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January 14, 2008

FAME starts loan program for lobstermen

The Finance Authority of Maine recently approved a loan program to help lobstermen buy new gear to comply with a controversial federal law.

The federal law requires lobstermen to replace their floating lines, which environmentalists argue harm whales, with sinking lines by October. Industry experts have put the cost of complying with the gear change at between $10,000 and $15,000 per lobsterman, and up to $85,000 per vessel, according to a press release from Sen. Olympia Snowe's office.

Under FAME's new loan program, approved by its board Dec. 20, banks offering loans to lobstermen can get FAME insurance for up to 75% of the loan, an increase from FAME's 60% standard. Lobstermen getting loans directly from FAME would pay only the prime interest rate, rather than FAME's standard rate of prime plus two percent.

Meanwhile, Sen. Olympia Snowe was scheduled to chair a public hearing this morning in Ellsworth to discuss how the requirement would affect the industry. The event was canceled due to snow and hasn't been rescheduled yet, according to officials at Snowe's office in Bangor.

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