Watermen's group ends its seafood cooperative

February 24, 1994|By Liz Atwood | Liz Atwood,Sun Staff Writer

The Maryland Watermen's Cooperative, formed to help save Annapolis' seafood industry and find markets for state seafood, is dissolving.

For four years, the co-op tried to operate a seafood retail and wholesale business and a processing plant in the old McNasby Oyster Co. building in Eastport. Now more than $100,000 in debt and with no prospect of repaying creditors, the co-op has decided to bail out.

Dan Beck, president of the co-op's board of directors, said the group is considering filing for bankruptcy.

The co-op's demise leaves the city stuck with a $750,000 loan and some $12,000 owed in back rent on the property. It also leaves the future of the Western Shore's only licensed seafood processing facility in doubt.

With the help of state, county and private loans, Annapolis bought the property, along with several other parcels, in 1989 to save them from condominium development, said Alderman Ellen O. Moyer, who represents the Eastport neighborhood.

Fifty-four watermen put up $1,000 each to invest in the cooperative, believing the project would be a way to promote their industry.

"We all knew from the start that we might not see our $1,000 back," Mr. Beck said. "But we were hoping that in years down the road we would receive a dividend on our investment."

Bureaucratic delays and bad management doomed the project almost from the beginning, Mr. Beck said.

The retail operation opened in November 1989, but the processing plant did not receive health department approvals until 1992. By that time, the watermen had no money left to buy seafood to process, Mr. Beck said.

Last year, the co-op members gave up trying to administer the project themselves and formed two joint venture partnerships with other businesses to run the day-to-day operations of the wholesale and retail businesses.

The retail venture closed before Christmas, and Mr. Beck said he didn't know if the operator planned to reopen it. A sign on the door reads, "Gone to Florida," and promises to reopen April 1.

The wholesale business, called Maryland Watermen's Corp., continues to operate as a fish and seafood packing and shipping facility.

Doug Orr, who operates that business, said that he would like to stay in the plant, but will move if he can't work out a lease with the city.

Mr. Beck said that in hindsight, the watermen underestimated the start-up costs involved in the operation. As a result, they always found it difficult to buy seafood, he said.

Although some have blamed the decline in the Chesapeake Bay's oyster harvest, he said that was not a factor in the closing of the co-op.

Among the co-ops debts are a $50,000 loan, $12,000 in back rent, and bills for paper, advertising and shipping.

Because the co-op has no assets, there may be no point in a bankruptcy filing, said the co-op's lawyer, Jerold Nussbaum. "It may unduly burden the court," he said.

Ms. Moyer said she would like to keep the seafood processing plant intact and look for other operators.

"We now have an asset that may be valuable when the bounty of the bay picks up," she said.

But Aldermen Carl Snowden, a Democrat representing the city's Ward 5, said the city may have no choice but to end the project. "It was a good idea. The city tried to maintain a viable maritime industry. But the economic reality is that it does not appear to be economically feasible," he said.

Ms. Moyer said that if the city does decide to abandon the idea of a seafood processing plant, there are other options, including using the property to expand the nearby Barge House Museum.

Mr. Beck, who put up more than $5,000 of his own money to keep the project afloat, said he is disappointed it did not work, and sorry that the co-op must close with so many unpaid debts.

"The only thing we can do is write it off," Mr. Beck said. "We done our very best."

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