Fishing for an Economy
Coastal Villages Region Fund leverages its quota to build Western Alaska
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n 2020, Coastal Villages Region Fund (CVRF) generated $91.6 million in gross revenue. Because CVRF is a nonprofit, it doesn’t qualify for Alaska Business’ Top 49ers list, but if it did, it would have placed in the mid-thirties on the list, between Usibelli Coal Mine and Watterson Construction. While CVRF is a nonprofit organization, it does not accept any charitable donations. All of the organization’s revenue is generated through fisheries investment. “We operate a seafood company and all of the revenue comes in through the catching, processing, and sale of Alaska seafood,” says CVRF’s CEO Eric Deakin. It is one of six Western Alaska Community Development Quota (CDQ) Program groups. According to NOAA Fisheries: “The Community Development Quota Program was established (i) to provide eligible western Alaska villages with the opportunity to participate and invest in fisheries in the Bering Sea and Aleutian Islands Management Area; (ii) to support economic development in western Alaska; (iii) to alleviate poverty and provide economic and social benefits for residents of western Alaska; and (iv) to achieve sustainable and diversified local economies in western Alaska.”
22 | February 2022
By Tasha Anderson Today, 10 percent of Alaska’s fisheries are set aside for CDQ groups. As Deakin puts it, “We’re one of six groups that were set up to manage the monetization of that quota and the delivery of programs with it to a group of villages.” CVRF represents and provides benefits to twenty villages, ranging from Scammon Bay south to Platinum. “A separate group near us, the Yukon Delta Fisheries Development Association, manages that are on the Yukon itself,” Deakin specifies. How are these groups supposed to make money, and how should they spend it once they do? Similar to the Alaska Native regional and village corporations created under ANCSA, the Western Alaska CDQ groups have needed to figure out how to best use their resources and meet their mission. And like the ANCSA corporations, they’ve evolved since their formation to be better at both.
Generating Revenue In its early years, like many of the other CDQ groups trying to find their footing, CVRF partnered with established fishing companies, leasing its quota to them to fish. Over time, CVRF has shifted to owning and managing its own vessels and directly selling its catch.
“For the most part, all the CDQs have trended in the direction of at least owning minority interest in their partners, just to be able to make more money on the value chain,” Deakin says. “In leasing, there’s a very small portion where it’s no risk, and a lot of the time you have guaranteed returns from a lease. But because of [having] no risk— you’re just leasing and not participating in the fishing, processing, or sales. It’s really not as profitable as it could be.” CVRF ventured into ownership in 2006, purchasing crab boats and partnering with the original owner to manage them for about three years before CVRF took over operations and management. At that point, CVRF was responsible for the catch, the upkeep of the boats, staffing them, et cetera. “The shipyard and boat maintenance can be pretty complex, and it gets very expensive,” Deakin says. “You have to have a lot of working capital to start that endeavor, or a big credit line, because boat repairs aren’t always cheap and you get surprises that come up that can be expensive.” CVRF also took the leap into vessel ownership in the pollock and cod fisheries. “We were the first CDQ to manage our own at-sea pollock vessel,” he says. The group’s pollock boat is a
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Coastal Villages Region Fund
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