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Small Business Relief Information
Cares Act Tip Sheet for Self-Employed Individuals
Paycheck Protection Program: How to Calculate Maximum Loan Amounts
Webinar on Economic Relief for Alaska’s Small Seafood Businesses
ADF&G CARES ACT FISHER DISASTER RELIEF DRAFT ELIGIBILITY REQUIREMENTS FOR FISHERMEN AND PROCESSORS- Updated October 8, 2020
On October 5, 2020, the Alaska Department of Fish and Game (ADF&G) released its “Section 12005 CARES Act Relief for Fisheries Participants Draft Spend Plan” which will distribute $50 million in fisheries disaster relief funds to eligible participants from the commercial fishing, seafood processing, charter fishing, aquaculture and subsistence sectors.
Fishermen eligible for relief must be Alaska residents at least 18 years old who participate in marine fisheries off Alaska and hold a 2020 Commercial Fisheries Entry Commission (CFEC) vessel license and/or a 2020 CFEC fishing permit. Applicants also must have operated in 2018 and 2019. Qualifying applicants must have incurred and be able to document a 35 percent gross revenue loss from March 1, 2020 – November 1 2020 as a direct or indirect result of COVID-19 relative to average gross revenue last five years (2015-2019). Those applicants who did not fish all five years can use an annual gross revenue for years available. Also, applicants who received other CARES Act relief must certify that the sum of the aid plus their 2020 regular fishing revenue will not exceed their average revenue from 2015-2019.
ADF&G will calculate payment amounts once the agency receives all applications. Eligible applicants will receive one share per permit and one per vessel.
Eligible processors must have an Alaska Department of Environmental Conservation (ADEC) 2020 seafood processing permit, have operated in 2018 and 2019, and have a minimum average wholesale revenue of $30,000 from 2015-2019. At-sea seafood processors must be home-ported in Alaska and those that meet the $30,000 minimum average wholesale revenue will apply in seafood processing rather than harvesting sector. Other eligibility requirements for processors are similar to those for commercial fishing business owners - applicants must be able to calculate annual wholesale revenue for 2015-2019 and document a greater than 35 percent wholesale revenue loss compared to the time period from March 1, 2020 through November 1, 2020. Those applicants who have operated for less than 5 years can use the years in operation to document the revenue loss. ADF&G’s spend plan proposes to create seven payment tiers based on wholesale revenues.
After NMFS approves ADF&G’s spend plan, the Pacific States Marine Fisheries Commission (PSMFC) will review applications and distribute the relief funds. ADF&Gs press release and information for submitting comments is available here:
http://www.adfg.alaska.gov/index.cfm?adfg=pressreleases.pr&release=2020_10_05
DEPARTMENT OF AGRICULTURE ANNOUNCES SEAFOOD TRADE RELIEF PROGRAM Updated September 14, 2020
On September 9, 2020, the U.S. Department of Agriculture announced the creation of the Seafood Trade Relief Program, which will release roughly $530 million in funds for fishermen impacted by tariffs on specific seafood products. The Department of Agriculture’s Farm Service Agency will administer the program, which is funded by the Commodity Credit Corporation. According to the agency:
“The intent of [the Seafood Trade Relief Program] is to provide financial assistance to commercial fishermen for expanding or aiding in the expansion of domestic markets for U.S. commercially caught and sold seafood, because seafood commodities have been impacted by trade actions of foreign government, resulting in the loss of exports.”
The program will provide payments on a per pound harvested basis for sixteen commercially harvested marine fish species. Qualifying species had an estimated trade damage in excess of $5 million and include fish caught by Alaska and West Coast small boat hook-and-line and fixed gear fishermen such as tuna, salmon, sablefish, geoducks, Dungeness, king and tanner crabs. To be eligible, commercial fishermen must still be an active U.S. commercial fisherman in 2020 and have harvested specific seafood species in 2019 with a valid federal or state fishing permit or license.
Fishermen can apply for the payments beginning September 14, 2020 through December 14, 2020. To apply, commercial fishermen must complete a “2020 Seafood Trade Relief Program Application” and submit the application to their local Farm Service Agency office. Applicants will have to certify the amount of commercial landings in pounds for the 2019 season. The payment amount per fishermen depends on the amount of pounds harvested. Payment rates reflect the estimated severity of the impact of trade disruption to U.S. seafood caught and sold commercially. The Department of Agriculture calculated the per pound payment amounts as shown in the table below:
For example, if a fisherman caught 100,000 pounds of salmon, the Farm Service agency would calculate the payment as 100,000 x $.16. In some cases the Farm Service Agency may require fishermen to submit additional documentation for eligibility, including commercial fishing permits, documentation of landings and other forms. There is a $250,000 cap on payments. Fishermen with an average adjusted gross income of $900,000 or more may or may not be eligible and should contact a Farm Service Agency representative for criteria and other information applicable to this income threshold.
The Department of Agriculture used a trade damage model that simulated reductions in U.S. exports caused by the increased tariffs. The trade damage model estimated roughly $530 million in trade damages to U.S. commercial fishermen.
The online application and other information about the Seafood Trade Relief Program is available at:
https://www.farmers.gov/Seafood
Instructions are available here:
The Alaska Service Center is in Palmer, and its website, including contact information for staff administering the STRP is here:
https://www.fsa.usda.gov/state-offices/Alaska/index
Fishermen in other states can find their local Farm Agency Service Center through the following link:
https://www.farmers.gov/service-center-locator
There is a Call Center available for fishermen who may need individual support with the application process: (877) 508-8364.
ALASKA CARES ACT ELIGIBILITY CRITERIA EXPANDED BEGINNING MONDAY, AUGUST 31, 2020 Updated August 31, 2020
On August 27, 2020, the State of Alaska issued expanded eligibility criteria for the distribution of small business relief grants through the AK CARES Funding Program (“AK CARES”). Effective Monday, August 31, 2020, the application process will be open to businesses that received any amount of Paycheck Protection Program (PPP) or Economic Injury Disaster Loan (EIDL) funds. Previously, small businesses that had received more than $5,000.00 in other CARES Act federal assistance such as U.S. Small Business Administration’s Paycheck Protection Program loans or Economic Injury Disaster loans were ineligible. The state also expanded the program to include businesses that are secondary sources of income so these grants may also be available to part-time commercial fishermen. Roughly $240 million remains available for small business relief.
