Maine's fisheries represent $750 million in annual state revenues and support 35,000 jobs. But according to the Island Institute in Rockland, Maine, there are only 20 miles of working waterfront among the 5,300 miles of coastline in the state of Maine. Much of it has been sold for residential use, vacation homes and other types of tourist development at prices that lobstermen can no longer afford.
"You need a lot of infrastructure on all these peninsulas and islands, and the ability to land lobster up and down the coast is critical," says Hugh Cowperthwaite, CEI's fisheries director. "You can't have all these small boats running to Portland or driving to Portland. It just doesn't make sense."
In 2003, CEI played a role in the early development of a first-of-its-kind conservation easement in York, Maine. Easements are the legal removal of a right of use, and conservation easements generally protect wildlife habitat and recreational land by eliminating development rights.
Historically, most conservation easements in Maine were "forever wild," meaning all economic use of the land was strictly prohibited. In this case, however, the easement was used to protect the economic use of the land by preserving the "working" nature of the waterfront.
In York, the 2,290-square-foot Sewall Bridge dock was situated on one-sixth acre, and its purchase by two lobstermen gave one of them (also a wholesaler) a place to buy the catch from 14 other lobstermen. The negotiated price of the property was $710,000, its value at "highest and best use." In this case, that meant development as residential or tourist-related property.
The lobstermen paid $300,000. The York Land Trust, with donations and a $150,000 loan from CEI, paid $410,000 for the development rights and placed a conservation easement on the property. The lobstermen own the property, but there is a covenant in the deed restricting its use to commercial fishing even if they sell it in the future.
CEI helped form the Maine Working Waterfront Coalition that lobbied the state to fund additional working waterfronts with public investments, and Maine's voters have overwhelmingly approved bond funds to acquire additional development rights based on the York model. CEI administers the program, which has allowed nine fishermen's co-ops, three municipalities, a land trust and an historical society, among others, to preserve 24 additional working waterfronts from Harpswell and Boothbay to Vinalhaven and Isle au Haut.
Real estate notwithstanding, lending has always been the backbone of CEI's fisheries program, which it administers through its Fisheries Revolving Loan Fund. Since l979, it has made 215 loans to the industry totaling $14.4 million--gap financing that has leveraged an additional $50 million from local banks. About half those loans have gone to harvesters, 12% to seafood processors and the rest to shore-side suppliers, wholesalers, and for infrastructure.
Forestry And Recreation
But while CEI's strategy has always involved supporting entrepreneurship and local enterprises rather than attracting big business to the state, the downside was the inability to do impact investing on a larger scale. During the l990s, a group of CDFIs led by CEI's CEO Ron Phillips developed the New Markets Tax Credit (NMTC) concept to spur investment in distressed communities. Authorized by Congress and allocated by the Treasury's CDFI Fund, NMTCs allow investors to reduce their basis by 20% to 25% and thereby increase returns.
Through CEI Capital Management LLC (CCML), its for-profit subsidiary, CEI has $778 million in investment capacity, making it the largest NMTC allocation in the country. It has completed 68 of these complex multi-million projects, with about one-quarter of them in Maine.