The Pilots Association rate increase application, if approved, will have a dramatic and significant negative impact on commercial vessel activity at Port Tampa Bay (PTB).
The application proposes a change to the formula used for calculating pilotage fees from the current base rate, which considers vessel draft and gross tonnage, to a new formula that would also include vessel length and beam, in addition to the draft and gross tonnage.
The application requests a change in the rate structure reducing the focus on gross tonnage (GT) and adding other elements to the charge, such as length (LOA) and beam, aside from the draft and gross tonnage already applied.
In just the first year of this proposed new formula, typical vessels calling PTB will see increases in their pilotage charges ranging from 38% to 93%, depending on their specifications. See the chart below. Although not shown on the chart, one of the shippers calling on PTB just notified us that his pilotage rates would increase from about $1,000 to $2,395 in the first year. This shipper alone would see a pilotage rate increase of 140% or $2,790 per call (an additional $1,395 in pilotage fees for each vessel movement).
To make matters worse, the Pilots Association’s application proposes an increase of 6% each year for the following three years to this already devastating new fee structure, and then an increase of 3% each year for the next seven years. This would result in an increase of 102% to 183% over a period of 10 years for these typical vessels. Please note that the last pilotage rate change for the Port of Tampa was approved in 2008 for a mere 3% for two years; 2009 and 2010.
The Pilots Association has also proposed for the first time new additional fees per vessel movement for Training/Technology, Transportation, Pilot Boat Fund, Port Communication, Pilot Station Capital Fund, Pilot Carried to Sea and Second Pilot fees.
The Board of Pilot Commissioners have scheduled a “Rate Hearing” for Thursday, March 2, 2023, at 9 a.m., Westshore Grand Hotel, Tampa, 4860 West Kennedy Boulevard, Tampa, Florida. We object to the proposed rate increase, Port users, Boat agents, and interested parties filed their objections and will comment at the public hearing.
The hearing will be conducted by a committee of the Board of Pilot Commissioners, the Pilotage Rate Review Committee.
The Pilotage Rate Review Committee is required to determine whether the requested rate change will result in fair, just and reasonable rates.
The Committee may take into consideration the consumer price index or any other comparable economic indicator when fixing rates of pilotage; however, because the consumer price index or such other comparable economic indicator is primarily related to net income rather than rates, the Committee shall not use it as the sole factor in fixing rates of pilotage.
Finally, the Committee is required to fix rates of pilotage pursuant to Section 310.151, Fla. Stat., based upon the following vessel characteristics.
Below is a brief analysis showing the cost variance of the proposed system using a sample of typical vessels that are currently sailing from Port Tampa Bay:
The rates reflect the proposed pilotage rate increase solely for the first year. Please note that the Pilots Association is also proposing a rate increase at a fixed percentage for the 10 years after the effective date of the new rate. All rates and fees would increase by 6% on the anniversary date for three (3) years, then 3% per year for a period of seven (7) years on the same anniversary date. Here is a chart showing the increase in pilotage rates for these same vessels over the 10-year period:
With respect to cruise, the proposed Port of Tampa pilotage rate increases with the recently revised fees from Port Canaveral and Port Miami that entered into effect in 2022 and determined that the proposed Port of Tampa new rate structure and fees will on average be 63% more expensive than Port Canaveral and 58% more expensive than Port Miami.
I did submit the letter objecting to the proposed drastic pilotage rate increases as a concerned party. In the capacity of PTB commissioner, I fully understand that The Tampa Bay Pilots Association is an integral part of the port community. However and unfortunately, these proposed increases represent a sharp contrast to the spirit of cooperative and constructive engagement we have come to expect from this valued partner, and by no means meet the test of being “fair, just, and reasonable.”
Hung Mai is a Port Tampa Bay Commissioner.