August 14, 2020 — Politicians are praising the recent news that NOAA Fisheries has reduced the outstanding principal balance on the Pacific Coast Groundfish Fishing Capacity Reduction Buyback Loan. The loan has been reduced by nearly $6 million.
In 2000 the West Coast groundfish fishery was declared an economic disaster. In response, Congress authorized a $46 million buyout to reduce overcapacity. $36 million in funds was provided in the form of a loan that the remaining fishing vessels agreed to repay based on a 3.5%-5% fee on ex-vessel revenue over 30 years. Interest started accruing in March 2004, but NMFS did not implement a repayment system until September 2005. Vessels could not make any loan repayments during this time, which added $3.8 million in interest. And now, because of that error, those remaining vessels now owe over $13 million more than they would have if NMFS had immediately implemented a repayment system. The Pacific Coast groundfish industry has made payments of more than $34 million towards the loan, but as of December 2019 still owed $22.4 million.