The following is text of a news release from the American Great Lakes Ports Association (AGLPA):
(WASHINGTON) — The U.S. Coast Guard has published its final 2018 rates for Great Lakes pilotage services. The new hourly rates are estimated to generate a total of $25,156,442 in revenue for the three Great Lakes pilot companies. This represents a $2,830,061 increase from 2017, or a 12.7 percent increase in total cost over last year.
The Coast Guard maintains a regulated monopoly structure for Great Lakes pilotage, similar to a utility. The agency revises the hourly rates for Great Lakes pilotage service annually through a federal rulemaking process. In its initial proposal last January, the Coast Guard recommended a 5.2 percent increase in overall revenue for 2018. Instead, the agency implemented a 12.7 percent increase.
The Coast Guard had originally proposed revising pilot target compensation from its 2017 level of $332,000 a year down to $319,000 a year for 2018. This adjustment was in response to our successful lawsuit challenging the arbitrary nature in which the agency had earlier determined the $332,000 compensation level. In its final rule, the Coast Guard failed to follow through and ultimately decided to set pilot compensation at $352,485 a year.
The new 2018 pilotage rates represent the fourth consecutive year of double-digit cost increases implemented by the Coast Guard as shown below:
2018 – 12.7 percent increase in total cost over 2017
2017 – 14 percent increase in total cost over 2016
2016 – 24 percent increase in total cost over 2015
2015 – 20.1 percent increase in total cost over 2014
In 2014, the total proposed cost of U.S. Great Lakes pilotage was $12.7 million. Four years later, the Coast Guard has doubled it to $25.1 million. All of this cost is recovered from Great Lakes vessel operators in hourly charges for pilotage services. No federal funds subsidize this system.
