PORTLAND, Maine — The decision to sharply increase fees charged to steer foreign ships in and out of the local harbor was above board the first time, according to the group that oversees the harbor. But it’s going to vote on it again anyway.
In May, the Portland Board of Harbor Commissioners approved a roughly 70 percent hike in the minimum fee charged by local pilots, who guide the arrival and departure of large, foreign vessels.
The change represents hundreds of thousands of dollars a year in fees for companies that frequent the port and has been met with a legal challenge by the operator of the Portland-Nova Scotia ferry, which says the additional cost could sink the “barely profitable” business.
On Thursday, the board is set to vote on approving the exact same fee increase it passed in the spring, even though the group has maintained in court filings that its initial decision was legally legitimate.
Members of the harbor commission, which is an autonomous government body with members appointed by Portland, South Portland and the state, are remaining tight-lipped about why they’re going to again vote on the price hike. City spokeswoman Jessica Grondin said the May vote was “entirely appropriate” but that the commission decided “that a more robust examination of compensation for pilots in the port might be helpful.” The commission is represented by Portland’s corporation counsel but is not part of city government.
In an August lawsuit against Portland Pilots Inc. and the board, Bay Ferries Ltd. claimed that vote was cast without proper notice to the public or company. The Canadian ferry operator further claimed that the commission fell short of its regulatory duty because it didn’t scrutinize the finances of Portland’s two pilots, who requested the minimum fee be increased from $709 to $1,200 for every voyage in or out of the harbor.
State and federal law requires that a pilot guide large ships in and out of port. Beyond the minimum charge, the cost of this service is based on the size of the ship and amount of fuel used.
Bay Ferries’ lawyer has suggested a cozy relationship between the board and the two men who handle all piloting in Portland harbor — while an attorney for the pilots claims the lawsuit is part of the Canadian companies’ multi-pronged effort to loosen industry regulation.
“Clearly the ‘independent’ commission and the monopoly it regulates are cooperating to ensure the financials are hidden from the public,” Bay Ferries’ lawyer, Harold Pachios, a founding partner with Preti Flaherty, said.
Bay Ferries runs “The Cat” ferry through Portland harbor almost daily during the summer and said that the increased pilotage fee would cost it $96,000 more each year.
The hike will also affect other business that frequent Portland. They include Eimskip, the Icelandic shipping giant that runs its North American operations out of the city and plans to begin weekly calls to the port in December. A company representative did not respond to a request for comment Tuesday.
In its suit, Bay Ferries contends that the board failed in its obligations as a regulator because it approved the pilot’s requested rate increase without reviewing their books. Commissioners asked the pilots to provide information on their expenses but has not required that they disclose income, which would provide a fuller financial picture.
“The commission is making it clear they have no interest in knowing anything about the amount of money flowing into the bank accounts of the two pilots,” Pachios said Tuesday.
The pilots’ attorney, however, told the Bangor Daily News that his clients have lost money and been forced to cut staff in recent years, as the number of tankers entering the harbor to use the Portland-Montreal pipeline has dropped.
The increased fee aligns with rates charged by pilots in other ports and is still less than the $1,300 daily cost of operating a pilot boat, according to Twain Braden, a lawyer with Thompson Bowie & Hatch LLC.
In nearby ports, pilotage fees range from $2,370 in Searsport to $750 in Portsmouth, according documents the Portland pilots sent to the harbor commission. But paying them is relatively new for Bay Ferries.
Until 2012, Maine law exempt ferries calling on Bar Harbor and Portland from having to take on a pilot every time they entered or left state waters. Bay Ferries wasn’t running a route to Portland the year that law was changed, and Twain said lobbying has already begun to change it back.
Among the, as yet unwritten, bills approved for consideration in the next legislative session is “An Act To Promote Passenger Ferry Service between Maine and Nova Scotia by Amending the Laws Governing Pilotage Requirements.”
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