BILL ANALYSIS
AB 1888
Page 1
Date of Hearing: March 22, 2010
ASSEMBLY COMMITTEE ON TRANSPORTATION
Bonnie Lowenthal, Chair
AB 1888 (Ma) - As Amended: March 15, 2010
SUBJECT : Bar Pilot surcharge vessel exemptions
SUMMARY : Specifically allows noncommercial vessels that are
maritime academy training vessels and vessels owned and operated
by nonprofit museums or foundations to receive pilotage services
at no charge. Specifically, this bill :
1)Exempts from pilotage fees and surcharges noncommercial
vessels that are maritime academy training vessels and vessels
owned and operated by nonprofit museums or foundations.
Requires vessels, owners, or operators to indemnify and hold
harmless pilots and their organizations with respect to
liability and claims, as specified.
2)Increases the size of recreational watercraft, such as large
yachts, from 300 gross tons to 750 gross tons, for which bar
pilot services would not be required.
3)Raises the minimum charges for bar pilot pilotage services
from $662 to $1,500.
4)Revises the accounting information required monthly of the bar
pilots to include the amount of fees and surcharges not
collected pursuant to the non-piloting charges for training
and nonprofit vessels as specified.
EXISTING LAW :
1)Establishes Board of Pilot Commissioners (Board) for the Bays
of San Francisco, San Pablo and Suisun, and Monterey, to
license and regulate maritime pilots who guide vessels
entering or leaving those bays. The seven members of the
Board are appointed by the Governor with the consent of the
Senate. Prescribes pilotage rates for vessels and requires
vessels to pay a specified rate of bar pilotage through the
Golden Gate Bridge and into or out of the bays of San
Francisco, San Pablo, Suisun, and Monterey.
2)Imposes a surcharge on pilotage fees to be deposited in the
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Board's Special Fund that is used to support the Board.
Imposes other surcharges for navigation technology, pilot
trainee programs, licensed pilots continuing education
programs, maintaining pilot boats, and for pilot pension
plans. Requires the Board to adopt standards and a training
program for pilots, inland pilots, and pilot trainees and
requires that any surcharge money collected be deposited in
separate and specific trainee and pilot funds.
3)Establishes a minimum charge for pilotage services at $662.
4)Requires every pilot to provide a monthly accounting to the
Board of pilotage moneys received including the following
information:
a) The name of each vessel piloted;
b) The name of each vessel for which pilotage has been
charged or collected;
c) The amount charged to or collected for each vessel;
d) Any rebates made and allowed and for what amounts;
e) The depth of each vessel's draft and its highest gross
tonnage; and,
f) Whether the vessel was inward or outward bound.
5)Under federal law, requires that all foreign vessels in excess
of 300 gross tons entering or leaving a United States port use
the services of maritime pilots.
FISCAL EFFECT : Unknown
COMMENTS : Pilotage of international trade vessels in the United
States is regulated by the individual states, each of which
maintains a pilotage system that is suited to the particular
needs and circumstances of its own waters. In 1789, the first
Congress of the United States enacted a law giving the states
the right to regulate pilotage in their waters. That created
the state pilotage system, which remains in effect today. Every
foreign-flag vessel and every United States-flag vessel engaged
in international trade moving in the waters of a state is
required by the state to take a pilot licensed by the state.
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In California, bar pilots are responsible for steering an
arriving vessel through the Golden Gate Bridge of San Francisco
Bay, the bay waters, and adjoining navigable waters, which
include San Pablo Bay, Suisun Bay, the Sacramento and San
Joaquin Rivers, and its tributaries. Pilotage services are also
provided for Monterey Bay. When a vessel approaches the "SF"
buoy 12 miles west of the Golden Gate Bridge, a bar pilot boards
the ship and takes navigational control. It becomes the bar
pilot's responsibility to guide the ship to its berth. The bar
pilots provide service to all types of vessels, from large
recreational yachts over 300 gross tons to 100-foot tugs to
1000-foot supertankers. Inland pilots (only one remaining) are
not licensed to operate outside of the Golden Gate Bridge in the
open ocean area but pilot in the inland bays and river channels.
Maritime pilots licensed by the Board are required to pay the
Board a percentage of pilotage fees collected by them. These
moneys are used to pay expenses of the Board and its officers in
licensing and regulating the bar and inland pilots. The fund is
also used to pay per diem of the Pilotage Rate Committee for San
Francisco, San Pablo and Suisun Bays. The remaining majority of
the pilotage fees pay for pilot direct operating costs and
compensation. In addition to the pilotage fee paid by
commercial vessels and distributed to the pilots, there are a
number of other additional surcharges for various purposes as
follows:
1)The surcharge limit for the Board operations is up to 7.5%.
The surcharge is presently at 2.4%.
2)The surcharge for pilot trainees is $9 per trainee (currently
11), per vessel move.
3)The surcharge for bar and inland pilot continuing education
programs is $45 per vessel move.
