71 FR 134 pgs. 39629-39642 - Rates for Pilotage on the Great Lakes
Type: PRORULEVolume: 71Number: 134Pages: 39629 - 39642
Docket number: [USCG-2006-24414]
FR document: [FR Doc. E6-11062 Filed 7-12-06; 8:45 am]
Agency: Homeland Security Department
Sub Agency: Coast Guard
Official PDF Version: PDF Version
DEPARTMENT OF HOMELAND SECURITY
Coast Guard
46 CFR Part 401
[USCG-2006-24414]
RIN 1625-AB05
Rates for Pilotage on the Great Lakes
AGENCY:
Coast Guard, DHS.
ACTION:
Notice of proposed rulemaking.
SUMMARY:
The Coast Guard is proposing to update the rates for pilotage on the Great Lakes. Based on our review we propose to adjust the pilotage rates an average of 6% for the 2006 shipping season to generate sufficient revenue to cover allowable expenses, target pilot compensation, and returns on investment.
DATES:
Comments and related material must reach the Docket Management Facility on or before August 14, 2006.
ADDRESSES:
To make sure your comments and related material are not entered more than once in the docket, please submit them by only one of the following means:
(1) By mail to the Docket Management Facility (USCG-2006-24414), U.S. Department of Transportation, room PL-401, 400 Seventh Street, SW., Washington, DC 20590-0001.
(2) By delivery to room PL-401 on the Plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The telephone number is 202-366-9329.
(3) By fax to the Docket Management Facility at 202-493-2251.
(4) Electronically through the Web site for the Docket Management System at http://dms.dot.gov .
The Docket Management Facility maintains the public docket for this rulemaking. Comments and material received from the public, as well as documents mentioned in this preamble as being available in the docket, will become part of this docket and will be available for inspection or copying at room PL-401 on the Plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. You may also find this docket on the Internet at http://dms.dot.gov . Anyone is able to search the electronic form of all comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review DOT's complete Privacy Act Statement in the Federal Register published on April 11, 2000 (Volume 65, Number 70; Pages 19477-78), or you may visit http://dms.dot.gov .
FOR FURTHER INFORMATION CONTACT:
For questions on this proposed rule, call Mr. Michael Sakaio, Program Analyst, Office of Great Lakes Pilotage, Commandant (G-PWM), U.S. Coast Guard, at 202-372-1538, by fax 202-372-1929, or by e-mail at msakaio@comdt.uscg.mil . For questions on viewing or submitting material to the docket, call Renee V. Wright, Chief, Dockets, Department of Transportation, telephone 202-493-0402.
Table of Contents
I. Public Participation and Request for Comments
A. Submitting Comments
B. Viewing Comments and Documents
C. Public Meeting
D. Privacy Act
II. Program History
III. Purpose of the Proposed Rule
A. Proposed Pilotage Rate Changes-Summarized
B. Calculating the Rate Adjustment
Step 1: Calculating the Base Period Total Economic Cost (Cost per Bridge Hour by Area for the Base Period)
Step 2. Calculating the Expense Multiplier
Step 3. Calculating the new annual "projection of target pilot compensation" using the same procedures found in Step 2 of Appendix A to 46 CFR part 404.
Step 4: Increase the new total target pilot compensation in Step 3 by the expense multiplier in Step 2.
Step 5(a): Adjust the result in Step 4, as required, for inflation or deflation.
Step 5(b): Calculate Projected Total Economic Costs.
Step 6: Divide the Result in Step 5(b) by Projected Bridge Hours to Determine Total Unit Costs (Adjusted Cost per Bridge Hour by Area).
Step 7: Divide prospective unit costs in Step 6 by the base period unit costs in Step 1.
Step 8: Adjust the base period rates by the percentage change in unit costs in Step 7.
IV. Regulatory Evaluation
A. Small Entities
B. Assistance for Small Entities
C. Collection of Information
D. Federalism
E. Unfunded Mandates Reform Act
F. Taking of Private Property
G. Civil Justice Reform
H. Protection of Children
I. Indian Tribal Governments
J. Energy Effects
K. Technical Standards
L. Environment
V. Regulatory Text
SUPPLEMENTARY INFORMATION:
I. Public Participation and Request for Comments
We encourage you to participate in this rulemaking by submitting comments and related materials. All comments received will be posted, without change, to http://dms.dot.gov and will include any personal information you have provided. We have an agreement with the Department of Transportation (DOT) to use the Docket Management Facility. Please see DOT's "Privacy Act" paragraph below.
A. Submitting Comments: If you submit a comment, please include your name and address, identify the docket number for this rulemaking (USCG-2006-24414), indicate the specific section of this document to which each comment applies, and give the reason for each comment. You may submit your comments and material by electronic means, mail, fax, or delivery to the Docket Management Facility at the address under ADDRESSES ; but please submit your comments and material by only one means. If you submit them by mail or delivery, submit them in an unbound format, no larger than 8 1⁄2 by 11 inches, suitable for copying and electronic filing. If you submit them by mail and would like to know that they reached the Facility, please enclose a stamped, self-addressed postcard or envelope. We will consider all comments and material received during the comment period. We may change this rule in view of them.
B. Viewing comments and documents: To view comments, as well as documents mentioned in this preamble as being available in the docket, go to http://dms.dot.gov at any time and conduct a simple search using the docket number. You may also visit the Docket Management Facility in room PL-401 on the Plaza level of the Nassif Building, 400 Seventh Street SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.
C. Public Meeting: We do not plan to hold a public meeting. But you may submit a request for one to the Docket Management Facility at the address under ADDRESSES explaining why one would be beneficial. If we determine that one would aid this rulemaking, we will hold one at a time and place announced by a later notice in the Federal Register .
D. Privacy Act: Anyone can search the electronic form of all comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review the Department of Transportation's Privacy Act Statement in the Federal Register published on April 11, 2000 (65 FR 19477), or you may visit http://dms.dot.gov .
II. Program History
The Great Lakes Pilotage Act of 1960 requires foreign-flag vessels and U.S.-flag vessels in foreign trade to use federal Great Lakes registered pilots while transiting the St. Lawrence Seaway and the Great Lakes system. 46 U.S.C. Chapter 93, §§ 9302 and 9308. The Coast Guard is responsible for administering this pilotage program, which includes setting rates for pilotage service.