Commercial fishermen with 50 or fewer full-time equivalent employees who engage primarily in Alaska fisheries and who held and fished a Limited Entry permit in 2019 and 2020 and participated in a fishery that produced income in 2019 are eligible to apply for the grants. DCCED has also carved out three exceptions for fishermen who did not fish a state permit in 2019: (1) a permit holder who purchased a permit for the first time in 2020 is eligible they actively participated in an Alaska fishery in 2019 as a crew member; (2) a permit card holder who did an emergency transfer of the permit in 2019 and is actively fishing in 2020 is eligible and (3) temporary permit holders who held Limited Entry permits by emergency transfer are eligible.
Grants will range between a minimum amount of $5,000 and a maximum amount of $100,000. Applicants can calculate grant amounts based on eligible expenses incurred from March 11, 2020 to the application date and some applicants may be able to include expenses incurred 8 weeks after the application date. All funds must be spent by December 30, 2020.
Eligible expenses are COVID-19 emergency related business expenses: (1) payroll costs & expenses; (2) short term debt such as credit card debt incurred to support business during emergency; (3) rent or mortgage payments, (4) utilities payments, (5) Personal Protective Equipment purchases, (6) business equipment purchases; (7) inventory replenishment or necessary re-opening expenses.
Commercial fishermen will need to document their eligible expenses, including tax returns, proof of permit ownership, vessel mortgage agreements or leases, and receipts for expenses. Eligible expenses can include vessel owner net self-employment fishing earnings shown on the 2019 tax return (Schedule C) and crew shares for each crew member, based on 2019 earnings as reported on 1099s. Copies of receipts, credit card statements or other account statements will be necessary to document other eligible expenses such as moorage and storage payments, utilities payments, including electricity, fuel, heating oil, phone and internet, purchase of personal protective equipment, or other equipment or maintenance that is necessary for a commercial fishing business operation. New equipment to expand operations or unnecessarily replace or upgrade currently functional equipment are not eligible grant expenses.
The program will run until (1) November 15, 2020; (2) the end of the declared COVID-19 emergency or (3) the allocated are funds spent. There are no fees, and no repayment is needed except in the case of malfeasance. Qualifying applicants will have to adhere to a grant agreement outlining grant fund conditions. DCCED encourages businesses that become eligible this week to begin preparing applications promptly by reviewing the program check list, examples of eligible expenses, FAQs, and other materials available on the program website.
Links to the online application and Frequently Asked Questions are here:
https://www.commerce.alaska.gov/web/ded/AKCARESGrant/FAQ.aspx
ALFA is providing overviews of these loan and grant programs as general information for commercial fishermen and fishery support businesses. This information is not legal or financial advice. The DCCED also recommends that applicants seek professional advice on the tax consequences of received grants from AK CARES.
ALASKA DED WILLING TO CONSIDER LOAN ASSISTANCE- Updated August 15, 2020
The Alaska Division of Economic Development – Investments (DED-Investments) is prepared to work with existing borrowers who may experience economic hardship related to COVID-19. DED-Investments has experienced staff specifically trained to understand the fishing industry, and they are equipped with the tools to assist affected fishermen.
DED-Investments’ approach is to work closely with individual borrowers to craft solutions that work best for each individual borrower. Solutions are pursued on a case-by-case basis, as each borrower’s circumstances are different.
If you are experiencing economic hardship or have any questions, contact the DED-Investments and ask to speak to a loan officer. The officer will explain all available options and provide as much assistance as necessary to find a solution.
DED-Investments staff can be contacted at (907) 465-2510, 1-800-478-5626 (toll free), or financing@alaska.gov.
CITY OF SITKA CARES GRANT APPLICATION NOW AVAILABLE- Updated August 10, 2020
The City of Sitka's CARES grant application is now available online. Boat owners and deckhands can apply for $2,500 to $10,000. We recommend you apply as soon as possible, and the deadline for application is August 31, 2020.
You can fill them out electronically or scan and email to caresgrants@cityofsitka.org
https://www.cityofsitka.com/documents/City-and-Borough-of-Sitka-CARES-Act-Grant-Application.pdf
CITY OF SITKA FINALIZES GRANT PROGRAM FOR SITKA BUSINESSES AFFECTED BY COVID-19, APPLICATION PERIOD ENDS AUGUST 31, 2020 - Updated August 8, 2020
At its July 28, 2020 regular meeting, the Assembly approved the distribution of a $5 million pool of funds for local non-profits and small businesses. The application period has started and will end at 5 p.m. on August 31, 2020. Eligible recipients will can apply for grants in the following amounts: (1) $2,500 for 2019 revenues of less than $100,000; (2) $5,000 for 2019 revenues between $100,000 and $250,000; (3) $7,500 for 2019 revenues between $250,000 and $500,000 (4) $10,000 for businesses with revenues exceeding $500,000. The City may adjust these amounts if demand exceeds available funds.
The purpose of the grants is to assist with business interruption costs caused by the COVID-19 pandemic, including income lost due to shutdowns, additional operating expenses and other economic impacts. Funds may be used for future expenses or to cover for funds already spent. Eligible recipients must have experienced negative economic impacts due to COVID-19. Those impacts may include loss of sales or revenues due to shutdown measures, inventory loss, operating expenses incurred to protect staff and customer and may include funds already spent for those purposes. Funds must be expended by December 30, 2020. The City will not be requiring proof of spending after the fact. Applicants will not have to document economic losses but must provide a copy of a 2019 or 2018 tax return.
The City’s grant program includes commercial fishing businesses. The grant application does have a line where applicants need to provide a city sales tax registration number but commercial fishing business owners can leave that line blank because most commercial fishing vessel operators are not required to register with the sales tax office.
Commercial fishing business owners who are not permanent Sitka residents also may apply if they “have significant permanent business operations physically conducted within the boundaries of the City and Borough of Sitka.” Non-resident commercial fishing business owners can meet this criterion by having permanent moorage for their fishing vessel in Sitka. Deckhands may also apply for the grants provided they are Sitka residents, have been present in Sitka for at least 180 days in the last 12 months, and have experienced economic hardship due to COVID-19.
