the Coast Seafoods Company, the biggest oyster grower in Humboldt Bay (and in California), spent more than $1 million on permits and environmental reviews over a 10-year period (Walters 2012). Given its large size, resources and experience, Coast Seafoods could negotiate the complex regulatory process and absorb the expense. However, the same regulatory process and associated costs are significant barriers to smaller growers and to potential new growers. One grower put it this way: "If you want to set up a new oyster farm on the bay – or expand an existing one – you’ll need buckets of money and the perseverance of a gull choking down a starfish to complete the slow-going, complex multi-agency permitting and environmental review process."

Environmental Concerns. Progressive mariculture management measures have been implemented within Humboldt Bay over the past two decades, the most significant being the conversion of oyster aquaculture activities from bottom to off-bottom culture. The District also maintains a Mariculture Monitoring Committee to evaluate existing and new information regarding the environmental impacts of oyster aquaculture activities, and to develop recommendations for best management practices designed to minimize degradation of sensitive estuarine habitats and communities. However, given the goal to expand mariculture in Humboldt Bay, questions have been raised by state and federal agencies, as well as local stakeholders, about the bay's capacity to support growth in the aquaculture industry. Concerns exist as to the potential individual and cumulative impacts that mariculture expansion may have on eelgrass and other bay co-habitants. The need to assess the potential effects of current and proposed aquaculture, and provide information regarding Humboldt Bay's ecological carrying capacity, has been recognized. Additionally, others indicate that planning should ensure that expansion does not negatively impact other bay-dependent industries, recreational opportunities, and wildlife. For example, the Pacific Flyway Council points out that Humboldt Bay is the most important bay in California for black brant (Branta bernicla nigricans) and the fourth most utilized staging area in the Pacific Flyway. The reliance of brant on eelgrass makes them highly vulnerable to fluctuations in the quality of eelgrass habitat. Thus, the extent to which expanded aquaculture has the potential to significantly degrade eelgrass habitat is a cause for concern.

Actions and Approaches
In March 2009, the Humboldt Bay Harbor, Recreation and Conservation District (the District), a county-wide taxing entity, established an Economic Development Committee comprising District commissioners, members of the aquaculture industry (growers), entrepreneurs, economic developers, government planners and interested citizens. The committee held a series of forums over a six month period to explore economic development opportunities for Humboldt Bay, including one forum on fishing and mariculture. The committee was tasked with defining opportunities with the greatest potential, identifying key players and their motivations, and identifying development barriers and ways to overcome them. The committee’s recommendations and prioritized policies and actions had to be consistent with the District’s Strategic Plan, including the objective “to pursue economic development that is attainable, innovative and consistent with both best environmental practices and the Humboldt Bay Management Plan.” Their recommendations for enhancing economic development opportunities in aquaculture were to design an innovative, streamlined permitting process; create an aquaculture committee to guide the District in expanding the aquaculture industry; and explore funding mechanisms for an aquaculture business park/incubator.

The District's first decided to pre-permit space in the bay that could then be leased to growers. Specifically, the District would obtain regulatory approvals (permits) for clam and oyster (and macro-algae) culture at specific Humboldt Bay sites and, once permitting is complete, lease them to private entities (growers) through a public bidding process. The approach is designed to streamline the traditional permitting process, transfer the regulatory risk from the growers to the District while still ensuring environmental compliance by growers, and provide a reasonable (more affordable) entry investment cost for new growers.

In spring 2010, at the request of District Commissioner Mike Wilson, an Environmental Science & Management Senior Planning Practicum class at Humboldt State University conducted a Pre-Feasibility Study Examining Oyster Mariculture Expansion in Humboldt Bay, California (Carter-Griffin et al. 2010). The students reported on physical and regulatory opportunities and constraints to expansion and, using spatial analysis techniques, identified 2,647 acres with potential for shellfish farming that they considered would not harm eelgrass or other bay co-habitants.

In 2011, the District applied for a $200,000 grant from the Humboldt County Headwaters Fund to identify specific mariculture expansion sites in Humboldt Bay and to develop a process and guidelines by which the District would pre-permit mariculture sites and then lease them to growers. The Humboldt State University pre-feasibility study that identified additional areas for potential oyster aquaculture expansion provided the justification for the grant request (Carter-Griffin et al. 2010). The grant was approved by the Humboldt County Board of Supervisors.

