Ultimately, with full regulation and the forming of associations came fee commissions.

During the 2004 Regular Session of the Louisiana Legislature, a statewide fee commission – The Pilotage Fee Commission – was created to go into effect January 1, 2005. The new fee commission consists of four pilot representatives – one from each of the pilot associations, four industry representatives, and three independent at-large members.

On the industry side, the governor shall appoint four members and four alternates from nominees submitted by the New Orleans Steamship Association, the Mississippi River Maritime Association, the Lake Charles Maritime Association, the International Freight Forwarders and Custom Brokers Association of New Orleans, Inc., the Louisiana Association of Business and Industry, the Louisiana Chemical Association, and the Louisiana Mid-Continent Oil and Gas Association.

The three at-large members shall sign and maintain a statement of neutrality and shall not be a family member of, nor have a financial, business, or pecuiary relationship with a member or with any entity represented on the commission or on the Board of Louisiana River Pilot Review and Oversight.

The Fee Commission may promulgate rules to provide for the examination of pilot financial records, a simply majority vote is required on all matters, and an impasse goes straight to court.

The new Fee Commission provides direct input into the process for those paying the fees. It has less politics and provides for new rules and funding for the commission, offering a venue for cooperation and further economic development along Louisiana waterways.

History of the Fee Commissions
Once set by statutes, Louisiana pilot rates fell under the jurisdiction of fee commissions in 1968. There were four commissions, one for each association. Eight members, all appointed by the governor, served on each commission, four representing the pilots and four the shipping industry. Both the pilots and the shipping industry of Louisiana mutually agreed on this format.

Since that time, numerous bargained agreements have been reached by each fee commission. If the Commission deadlocked, the Louisiana Public Service Commission (LPSC) acted as a member of the Fee Commission to break the tie. Only on two or three occasions during the past 30 years did the failure to negotiate in a timely fashion result in the issue being decided by the LPSC. The decision of both the Fee Commission and the LPSC were allowed to be reviewed by the judicial process.

The most recent history of the fee commission process for the Mississippi River pilots is the following: Negotiations since 1989 have resulted in two, three-year and one, five-year bargained agreements. The target earnings of a pilot’s service at the end of 1999 were anticipated to be $296,000. There is no guaranteed salary – only a target rate based on volume of work from the target year. Pilot compensation is based on the number and type of vessels moved. This was agreed on by the shipping industry represented on the pilot fee commission.

The fee commissioners for industry resigned en masse in January of 1998. This occurred when some of the nominating agencies disagreed with the negotiated fees. Those fee commissioners then filed suit. They lost in court at the district level, won at the appeals level and lost again at the Supreme Court. The fee commissioners appointed to represent industry then resigned en masse.

Therefore the issue at hand was brought before the LPSC. The LPSC spent one year researching the cases and getting comparable data rates from other states. All appropriate parties were allowed to participate. The LPSC then set the tariffs, which are in place today.

Since the decision of the LPSC was not satisfactory with some members of industry, even though some participated in the process, the disgruntled members, through the apparent leadership of the Venezuelan-owned CITGO, formed the Pilot User’s Group of Louisiana (PUGL). That group refuses to negotiate fees as outlined in the state statutes and is now attempting to control all aspects of state pilotage and is proposing legislation to accomplish that.

Not all members of industry have agreed with that position. The Mississippi River Maritime Association, which represents approximately 50% of the ships that call on the Mississippi River system, has voted to nominate its members to the fee commission for the pilots on the Mississippi River. The PUGL group has attempted to intimidate this group with threats of lawsuits if they nominate.

From 1999 to 2004, the Public Service Commission took over the job of the fee commissions. In their time, they raised the annual pay rate of the pilots. The tariffs earned are pooled and then dispersed to each pilot by the number of hours worked. The current target earnings are $335,000 a year for state pilots on the Mississippi River. The target for the Lake Charles Association members is $285,000 within the regulated area. The Lake Charles Pilots receive additional revenue for piloting services on the outer bar, which is currently unregulated.

In 2002, both the Port of New Orleans and the three Mississippi River pilot associations asked the governor to appoint new members from the shipping industry to the fee commissions and return the duty of fee setting to them.

In March of 2004, Governor Kathleen Babineaux Blanco did appoint new members representing the shipping industry and the ports to the fee commissions of the three Mississippi River pilot associations. This put the job of setting the tariffs back before the fee commissions and away from the LPSC. This format stands until the previously mentioned Pilotage Fee Commission becomes operable on January 1, 2005.