The U.S. waters of the Great Lakes and the St. Lawrence Seaway are divided into three pilotage Districts. Pilotage in each District is provided by an association certified by the Director of Great Lakes Pilotage to operate a pilotage pool. It is important to note that, while the Coast Guard sets rates, it does not control the actual compensation that pilots receive. This is determined by each of the three District associations, which use different compensation practices.
District One, consisting of Areas 1 and 2, includes all U.S. waters of the St. Lawrence River and Lake Ontario. District Two, consisting of Areas 4 and 5, includes all U.S. waters of Lake Erie, the Detroit River, Lake St. Clair, and the St. Clair River. District Three, consisting of Areas 6, 7, and 8, includes all U.S. waters of the St. Mary's River, Sault Ste. Marie Locks, and Lakes Michigan, Huron, and Superior. Area 3 is the Welland Canal, which is serviced exclusively by the Canadian Great Lakes Pilotage Authority and, accordingly, is not included in the U.S. rate structure. Areas 1, 5, and 7 have been designated by Presidential Proclamation, pursuant to the Great Lakes Pilotage Act of 1960, to be waters in which pilots must at all times be fully engaged in the navigation of vessels in their charge. These waters were "designated" because they are difficult waters to navigate. Areas 2, 4, 6 and 8 have not been so designated because they are open bodies of water. Under the Great Lakes Pilotage Act of 1960, pilots assigned to vessels in these areas are only required "to be on board and available to direct the navigation of a vessel at the discretion of and subject to the customary authority of the master." 46 U.S.C. 9302(a)(1)(A) and (B).
The Coast Guard pilotage regulations require annual reviews of pilotage rates and the creation of a new rate at least once every five years, or sooner, if annual reviews show a need. 46 CFR part 404. To assist in calculating pilotage rates, the pilotage associations are required to submit to the Coast Guard annual financial statements prepared by certified public accounting firms. In addition, every fifth year, in connection with the mandatory rate adjustment, the Coast Guard contracts with an independent accounting firm to conduct a full ratemaking by auditing the accounts and records of the pilotage associations and by preparing and submitting financial reports relevant to the ratemaking process. In those years when a full ratemaking is conducted, the Coast Guard generates the pilotage rates using Appendix A to 46 CFR part 404. Between the five-year full ratemaking intervals, the Coast Guard annually reviews the pilotage rates using Appendix C to 46 CFR part 404, and adjusts rates when deemed appropriate.
The last full ratemaking was published in the Federal Register on April 3, 2006 (71 FR 16501). In that ratemaking, the Coast Guard applied the Appendix A methodology for calculating rates. For this annual rate review and adjustment, we are using the methodology contained in Appendix C.
III. Purpose of the Proposed Rule
The authority to establish pilotage rates on the Great Lakes derives from 46 U.S.C. 9303(f), which states that: "[t]he Secretary shall prescribe by regulation rates and charges for pilotage services, giving consideration to the public interest and the costs of providing the services."
The pilotage regulations require that pilotage rates be reviewed annually. If the annual review shows that pilotage rates are within a reasonable range of the base target pilot compensation set in the full ratemaking, no adjustment to the rates will be initiated. (Target pilot compensation is defined in 46 CFR part 404, Appendix B, and is the compensation that pilots are intended to receive for full time employment.) However, if the annual review indicates that an adjustment is necessary, then the Coast Guard will establish new pilotage rates using § 404.10 and either Appendix A or Appendix C of part 404.
The Appendix C ratemaking methodology is intended for use during the years between Appendix A full ratemaking reviews and adjustments. This section is a description of the analyses performed, and the eight-step methodology followed, in the development of the Appendix C adjustment. The first part summarizes the rate adjustments proposed in this rule. The second part describes the ratemaking process and explains the formulas used in the methodology to show how the rate adjustment was actually calculated.
A. Proposed Pilotage Rate Changes-Summarized
This proposed rule would adjust the rates for Federal pilots on the Great Lakes, contained in 46 CFR 401.405, 401.407, and 401.410, in accordance with Appendix C of 46 CFR part 404. Using this methodology, the rate adjustment would result in an average increase of 6 percent across all Districts over the last pilotage rate adjustment.
| If pilotage service is required in: | Then the percentage increases over the current rate is: |
|---|---|
| Area 1 (Designated waters) | 5.44 |
| Area 2 (Undesignated waters) | 6.30 |
| Area 4 (Undesignated waters) | 6.39 |
| Area 5 (Designated waters) | 5.65 |
| Area 6 (Undesignated waters) | 6.26 |
| Area 7 (Designated waters) | 5.50 |
| Area 8 (Undesignated waters) | 6.20 |
Rates for "Cancellation, delay or interruption in rendering services (§ 401.420)" and "Basic rates and charges for carrying a U.S. pilot beyond [the] normal change point, or for boarding at other than the normal boarding point (§ 401.428)" have been increased by 6 percent. These changes are the same in every Area.
B. Calculating the Rate Adjustment
The ratemaking analyses and methodology contained in Appendix C to 46 CFR part 404 is comprised of eight steps. These steps are:
1. Calculating the Base Period Total Economic Cost (Cost Per Bridge Hour by Area for the Base Period);
2. Calculating the Expense Multiplier;
3. Calculating the Annual Projection of Target Pilot Compensation;
4. Increasing the Projected Pilot Compensation in Step 3 by the Expense Multiplier;
5. Adjusting the Result for Inflation or Deflation;
6. Dividing the Result in Step 5 by Projected Bridge Hours to Determine Total Unit Costs (Adjusted Cost per Bridge Hour by Area);
7. Dividing Prospective Unit Costs (Total Unit Cost) in Step 6 by the Base Period Unit Costs in Step 1; and
8. Adjusting the Base Period rates by the Percentage Changes in Unit Cost in Step 7.
The base data used to calculate each of the eight steps comes from the final rule published in the Federal Register on April 3, 2006 (71 FR 16501), adjusting pilotage rates on the Great Lakes. 71 FR 16501. The Coast Guard also used the most recent union contracts between the American Maritime Officers' union (AMO) and vessel owners and operators on the Great Lakes to determine target pilot compensation. Bridge hour projections for the 2006 season have been obtained from historical data, pilots, and industry. Bridge hours are the number of hours a pilot is aboard a vessel providing pilotage service.
Some values may not total exactly due to format rounding for presentation in charts and explanations in this section. The rounding does not affect the integrity or truncate the real value of all calculations in the ratemaking methodology described below.
Step 1: Calculating the Base Period Total Economic Cost (Cost per Bridge Hour by Area for the Base Period).
