Efforts to improve the financial health of the Portland Fish Exchange met some resistance from its board of directors last week, despite warnings that the problems are severe.
The exchange has had its ups and downs this year. While catches that were small through May and June have improved in July and August, the consensus from the Portland Fish Pier Authority, the landlord for businesses on the pier, is that change is still necessary.
In June, when the authority was asked by the exchange board for financial support, it granted some funding on the condition that the business would explore bringing in an outside entity to take over management and operations. In subsequent meetings, authority Chair Meredith Mendelson urged the exchange to advance the process quickly.
Vessel Services and Bristol Seafood, businesses on the fish pier, replied to a formal Expression of Interest issued by the board; either could become the first outside entity to manage operations at the exchange since its start more than 36 years ago.
Some exchange directors balked at the potential changes in a Sept. 15 meeting. But eventually, the board voted 4-0-1 to move the process forward, with President Rob Odlin abstaining.
In an interview, Vessel Services President Alan Tracy said time is of the essence for the exchange, and while he hopes to have the opportunity to work together with the exchange, Vessel Services won’t wait long for the board to act.
He said Vessel Services has made its concerns known about a “lack of urgency” on the board. Sooner rather than later, Tracy said, the businesses have to have “an open and frank discussion” about concepts for the future and to ensure they’re on the same page going forward.
The board’s hesitation came when members were adjusting the wording of selection criteria – the method by which officials will evaluate the two expressions of interest. Portland’s waterfront coordinator, Bill Needelman, warned the directors not to be too restrictive with the criteria.
Among the listed criteria is the need for a more sustainable business model, since the exchange has lately depended on subsidies from the pier authority to help keep its doors open.
But some exchange board members see no problem with reliance on subsidies.
“What’s wrong with (the pier authority) providing the subsidies to keep the doors open?” Odlin asked.
Needelman replied that subsidies aren’t sustainable and could lead to the loss of capital reserves, which would mean an inability to afford major repairs or capital improvements.
This year, the exchange has received $160,000 from the pier authority. It hopes to pay down most of its remaining line of credit with the latest subsidy.
“It was getting to the point where the projections as presented by this body would’ve bled the capital reserves dry,” Needelman said. “The numbers that came forward were dire, and it was going to come to a head.”
Board members Nick Alfiero, who owns Harbor Fish Market, and Avis Leavitt objected to making substantive changes to exchange operations and took issue with the wording of the selection criteria.
“There’s a lot of things at play here that I don’t particularly like,” Alfiero said. Both said they were caught off guard by the possibility that the exchange could continue in a model other than an auction. Prior to the vote to approve the process, the board voted 5-0 to add an amendment that requires there to be an “open and transparent groundfish auction.”
“I hate to just throw this whole thing away because the city wants to at least break even, or make money, or be sustainable,” Alfiero said.
As part of a potentially new structure, Tracy said Vessel Services would take over management of the exchange, which could eliminate the need for the board. He said the board is part of the problem that’s “gotten them where they are now,” because it creates too much distance between decision-makers and the day-to-day operation of the business.
Representatives of Bristol Seafood, the other business considering the management opportunity, couldn’t be reached for comment.
Tracy said it won’t be a competition between the two businesses, which have been familiar with each other for a long time, and he has no problem if the other business is determined to be a better fit for the exchange.
The exchange relied on the groundfish catch, but that dependence has waned particularly in the last 15 years or so. Even still, the feeling from stakeholders is that the fishery is here to stay.
Ben Martens, executive director of the Maine Coast Fishermen’s Association, said as long as boats keep bringing in high-quality fish, there remains reason for optimism.
“(We have) resilience and a vibrant future in front of us for that fishery,” Martens said, “but the question is how do we maintain that infrastructure, the knowledge, and the thought that we’re going through some lean times right now.”
But he also said stability is a key hurdle for the exchange, where the manager position has been in flux for several months and three board members are set to conclude their terms at the end of October.
Martens, who was asked by the board to be part of a committee that will evaluate the proposals from Bristol and Vessel Services, said he’s not worried that only two responses came in, and would have been thrilled with just one.
He said he’s looking for a vision from the candidates that can build toward the future, with a foundation built on groundfish. “For a long time we’ve been treading water down at the Portland Fish Exchange,” Martens said. “Now is a time of action.”
Dependence on groundfish has faded in part as the value of other produces, like lobster and scallops, has increased.
But now, even the lobster fishery, having reached its height of sales in 2021, faces challenges, not the least of which was the “red-listing” last week of American lobster by Seafood Watch, a program at the Monterey Bay Aquarium in California that rates seafood for sustainability.
The listing was based on a perceived threat that lobstering equipment poses to the North Atlantic right whales that become entangled in fishing gear. Maine fishing industry stakeholders and politicians have condemned the label. Gov. Janet Mills in a Sept. 6 statement said the claim is “flat out wrong,” noting none of the right whale deaths recorded by the National Oceanic and Atmospheric Association have been attributed to Maine lobstering.
Martens said the Seafood Watch action probably won’t change many minds, but it could close some markets to Maine lobster. The instability seen in the lobster industry right now further emphasizes the need to protect access to and build capacity for businesses to diversify into other healthy fisheries, he added.
Even though lobster is still considered by many to be one of the most sustainable fisheries in the world, other fishing practices like kelp and oysters have been solidifying their places in the future of Maine’s fishing industry.
Abby Barrows, a Maine native, marine scientist, and oyster farmer, said aquaculture featuring kelp and shellfish has been reaping all sorts of benefits for Maine.
Many of the long-term challenges the Gulf of Maine faces in relation to climate change can be remedied by the presence of kelp and shellfish, she said, so while it’s another way to support Maine’s waterfront economy, it also ensures the sustainability of the water it depends on.
For example, Barrows said oyster farms can help combat storm surges by deflecting waves; can help address ocean acidification by making surrounding waters more basic, and create a healthier ecosystem through carbon sequestration.
Shifting the dependence of Maine’s fisheries from groundfish to lobster over the years took time, and the same thing could happen as the Portland Fish Exchange considers its options, she said, and more fishermen explore the variety of options that the Gulf of Maine has to offer.
But it won’t happen overnight.
“Mainers aren’t known for jumping at change,” Barrows said. “We are New Englanders, after all.”