By Sean Horgan
---- — In a step that could lead to the first federal financial assistance to Massachusetts’ fishing-related businesses, Gov. Deval Patrick has officially certified the widespread economic hardship imposed on Massachusetts fishing communities by the fishery disaster proclaimed a year ago by the U.S. Department of Commerce.
That assistance, if recognized by the U.S. Small Business Administration, would come in the form of low-interest loans to approved Bay State fishermen and fishing-related businesses.
In a letter to Frank Skaggs, the director of the SBA’s disaster assistance office, Patrick certified that small businesses in six Massachusetts counties, including Essex County, “suffered substantial economic injury as a result of the fishery resource disaster.”
Patrick also pointed out that the degree of economic injury to fishermen and commercial fishing-related businesses is so severe “that financial assistance at reasonable rates and terms is not otherwise available, thereby creating the necessity for federal involvement in the form of subsidized loans from the Small Business Administration.”
The low-interest loan program, if approved by the SBA, would be the federal government’s first firm commitment of financial assistance to the industry that has been ravaged by NOAA’s Draconian cuts to to the allowable catch quotas for many of the ground fishing species traditionally fished by the Gloucester commercial fleet.
Carol Chastang, an SBA spokeswoman, said the federal agency is reviewing the governor’s request for a disaster declaration. That disaster declaration by the SBA is necessary before any loan program could be instituted.
“If the answer is yes, SBA will lay out the application process for long-term, low-interest loans and it will go from there,” said Peter Judge, spokesman for the Massachusetts Division of Marine of Fisheries.
Patrick’s certification of the scope of the disaster also represented a rare initiative by the Commonwealth to help alleviate the impact of financial disaster that has befallen the state’s commercial fishing industry since the new NOAA quotas were instituted in May.
State Rep. Ann-Margaret Ferrante, D-Gloucester, applauded the governor’s action Monday, but said she would prefer to see the financial assistance come in the form of grants rather than loans.
“Hopefully the governor can get across to the (Obama) administration that, when you take away somebody’s income, it becomes very difficult to come up with the money to pay for low-interest loans,” Ferrante said.
Any federal assistance involving grants would have to come from other federal sources. The SBA, according to Chastang, only provides loans to eligible recipients. It does not have within its purview the ability to provide direct grants to afflicted businesses, she said.
The Gloucester-based Northeast Seafood Coalition also endorsed Patrick’s action, calling it “an essential step” for the SBA to declare a disaster and make the Massachusetts groundfish fishery eligible for SBA disaster assistance.
State agencies, assisted in a preliminary survey by the coalition and the Massachusetts Fishermen’s Partnership, determined that several hundred Massachusetts fishermen and businesses will be impacted by the fishery resource disaster.
“Several businesses surveyed report losses of more than 40 percent of gross revenues when comparing 2011 to 2012 figures,” Patrick wrote. “These figures demonstrate a sharp decline that is expected to significantly worsen in the 2013 season because of the disaster.”
Sean Horgan may be contacted at 978-283-7000 x3464, or firstname.lastname@example.org. Follow him on Twitter at @SeanGDT