The base period numbers used in all calculations are those that were set by the final rule published in the Federal Register on April 3, 2006 (71 FR 16513). The data used for this first step is obtained from the tables containing the base operating expense, base target pilot compensation, and base return element computations. This first step requires that we calculate the total economic cost for the base period by taking from these tables, and adding together, the recognized expenses, the total cost of target pilot compensation, and the return element in each Area. We then take this sum and divide it by the total bridge hours used in each Area in setting the base period rates. This calculation gives us the cost of providing pilotage service per bridge hour by Area for the base period.
The following tables summarize the Step 1 computations:
| Area 1 St. Lawrence River | Area 2 Lake Ontario | Total-District One | |
|---|---|---|---|
| Base Operating Expenses | $368,186 | $372,911 | $741,097 |
| Base Target Pilot compensation | +$1,207,209 | +$725,848 | +1,933,057 |
| Base Return Element1 | +$8,087 | +$10,185 | +$18,272 |
| Subtotal | =$1,583,482 | =$1,108,944 | =$2,692,426 |
| Base Bridge Hours | ÷6,000 | ÷9,000 | ÷15,000 |
| Base Cost per Bridge Hour | =$263.91 | =$123.22 | =$179.50 |
| 1 The return element is defined at Appendix B to 46 CFR part 404 as the sum of net income and interest expense. The return element can be considered the sum of the return to equity capital (net increase), and the return to debt (the interest expense). | |||
| Area 4-Lake Erie | Area 5-Southeast Shoal to Port Huron, MI | Total-District Two | |
|---|---|---|---|
| Base Operating Expenses | $427,333 | $632,117 | $1,059,450 |
| Base Target Pilot compensation | +$725,848 | +$1,408,410 | +$2,134,258 |
| Base Return Element | +$20,354 | +$24,275 | +$44,629 |
| Subtotal | =$1,173,535 | =$2,064,802 | =$3,238,337 |
| Base Bridge Hours | ÷9,000 | ÷7,000 | ÷16,000 |
| Base Cost per Bridge Hour | =$130.39 | =$294.97 | =$202.40 |
| Area 6-Lakes Huron and Michigan | Area 7-St. Mary's River | Area 8-Lake Superior | Total-District Three | |
|---|---|---|---|---|
| Base Operating Expenses | $693,924 | $271,563 | $433,484 | $1,398,971 |
| Base Target Pilot compensation | +$1,451,696 | +$804,806 | +$1,016,187 | +$3,272,689 |
| Base Return Element | +$25,283 | +$9,768 | +$15,451 | +$50,502 |
| Subtotal | =$2,170,903 | =$1,086,137 | =$1,465,122 | =$4,722,162 |
| Base Bridge Hours | ÷18,000 | ÷4,000 | ÷12,600 | ÷34,600 |
| Base Cost per Bridge Hour | =$120.61 | =$271.53 | =$116.28 | =$136.48 |
Step 2. Calculating the Expense Multiplier.
The expense multiplier is the ratio of both the base operating expenses and the base return element to the base target pilot compensation by Area. This step requires that we add together the base operating expense and the base return element. Then we divide the sum by the base target pilot compensation to get the expense multiplier for each Area. The following tables show the calculations:
| Area 1-St. Lawrence River | Area 2-Lake Ontario | Total-District One | |
|---|---|---|---|
| Base Operating Expense | $368,186 | $372,911 | $741,097 |
| Base Return Element | +$8,087 | +$10,185 | +$18,272 |
| Subtotal | =$376,273 | =$383,096 | =$759,369 |
| Base Target Pilot Compensation | ÷$1,207,209 | ÷$725,848 | ÷$1,933,057 |
| Expense Multiplier | =.31169 | =.52779 | =.39283 |
| Area 4-Lake Erie | Area 5-Southeast Shoal to Port Huron, MI | Total-District Two | |
|---|---|---|---|
| Base Operating Expense | $427,333 | $632,117 | $1,059,450 |
| Base Return Element | +$20,354 | +$24,275 | +$44,629 |
| Subtotal | =$447,687 | =$656,392 | =$1,104,079 |
| Base Target Pilot Compensation | ÷$725,848 | ÷$1,408,410 | ÷$2,134,258 |
| Expense Multiplier | =.61678 | =.46605 | =.51731 |
| Area 6-Lakes Huron and Michigan | Area 7-St. Mary's River | Area 8-Lake Superior | Total-District Three | |
|---|---|---|---|---|
| Base Operating Expense | $693,924 | $271,563 | $433,484 | $1,398,971 |
| Base Return Element | +$25,283 | +$9,768 | +$15,451 | +$50,502 |
| Subtotal | =$719,207 | =$281,331 | =$448,935 | =$1,449,473 |
| Base Target Pilot Compensation | ÷$1,451,696 | ÷$804,806 | ÷$1,016,187 | ÷$3,272,689 |
| Expense Multiplier | =.49543 | =.34956 | =.44178 | =.44290 |
Step 3. Calculating the new annual "projection of target pilot compensation" using the same procedures found in Step 2 of Appendix A to 46 CFR part 404.
Step 2 of Appendix A requires the Director of Great Lakes Pilotage to:
1. Determine the new target rate of compensation;
2. Determine the new number of pilots needed in each pilotage Area; and
3. Multiply new target compensation by the new number of pilots needed toproject total new target pilot compensation needed in each Area.
Each step is detailed as follows:
1. Determination of New Target Pilot Compensation
Target pilot compensation for pilots providing services in undesignated waters approximates the average annual compensation for first mates on U.S. Great Lakes vessels. For this notice of proposed rulemaking (NPRM), the average annual compensation for first mates is determined based on the AMO union contract effective August 1, 2005, for wages and benefits received by first mates.
Target pilot compensation for pilots providing services in designated waters approximates the average annual compensation for masters on U.S. Great Lakes vessels. It is calculated as 150 percent of the compensation earned by first mates on U.S. Great Lakes vessels. The Office of Great Lakes Pilotage has consistently calculated this by first multiplying the first mates' salary by 150 percent and then adding benefits, since this is the best approximation of the average annual compensation for masters.
