Temporary fuel tax rebate for fisherman starts Jan. 1 in Portland

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PORTLAND — Beginning this weekend, ground fishermen will be able to land their fish in Portland and receive a benefit that many have travelled to Massachusetts for: tax-free diesel fuel.

But there’s a catch. The privately funded program is only a temporary solution to what many believe is a significant reason ground fisherman leave the state.

The Maine Fisherman’s Cooperative Association announced in a press release that it has established the temporary rebate program, which will reimburse fisherman for the 5 percent fuel tax the state charges.

The program begins on Jan. 1, 2011, and will continue until the $30,000 in funding runs out.

The diesel fuel tax is one of the reasons many ground fisherman have turned their backs on Portland Harbor, the cooperative said, preferring instead to head for Massachusetts, which does not tax the fuel.

“We want to make Portland as attractive as Gloucester (Mass.) for landing ground fish by eliminating one of the biggest costs to keeping fish local,” MCFA President Terry Alexander said. “The best way to bring Maine boats back is to level the playing field.”

A vessel captain can pay between $5,000 and $10,000 a year in fuel taxes to the state, according to the organization.

A state task force in 2004 identified the fuel tax as a major reason for the loss of fishing fleets and recommended its repeal. In 2007, an abatement program was established by the state.

But that program ended last year.

Meanwhile, the state’s ground-fishing fleet has been cut in half over the last four years.

The exodus has meant hard times at the Portland Fish Exchange, a nonprofit auction house established in 1986. In recent years, annual landings at the exchange have dropped from 20 million pounds to less than 10 million pounds.

“As much as Maine fishermen would like to keep their catch here, they – like most business owners – need to weigh the financial implications of the decision,” Portland Fish Exchange Manager Bert Jongerden said. “By removing the fuel tax roadblock, I am hopeful that we can see some of the fleet return.”

Ed Bradley, owner of Vessel Services, said loss of fishermen not only affects marine businesses, but the regional economy.

“Whether fuel sales or maintenance and repair work, the fishing industry supports and creates a lot of local jobs and we need to do what we can to keep them here,” Bradley said.

Fishermen must sell their catch at the Portland Fish Exchange and purchase their fuel from Vessel Services within 10 days to get the 5 percent diesel fuel tax refund.

But fishermen are also struggling with factors beyond the fuel tax, including the inability to sell the lobsters they drag up, called by-catch, and new federal regulations that have cut annual fishing days from 70 to 48.

“We are trying to survive the current regulations and cannot afford to lose money by landing our fish in Maine,” said Jim Odlin, who owns a fishing fleet.

Randy Billings can be reached at 781-3661 ext. 100 or [email protected]