Great Lakes pilotage rates rising 11 percent for 2019May 14, 2019 09:43 AM
It is the fifth consecutive year the Coast Guard has implemented a double-digit increase
The following is text of a news release from the American Great Lakes Ports Association (AGLPA):
(WASHINGTON) — Last Friday, the U.S. Coast Guard (USCG) published a final rule in the Federal Register setting rates for U.S. pilots on the Great Lakes for the 2019 navigation season. The rates will take effect on June 10.
For the fifth consecutive year, the Coast Guard has implemented a double-digit increase in pilotage costs over the previous year. The 2019 rates will increase overall cost by 11 percent over last year. A year-by-year breakdown of recent cost increases appears below. Increases are primarily the result of a growing pilot workforce and higher pilot compensation.
(Year / number of pilots / total estimated cost / percentage over prior year estimate)
2014 / 36 / $12,889,868
2015 / 36 / $15,451,455 / +20 percent over 2014
2016 / 37 / $19,103,678 / +24 percent over 2015
2017 / 45 / $22,326,381 / +14 percent over 2016
2018 / 49 / $25,156,442 / +12.7 percent over 2017
2019 / 51 / $27,988,185 / +11.3 percent over 2018
It is important to remember that the 2019 rates seek to generate revenue for the three U.S. Great Lakes pilot associations based on the USCG's traffic projections for 2019. The agency uses a 10-year rolling average to estimate traffic. Actual revenue might be higher or lower, depending on actual traffic levels.
The new rates include an updated pilot target compensation level of $359,887 for the nine month shipping season. This number was derived by adjusting the previous year's target compensation ($352,485) by inflation. The previous year's target was derived by the USCG through a disputed mathematical extrapolation of what the agency thinks the masters of U.S.-flag lake vessels earned in 2015.
The final rule provides for a total of 51 pilots: 17 in District 1 (St. Lawrence and Lake Ontario); 14 in District 2 (Lake Erie and Detroit/St. Clair rivers); and 20 in District 3 (Lakes Huron, Michigan, Superior and St. Marys River). The rule also provides funds for training of new applicant pilots, including two in District 1, one in District 2, and four in District 3.
On Nov. 16, 2018, AGLPA and other industry partners filed joint public comments challenging several aspects of the proposed rate increase. The arguments were rejected by the Coast Guard. To view a copy of the submission, click here.
To view a copy of the final 2019 Great Lakes pilotage rate-setting rule, click here.