Defense bill will include loan relief for trawl fishermen

The World
By Gail Elber
December 6, 2014

WASHINGTON, D.C. — West Coast fishermen will get relief from high-interest government loans that were part of a 2003 assistance package, thanks to a provision inserted in the National Defense Authorization Act by U.S. Rep. Peter DeFazio.

DeFazio also secured inclusion of legislation to expand the Oregon Caves National Monument near Cave Junction by 4,070 acres and designate the River Styx — the underground stream running through Oregon Caves — as the first subterranean Wild and Scenic River in the nation. 

The legislative package annually includes not only funding for the armed forces but also a hodgepodge of measures, sometimes controversial, that legislators add onto it in political maneuvers.

The House passed NDAA this week, and the Senate is expected to take it up next week. The Oregon Caves proposal is one of several NDAA provisions regarding public lands that Senate Republicans have said they oppose.

The fishermen's loan issue began in 2000, when the West Coast groundfish fishery was declared a federal fishery disaster because of low stock abundance, overfishing and an overcapitalized fleet. In 2003, Congress authorized a $36 million loan to finance a capacity reduction program to buy out 91 vessels and 239 fishing permits.  

The fishermen who remained in the fishery agreed to repay the cost of buying out these vessels and permits. The original loan was set up with a repayment rate of five percent ex-vessel value of all fish harvested, a 30-year repayment period, and a 6.97 percent interest rate – which was two points over the prime rate at the time.

Five percent ex-vessel value is a third of the profits for many trawl vessel owners, said Brad Pettinger, executive director of the Oregon Trawl Commission, a state agency that represents trawlers' interests.

And because Congress didn't create a means for fishermen to start paying on the loan until 2005, $4 million in interest accrued before payments even began. After making payments for 12 years, the fishermen have barely begun paying down the principal of the loan, Pettinger said.

Under the new legislation, the repayment rate would not exceed three percent ex-vessel value of all fish harvested, the repayment period would extend to 45 years, and the interest rate would be the treasury rate.

Pettinger said members of Congress from both parties had long realized that the loan program was burdensome, but legislation to change it, sponsored by West Coast legislators, had never gotten traction until DeFazio's move this year.

About 130 trawlers, including the whiting fleet, currently ply the West Coast, Pettinger said.

DeFazio also helped add to the NDAA legislation that would expand the Oregon Caves National Monument nearly tenfold, which he said would boost the local economy with additional tourist dollars and create needed jobs in southern Oregon. The legislation, pushed by DeFazio and Sen. Ron Wyden, expands the Oregon Caves National Monument by 4,070 acres and designates the River Styx — the underground stream running through Oregon Caves — as the first subterranean Wild and Scenic River in the nation. 

The expansion would be achieved by transferring land from the U.S. Forest Service to the National Parks Service. Supporters say the move would protect valuable habitat and enable restoration of fire-damaged areas, for which NPS has more money than USFS does. Opponents have criticized a move that would lock up forest land away from logging and other uses.

More than 70,000 tourists visit Oregon Caves each year, generating $4.8 million in local revenues and supporting 70 local jobs in economically hard-hit Josephine County and Cave Junction.