The following tables (7, 8, and 9) summarize how target pilot compensation is determined for undesignated and designated waters:
| Monthly component | (First mate) pilots on undesignated waters | (Master) pilots on designated waters |
|---|---|---|
| $226.96 (Daily Rate) × 54 (Days) | $12,256 | N/A |
| Monthly Total × 9 Months = Total Wages | $110,303 | N/A |
| Wages: $226.96 (Daily Rate) × 54 × 1.5 | N/A | $18,384 |
| Monthly Total × 9 Months = Total Wages | N/A | $165,454 |
| Monthly component | (First mate) pilots on undesignated waters | (Master) pilots on designated waters |
|---|---|---|
| Employer Contribution-401(K) Plan | $612.79 | $919.19 |
| Clerical | +$340.44 | +$340.44 |
| Health | +$2,512.51 | +$2,512.51 |
| Pension | +$1,283.10 | +$1,283.10 |
| Monthly Total Benefits | =$4,748.84 | =$5,055.24 |
| Monthly Total Benefits × 9 months | =$42,740 | =$45,497 |
| (First mate) pilots on undesignated waters | (Master) pilots on designated waters | |
|---|---|---|
| Wages | $110,303 | $165,454 |
| Benefits | +$42,740 | +$45,497 |
| Total Wages Plus Benefits | =$153,042 | =$210,951 |
The monthly component for wages is derived by multiplying the daily rate of pay by 54 days, instead of 30 days, based upon the following formulation obtained from the AMO union contract:
a. Average Working Days per month-30.5
b. Vacation Days per month-15.0
c. Weekend days per month-4.0
d. Holidays per month-1.5
e. Bonus per month-3.0
Monthly Multiplier-54.0
Additionally, we use a nine-month multiplier in computing annual wages and benefits because the season is nine months in duration vice 12 months.
Effective August 1, 2002, the matching benefit increased to 50 percent for each participating 401(k) employee up to a maximum of 5 percent of a participating employee's compensation. For purposes of this benefit, the AMO union contracts interpret "employee compensation" to mean base wages. District Two has a pension plan, while District Three has a 401(k) plan. District One does not provide either a 401(k) or pension plan for its members. Therefore, to conform to the 401(k) matching benefit provision under the AMO union contracts, pilot compensation for Districts Two and Three are increased. The increase in undesignated waters is $5,515.20 and for designated waters is $8,272.80 per pilot. These increases are 5 percent of compensation, respectively.
District One does not administer any form of 401(k) or retirement plan. At the recommendation of the independent accountant, the Coast Guard has determined that the District One Association pilots should receive the same employer matching benefits as Districts Two and Three.
Accordingly, the compensation base of District One is adjusted to include an amount equivalent to an employer's contribution under the AMO 401(k) matching plan, which increases pilot compensation in undesignated waters by $5,515.20 and for designated waters by $8,272.80 per pilot.
2. Determination of New Number of Pilots Needed
The number of pilots needed in each Area of designated waters is established by dividing the projected bridge hours for that Area by 1,000. Bridge hours are the number of hours a pilot is aboard a vessel providing pilotage service. The number of pilots needed in each Area of undesignated waters is established by dividing the projected bridge hours for that Area by 1,800. These hours are the target number of bridge hours a pilot needs to earn target pilot compensation.
Projected bridge hours are based on the vessel traffic that pilots are expected to serve. The Coast Guard projects that traffic for the 2006 navigation season will remain the same as it did in 2005. As indicated, these projections were made based upon historical data, and all other relevant information provided by pilots and industry. Dividing the projected annual number of bridge hours per Area by the target number of bridge hours per pilot results in the number of pilots that will be needed in each Area to service vessel traffic.
The following table, "Number of Pilots Needed," shows the calculation of the number of pilots needed in each Area for the 2006 navigation season rounded to the next whole pilot:
| Pilotage area | Projected 2006 bridge hours | Divided by bridge-hour target | Pilots needed |
|---|---|---|---|
| AREA 1 | 6,000 | 1,000 | 6 |
| AREA 2 | 9,000 | 1,800 | 5 |
| AREA 4 | 9,000 | 1,800 | 5 |
| AREA 5 | 7,000 | 1,000 | 7 |
| AREA 6 | 18,000 | 1,800 | 10 |
| AREA 7 | 4,000 | 1,000 | 4 |
| AREA 8 | 12,600 | 1,800 | 7 |
| Total Pilots Needed | 44 |
3. Projection of New Total Target Pilot Compensation
The projection of new total target pilot compensation is determined separately for each pilotage Area by multiplying the number of pilots needed in each Area by the target pilot compensation for pilots working in that Area.
The results for each pilotage Area are set out as follows:
| Area 1-St. Lawrence River | Area 2-Lake Ontario | Total-District One | |
|---|---|---|---|
| Projection of target pilot compensation | $1,265,708 | $765,212 | $2,030,920 |
| Area 4-Lake Erie | Area 5-Southeast Shoal to Port Huron, MI | Total-District Two | |
|---|---|---|---|
| Projection of target pilot compensation | $765,212 | $1,476,660 | $2,241,872 |
| Area 6-Lakes Huron and Michigan | Area 7-St. Mary's River | Area 8-Lake Superior | Total-District Three | |
|---|---|---|---|---|
| Projection of target pilot compensation | $1,530,424 | $843,805 | $1,071,297 | $3,445,526 |
Step 4: Increase the new total target pilot compensation in Step 3 by the expense multiplier in Step 2.
The increase in Step 4 refers to the proportional increase of operating expense when new total target pilot compensation is multiplied by the expense multiplier. The calculations for Step 4 appear as follows:
| Area 1-St. Lawrence River | Area 2-Lake Ontario | Total-District One | |
|---|---|---|---|
| Pilot Compensation | $1,265,708 | $765,212 | $2,030,920 |
| Expense Multiplier | ×.31169 | ×.52779 | ×.39283 |
| Projected Increase in Operating Expense | =$394,506 | =$403,872 | =$797,813 |
| Area 4-Lake Erie | Area 5-Southeast Shoal to Port Huron, MI | Total-District Two | |
|---|---|---|---|
| Pilot Compensation | $765,212 | $1,476,660 | $2,241,872 |
| Expense Multiplier | ×.61678 | ×.46605 | ×.51731 |
| Projected increase in Operating Expense | =$471,966 | =$688,200 | =$1,159,749 |
| Area 6-Lakes Huron and Michigan | Area 7-St. Mary's River | Area 8-Lake Superior | Total-District Three | |
|---|---|---|---|---|
| Pilot Compensation | $1,530,424 | $843,805 | $1,071,297 | $3,445,526 |
| Expense Multiplier | ×.49543 | ×.34956 | ×.44178 | ×.44290 |
| Projected Increase in Operating Expense | =$758,211 | =$294,964 | =$473,282 | =$1,526,023 |
Step 5(a): Adjust the result in Step 4, as required, for inflation or deflation.