Because of the August 31, 2020, deadline ALFA urges fishermen interested in these grants to apply soon. Applications and Frequently Asked Questions are available at the following links:
http://www.cityofsitka.com/documents/City-and-Borough-of-Sitka-CARES-Act-Grant-Application.pdf
The City prefers online submissions by e-mail but will accept mailed applications. Grant applications and questions about the program may be submitted by email to grantsadmin@cityofsitka.org, or hand-delivered or mailed to the City and Borough of Sitka at 100 Lincoln Street, Sitka, AK 99835. The City will issue checks and send them by regular mail.
ALFA is providing overviews of these loan and grant programs as general information for commercial fishermen and fishery support businesses. This information is not legal or financial advice.
PAYCHECK PROTECTION PROGRAM CHANGES
August 3, 2020 update: Paycheck Protection Program loan application deadline extended with new provisions for commercial businesses and crew
Paycheck Protection Program Guidelines for Fishermen
07/01/20 Update: The Senate voted to extend the Paycheck Protection Program. Our expectation is that the House will do the same- extend until the money runs out. If you have not yet applied please contact your local bank to fill out an application. Amending existing PPP applications is determined on a case by case basis; please contact your bank to see if you can amend your PPP loan to qualify for additional CARES Act support.
If you skipped getting the PPP disaster assistance because it seemed like a lot of work to just pay yourself and not your crew, now is the time to revisit that decision!
Now is your LAST chance to get 2 months of payroll for yourself AND your crew, even if you 1099 your crew.
Today, the U.S. Treasury Department released new guidance specific to fishing businesses.
Fishing boat owners can now count their 1099 crew as part of their payroll calculations. "A fishing boat owner may include compensation reported on Box 5 of IRS Form 1099-MISC and paid to a crewmember ... as a payroll cost in its PPP loan application"
Note, if your crew already received their own PPP loan, you cannot include them in your payroll calculations.
PPP applications must be submitted to the SBA by next Tuesday, June 30, so apply NOW (no later than Monday) with an approved SBA lender.
We've heard folks have had the best results with local community banks. The Cooperative Bank of Cape Cod will accept your PPP application even if you don't bank with them. The bank can help you with the application or you can call SCORE or a Navigator.
Loans made after June 5 will have 24 weeks instead of 8 weeks to use the funds and the PPP loan will be fully forgiven if the funds are used for payroll costs (at least 60%), interest on business mortgages, rent, and utilities, and you meet the forgiveness guidelines. There are allowances for Seasonal Employees.
Click here to view the Full Forgiveness Application.
New EZ application requires fewer calculations and less documentation. Details are available in the instructions to the new EZ application form (page 3).
You can use the EZ application if you:
Are self-employed and have no employees; OR
Did not reduce the salaries or wages of their employees by more than 25%, and did not reduce the number or hours of their employees; OR
Experienced reductions in business activity as a result of health directives related to COVID-19, and did not reduce the salaries or wages of their employees by more than 25%.
EMERGENCY RULE TO ALLOW IFQ TRANSFERS IN 2020
The emergency rule to allow IFQ transfers in 2020 was published on June 25, 2020 in the federal register.
Instructions on the transfer process are here:
The transfer application is here:
Temporary Transfer of Halibut/Sablefish IFQ Application
ADF&G PROVIDES GUIDANCE FOR $50 MILLION SPEND PLAN FOR COVID-19 DISASTER RELIEF FUNDS FOR ALASKA FISHERY PARTICIPANTS
On May 7, 2020, the Secretary of Commerce announced the release of $300 million in relief funds appropriated for fishery participants under the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”). Alaska and Washington State are the two largest recipients of CARES Act fisheries relief, each receiving $50 million. NOAA Fisheries established a cap of $50 million and then used revenue information from commercial and charter fishing sectors, aquaculture businesses, and processing/seafood sectors of coastal state to allocate the funding. Fishery participants who qualify for relief payments must incur, either directly or indirectly, a loss in revenues exceeding 35 percent compared to the prior 5-year average.
The funds will be available to mitigate direct or indirect fishery-related losses and impacts to subsistence, cultural and ceremonial fisheries. There is a large pool of eligible “fishery participants,” including commercial fishermen, charter fishing operators, privately owned marine aquaculture businesses such as shellfish farmers, subsistence and cultural users, processors and other fishery related businesses. Businesses such as vessel repair operations, bait and tackle shops and seafood retailers generally will not be eligible for this fisheries disaster relief package.
NOAA Fisheries delegated relief allocation details to states and interstate marine fisheries commissions. The Pacific States Marine Fisheries Commission (PSMFC) will distribute the $134 million in funds allocated to Alaska, Washington, Oregon and California. The PSFMC will review applications and disburse funds after states develop “spend plans” approved by NMFS. The spend plans will describe funding categories, including direct payments to fishermen, fisheries infrastructure and/or fisheries-related education to address direct and indirect COVID-19 impacts.
The Alaska Department of Fish and Game (ADF&G) is the lead agency responsible for working with Alaska resident fishery participants. Out-of-state residents who fish in Alaska, mostly from Washington state, will have to apply in their own state of residence. ADF&G is now beginning to evaluate how to proceed with the spend plan, using what it describes as “very broad guidance” from NOAA Fisheries. The agency has not yet developed eligibility criteria or finalized the application process. There is no formal comment period for the spend plan but ADF&G plans to work with representatives of eligible fishery sectors across the state to finalize the spend plan.
ADF&G’s initial guidance on the fisheries disaster relief indicates that Alaska will not necessarily exclude fishermen who have received assistance from other CARES Act relief programs such as the Paycheck Protection Program. Instead, fishermen receiving other relief will still be eligible to apply but the state will consider the amount of other relief received. The guidance explains that eligible fishery participants will likely have to add their fishery income, any other federal CARES Act relief such as Paycheck Protection Program loans with the amount of fisheries disaster relief requested. They must then certify that these income sources will not cause the sum of revenue from these three income to exceed participants average revenue earned across the previous five years.
