Port pilots love law agents hate

Legislators hear it works `flawlessly,' or creates `monopoly'

January 24, 2001|By Michael Dresser | Michael Dresser,SUN STAFF

Shipping lines told legislators yesterday that a bill passed last year has led to a 50 percent increase in docking fees and created a new monopoly that could drive costs even higher for the port of Baltimore.

But a representative for the docking pilots said the law was working "absolutely flawlessly."

Members of the House Economic Matters Committee heard the widely divergent views during a briefing to update them on the effects of legislation that put under state regulation the port's 10 pilots who guide ships into their berths.

For such a small group, the docking pilots have received a lavish amount of attention from Maryland lawmakers and lobbyists. Fallout from the legislation, one of the most bitterly contested issues of the 2000 General Assembly session, makes it likely that the matter will come back to haunt legislators this year. Rupert Denney, president of the Maryland Maritime Association, said shipping lines were "seriously concerned and frustrated" about a law that gave "the docking pilots a monopoly.

Denney said the association's members took no comfort from the fact that rates are now regulated by the state Public Service Commission, charging that the panel had let rates escalate for the pilots.

Lee Connor, president of John S. Connor Inc., a shipping agent, said the docking pilots increased their rates 50 percent just before they came under PSC regulation Oct. 1. "Frankly, we felt we had something crammed down our throats," he said.

Gary R. Alexander, a lobbyist representing the Association of Maryland Docking Pilots, said the increase reflected the pilots' increased costs, primarily from having to pay benefits previously underwritten by the tugboat companies. He said none of the docking pilots are taking home more money as a result of the rate increase.

The tugboat companies have failed to pass along to their shipping line customers the savings they realized from dropping benefits, he charged. "I believe there has been a windfall for the tugboat companies."

The lobbyist noted that the PSC would conduct a review of the docking pilots' costs and could order a refund if the commission decides the increase was excessive.

But the shipping lines said their concern over the legislation went beyond the docking pilots' rates. Denney said the law went too far in giving the pilots authority to call in extra tugboats to help them bring ships into port.

Denney said shipping lines already had seen at least one incident in which a pilot had called in an "unnecessary" tug - a significant added expense.

The shipping lines also predicted harmful consequences from a rule adopted by the board set up to regulate the pilots. The rule, which prohibits the pilots or their families from holding an interest in tugboat companies, affects one pilot, Joe Krause, who recently sold his interest in Krause Marine Towing Co. to his wife.

Under the rule, which has not gone into effect, the Krauses would have to choose between their interest in the company and a docking pilot's license.

Connor said the shipping lines want to see Krause Marine stay in business, saying the family-owned company had helped bring down tugboat rates in a market dominated by Moran Towing of Maryland and McAllister Marine Towing of Baltimore.

Del. Michael E. Busch, the Arundel Democrat who chairs the Economic Matters Committee, and several other legislators were troubled by the rule and believed it went beyond the intent of the legislature.

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