EDITOR’S NOTE: Due to a printer error, the complete story is not available in our print edition. Below is the full story.
With restrictions set to take effect next year that will slash the number of days New England fishermen can spend at sea, federal regulators are dangling this offer in front of commercial anglers:
You want out? We’ll help buy your boats.
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Over the past week, officials from Northeast Sea Grant have been hosting a series of meetings to gauge New England fishermen’s interest in a voluntary, industry-funded buyout of potentially hundreds of commercial groundfish boats.
Congress has set aside a $46-million loan to buy the boats of willing New England fishermen. The loan would be repaid over 20 years through landing fees assessed on the fleet’s remaining boats.
The proposed buyback is just one alternative aimed at softening the economic blow from federally mandated groundfish restrictions, which could cut the combined number of days that New England vessels are allowed to fish by as much as 65 percent, starting in May 2004.
The idea: Rather than all of New England’s roughly 1,000 active groundfish vessels scavenging for a dwindling number of fishing days, give a smaller number of boats more days – and a better chance to earn a decent living.
But whether or not the fishermen bite is entirely up to them. “No one on the (New England Fisheries Management) Council is ramming this down your throat; it’s an option,” said Paul Howard, the council’s executive director, who spoke to about 30 New Bedford fishermen last week during the first of nine introductory meetings throughout New England.
A meeting is scheduled from 1 to 4 p.m. Monday, June 30, at the University of Rhode Island’s Narragansett Bay campus.
The buyback would require a two-thirds majority vote of New England’s 1,500 groundfish permit holders (roughly 500 of which are considered inactive). Just reaching the point of a referendum could take more than two years.
The plan would offer any groundfish boat owner a quick way to cash out. The remaining boats would be on the hook to repay the $45-million loan through a maximum 5-percent charge on the value of their landings.
For example, a fisherman who lands $200,000 worth of fish in one year would pay a maximum of $10,000 toward the loan.
So what’s in it for those boat owners? The tantalizing prospect of more fish.
The groundfish business should become more lucrative in coming years as yellowtail flounder, haddock and cod stocks rebound, researchers say. Revenues from New England groundfish landings should triple by 2018, from $100 million now to around $300 million, according to the fisheries management council.
A successful boat buyback would mean fewer boats chasing those multiplying fish.
But fishermen are leery, based on the initial reaction from a handful of boat owners who attended last week’s meeting at the New Bedford Whaling Museum.
“I don’t believe that ($300 million) number at all,” said Rodney M. Avila, who has fished out of the New Bedford port for more than 40 years.
Avila and many other fishermen said that if they agreed to support the buyback, there’s no protection against future restrictions that might hamper their ability to catch enough fish to repay the loan.
“You’re asking us to help pay back a $45-million loan, but what if the council pulls the rug out from under us and we don’t have those days” at sea? Avila asked. “Now I can’t sell my vessel because nobody wants to buy my liability.”
The plan would be the first industry-funded boat buyback in New England, although the federal government in recent years has paid out of its own pocket to bail out struggling fishing vessels.
In the mid-1990s, the government spent $24 million in disaster-relief funds to buy out 79 New England fishing vessels. And in 2001 and 2002, $9.5 million was spent to buy 245 inactive permits.
But under the industry-funded model, the entire remaining fleet – not the government – would be picking up most of the tab. The plan also is much broader in scope: Regulators would like to see the fleet thinned by as many as 600 active groundfish boats, or more than half of New England’s fleet.
Robert Lane, who owns an 88-foot groundfish boat in the New Bedford port, said he thinks there are plenty of fishermen – especially those approaching retirement – who would be interested in selling out.
“I see an opportunity to reduce the fleet and to give people a way out, which I believe they’re going to need,” Lane said, alluding to the looming restrictions.
But he also sees risks on both sides. For those bailing out, Lane said the capital-gains tax on the boat sales could be a killer. A number of fishermen also questioned whether the $46 million – plus $10 million in no-strings-attached funding Congress approved in February – would be enough to fairly compensate the hundreds of boat owners who may opt to sell.
Boat sales would likely be conducted through a reverse auction, and bids would
have to meet criteria outlined by the National Oceanic and Atmospheric Association,
which would administer the buyback program.
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