ADF&G recognizes that many fisheries or underway or not yet prosecuted so is working with NMFS to ensure all fisheries are eligible and that applicants will have adequate time to submit applications. ALFA sent a comment letter to ADF&G shortly after NMFS released the funds and requested that the agency wait until the end of the season in order to determine which fisheries will experience the greatest revenue losses so as to target relief toward fishermen and coastal communities with the most need. The CARES Act requires expenditure of funds by September 30, 2021 but Congress wanted to see funds expended by September 2020.
$300 million is not a large sum given the diversity and scale of eligible commercial, charter, and aquaculture businesses and Tribal fisheries across the country. ALFA and other small boat fisheries groups from coastal states around the country have asked Congress to more fully fund relief efforts, including more funds for direct assistance to commercial fishermen and other investments to maintain the viability of coastal communities. Many fleets, particularly producers of high quality seafood served in restaurants, have faced major market price declines.
50 million is half the amount anticipated by Alaska based on its highly productive fisheries, which produce more seafood volume than all the other states combined - nearly 60 percent of all commercial fishery landings in the United States by volume, and one-third of the nation’s commercial fishery economic value. 15,592 Alaska residents participate in the state’s commercial fisheries. A recent McDowell Group report reviewing the state’s fishing industry identified 27,738 skippers and crew and 9,000 vessels participating in Alaska’s fisheries and harvesting 5.6 billion pounds of seafood worth $1.6 billion. 38 percent of this value accrues to Alaska residents.
Given the small amount of relief funds relative to the size of Alaska’s fisheries, ALFA has concerns about whether this aid package will adequately help southeast Alaska fishermen weather this storm. Southeast Alaska is one of the most important fishing regions in the state, with more fishery workers than any region other than the Bering Sea. According to the Alaska Sustainable Fisheries Trust’s 2019 SeaBank Annual Report (pending, in press), seven of the top 100 fishing ports by value in the entire country are Southeast Alaskan communities. As recently as 2017, southeast Alaska fishermen generated a fishery ex-vessel value of $288.8 million – or nearly as much funds as Congress allocated to commercial and charter fishermen, seafood processors and Tribal fisheries in the entire country. There are roughly 2,700 commercial fishing permit holders and 2,400 crew members living in southeast Alaska communities. Their harvests supported over 4,500 processing jobs, generating $50 million in wages – or an amount equivalent to the State of Alaska’s share of the CARES Act fisheries disaster relief.
Other national fishery stakeholders share these concerns. As reported by the Washington Post in April, the fishing industry portion of the $2 trillion CARES Act spending package will not adequately mitigate losses incurred by the $100 billion U.S. seafood industry. In 2017, U.S. consumers spent $102.2 billion for fishery products - $70 billion at restaurants and food service, and $33 billion in grocery and retail sales for home consumption. According to Robert Vanasse, executive director of Saving Seafood, the $300 million allocated for fisheries disaster relief pales in comparison to the $9.5 billion allocated for livestock and other crop production. As explained by Vanasse, economic downturns could force thousands of commercial fishermen into bankruptcy with serious adverse effects on coastal communities throughout the country.
Massachusetts Senators also had concerns with the aid package. Massachusetts is second to Alaska in national fishery production and received $28 million in CARES Act relief funds. Senator Ed Markey stated that the $28 million in aid “should only be the beginning,” noting that his state hosted the highest valued port in the country, New Bedford, and $28 million would not adequately address the needs of the state’s fishing economy. In a recent letter to NOAA Fisheries, Senator Elizabeth Warren of Massachusetts and other representatives explained that the coronavirus has caused restaurant closures and disrupted export markets in major seafood consuming countries such as China, leaving the U.S. seafood and fishing industries “under serious financial duress.” Washington Senator Maria Cantwell has noted that “due to the unique nature of fishing businesses, many have been left without federal assistance until now.”
ADF&G Guidance on progress on the spend plan to this point is available here:
https://www.adfg.alaska.gov/static/home/news/hottopics/pdfs/cares_act_guidance_6520.pdf
$300 MILLION APPROPRIATION FOR FISHERIES DISASTER RELIEF IMPLEMENTED BY THE NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION (NOAA)
Commercial fishermen will need relief due to the closures of restaurants and effects on other foreign and domestic wholesale and retail markets. Drops in prices and demand for fresh seafood have created a crisis for community-based fishermen and seafood businesses. Over two-thirds of domestic seafood consumption is in restaurants or through other food service establishments.
The CARES Act authorizes assistance to “fishery participants.” Congress appropriated $300,000,000 million for this program up front to that distribution of funds should occur without as much delay as other, separate fishery disaster relief packages. The pool of eligible “fishery participants” is very broad and includes Tribes, commercial fishermen, charter fishermen, fishing communities, some aquaculture businesses, processors and other fishery related businesses.
Qualifying participants must incur, either directly or indirectly, a loss in revenues exceeding 35 percent compared to the prior 5-year average. NOAA will facilitate the distribution of funds, but the agency is still developing the program. Preliminary information indicates that the proposed application deadline will be September 1st, but applicants should apply early (June) and then amend the application later if necessary. Funds could be made available within a fishing season.
Many uncertainties remain about the fishery disaster relief portion of the bill. The mechanisms for how the funds will be dispersed and who will receive funding are unknown. There is some concern that, in the absence of appropriate oversight, relief could go to big seafood firms and aquaculture, and smaller businesses may not receive funds in a proportionally fair manner. $300 million is not a large sum given the diversity and scale of eligible fishery participants across the entire country. Additionally, as the pandemic stretches into the summer, more relief may become necessary. There likely will be a 4th stimulus package coming out in the future.
As reported by the Washington Post earlier this month, the fishing industry portion of the $2 trillion spending package will not adequately mitigate losses incurred by the $100 billion U.S. seafood industry. According to Robert Vanasse, executive director of Saving Seafood, the $300 million allocated for fisheries disaster relief pales in comparison to the $9.5 - $14 billion allocated for livestock and other crop production. These same industries received $12 billion and $16 billion in 2018 and 2019 trade relief packages to mitigate losses from the trade war with China. Congress excluded the seafood industry from these two trade packages – even though many seafood products also experienced similar price reductions due to the trade war.
