SMALL FISHING GROUPS GAIN ACCESS TO FEDERAL FINANCING SUPPORT
FCC Scores Big Win for Small-Boat Fishermen and their Communities
Washington, DC – Small-boat fishermen and community-based fishing organizations just received a big boost in their struggle to finance rights to catch fish in federally managed waters.
The National Marine Fisheries Service (NMFS) has issued a proposed rule that would provide financial assistance to community fishing associations, permit banks and community quota banks to purchase fishing quota and other harvesting rights. Since 2012, members of the Fishing Communities Coalition (FCC) have worked with Congress to change the law to ensure that community-based fishing associations could access a key loan program to finance harvesting rights for young and beginning fishermen.
The new rule implements changes to the Fisheries Finance Program (FFP) made by the Coast Guard Authorization Act of 2015 (P.L. 114-120). Prior to the change, loans for the purchase of harvesting rights were limited to fisheries in Alaska.
“This is a major positive change that will give younger fishermen and smaller fishing operations a chance to build their businesses for the future,” said John Pappalardo, FCC President and CEO of the Cape Cod Commercial Fishermen’s Alliance. “Financing community quota banks has been a huge challenge for our member fishermen, so having FFP loans available as a potential source of funding is a powerful change for the better.”
After the 2015 law was passed, members of the FCC met with NMFS personnel to provide information on how various quota banks were created and how they work.
The new rule does not waive the economic soundness test applied by NMFS to all FFP loans. Like other FFP loans, lending for harvesting rights is subject to a loan limit of 80 percent of the actual cost. Harvesting rights loans can carry a 25-year term and be used to purchase new rights or refinance debt associated with the prior purchase of harvesting rights.
“This new rule represents a major victory for fishing communities and small-scale fishing businesses across the nation,” Pappalardo continued. “FCC members in Alaska, Maine and Massachusetts have already created community quota banks – and this new rule will allow more fishermen to build a career on the water.”