And as you might expect, there's nobody to bail it out. Too small. No Wall Street safety net. No bonuses for the managers who preside over the mess. No sympathy from the green eyeshade crowd that sees the cold, hard numbers.
NEW BEDFORD, Mass. — November 4, 2013 — The following is a excerpt from a column written by Steve Urbon, originally published in the New Bedford Standard-Times:
Everyone knows by now that the federal government has clamped down on fishing for all the reasons I don't need to get into here.
So that has stopped almost all the groundfish boats from fishing. That, in turn, has nearly cut off the supply of funds being paid into the New Bedford Fishermen's Pension Fund, which collects 2.2 percent off the top of the catch of every boat, before expenses.
That, plus the recession of 2008 that drained $4 million from the assets of the fund, leaves the fund underwater with only 80 percent of the assets it needs to meet its obligations.
And as you might expect, there's nobody to bail it out. Too small. No Wall Street safety net. No bonuses for the managers who preside over the mess. No sympathy from the green eyeshade crowd that sees the cold, hard numbers.
I sat last Friday in a corner of the ballroom at the Fishermen's Club on Orchard Street in the South End with the pension funds actuary, its trustees, a couple of lawyers, and about eight angry and desperate boat owners/operators who are trapped in this dilemma, and who insisted that a reporter stay in the room so you could learn about the fix they are in.
Much of their frustration came from not getting the answers they want from the pension fund's managers. So, actuary Basil Castrovinci walked everybody through the annual report and the costs they would confront if boat owners left the pension plan, or if the plan were to throw in the towel and put itself in the loving arms of the federal government.
The boat owners didn't get much advice about what they ought to do, and the frustration was apparent. Here they were locked into a pension plan that was in better times a no-brainer, and left holding the bag as being the last couple of dozen boats still classified as "active" and still contributing – and liable.
"Active" though, is something of a joke, and here's why: To avoid being tagged as withdrawing from the pension fund and being assessed hundreds of thousands of dollars, boats must fish one day a year, even if it costs them money in fuel, supplies, and so on. Losing money on one trip a year is a bargain considering the alternative.
Twenty-one groundfish boats were counted in 2012, but it came out at the meeting that just four of them are actually fishing regularly and paying into the pension system.
The rest are just tied up at the dock, hanging on for dear life, waiting for an answer, a way out, that no one provides.
Castrovinci said that appealing to federal pension regulators is a longshot because so many pension plans have been hammered by the recession, and he's probably right.
Read the full opinion piece at the New Bedford Standard-Times