The calculations for Step 5(a) appear below. Inflation rates were obtained from the U.S. Department of Labor, Bureau of Labor Statistics, "Midwest Economy-Consumer Prices," using the years 2003 to 2004 annual average in the amount of 2.4 percent per year.
| Area 1-St. Lawrence River | Area 2-Lake Ontario | Total-District One | |
|---|---|---|---|
| Projected Increase in Operating Expense | $394,506 | $403,872 | $797,813 |
| Inflation Rate | ×1.024 | ×1.024 | ×1.024 |
| Adjusted Projected Increase in Operating Expense | =$403,974 | =$413,565 | =$816,961 |
| Area 4-Lake Erie | Area 5-Southeast Shoal to Port Huron, MI | Total-District Two | |
|---|---|---|---|
| Projected Increase in Operating Expense | $471,966 | $688,200 | $1,159,749 |
| Inflation Rate | ×1.024 | ×1.024 | ×1.024 |
| Adjusted Projected Increase in Operating Expense | =$483,293 | =$704,717 | =$1,187,583 |
| Area 6-Lakes Huron and Michigan | Area 7-St. Mary's River | Area 8-Lake Superior | Total-District Three | |
|---|---|---|---|---|
| Projected Increase in Operating Expense | $758,211 | $294,964 | $473,282 | $1,526,023 |
| Inflation Rate | ×1.024 | ×1.024 | ×1.024 | X 1.024 |
| Adjusted Projected Increase in Operating Expense | =$776,408 | =$302,043 | =$484,641 | =$1,562,648 |
Step 5(b): Calculate Projected Total Economic Costs.
After the inflation adjustments are made to the Operating Expenses in Step 5(a), the adjusted amount (Adjusted Projected Increase in Operating Expense) is added to the New Total Target Pilot Compensation, as determined in Step 3, to arrive at a Projected Total Economic Cost. The Total Economic Cost is necessary in order to determine the Total Unit Cost in Step 6. The calculations for Step 5(b) appear as follows:
| Area 1-St. Lawrence River | Area 2-Lake Ontario | Total-District One | |
|---|---|---|---|
| Adjusted Projected Increase in Operating Expense | $403,974 | $413,565 | $816,961 |
| Projected Target Pilot Compensation | +$1,265,708 | +$765,212 | +$2,030,920 |
| Projected Total Economic Cost | =$1,669,683 | =$1,178,777 | =$2,847,881 |
| Area 4-Lake Erie | Area 5-Southeast Shoal to Port Huron, MI | Total-District Two | |
|---|---|---|---|
| Adjusted Projected Increase in Operating Expense | $483,293 | $704,717 | $1,187,583 |
| Projected Target Pilot Compensation | +$765,212 | +$1,476,660 | +$2,241,872 |
| Projected Total Economic Cost | =$1,248,505 | =$2,181,376 | =$3,429,454 |
| Area 6-Lakes Huron and Michigan | Area 7-St. Mary's River | Area 8-Lake Superior | Total-District Three | |
|---|---|---|---|---|
| Adjusted Projected Increase in Operating Expense | $766,408 | $302,043 | $484,641 | $1,562,648 |
| Projected Target Pilot Compensation | +$1,530,424 | +$843,805 | +$1,071,297 | +$3,445,526 |
| Projected Total Economic Cost | =$2,306,832 | =$1,145,848 | =$1,555,937 | =$5,008,174 |
Step 6: Divide the Result in Step 5(b) by Projected Bridge Hours to Determine Total Unit Costs (Adjusted Cost per Bridge Hour by Area).
| Area 1-St. Lawrence River | Area 2-Lake Ontario | Total-District One | |
|---|---|---|---|
| Projected Total Economic Costs | $1,669,683 | $1,178,777 | $2,847,881 |
| Projected Bridge Hours | ÷6,000 | ÷9,000 | ÷15,000 |
| Total Unit Costs | =$278.28 | =$130.98 | =$189.86 |
| Area 4-Lake Erie | Area 5-Southeast Shoal to Port Huron, MI | Total-District Two | |
|---|---|---|---|
| Projected Total Economic Costs | $1,248,505 | $2,181,376 | $3,429,454 |
| Projected Bridge Hours | ÷9,000 | ÷7,000 | ÷16,000 |
| Total Unit Costs | =$138.72 | =$311.63 | =$214.34 |
| Area 6-Lakes Huron and Michigan | Area 7-St. Mary's River | Area 8-Lake Superior | Total-District Three | |
|---|---|---|---|---|
| Projected Total Economic Costs | $2,306,832 | $1,145,848 | $1,555,937 | $5,008,174 |
| Projected Bridge Hours | ÷18,000 | ÷4,000 | ÷12,600 | ÷34,600 |
| Total Unit Costs | =$128.16 | =$286.46 | =$123.49 | =$144.74 |
Step 7: Divide prospective unit costs in Step 6 by the base period unit costs in Step 1.
(This step calculates the percent change in unit cost from the base period to the prospective unit cost.)
| Area 1-St. Lawrence River | Area 2-Lake Ontario | Total-District One | |
|---|---|---|---|
| Prospective Unit Cost (Total Unit Cost) | $278.28 | $130.98 | $189.86 |
| Base Period Unit Cost | ÷$263.91 | ÷$123.22 | ÷$179.50 |
| Percentage Change in Unit Cost (Rate Adjustment) | =1.0544 | =1.0630 | =1.0577 |
| Area 4-Lake Erie | Area 5-Southeast Shoal to Port Huron, MI | Total-District Two | |
|---|---|---|---|
| Prospective Unit Cost (Total Unit Cost) | $138.72 | $311.63 | $214.34 |
| Base Period Unit Cost | ÷$130.39 | ÷$294.97 | ÷$202.40 |
| Percentage Change in Unit Cost (Rate Adjustment) | =1.0639 | =1.0565 | =1.0590 |
| Area 6-Lakes Huron and Michigan | Area 7-St. Mary's River | Area 8-Lake Superior | Total-District Three | |
|---|---|---|---|---|
| Prospective Unit Cost (Total Unit Cost) | $128.16 | $286.46 | $123.49 | $144.74 |
| Base Period Unit Cost | ÷$120.61 | ÷$271.53 | ÷$116.28 | ÷$136.48 |
| Percentage Change in Unit Cost (Rate Adjustment) | =1.0626 | =1.0550 | =1.0620 | =1.0606 |
Step 8: Adjust the base period rates by the percentage change in unit costs in Step 7.
