America’s Finest fails to win waiver

Unalaska Mayor Frank Kelty’s letter to Congress may well have been the death knell for the trawler America’s Finest. The Kirkland, Wash.-based Fishermen’s Finest’s request for a Jones Act waiver for the new boat has failed make it as a rider on the Homeland Security reauthorization bill.

“I know it was considered,” said Fishermen’s Finest President Dennis Moran. “I can’t say whether it was ever in or out.”

Late last year, the Coast Guard declined the request for a waiver.

“I honestly don’t know whether that’s the last stop,” Moran said. “It will involve listing the boat for international sale, which we’re going to go ahead and do.”

When Anacortes, Wash.-based builder Dakota Creek Industries was discovered to have built the new trawler with approximately 10 percent foreign steel — as opposed to the Jones Act-allowed 1.5 percent — the shipyard and Fishermen’s Finest suddenly found themselves in the position of asking forgiveness in a politically charged fishery.

Jones Act waivers are not unheard of in the fishing industry. But this waiver request happened to come during a rough patch in the Alaska groundfish industry, when most stakeholders are scrambling to make sure their people are being paid and their vision is effective for the long haul.

“There are very powerful business interests — I should say they’re powerful companies — that believe their business interests are advanced by preventing new building,” Moran said. “That creates new opportunities for them to expand.”

As Fishermen’s Finest prepared to consolidate two federal trawl permits for Alaska groundfish onto the new America’s Finest, the question became: What will come of the two boats the company is retiring? A logical option was to turn those boats into motherships, which can sit offshore and process deliveries from any vessels fishing in the region, in effect, reducing deliveries to shoreside processors.

A reduction in deliveries would affect the town of Unalaska-Dutch Harbor, which processes deliveries of the bulk of Bering Sea-Aleutian Islands harvests.

“I feel for Anacortes,” Unalaska Mayor Kelty told KUCB news in late February. “But… Anacortes and the shipyard are not our constituents. You’ve got to do what’s best for the city of Unalaska.”

Whether Kelty’s opposition was politically motivated is unclear. Some believe the exposure of Fishermen’s Finest’s challenge to Alaska’s tax law — which is supposed to be part of a confidential process — contributed to the mayor’s decision to press for limits on the company.

“Two years ago the state of Alaska raised the landing taxes,” Moran said. “The raise was focused heavily on our company and similarly situated companies. We have a right to challenge the tax within the confidential tax procedure, which we and several other companies did.”

Fishermen’s Finest has been advised that the tax law violates the U.S. Constitution on the grounds that it taxes exports.

“Our suggestion that there’s a law out there that’s illegal has upset people who benefit immensely from the illegal law,” Moran said. “That’s not good government. Government is supposed to follow the law, not break it.”

Whatever comes of the tax challenge, it appears the America’s Finest may live up to her name, just not in American fisheries.

“They [Dakota Creek] were willing to do whatever,” Moran said. “They self-reported. They did the right thing. They owned up to it. They offered to make a huge new investment, to bring all sorts of new technology into the country that they would make available to all the boatyards. It would have benefited everyone. All of that was rejected, and it went in the opposite direction, all to satisfy the appetites of a handful of politically well connected individuals.”

Now that Fishermen’s Finest has exhausted all options to launch the boat for American fisheries, Moran says they will be looking to liquidate the boat to a foreign buyer.

But who has the cash to buy a brand new 264-foot trawler? The rumors and hand-wringing over selling top fishing technology at a song to Russia have dominated the backside of the waiver chatter. Moran preferred not to disclose the nationalities of his prospective buyers, but he did confirm he had some interest outside of Russia.

“This is a big disappointment of course,” Moran said. “The fleet’s gotta get replaced some day. This certainly sets back fleet replacement — I don’t know, 10 years — for everybody. Maybe more.”

Dakota Creek has reportedly laid off nearly half of its yard staff. The yard’s future is uncertain.

“There’s a lot of fishermen who could be working on a boat that’s safe, strong and productive,” Moran said. “It’s a difficult thing to swallow, but apparently that’s the way it’s going to go down.

About the author

Jessica Hathaway

Jessica Hathaway is the editor in chief of National Fisherman.

  • John Dapper

    I feel for the shipyard workers that were laid off. But the problem is management made a decision to buy cheap steel. The Jones Act is there for a reason. Overall shipyard jobs are protected by the act. I’ve seen other waivers in commercial fishing vessels. Apparently not enough money was spread around Washington, DC or the they didn’t meet the price of a senator that could get it done.

  • Marshal mathers

    well, they better hope Dennis is better at negotiating boat sales than he is at building boats 😂

  • Caryn Pryer

    Sad. Rudy Petersen spent more than 40 years building that fish company, and in no time at all, looks like Dennis sank it … or at the very least, has it listing badly.

  • Fish buyer

    Cheap foreign steel isn’t at issue. It’s foreign formed steel using techniques not used in US. The waivers you have seen… were they requested proactively or reactively?

  • Piet

    Agree, steel import is allowed but without pre-cutting or forming. This makes shipbuilding very inefficient. The Jones Act makes US Shipyard very expensive even compared to Norway. US Fisherman need to work with old vessels while the whole world is renewing their fleets. Buying prepared steel packages would make the US shipyards more efficient and competitive and at the end more jobs.

  • Sminkypinky

    How can you say that; it’s clear the yard owned up to the error; they are the ones who will take the hit?

  • Caryn Pryer

    Of course Dakota Creek is admitting their responsibility. They built it, so the buck stops there. That does not absolve Fishermen’s Finest of their own responsibility. It goes without saying that when a company is spending 75 million bucks to build a boat, they are (or should be) involved, every step of the way. The first step was the hull, that’s comprised of an over abundance of the “offending” foreign fabricated steel. If you haven’t been following this story, the industry wide question is how did these two experienced companies manage to turn out a (Jones Act) noncompliant vessel? And more specifically, who made the decision to fabricate the steel in Holland? That question was posed to Dennis Moran, (President of F.F. & an attorney himself). But alas, he declined to answer.

  • Johnny Brown

    More lower paying jobs at the expense of higher paying ones….the same thing free trade has done for most of our manufacturing.

  • Piet

    It saved the European shipbuilding industry. The airplane industry is also not affected by a Jones Act and looks quit booming in the US. Delta buying Airbus, KLM buying Boeings looks like everyone happy in a healthy market. Both happening in Seattle, struggling shipyards and booming airplane manufacturing.

  • Mary LaFleur

    This is a horrible situation. Now another country will have the best fishing boat. Politicians need to get it! Ruining one of the finest companies in Anacortes and giving away something as great at the America’s Finest to anther country should be a sign that you don’t vote for the folks that let this happen. They are not real thinkers of the future, they are in it for political reasons. Common sense and reasoning has gone away and needed to come back for America’s Finest. At least our Mayor, Laurie Gere, tried to help, she understands how honest and reputable Dakota Creek Industries is. Shame on the folks that can’ recognize and error, hope they never make one!

  • Chris Jones

    The jobs lost if this vessel goes into service will be seasonal onshore fish processing jobs, traded for offshore processing jobs. Currently there are permanent skilled workers being laid off and perhaps putting at risk another US boat builder. This is not a good trade.

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