4)The pilot boat surcharge is $0.0065 mills per gross registered
ton of each vessel charged. (Note: A mill is a thousandth of a
dollar.)
5)The pension surcharge is $.01280 mills per gross register ton
of each vessel charged. (All five rates were effective as of
April 1, 2008.)
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6)The navigational aids surcharge until January 2011.
Current Charges : A vessel operator currently pays a bar pilot
$8.11 per draft foot of the vessel's deepest draft plus a charge
of 80.55 mills per high gross registered ton. However,
according to the bill's sponsor, the San Francisco Bar Pilots
(Bar Pilots), their members have provided free pilotage services
to the museum ship operated by the non-profit National Liberty
Ship Memorial based in San Francisco and the training ship of
the California Maritime Academy. Although this has been the
practice for many years, the Bar Pilots were recently advised
that such free pilotage conflicts with existing law and that
they have no discretion on charging whenever pilotage services
are provided. Further, the ships, while not being charged for
pilotage services, currently do not pay any surcharges as well.
Expressing opposition to this surcharge exemption, the Pacific
Merchant Shipping Association (PMSA) contends that this is a
shared-cost, equity, and an "issue of fairness because
surcharges are usually meant to pay for the cost of an item that
either has a public purpose (for example, support of the Board
in lieu of direct licensing fees, or trainee training), or for
an aspect of pilotage service that may be of a uniform benefit
(such as the surcharge for pilot boats or pilot continuing
education). These vessels should at least pay these minimal
surcharge amounts in order to support the licensing, safety and
public purposes as outlined in statute."
Mega Yacht exemption : Currently, yachts less than 300 gross
tons are not required to use bar pilot services. This bill
would increase the yacht size for which pilotage services would
not be required from 300 gross tons to 750 gross tons. In
justifying this exemption, the Bar Pilots indicate that these
yachts, "despite their size, tend to draw only about 10-12 feet
of water. They are not at risk of running aground." Further,
significantly, they contend that it is dangerous for a bar pilot
to board the yacht when the boats are at sea. "Unlike most
commercial ships that have a rather vertical side, the large
mega yachts have flared sides that make it difficult for pilot
boats to come alongside for boarding." PMSA similarly indicates
that "yachts that are subject to the current minimum size and
fee statutes take pilots away from potential commercial pilotage
work and then do not pay a high enough minimum to actually cover
the pilots' costs of performing these jobs. Smaller yachts may
pose safety hazards for pilots when transferring to and from
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these vessels which are more often underequipped or unprepared
for a proper pilot exchange while at sea. These changes would
eliminate the requirement to take a pilot on smaller yachts."
While there are significant reasons to increase the size of mega
yachts required to accept pilotage, we question this approach in
consideration of the unanticipated consequence of such action.
If we consider the consequences of discontinuing pilotage of
vessels between the 300 and 750 gross ton recreational yachts,
we wonder whether it will increase the state's risk for
potential infrastructure (collisions with public bridge footings
and abutments) or environmental damages, as the mega yachts
would not be commandeered by bar pilots especially during
inclement weather? If this is primarily a pilot boarding and
deboarding health and safety issue, what considerations are
there to make such boat-to-boat transfers safer, such as
mandating the pilot use of a marine safety harness/tether?
Increase in the minimum charge for pilotage services :
According to the Bar Pilots, "the current minimum rate was
established sometime before 1983, but how long before is
unknown. The Consumer Price Index (CPI) has increased by more
than 215% since 1983. Thus, larger ships whose fees are
calculated in accordance with the statutory formula have been
subsidizing the rates paid by small ships. The proposed rate
approximates the CPI increase." Similarly, PMSA indicates that
raising the minimum charge will ensure that "when pilotage
services are provided that they at least cover the pilots' base
costs." The fee increase proposed in this measure would
increase the minimum "pilotage" charge from $662 to $1500. This
$800+ rate cost increase would directly benefit bar pilot
compensation, the subject of legislation approved by this
committee and enacted last year (see "Related Bill" section
below). Currently, there are mega yachts greater than 750 gross
tons and that would be subject to the increased rate; however,
the Bar Pilots believe that there are no commercial ships small
enough to pay the minimum charge at either the current rate or
the proposed rate. Further, although bar pilot funds will
increase due to the pilotage increase, any such increase will be
offset by the exemptions for 300-750 gross ton yachts as
provided by this bill.
AB 1888
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Related Bill : SB 300 (Yee) Chapter 497, Statutes of 2009,
establishes a surcharge for payment of navigational aids for bar
pilots and revises the pilotage rate based upon the current
number of bar pilots.
REGISTERED SUPPORT / OPPOSITION :
Support
San Francisco Bar Pilots (Sponsor)
Pacific Merchant Shipping Association (PMSA) support if amended
Opposition
None on file
Analysis Prepared by : Ed Imai / TRANS. / (916) 319-2093