The "Percentage Change in Unit Cost" in Step 7 represents the percentage change or rate adjustment that will be applied to existing base period rates and charges in subpart D of 46 CFR part 401. For instance, in Area 1, the Percentage Change in Unit Cost of 1.0544 represents a 5.44 percent rate adjustment over the existing Area 1 rate. The rate adjustments are summarized by Areas in the following table. The actual adjustments are shown in the proposed amendments to regulatory text that follow this preamble. Each of the area rates listed in part 401 has been adjusted according to this table. Results are rounded to nearest whole dollar.
| If pilotage service is required in: | Then the percentage increases over the current rate is: |
|---|---|
| Area 1 (Designated waters) | 5.44 |
| Area 2 (Undesignated waters) | 6.30 |
| Area 4 (Undesignated waters) | 6.39 |
| Area 5 (Designated waters) | 5.65 |
| Area 6 (Undesignated waters) | 6.26 |
| Area 7 (Designated waters) | 5.50 |
| Area 8 (Undesignated waters) | 6.20 |
IV. Regulatory Evaluation
Executive Order 12866, "Regulatory Planning and Review," 58 FR 51735, October 4, 1993, requires a determination whether a regulatory action is "significant" and therefore subject to review by the Office of Management and Budget (OMB) and subject to the requirements of the Executive Order. This rulemaking is not significant under Executive Order 12866 and has not been reviewed by OMB.
The Coast Guard is required to conduct an annual review of pilotage rates on the Great Lakes and, if necessary, adjust these rates to align compensation levels between Great Lakes pilots and industry. (See the "Purpose of the Proposed Rule" section for a detailed explanation of the legal authority and requirements for the Coast Guard to conduct an annual review and provide possible adjustments of pilotage rates on the Great Lakes.) Based on our review, we are adjusting the pilotage rates for the 2006 shipping season to generate sufficient revenue to cover allowable expenses, target pilot compensation, and returns on investment.
This proposed rule would provide an additional six percent average rate adjustment for the Great Lakes system over the rate adjustment found in the 2005 final rule. This proposed increase is the result of adjustments for inflation, target pilot compensation, and operating expenses of the pilot associations.
These adjustments to Great Lakes pilotage rates meet the requirements set forth in 46 CFR part 404 for similar compensation levels between Great Lakes pilots and industry. They also include adjustments for inflation and changes in association expenses to maintain these compensation levels.
The increase in pilotage rates will be an additional cost for shippers to transit the Great Lakes system. This proposed rule would result in a distributional effect that transfers payments (income) from vessel owners and operators to the Great Lakes' pilot associations through Coast Guard regulated pilotage rates.
The shippers affected by these rate adjustments are those owners and operators of domestic vessels operating on register (employed in the foreign trade) and owners and operators of foreign vessels on a route within the Great Lakes system. These owners and operators must have pilots or pilotage service as required by 46 U.S.C. 9302. There is no minimum tonnage limit or exemption for these vessels. However, the Coast Guard issued a policy position several years ago stating that the statute applies only to commercial vessels and not to recreational vessels.
Owners and operators of other vessels that are not affected by this proposed rule, such as recreational boats and vessels only operating within the Great Lakes system, may elect to purchase pilotage services. However, this election is voluntary and does not affect the Coast Guard's calculation of the rate increase and is not a part of our estimated national cost to shippers.
We reviewed a sample of pilot source forms, which are the forms used to record pilotage transactions on vessels, and discovered very few cases of U.S. Great Lakes vessels (i.e., domestic vessels without registry operating only in the Great Lakes) that purchased pilotage services. There was one case where the vessel operator purchased pilotage service in District One to presumably leave the Great Lakes system. We assume some vessel owners and operators may also choose to purchase pilotage services if their vessels are carrying hazardous substances or were navigating the Great Lakes system with inexperienced personnel. Based on information from the Coast Guard Office of Great Lakes Pilotage, we have determined that these vessels voluntarily chose to use pilots and, therefore, are exempt from pilotage requirements.
We used 2003 arrival data from the Coast Guard's National Vessel Movement Center (NVMC) to estimate the annual number of vessels affected by the rate adjustment to be 214 vessels that, for some, make several journeys or trips into the Great Lakes system. These vessels entered the Great Lakes by transiting through or in part of at least one of the three pilotage Districts before leaving the Great Lakes system. These vessels often make several distinct stops docking, offloading, and onloading at facilities in Great Lakes ports. Of the total trips for the 214 vessels, there were approximately 1,090 U.S. port arrivals before the vessels left the Great Lakes system, based on 2003 vessel arrival data from the NVMC.
We used district pilotage revenues from the independent accountant's reports of the Districts' financial statements to estimate the additional cost to shippers of the rate adjustments in this proposed rule. These revenues represent the direct and indirect pilotage costs that shippers must pay for pilotage services in order to transit their vessels in the Great Lakes. Table 1 shows historical pilotage revenues by District.
| Year | District One | District Two | District Three | Total |
|---|---|---|---|---|
| 1998 | 2,127,577 | 3,202,374 | 4,026,802 | 9,356,753 |
| 1999 | 2,009,180 | 2,727,688 | 3,599,993 | 8,336,861 |
| 2000 | 1,890,779 | 2,947,798 | 4,036,354 | 8,874,931 |
| 2001 | 1,676,578 | 2,375,779 | 3,657,756 | 7,710,113 |
| 2002 | 1,686,655 | 2,089,348 | 3,460,560 | 7,236,563 |
| Source: Annual independent accountant's reports of the Districts to the Coast Guard's Office of Great Lake Pilotage. | ||||
While the revenues have decreased over time, the Coast Guard adjusts pilotage rates to achieve a target pilot compensation similar to masters and first mates working on U.S. vessels engaged in the Great Lakes trade.
