ELLSWORTH – It’s no secret that the economic impacts of the COVID-19 pandemic have been especially hard on small businesses and the self-employed.
While Maine workers who lost their jobs were, with greater or lesser difficulty, able to qualify for federally enhanced state unemployment insurance benefits, most fishermen were not so fortunate even though their incomes were substantially reduced. Like many small businesses and self-employed individuals, members of the fishing industry are still waiting for the distribution of funds Congress authorized under the so-called CARES Act, signed into law on March 27. And they still have little idea how much any of them will receive.
Last week, in an email distributed to members of the fishing industry, Department of Marine Resources Commissioner Patrick Keliher gave an update on the status of the CARES payments.
As for the CARES Act money, a number of factors have slowed its distribution as required to commercial fishermen, dealers, processors, aquaculturists and the members of the party and charter boat fleet.
In May, DMR surveyed the industry to determine how the $20 million allocated to Maine for relief of the fishing and seafood industry should be spent. According to Keliher, 79 percent of the respondents wanted a direct payment of their benefits by a check. “And that’s what we’re going to do,” he said.
But clearly not any time soon.
The problem for DMR has been that the CARES Act has strict requirements for who qualifies for payments.
Recipients must certify that they have experienced a greater than 35 percent loss of revenue compared to their previous five-year average as a result of the pandemic. Initially, DMR believed that it could do this certification at the fishery-wide level, Keliher said. Based on landings data, DMR found that almost all of Maine’s fisheries had more than a 35 percent revenue loss during the spring of 2020, as compared to the prior five-year average.
It turned out that DMR’s interpretation was wrong. The National Oceanic and Atmospheric Administration (NOAA) advised the department that “the 35 percent impact must be demonstrated at the level of each individual license holder.”
For many fishermen, that could be a tough requirement to meet, depending on the adequacy of their financial records.
DMR is currently analyzing whether it can use the landings data it has for the commercial fishing industry to certify the loss at the level of the individual. If that works, Keliher said, “it will mean that approximately 7,500 license holders don’t have to all do it themselves.”
Because DMR lacks “complete revenue data” for dealers, processors, aquaculturists and for-hire guides, members of those sectors of the industry will still have to individually certify their loss.
Once DMR completes its analysis, it will send letters and emails to license holders advising them whether the department believes the individual’s landings information shows a greater than 35 percent revenue loss and whether they are eligible to apply for CARES Act funds. The letter will include information on how to apply for funds or to submit an appeal.
The process will not be quick, and DMR cannot begin to issue checks now because the amount of the payments will depend on how many eligible applications are filed.
Keliher said he hoped to begin accepting applications and appeals during October and mailing checks in November. For that to happen, DMR will have to get its initial eligibility letters in the mail soon, but no date has been announced as of Labor Day.
“If that timeline shifts because of further complications, we will let you know as soon as we know, in a future update,” Keliher said.
The commissioner also denied “widely held” rumors that DMR planned to keep 50 percent of the CARES funds for itself. According to Keliher, DMR plans to retain “less than $50,000,” about 0.2 percent of the funds, to pay the direct costs of administering the program.
DMR will also use “a small percentage” of the funds to help build consumer demand for Maine seafood. According to Keliher, that idea was the result of “feedback we got from industry.”
According to Keliher, there have been false rumors spreading on social media recently about why the CARES payments have been delayed and about who will get them. Some posts, he said, suggested that “The state is keeping the money” or “It’s only going to support aquaculture.”
The extent of the rumors, and a complaint from an industry member that “no one tells us anything,” Keliher said, suggest that DMR-sponsored webinars and conference calls used to disseminate information to the fishing industry during the ongoing pandemic have been poor substitutes for the usual in-person meetings where the department provides updates on important topics. To solve that problem, Keliher said, while the “period of uncertainty caused by COVID-19” continues, he will send out monthly updates to members of the state’s fishing and aquaculture industries.
“Based on what I’m hearing from the public health experts, we might be in this boat for a while,” he said.