The approval by the federal Small Business Administration of a low-interest loan program for fishermen and fishing-related business is, as noted in Saturday’s Times story, good news for fishing families and waterfront businesses in communities such as Gloucester and others along the Massachusetts coast into New Hampshire.
After all, if this program helps one fishing boat owner or one other struggling waterfront business to stay afloat — it will be a good investment.
But Massachusetts congressional leaders and Gov. Deval Patrick had better be aware that the SBA program may indeed not help more than a handful of fishermen when easily hundreds are in dire need of federal and state assistance. That’s because the conditions mapped out by the SBA may block the vast majority of fishermen from even qualifying for the financing.
According to the SBA approval, loans of up to $2 million can be issued based upon fishermen’s or businesses’ credit history, their projected ability to repay the loans and possession of collateral of at least $5,000. And the loans will come with a maximum rate of 4 percent, with repayment terms stretching out for up 30 years.
That format parallels other such programs the SBA and other federal agencies have set up in the past, when businesses in various parts of the country have come face-to-face with a natural or other disaster. And let’s not forget that the current state of the Northeast groundfishery, including Gloucester and the rest of New England, has been recognized as an “economic disaster” by the Department of Commerce. But it’s hard to imagine how most fishermen will be issued — or even apply for — loans based on 2013 credit histories that now show their businesses driven to the brink bankruptcy, with homes and/or boat up for sale of facing potential foreclosure.
The SBA loan approval is a positive step, but, like the limited grant program that may allocated up to $10 million in Saltonstall-Kennedy Act funds for innovated fishery improvement projects, is just another tiny step toward confronting a giant economic problem.
Until meaningful and direct aid is forthcoming, lawmakers and other should hold off on any grand pronouncements and celebrations.