The disparity between relief amounts for protein producers leaves multiple “fishery participants” competing for a small amount of funds that are insufficient to mitigate losses to commercial fisheries alone. There are numerous hundred million dollar plus fisheries operating throughout the country and without equitable relief, price downturns could force thousands of commercial fishermen into bankruptcy with serious adverse effects on coastal communities throughout the country:
New Bedford, the top American port by seafood value, was worth $431 million in 2018. One of New Bedford’s major products, scallops, has experienced major price declines.
Sockeye production from Alaska, mostly from the Bristol Bay sockeye fishery, was 265.3 million pounds worth $351.5 million in 2018. Salmon price effects are unknown there is also uncertainty about Bristol Bay because of potential lost processing capacity caused by the virus.
In 2018 Alaska fishermen caught 576 million pounds of all salmon species, worth $598.1 million.
In 2018, fishermen harvested 146.2 million pounds of American lobster worth $624.2 million. Maine alone was responsible for 120.1 million pounds valued at $486.9 million. Media reports as of April 1, 2020 indicated prices drops for Maine lobstermen of nearly 50 percent.
Crab sales which rely on restaurants, have dropped precipitously for the nation’s second highest valued seafood, worth $645 million in 2018. 2018 Atlantic blue crab harvests of 137.4 million pounds were worth $188.4 million. Dungeness crab harvests from all Pacific Coast states of 68.3 million pounds were worth $239.3 million.
As previously noted, most top American seafood products rely on restaurants.
Source for fishery data: National Marine Fisheries Service. 2020. Fisheries of the United States, 2018. U.S. Dept. of Commerce, NOAA Current Fishery Statistics No. 2018. Available at: https://www.fisheries.noaa.gov/national/commercial-fishing/fisheries-united-states-2018.
NOAA has established a website to provide information about COVID-19 to fishery stakeholders. While there is no information directly about the fishery disaster relief package, the website does includes an email address (nmfs.covid-19@noaa.gov). Use this email to share info about the impacts to your business and what your needs are. Input may go into the decision-making process of how these funds will be applied.
CARES ACT EXTENDS UNEMPLOYMENT BENEFITS TO SELF-EMPLOYED WORKERS, UNEMPLOYED ALASKA FISHERMEN SHOULD CONSIDER APPLYING SOON
The CARES Act extended unemployment insurance to self-employed workers. Fishermen who think they need unemployment insurance should begin the application process now. It is likely that unemployment benefits for self-employed workers such as fishermen will also be retroactive to February 2, 2020 or to the first week a claimant was unable to work, whichever is later. The State of Alaska’s unemployment office is now accepting applications for the “Pandemic Unemployment Assistance” program, which provides benefits to individuals such as self-employed fishermen who would otherwise be ineligible for regular unemployment insurance.
One prerequisite to filing in Alaska is the need to have a “My Alaska” account. Fishermen who anticipate filing can sign up for this account now at: https://my.alaska.gov/NewAccount.aspx. Once you have a My Alaska account, you must first file for regular unemployment insurance prior to filing for Pandemic Unemployment Insurance at http://my.alaska.gov/ and click on “Unemployment.” According to the state’s website, after taking this first step, you should then be able to file for Pandemic Unemployment Assistance at the same site.
The Department of Labor cautions that you may still receive a message stating that you are ineligible while the agency is still completing programming for eligibility determinations. You should submit wage and/or earnings information with your Pandemic Unemployment Assistance online application while this programming continues. You will need either your most recent 2019 tax filing or other documents that show employment and earnings prior to becoming unemployed due to the pandemic.
In general, eligibility criteria for the extension of benefits for the self-employed and other applicants will require you to certify that certify that your self-employment is your principle source of income and livelihood, and that COVID-19 has caused you to become unemployed. COVID-19 causes of unemployment can include direct diagnosis or symptoms of COVID-19, the need to care for a family member with COVID-19 or provide child care during school closures, or being unable to reach a work place or losing prospective employment because of COVID-19.
The Act also appropriated funds for “Federal Pandemic Unemployment Compensation” in the amount of $600 per week. The weekly $600 payment is a federal stimulus automatically added to the weekly amounts paid to eligible unemployment insurance claimants. The extra payment period began on March 29, 2020 and ends July 25, 2020. Alaska has received these funds and currently eligible claimants should be receiving the stimulus now. Fishermen who are new to the unemployment program and end up receiving the stimulus and other benefits should be aware that these benefits are taxable, and there is an option to choose tax withholding when filing a claim.
For those without internet access, the Juneau claim center can be reached at: (907) 465-5552 and there is a statewide number at (888) 252-2557.
State of Alaska facts sheets about unemployment compensation insurance in general and the $600 stimulus payment are available here:
https://labor.alaska.gov/documents/COVID-19_FPUC.pdf
A fact sheet about unemployment compensation insurance in Alaska for the self-employed is available here:
https://labor.alaska.gov/documents/COVID-19_PUA.pdf
Other links to the state’s unemployment insurance website are here:
https://labor.alaska.gov/unemployment/
https://labor.alaska.gov/unemployment/COVID-19.htm
NEW ECONOMIC INJURY DISASTER LOAN APPLICATION PROCESS ON HOLD
According to the Small Business Administration’s website, the agency has not started the application period for new Economic Injury Disaster loans as it is still processing applications filed during the initial application period. The agency will provide updates on the availability additional Economic Injury Disaster loans as soon as possible. ALFA will monitor the website, and encourages fishermen interested in Economic Injury Disaster loans to also check in regularly at: https://www.sba.gov/page/coronavirus-covid-19-small-business-guidance-loan-resources.
Any individual who filed taxes as self-employed, a sole proprietor or independent contractor was eligible to apply for this loan. In most cases, crew were also eligible. The Small Business Administration’s website currently states (8:00 a.m. April 27, 2020) that is not accepting new applications due to the lapse in appropriations. Loan components for the initial application period were as follows:
(1) the loan initially included an option for an emergency advance of up to $10,000 that did not have to be repaid, but the Small Business Administration subsequently implemented a cap on the advance of $1,000 per employee;
(2) there was an online application process that is fairly streamlined so long as borrowers had basic tax return information at their fingertips;
(3) borrowers do not need to specify a desired loan amount - instead, the Small Business Administration would offer a specific amount and allow you for a six-month period to make the decision whether or not to accept the loan;
(4) long repayment terms of up to 30 years were a possible with a 3.75 percent interest rate and
(5) Funds were available for payroll, fixed debts, accounts payable and other standard operating costs that can’t be paid because of the disaster’s impact.
