GALTEX Pilots Granted Healthy Raise in Rates

Multi-year rate increase will eventually raise pilot tariffs as much as 18 percent over four years, despite a faltering economy, depressed freight rates and worldwide contraction of ocean shipping capacity. WGMA not yet on board as approving new rate structure. Court challenges may be brewing.

Last Friday – and following last week’s contentious two-day hearing that ended a long, drawn out battle over a proposed pilotage rate hike – the Board of Commissioners of Pilots for the Ports of Galveston County granted a five percent rate adjustment to the Galveston-Texas City Pilots tariff. The Board also indicated they would also approve a four year (5/4/4/4) percent tariff, assuming all objecting parties agree.

On July 15th, a hastily arranged mediation session did not yield any joy and the scheduled rate hearings went on as scheduled on Thursday and Friday of last week. A West Gulf Maritime Association (WGMA) prepared statement, issued after the mediation session, said, "Regrettably today’s mediation did not lead to an agreement. Both sides worked hard all day; however, we were unsuccessful despite best efforts.” WGMA represents a large portion of the local stakeholders opposed to the proposed pilotage rate hike. A final vote on the future rate tariff will be voted on in a meeting scheduled for August 10.

Following last week’s rate hearings, the WGMA again met yesterday and set time aside to discuss the multi year rate adjustment proposal with effected parties. Niels Aalund, Vice President of Maritime Affairs for WGMA, told MarEx on Wednesday, “The WGMA hosted a special membership meeting. We had a large turnout. Over 40 companies and organizations attended, including representatives from all objecting parties to the GALTEX tariff increase application. The issue of accepting a proposed 5/4/4/4 multi-year tariff rate adjustment was discussed and debated at length. A consensus position was not reached on the multi-year tariff adjustment proposal.”

The 15 GALTEX Ship pilots for the ports of Galveston and Texas City contend that that even after the rate hike that they still paid less than pilots at other Texas Gulf ports. During the two-day hearing, they petitioned the state commission for annual increases of 8 percent for two years, 7 percent for the following three years, as well as a cost of living adjustment each year. The multi-year rate granted by the commission amounts to less than one-half of what they were asking for, but still could hike pilot fees by as much as 18 percent over a four year period. Separately – and according to a MarEx source who declined to be identified in this article – it was reported that certain objecting parties are considering a court challenge to some or all parts of the Commission’s rate decision.

A WGMA-generated presentation insists that the total impact of the original rate request would have been very large (more than 80 percent).