The grant funds were used to hire H.T. Harvey & Associates (local ecological consultancy) and, in May 2014, the consultant provided maps and coordinates of specific mariculture parcels to be pre-permitted, and leasing guidelines such as the density of cultures, the number of oysters per acre, and cultural techniques and limitations. In July 2014, the District released a request for proposals (RFP) from those seeking to lease and culture tidelands once they are permitted by the District (with the expectation that permits would be obtained in 2015). The RFP included a schedule of minimum lease rates for each parcel along with guidelines for accepted culture methods. At the request of the Humboldt County Board of Supervisors, the lease includes a fee to cover future permitting costs. The expected lease term is five years with renewal if growers meet their lease obligations, including a requirement that sites must be kept in production and cannot be sub-leased. Growers who respond to the RFP are required to provide a statement of their qualifications and three references. The RFP deadline for proposals was October 10, 2014 and the RFP and bidding process is overseen by City of Eureka, the County of Humboldt and the District.

As part of the pre-permitting process, the District hired H.T. Harvey & Associates to produce a Draft Environmental Impact Report (DEIR) to assess impacts and propose mitigation measures for those impacts deemed of certain significance levels. The DEIR is to satisfy California Environment Quality Act (CEQA) requirements, as well as to support reviews and assessments by local, state and federal agencies. Lessees will be required to adopt approved mitigation measures. The District received the DEIR in January 2015 and announced a public comment period (1/23/2015 to 3/12/2015) and public meeting scheduled for March 4, 2015.

Accomplishments The project has evoked cautious optimism from conservationists and created ripples of excitement among shellfish farmers and regulators alike – locally, regionally, and nationally.

Next Steps The District is compiling, assessing, and responding to public comments it has received regarding the Draft Environmental Impact Report. For example, state and federal agencies responsible for reviewing the project recommended the siting of any new oyster farming activities in Humboldt Bay outside of eelgrass and away from areas sensitive to birds and other wildlife. In response, the Harbor District released revised draft project maps pertaining to its Environmental Impact Report process showing avoidance of much of the eelgrass beds and has also agreed to work more collaboratively with Audubon and others, as well as responsible agencies.

Key Partners

  • City of Eureka
  • City of Arcata
  • Coast Seafoods Company
  • H.T. Harvey & Associates
  • Humboldt Bay Harbor, Recreation and Conservation District
  • Humboldt County
  • Humboldt County Headwaters Fund
  • Humboldt State University

Contacts
Mike Wilson, Commissioner
Humboldt Bay Harbor, Recreation and Conservation District
P.O. Box 1030
Eureka, California 95502-1030
(707) 443-0801

Jack Crider, Executive Director
Humboldt Bay Harbor, Recreation and Conservation District
P.O. Box 1030
Eureka, California 95502-1030
(707) 443-0801
jcrider@humboldtbay.org

Additional Information
Humboldt Bay Harbor, Recreation and Conservation District. Retrieved May 10, 2015, from http://humboldtbay.org.

National Shellfish Initiative, Office of Aquaculture. NOAA Fisheries. Retrieved May 11, 2015, from http://www.nmfs.noaa.gov/aquaculture/policy/shellfish_initiative_homepage.html.

References
Carter-Griffin, C., C. Hubauer, A, Minks and E. Robinson. 2010. A Pre-Feasibility Study Examining Oyster Mariculture Expansion in Humboldt Bay, California. Humboldt State University, Natural Resource Planning and Interpretation Senior Planning practicum. 50 pp.

Coomber, C. (2015, March 26). How can we grow aquaculture in California? Sea Grant California. Retrieved May 8, 2015, from https://caseagrant.ucsd.edu/news/how-can-we-grow-aquaculture-in-california

H.T. Harvey & Associates. 2015. Draft Environmental Impact Report for the Humboldt Bay Mariculture Pre-Permitting Project. SCH #2013062068. Prepared for Humboldt Bay Harbor, Recreation and Conservation District. http://humboldtbay.org/documents.

Humboldt Bay Harbor, Recreation and Conservation District, Economic Development Committee Summary Report, 2010, http://humboldtbay.org/humboldt-bay-harbor-recreation-and-conservation-district-economic-development-committee.

Humboldt Bay Harbor, Recreation and Conservation District, Economic Development Committee, 2010, Prioritization of Potential Policies and Actions for Economic Development of Humboldt Bay, http://humboldtbay.org/humboldt-bay-harbor-recreation-and-conservation-district-economic-development-committee.

Walters, H. (2012, April 5). The World Is Yours, Oyster Farmer. The North Coast Journal Weekly. Retrieved January 8, 2015, from http://www.northcoastjournal.com/humboldt/the-world-is-yours-oyster-farmer/Content?oid=2133083.

Last updated 16-Oct-15





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Region
  • Pacific
Geographic Scope
  • County(s)
Governance Structure
  • Dillon Rule
Issues
  • Economic development
  • Environmental impacts: resource protection, habitat loss, water quality degradation
  • Regulatory factors
Tools
Waterfront Uses
  • Aquaculture
Digital Coast Snapshots
Flood Exposure
Wetland Benefits
Coastal & Maritime Jobs