(6) One of the most important things to remember in applying for this loan is to check the box requesting the advance – the Small Business Administration will not be responding to applications immediately and the best way to confirm receipt of the application is to check for the advance deposit in your bank account.
For fishermen who have already applied, the advances are taking two weeks to arrive rather than the anticipated 3 – 5 days. The Small Business Administration has been advising applicants that disbursements from the initial $300 million in appropriations will be for two months of working capital up to a maximum of $15,000 per applicant (in addition to the forgivable advance).
NOAA FISHERIES ALLOCATE $50 MILLION IN COVID-19 DISASTER RELIEF FUNDS TO DIVIDE BETWEEN ALASKA COMMERCIAL FISHERMEN, CHARTER OPERATORS, AND PROCESSORS
On May 7, 2020, the Secretary of Commerce announced the release of $300 million in relief funds appropriated for fishery participants under the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”). Alaska and Washington State will be the two largest recipients of CARES Act fisheries relief, each receiving $50 million – twice as much as any other state except for Massachusetts. NOAA Fisheries established a cap of $50 million and then used revenue information from commercial and charter fishing sectors, aquaculture businesses, and processing/seafood sectors of coastal state to proportionally allocate the funding. Fishery participants who qualify for relief payments must incur, either directly or indirectly, a loss in revenues exceeding 35 percent compared to the prior 5-year average.
The funds will be available to mitigate direct or indirect fishery-related losses and impacts to subsistence, cultural and ceremonial fisheries. The CARES Act does authorize direct payments. There is a large pool of eligible “fishery participants,” including commercial fishermen, charter fishing operators, privately owned marine aquaculture businesses such as shellfish farmers, subsistence and cultural users, processors and other fishery related businesses. Businesses such as vessel repair operations, bait and tackle shops and seafood retailers generally will not be eligible for this fisheries disaster relief package.
There has been some concern that, in the absence of appropriate oversight, big seafood firms and aquaculture businesses could consume most of the relief package, and smaller businesses may not receive funds in a proportionally fair manner. $300 million is not a large sum given the diversity and scale of eligible commercial, charter, and aquaculture businesses and Tribal fisheries across the country.
For example, $50 million is half the amount anticipated by Alaska based on its highly productive fisheries, which produce more seafood volume than all the other states combined - nearly 60 percent of all commercial fishery landings in the United States by volume, and one-third of the nation’s commercial fishery economic value. 15,592 Alaska residents participate in the state’s commercial fisheries. A recent McDowell Group report reviewing the state’s fishing industry identified 27,738 skippers and crew and 9,000 vessels participating in Alaska’s fisheries and harvesting 5.6 billion pounds of seafood worth $1.6 billion. 38 percent of this value accrues to Alaska residents.
Many of the details of the fund allocation are unknown and delegated to states and interstate marine fisheries commissions. NOAA Fisheries will provide the $134 million in funds allocated to Alaska, Washington, Oregon and California to the Pacific States Marine Fisheries Commission (PSMFC) for distribution. The PSFMC will also distribute an additional $1 million to Alaska Tribes and $5.1 million to West Coast tribes. The PSFMC will review applications and disburse funds after states and Tribes develop “spend plans” for approval by NMFS. The spend plans will need to describe funding categories, including direct payments, fisheries infrastructure and fisheries-related education to address direct and indirect COVID-19 impacts.
NOAA Fisheries has delegated state marine fisheries management agencies with initial responsibility to work with fishery participants to understand the fund distribution process. For Alaska fishermen, this means the Alaska Department of Fish and Game (ADF&G) will likely be the lead agency. ADF&G is currently working on a “spend plan” for allocating $24.5 million in disaster relief funds for fishermen and communities affected by the Gulf of Alaska cod crash. The agency provided a brief initial comment period and intends to release its plan for a second comment period later this spring, revise the spend plan and allow for a final public comment period prior to submitting it to NOAA Fisheries for approval. Notably, the state has proposed to allocate a third to half of the disaster funds for research projects rather than direct relief to fishery participants.
While the specifics of spend plans are uncertain at this time, the recent fishery disaster relief fund distribution for the 2016 Gulf of Alaska pink salmon crisis may foreshadow challenges with distributing a smaller amount of CARES Act relief funds to a larger and much more diverse pool of fishery participants. There were $56.4 million in funds allocated for the pink salmon fishery disaster. The PSFMC distributed $31.8 million to fishermen and $17.7 million to processors. There were significant differences in regional allocations – Prince William Sound and Kodiak fishermen received over $29 million in disaster relief, while southeast Alaska fishermen received $176,427 – less than Lower Cook Inlet, South Alaska Peninsula, and Chignik, which cumulatively are less than 15% the size of the southeast Alaska pink salmon fishery. Some southeast Alaska permit holders reported receiving checks for a few hundred dollars, while some Prince William Sound crew reported receiving checks exceeding $10,000.00.
ADF&G and the PSFMC will have to address the challenge of adding charter and qualifying aquaculture operations such as southeast Alaska’s oyster farms into the pool of eligible fishery participants. According to a 2015 NOAA Fisheries study, charter fishing is a $180 million contributor to Alaska’s statewide economy. In a recent letter to the North Pacific Fishery Management Council, charter industry representatives explained that they are facing significant cancellations and additional challenges association with the cancellation of large cruise ship sailings and travel restrictions. Some operators have already cancelled their seasons. Others have cancelled trips at least through May and are awaiting decisions from the Governor’s office on visitor quarantine requirements before deciding whether to cancel operations in subsequent months. All will experience significant revenue declines.
If the Pacific States Marine Fisheries Commission were to allocate the entire $50 million to Alaska’s 15,592 resident skippers and crew, the relief package would amount to slightly more than $3,200 per fisherman. If ADF&G and the PSFMC decided to divide the funding in thirds between charter fishing and processing sectors and Alaska resident commercial fishermen, direct payments to Alaska’s 15,592 resident skippers and crew would be roughly $1,100.00.
