1. What is the Local Fish Fund?
The Fund is a subsidiary of the Alaskan Sustainable Fisheries Trust designed to facilitate intergenerational ownership transfers of fishing access rights within local fishing communities.
Thirty years ago, a young person who wanted to fish commercially needed a boat, some fishing gear, and a sense of adventure to get started in the business. Today, young fishermen face staggering entry level costs, high operating costs, and a level of risk that is equivalent to buying a starter hotel, instead of a starter house, as a first step in home-ownership. The average age of a commercial fisherman in Alaska is now 50, up by nearly 10 years since 1980.
Between the outmigration of permits and quota and the graying of the fleet, access to Alaskan fisheries is rapidly being concentrated in the hands of large companies with little interest in seeing Alaska communities prosper and local ecosystems continue to thrive for generations.
2. Where does the fund operate?
The Fund operates in coastal communities in the Gulf of Alaska, initially in the GOA halibut and sablefish fisheries, and is seeking to diversify across other Alaska fisheries.
3. Who does the fund serve?
The Fund serves three demographics; 1) emerging local fishermen, seeking equity in their local fishery, 2) established local fishermen, seeking to divest their holdings, 3) socially conscious investors.
4. Who does the Fund benefit?
We believe the fund ultimately benefits everyone in the southeast community.
The Local Fish Fund (LFF), is designed to be a revenue generating program that facilitates access to coastal fisheries by Alaska community residents while mentoring young fishermen in stewardship and leadership. LFF helps overcome barriers to entry by providing the cash, sharing the risk, and administering the loans that young fisherman need to acquire ownership of fishing access privileges. Likewise, LFF provides retiring fishermen with a flexible exit strategy consistent with their long-term commitment to the resource and their community. Finally, LFF provides an opportunity for socially and environmentally responsible investors who care about sustainable fisheries and healthy fishing communities and understand the vital connection between the two.
5. What problem is the Fund trying to Solve?
Fishery rationalization has stabilized stocks and increased profits - at the cost of high entry barriers for the next generation. Aspiring local fishermen fish quota for others at tight margins, without a path to future ownership.
6. What is the financing mechanism?
The Fund facilitates quota share transfers between retiring and emerging fishermen through a combination of conventional, fixed loans, tied to stipulations for community residence and responsible fishing, and will partner in the emerging fishing operation by funding the quota down payment, in return for a share of future cash flow.
7. How does the Fund compete?
Conventional lending mechanisms do not provide partner-based investing options for fishermen, do not account for harvest price fluctuations in their repayment models, and require prohibitive down-payment and collateral.
8. Can the market sustain this kind of operation?
Total value of halibut/sablefish Quota has appreciated by $1.1 billion since 1995. 2011 alone saw $22 million of transfer activity in the GOA halibut and sablefish market.
9. What support has the Fund already received?
The Fund has renewable grants from the Oak Foundation, the National Fish & Wildlife Foundation, the City of Sitka, the Skaggs Foundation, plus contributions from individuals, with more than $250k in start-up capital .
10. What is the current status of Fund operations?
The Local Fish Fund has completed a business plan and market analysis, developed models for assessment of fishing operations, and established a core operations team. To date, LFF has facilitated transfer of over half a million dollars of quota shares and permits to Alaskan residents, with the most recent transfer completed in the first week of June 2017. We are currently finalizing terms with a regional fiscal agent that will guide program expansion as we take LFF to scale. We have $1.2 million in capital pledged by fishermen and $3 million in program related investment capital pending through NatureVest. ASFT has been awarded $180,000 in committed grant funds for the project.
LFF’s progress in scaling up to meet community need has been facilitated through strong regional partnerships and local support. LFF’s first transaction included a partnership with Sealaska’s community development arm Haa Aani; the others involved local fishermen and local investment. LFF has also forged strong partnerships with The Nature Conservancy, NatureVest and, most recently, the Juneau Economic Development Commission..
ASFT is currently working closely with our partners to fully capitalize LFF and take this innovative program to scale. Additionally, ASFT and partner organization Alaska Longline Fishermen's Association, have introduced 40 young people to commercial fishing through our Young Fishermen's Deckhand Apprentice Program.