GloucesterTimes.com, Gloucester, MA

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March 21, 2013

Fish fund shows boats' debt up 700%

Over the first two years of catch share fishing, through 2011, debt to the Gloucester Fishing Community Preservation Fund for the lease of the allocation of fish from the permits acquired by the fund to help keep Gloucester boats active climbed almost 700 percent to nearly $800,000, according to the fund’s 2011 filings with the Internal Revenue Service and the state attorney general.

Gloucester fishermen interviewed for this story said the spike in debt for the lease of quota reflects the increasing desperation of fishermen to remain at work even without the resources to pay or provide collateral for the additional fishing rights that the preservation fund provides.

A number of fishermen said they had leased quota in small amounts — no more than $3,000 — without providing collateral, and were appreciative of the courtesy.

The accounts receivable at the start of 2010 was recorded to be $12,290 on the nonprofit’s 990 in lieu of tax filing. By the end of the year, the form showed accounts receivable of $143,713, according to the earlier form signed by Vito Giacalone, then the president of the preservation fund which is also known as the Gloucester Permit Bank.

That same amount, $143,713, was the sum of the accounts receivable listed at the start of 2011, according to the later filing signed by Jacqueline Odell, treasurer of the permit bank. The end of 2011 accounts receivable had ballooned to $791,695.

The audited financial statement filed with Attorney General Martha Coakley’s office Jan. 28, 2013 contained a note describing “accounts receivable” as “the amount management expects to collect from balances outstanding at year-end on management’s assessment of the credit history and current relationships with each vessel. Management believes that all accounts receivable are fully collectible and therefore no reserve for bad debt is required,” the note concluded.

The preservation fund was incorporated in 2007 as a 501(c)3 charitable corporation, created to receive $12 million from the state in mitigation of the loss of fishing grounds off Gloucester for liquefied natural gas terminals. Giacalone was the president and only full-time salaried employee, paid $72,000 a year.

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