Corpus Christi Port Users Stunned by Proposed Fee Hike

Port contemplates 700 percent Fee Hike as local stakeholders mull options and circle the wagons in opposition.

In a notice sent this week to “all port users” by the Port of Corpus Christi Authority, a proposed new Harbor Safety Fee to fund the new security marine patrol has taken local stakeholders completely by surprise. According to the notice, the fee “will be based on a charge per ship or barge as is currently done for the Fireboat tariff. The Port intends to eliminate Fireboat tariff Item 301 entitled “Harbor Fee” (currently $275.00 for ships and $35.00 for barges) as a separate billing charge and will combine this cost with the cost for the security marine patrol.” According to Executive Director John P. LaRue, “This will provide our customers with one combined charge for marine fire and marine police protection.”

The new Harbor Safety Fee will fund the operation of two marine patrol boats on a 24 hour a day, 7 day a week basis, as well as incorporating the current Fireboat fee in it. The recommended fee structure is as follows:

• Two Boats Operational 24/7
• Ship Fee: $2,032.00
• Barge Fee: $ 230.00

The port authority notice also went on to say, “The proposed Harbor Safety Fee will be presented to the Port Commission at their December 8th meeting. The Port’s Security Committee and Executive Staff have reviewed the fee and recommend approval. Staff will recommend that the Harbor Safety Fee be made effective April 1, 2010 to take into account that the Marine Patrol Division will not be fully operational until mid-year. Staff will further recommend that the tariff for the Fireboat (currently called the Harbor Fee) stay in place until March 31, 2010 and be eliminated thereafter.”

According to local sources, the new harbor safety fee would hike rates by as much as 700 percent for barges and ships, at a time when most are in a poor position to absorb the increases. In way of response, the West Gulf Maritime Association (WGMA) has issued an alert to its members, agents, principals and stakeholders that a new tariff increase is anticipated. According to the alert, WGMA's Vice President for Maritime Affairs, Niels Aalund said, “As directed by our members, WGMA plans to oppose this increase. WGMA staff will work jointly with the Port Industry Committee (PIC) in Corpus Christi and the barge interests.”

If approved by the Port Commission at their December 8th meeting, the fee, intended to cover both the current “Fire Boat Fee” and new “Security Boat“ fee into one charge, will be in effect April 1. The proposed fee hike comes at a time when the American Association of Port Authorities (AAPA) is heralding a change in Federal Emergency Management Agency policy that now will allow the use of preparedness grant funds for security equipment maintenance contracts, warranties, repair or replacement costs, upgrades and user fees under all active and future grant awards. FEMA manages the Department of Homeland Security's Port Security Grants program.

"This reversal in DHS policy is welcome news and represents years of advocacy on the part of the port industry," said Kurt Nagle, AAPA's president and chief executive officer. "The 2006 SAFE Port Act allows port security grants to cover maintenance, repair and replacement expenses, but DHS' past limitations on these costs have resulted in grantees having to take over this large financial burden."

Mr. Nagle said that the policy change will help AAPA member ports pay the increasingly burdensome costs of ensuring their security equipment and operating systems are in top working order. "Over time, security maintenance and repair expenses can easily exceed the original purchase price of the equipment. AAPA has long advocated for Port Security Grants to cover these increasingly onerous costs."

According to AAPA, the port of Corpus Christi ranks 19th in the country in terms of “cargo value” transferred across the docks (2005 statistics). A DHS accounting of port security grants by port area, through FY-07, showed that the port of Corpus Christi had already received more than $30 million in such funds. It is likely that local stakeholders will point to these numbers and ask local officials to consider using portions of these funds to offset the proposed “Harbor Safety Fee.”