Given the small amount of relief funds relative to the size of Alaska’s fisheries, ALFA has concerns about whether this aid package will adequately help southeast Alaska fishermen weather this storm. Other national fishery stakeholders share these concerns. Other CARES Act relief packages for small businesses have been difficult for commercial fishermen to access. Washington State Senator Maria Cantwell has explained that “[d]ue to the unique nature of fishing businesses, many have been left without federal assistance until now.”
According to Robert Vanasse, executive director of Saving Seafood, the $300 million allocated for fisheries disaster relief pales in comparison to the $9.5 billion allocated for livestock and other crop production. In 2017, U.S. consumers spent $102.2 billion for fishery products - $70 billion at restaurants and food service, and $33 billion in grocery and retail sales for home consumption. As explained by Vanasse, economic downturns could force thousands of commercial fishermen into bankruptcy with serious adverse effects on coastal communities throughout the country. Regions like southeast Alaska that produce high value seafood products for restaurant markets may be particularly vulnerable.
In a recent letter to NOAA Fisheries, Senator Elizabeth Warren of Massachusetts, which has the nation’s second largest commercial fishing economy, explained that the coronavirus has caused restaurant closures and disrupted export markets in major seafood consuming countries such as China, leaving the U.S. seafood and fishing industries “under serious financial duress.” Massachusetts received $28 million in CARES Act relief funds. Senator Ed Markey stated that the $28 million in aid “should only be the beginning,” noting that his state hosted the highest valued port in the country, New Bedford, and $28 million would not adequately address the needs of the state’s fishing economy.
Southeast Alaska is one of the most important fishing regions in the state, with more fishery workers than any region other than the Bering Sea. According to the Alaska Sustainable Fisheries Trust’s 2019 SeaBank Annual Report (pending, in press), seven of the top 100 fishing ports by value in the entire country are Southeast Alaskan communities. There are roughly 2,700 commercial fishing permit holders and 2,400 crew members living in southeast Alaska communities. Their harvests supported over 4,500 processing jobs, generating $50 million in wages – or an amount equivalent to the State of Alaska’s share of the CARES Act fisheries disaster relief.
ALFA will monitor progress on Alaska’s efforts to develop its spend plan and update its website as more information becomes available.
NOAA Fisheries’ press release, including fund allocations by state is available here:
The Pacific States Marine Fisheries Commission and information about distribution of the pink salmon disaster relief funds are available at these links:
https://www.psmfc.org/;http://www.psmfc.org/wpcontent/uploads/2019/08/FAQsForGOAPinkSalmonDisaster_8_05_19.pdf
Information about U.S. fisheries, including commercial fishery production by state, recreational fishing effort and aquaculture production is available in this report:
https://www.fisheries.noaa.gov/national/commercial-fishing/fisheries-united-states-2018.
Below are links to recent media reports on the relief package:
https://www.washingtonpost.com/business/2020/04/08/commercial-fishing-coronavirus/
ALASKA LOAN PROGRAMS
Alaska Department of Commerce web page also has links to state programs available to small businesses. The Division of Economic Development has a microloan program that provides short-term loans between $35,000 and $70,000 to resident small businesses for working capital, construction, or other commercial purposes. There are larger, rural development initiative fund loans with longer repayment terms available to businesses in smaller southeast Alaska communities for working capital, construction or other commercial purposes. These rural development fund loans are meant for smaller Southeast Alaska communities with less than 5,000 residents. The state’s Small Business Economic Development Loan Fund also has small business loan funds available for other purposes, such as business expansion.
Alaska Department of Commerce loan page has links to these loans: https://www.commerce.alaska.gov/web/EconomicRecoveryResourcesforBusiness/EmergencyBusinessAssistanceLoans.aspx
ALFA is providing overviews of these loan programs as general information for commercial fishermen and fishery support businesses. This information is not legal or financial advice. ALFA urges individuals interested in these loan programs to contact their banker, attorney, or accountant for specific advice regarding eligibility for their particular situation.
COVID19 CATCHER AND TENDER VESSEL PROCEDURES
Covid19 Catcher and Tender Vessel Procedures-V1.5.
Catcher-Tender Covid-19 Checklist
VESSEL ACTION PLANS AND TRAVEL PROCEDURES
ALFA Health Mandate 17 Summary Poster
On April 23, 2020, the State of Alaska issued Health Mandate 017, which provides guidance for independent fishing vessels operating in Alaska during the 2020 season. The purpose of the mandate is to enact standardized protective measures for independent commercial fishing vessels operating in Alaska waters and ports to prevent, slow or disrupt the COVID-19 virus. Mandate 017 defines “independent commercial fishing vessels” as “catcher and tender vessels that have not agreed to operate under a fleet-wide plan submitted by a company, association, or entity that represents a fleet of vessels.” This definition applies to most ALFA member vessels.
The Mandate does not apply to skiffs operating from shore. The State of Alaska will be preparing specific guidance for commercial fisheries operating from skiffs over the next week, advises skiff fishermen operating in the meantime to operate using guidelines for charter fisheries and remote lodges available here: https://gov.alaska.gov/wp-content/uploads/sites/2/0425-COVID-MANDATE-016-Attachment-J-Fishing-Charters.pdf ;https://gov.alaska.gov/wp-content/uploads/sites/2/0425-COVID-MANDATE-016-Attachment-L-Lodging-and-Overnight-Camping.pdf.
You can read Health Mandate 017, access required forms, and review other state of Alaska health mandates at the following link: https://covid19.alaska.gov/health-mandates/.
All fishermen will need to review and carry Appendix 01 and Appendix 02 to Health Mandate 017. Appendix 01 is the “Alaska Protective Plan for Independent Commercial Fishing Vessels” and has seven specific sections that cover documents, travel procedures, and protective and screening measures and directives for use on-board the vessel and at port. Independent commercial fishing vessels must enact Appendix 01 protective measures and procedures, and other controls as necessary to ensure crew member compliance. This plan replaces the need to develop a Community/Workforce Protective Plan under Health Mandates 010 and 012. The following discussion is only a summary of Protective Plan requirements – vessel captains must review, carry and comply with the more specific directions provided in the state Plan.