We estimate the additional cost of the rate adjustment in this proposed rule to be the difference between the total adjusted revenue based on the 2005 rate adjustment and the proposed rate adjustment (change) revenue in this proposed rule. These revenue values and adjustments are described and calculated in the "Calculating the Rate Adjustment" section of this rulemaking. The projected revenue uses the 2002 revenues in Table 1 adjusted for the 2005 final rule and the proposed adjustments for inflation, wages, and 401(k) contributions from this proposed rule. Table 2 compares projected and adjusted revenues and costs of the proposed rule to industry by district.
| District | District One | District Two | District Three | Total2 |
|---|---|---|---|---|
| Base Revenue1 | 1,686,655 | 2,089,348 | 3,460,560 | 7,236,563 |
| Total Adjusted Revenue3 | 2,643,732 | 3,125,036 | 4,722,162 | 10,490,930 |
| Proposed Rate Change4 | 1.0577 | 1.059 | 1.0606 | 1.0594 |
| Revenue Needed5 | 2,796,275 | 3,309,413 | 5,008,325 | 11,114,013 |
| Additional Revenue or Cost of this Rulemaking6 | 152,543 | 184,377 | 286,163 | 623,083 |
| 1 Base revenue is from the 2002 base accounting year data. | ||||
| 2 Some values may not total due to rounding. | ||||
| 3 Total adjusted revenue = '2002 base revenue' + '2005 final rule rate adjustment revenue'. | ||||
| 4 See step 7 of the "Calculating the Rate Adjustment" section of this proposed rule. We used the districts' percent change in unit costs for the rate change. | ||||
| 5 Revenue needed = 'total adjusted revenue' × 'proposed rate change'. | ||||
| 6 Additional revenue or cost of this proposed rule = 'revenue needed'-'total adjusted revenue'. | ||||
After applying the rate change in this proposed rule, the resulting difference between the revenue projected and the revenue needed is the annual cost for the affected population of this proposed rule. This figure will be equivalent to the total additional payments that shippers will make for pilotage services from this proposed rule.
The annual cost of the rate adjustment in this proposed rule to shippers is approximately $623,083 (non-discounted). To calculate an exact cost per vessel is difficult because of the variation in vessel types, routes, port arrivals, commodity carriage, time of season, conditions during navigation, and preferences for the extent of pilotage services on designated and undesignated portions of the Great Lakes system. Some owners and operators will pay more and some will pay less depending on the distance and port arrivals of their vessels' trips. However, the annual cost reported above does capture all of the additional cost the shippers would face as a result of the rate adjustment in this proposed rule.
We estimated the total cost to shippers of the rate adjustments in this proposed rule over a five-year period, because the Coast Guard is required to determine and, if necessary, adjust Great Lakes pilotage rates at a minimum of at least once every five years from the 2005 rate adjustment. However, the Coast Guard does evaluate and analyze the Great Lakes pilotage rates every year, regardless of whether an adjustment is needed or not. The total five-year (2006-2010) present value cost estimate of this rulemaking to shippers is $2.7 million discounted at a seven percent discount rate and $2.9 million discounted at a three percent discount rate.
The cost to shippers of this proposed rule is minimal compared with the travel cost shippers save when they use the Great Lakes system. The alternative to Great Lakes waterborne transportation is to choose coastal delivery, such as East Coast and Gulf Coast ports that are more expensive, and extra-modal transportation overland, which is far less practical and has additional transportation costs for all commodity groups. See Coast Guard docket number USCG-2006-24414 for an assessment of alternatives to Great Lakes waterborne transportation and the associated costs entitled "Analysis of Great Lakes Pilotage Costs on Great Lakes Shipping and the Potential Impact of Pilotage Rate Increases" (October 1, 2004).
A. Small Entities
Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this proposed rule would have a significant economic impact on a substantial number of small entities. The term "small entities" comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000.
In 2003, most vessels engaged in foreign trade on the Great Lakes were large foreign-owned shipping conglomerates. There were two U.S. companies that were operating vessels engaged in foreign trade in the Great Lakes system that would be affected by the rate adjustments in this proposed rule and pay additional costs for pilotage services. However, these two companies are subsidiaries of large foreign parent entities. The North American Industry Classification System (NAICS) code subsector for these shippers is 483-Water Transportation, and includes one or all of the following 6-digit NAICS codes for freight transportation: 483111-Deep Sea Freight Transportation, 483113-Coastal and Great Lakes Freight Transportation, and 483211-Inland Water Freight Transportation. According to the Small Business Administration's definition, a U.S. company with these NAICS codes and employing less than 500 employees is considered a small entity. These large foreign-owned shippers do not qualify as small entities because their number of employees exceeds 500. We assume that new industry entrants will be comparable in size to these shippers with a large enough employee base and the financial resources to support long international trade routes and, thus, will not be small businesses.
There are three U.S. entities that are affected by the proposed rule that will receive the additional revenues from the proposed rate adjustment. These are the three pilot associations that are the only entities providing pilotage services within the Great Lakes districts. Two of the associations operate as partnerships and one operates as a corporation. These associations are classified with the same NAICS industry classification and small entity size standards as the U.S. shippers above, but they have far fewer than 500 employees: approximately 65 total employees combined. However, they are not adversely impacted with the additional costs of the proposed rate adjustments, but instead receive the additional revenue benefits for operating expenses and pilot compensation.
Therefore, the Coast Guard certifies under 5 U.S.C. 605(b) that this proposed rule would not have a significant economic impact on a substantial number of U.S. small entities. If you think that your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment to the Docket Management Facility at the address under ADDRESSES . In your comment, explain why you think it qualifies and how and to what degree this rule would economically affect it.
B. Assistance for Small Entities
Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we offered to assist small entities in understanding the proposed rule so that they could better evaluate its effects on them and participate in the rulemaking. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please call Paul Wasserman, Director, Office of Great Lakes Pilotage, (G-PWM-2), U.S. Coast Guard, telephone 202-372-1535 or send him e-mail at pwasserman@comdt.uscg.mil. Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247).
C. Collection of Information
Under the Paperwork Reduction Act (44 U.S.C. 3501-3520), the Office of Management and Budget (OMB) reviews each proposed rule that contains a collection of information requirement to determine whether the practical value of the information is worth the burden imposed by its collection. Collection of information requirements include reporting, record keeping, notification, and other similar requirements.
This proposed rule would call for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). This proposed rule would not change the burden in the collection currently approved by the Office of Management and Budget (OMB) under OMB Control Number 1625-0086, Great Lakes Pilotage Methodology.
D. Federalism
A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this proposed rule under that Order and have determined that it does not have implications for federalism because there are no similar State regulations, and the States do not have the authority to regulate and adjust rates for pilotage services in the Great Lakes system.
E. Unfunded Mandates Reform Act
The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this proposed rule would not result in such expenditure, we do discuss the effects of this rule elsewhere in this preamble.
F. Taking of Private Property
This proposed rule would not effect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.
G. Civil Justice Reform
This proposed rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.
H. Protection of Children
We have analyzed this proposed rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not create an environmental risk to health or risk to safety that may disproportionately affect children.
I. Indian Tribal Governments
This proposed rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.
J. Energy Effects
We have analyzed this proposed rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a "significant energy action" under that order because it is not a "significant regulatory action" under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.
K. Technical Standards
The National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note) directs agencies to use voluntary consensus standards in their regulatory activities unless the agency provides Congress, through the Office of Management and Budget, with an explanation of why using these standards would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards ( e.g. , specifications of materials, performance, design, or operation; test methods; sampling procedures; and related management systems practices) that are developed or adopted by voluntary consensus standards bodies. This proposed rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards.
L. Environment
We have analyzed this proposed rule under Commandant Instruction M16475.lD and Department of Homeland Security Management Directive 5100.1, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f), and have made a preliminary determination that there are no factors in this case that would limit the use of a categorical exclusion under section 2.B.2 of the Instruction. Therefore, we believe that this rule should be categorically excluded, under figure 2-1, paragraph (34)(a), of the Instruction, from further environmental documentation. Paragraph 34(a) pertains to minor regulatory changes that are editorial or procedural in nature. This NPRM proposes rate adjustments in accordance with applicable statutory and regulatory mandates. A preliminary "Environmental Analysis Check List" is available in the docket where indicated under the "Public Participation and Request for Comments" section of this preamble. Comments on this section will be considered before we make the final decision on whether this rule should be categorically excluded from further environmental review.
List of Subjects in 46 CFR Part 401
Administrative practice and procedure, Great Lakes, Navigation (water), Penalties, Reporting and recordkeeping requirements, Seamen.
For the reasons discussed in the preamble, the Coast Guard proposes to amend 46 CFR part 401 as follows:
PART 401-GREAT LAKES PILOTAGE REGULATIONS
1. The authority citation for part 401 continues to read as follows:
Authority:
46 U.S.C. 2104(a), 6101, 7701, 8105, 9303, 9304; Department of Homeland Security Delegation No. 0170.1 46 CFR 401.105 also issued under the authority of 44 U.S.C. 3507.
2. In § 401.405, revise paragraphs (a) and (b), including the footnote to Table (a), to read as follows:
§ 401.405 Basic rates and charges on the St. Lawrence River and Lake Ontario.
Area 1 (Designated Waters):
| Service | St. Lawrence River |
|---|---|
| Basic Pilotage | 1 $12 per Kilometer or $20 per mile. |
| Each Lock Transited | 1 251. |
| Harbor Movage | 1 821. |
| 1 The minimum basic rate for assignment of a pilot in the St. Lawrence River is $548, and the maximum basic rate for a through trip is $2,405. | |
(b) Area 2 (Undesignated Waters):
| Service | Lake Ontario |
|---|---|
| Six-Hour Period | $391 |
| Docking or Undocking | 373 |
3. In § 401.407, revise paragraphs (a) and (b), including the footnote to Table (b), to read as follows:
§ 401.407 Basic rates and charges on Lake Erie and the navigable waters from Southeast Shoal to Port Huron, MI.
(a) Area 4 (Undesignated Waters):
| Service | Lake Erie (East of Southeast Shoal) | Buffalo |
|---|---|---|
| Six-Hour Period | $559 | $559 |
| Docking or Undocking | 431 | 431 |
| Any Point on the Niagara River below the Black Rock Lock | N/A | 1,099 |
(b) Area 5 (Designated Waters):
| Any point on or in | Southeast Shoal | Toledo or any Point on Lake Erie west of Southeast Shoal | Detroit River | Detroit Pilot Boat | St. Clair River |
|---|---|---|---|---|---|
| Toledo or any port on Lake Erie west of Southeast Shoal | $1,433 | $846 | $1,859 | $1,433 | N/A |
| Port Huron Change Point | 1 2,494 | 1 2,890 | 1,874 | 1,458 | 1,036 |
| St. Clair River | 1 2,494 | N/A | 1,874 | 1,874 | 846 |
| Detroit or Windsor Or the Detroit River | 1,433 | 1,859 | 846 | N/A | 1,874 |
| Detroit Pilot Boat | 1,036 | 1,433 | N/A | N/A | 1,874 |
| 1 When pilots are not changed at the Detroit Pilot Boat. | |||||
4. In § 401.410, revise paragraphs (a), (b), and (c) to read as follows:
§ 401.410 Basic rates and charges on Lakes Huron, Michigan, and Superior, and the St. Mary's River.
(a) Area 6 (Undesignated Waters):
| Service | Lakes Huron and Michigan |
|---|---|
| Six-Hour Period | $443 |
| Docking or Undocking | 421 |
(b) Area 7 (Designated Waters):
| Area | De Tour | Gros Cap | Any Harbor |
|---|---|---|---|
| Gros Cap | $1,532 | N/A | N/A |
| Algoma Steel Corporation Wharf at Sault Ste. Marie Ontario | 1,532 | 577 | N/A |
| Any point in Sault Ste. Marie, Ontario, except the Algoma Steel Corporation Wharf | 1,284 | 577 | N/A |
| Sault Ste. Marie, MI | 1,284 | 577 | N/A |
| Harbor Movage | N/A | N/A | 577 |
(c) Area 8 (Undesignated Waters):
| Service | Lake Superior |
|---|---|
| Six-Hour Period | $388 |
| Docking or Undocking | 369 |
§ 401.420 [Amended]
5. In § 401.420-
a. In paragraph (a), remove the number "$70" and add, in its place, the number "$74"; and remove the number "$1,100" and add, in its place, the number "$1,166".
b. In paragraph (b), remove the number "$70" and add, in its place, the number "$74"; and remove the number "$1,100" and add, in its place, the number "$1,166".
c. In paragraph (c)(1), remove the number "$416" and add, in its place, the number "$441"; in paragraph (c)(3), remove the number "$70" and add, in its place, the number "$74"; and, also in paragraph (c)(3), remove the number "$1,100" and add, in its place, the number "$1,166".
§ 401.428 [Amended]
6. In § 401.428, remove the number "$424" and add, in its place, the number "$449".
Dated: May 30, 2006.
C.E. Bone,
Rear Admiral, U.S. Coast Guard, Assistant Commandant for Prevention.
[FR Doc. E6-11062 Filed 7-12-06; 8:45 am]
BILLING CODE 4910-15-P