DOCUMENTATION
Mandate 017 first requires that all independent fishing vessels must carry an “Independent Fishing Vessel Protective Measures Acknowledgement Form” acknowledging and agreeing to comply with Appendix 01 to Mandate 17. That form is available at: https://gov.alaska.gov/wp-content/uploads/sites/2/COVID-MANDATE-017-Appendix-02-Acknowledgement-Form.pdf. Fishermen must retain the form and any other required documentation under the mandate and Appendix 01 for the duration of the 2020 fishing season. The form must be available to present to seafood purchasing agents, and federal, state and local authorities, including law enforcement and fisheries regulators. Additionally, vessel captains must maintain a ship’s log or other electronic document certifying crew screening, quarantining and on-board procedures taken should any crew member become ill.
Independent Fishing Vessel Protective Measures Acknowledgement Form
Alaska Protective Plan for Independent Commercial Fishing Vessels
TRAVEL PROCEDURES, SELF-QUARANTINING AND SCREENING
Crew arriving via airplane will need to wear cloth face coverings, carry documentation showing that they are a “Critical Infrastructure Worker” and, upon arrival in an Alaska port, proceed directly to their self-quarantine location, whether on board the vessel, hotel room, or other location. Crew or captains arriving from out of state must self-quarantine for 14 days. The Protective Plan provides nine additional directives for self-quarantining, including procedures for when crew are living on-shore, when new crew arrive at the vessel and accounting for transit time from out-of-state ports. Captains must interview crew with a series of health-related questions and ensure that crew are free of symptoms prior to allowing them to board the vessel. Importantly, vessels must fly a “Lima” flag when any quarantining crew are on board and have thermometers available as part of the physical screening process.
ALFA Critical Industry Letter for Crew
PROCEDURES IN PORT
Once self-quarantining is complete, the Protective Plan directs fishing vessel captains and crew to remain on their vessel in port except for essential purposes, such as offloads, grocery and other resupply and maintenance work. During these interactions, crew and shore-based workers must avoid face-to-face interaction. The Protective Plan recognizes that some fishermen live locally and those individuals must comply with Health Mandate 011 social distancing guidelines when returning to a local residence. If it is necessary to have a service vendor onboard the vessel, captains must conduct a screening and implement other measures specified in the Protective Plan to minimize contact between vendors and crew.
PROCEDURES ONBOARD A VESSEL
The Protective Plan provides recommendations and guidelines for social distancing onboard a vessel which may vary according to size and layout. Guidelines include protocols for galley and meals, vessel sanitizing, and individual hygiene. Where practicable, captains should assign one crew member with specific galley and sanitization duties. There must be a written procedure for vessel sanitizing. The Protective Plan also provides seven specific procedures in the event that crew become ill. They must be isolated if possible on the vessel as specified in the Protective Plan. Vessels that are unable to isolate individuals must then begin a fourteen-day period of isolation. Captains must contact a public health center if a crew member becomes ill with suspected COVID-19 symptoms. In some cases, vessels with a mildly ill crew member may continue fishing and complete a fourteen-day quarantine at sea. State of Alaska officials encourage captains in this circumstance to operate within range of medical facilities in case the sick crew members condition worsens.
OTHER ISSUES
The Protective Plan components such as document retention, self-quarantining and other measures are mandatory. Violations are subject to civil and potentially serious criminal penalties. The State of Alaska will not be conducting rigorous enforcement and expects commercial fishermen to comply in their own best interest. Any fleet failures to adhere to Health Mandate 017 could result in additional fishery restrictions.
Some communities will have stricter standards. The State advises commercial fishermen to comply with local community standards and work with the State to resolve conflicts.
United Fishermen of Alaska recent Health Mandate 017 webinar is accessible at: http://www.ufafish.org/ufa-covid-19/.
CHECKLISTS
Berthing, Off-load, and Shore Leave Precautions
Managing Suppliers/Vendors Checklist
Sanitation and Disposal Checklist
WHEN CREW MEMBERS SHOW SYMPTOMS
If a crew member starts showing symptoms of COVID19, follow the protocol for Quarantine/Isolation. Contact a healthcare provider, as well as the harbor master, when returning to port for further instruction and next steps.
Quarantine Procedures Checklist
Symptom Decision Walk-through
ALFA COMMENTS ON COVID-19 STIMULUS PACKAGE
Below please find ALFA comments on the COVID19 stimulus package. These range from Sitka specific to programs with regional, statewide, and national opportunity/impact. While small scale fishermen need immediate assistance to survive the pandemic and its impacts on seafood markets, ALFA’s hope is that longer-term investment will be focused on supporting a more sustainable industry and a more resilient seafood delivery system.
ALFA Stimulus Comments to Congressmen
WEB AND OTHER RESOURCES:
The Small Business Administration has a non-profit partner, SCORE, that also provides extensive information and assistance with CARES Act programs: https://www.score.org/coronavirus-sba-loans-and-cares-act-assistance
For general information and links associated with the Small Business Administration’s COVID-19 assistance programs: https://www.sba.gov/disaster-assistance/coronavirus-covid-19
For information about the Small Business Administration’s disaster loan programs: https://www.sba.gov/funding-programs/disaster-assistance
There is an excellent, one and a half hour webinar accessible through the front page of the Maine Coast Fishermen’s Association website. ALFA urges fishermen seeking additional information about CARES Act loans to view the webinar at: https://www.mainecoastfishermen.org/
Questions? Contact the SBA disaster assistance customer service center at 1-800-659-2955 (TTY: 1-800-877-8339).
ALFA is providing overviews of these loan programs as general information for commercial fishermen and fishery support businesses. This information is not legal or financial advice. ALFA urges individuals interested in these loan programs to contact their banker, attorney or accountant for specific advice regarding eligibility for their particular situation.
The website for the Paycheck Protection Program is available at:
https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/paycheck-protection-program
The Small Business Administration also updated its “Frequently Asked Questions” page about the Paycheck Protection Program this week:
https://www.sba.gov/document/support--faq-lenders-borrowers
For general information and links associated with the Small Business Administration’s COVID-19 and other assistance programs: https://www.sba.gov/disaster-assistance/coronavirus-covid-19; https://www.sba.gov/funding-programs/disaster-assistance;
https://www.sba.gov/page/coronavirus-covid-19-small-business-guidance-loan-resources.
QUESTIONS? CONTACT US
Debbie Rinckey: 907-862-0319
Linda Behnken: 907-738-3615