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Vol. 140, No. 26 — December 27, 2006
Registration
PILOTAGE ACT Regulations Amending the Laurentian Pilotage Tariff Regulations P.C. 2006-1536 December 14, 2006 Whereas the Laurentian Pilotage Authority, pursuant to subsection 34(1) (see footnote a) of the Pilotage Act, published in the Canada Gazette, Part I, on October 7, 2006, a copy of the proposed Regulations Amending the Laurentian Pilotage Tariff Regulations, substantially in the form set out in the annexed Regulations; Therefore, Her Excellency the Governor General in Council, on the recommendation of the Minister of Transport, Infrastructure and Communities, pursuant to subsection 33(1) of the Pilotage Act, hereby approves the annexed Regulations Amending the Laurentian Pilotage Tariff Regulations, made by the Laurentian Pilotage Authority on October 18, 2006. REGULATIONS AMENDING THE LAURENTIAN PILOTAGE TARIFF REGULATIONS AMENDMENT 1. Schedule 2 to the Laurentian Pilotage Tariff Regulations (see footnote 1) is replaced by the schedule set out in the schedule to these Regulations. COMING INTO FORCE 2. These Regulations come into force on January 1, 2007. SCHEDULE (Section 1) SCHEDULE 2 (definition "time factor" in section 1 and sections 2 and 9) PILOTAGE CHARGES
1 The number of chargeable hours of service is calculated from the later of the time for which the pilotage services are requested and the time the pilot reports for pilotage duty until the time of cancellation.
REGULATORY IMPACT Description The Laurentian Pilotage Authority (the Authority) is responsible for administering, in the interest of safety, an efficient pilotage service within Canadian waters in and around the province of Quebec, north of the northern entrance to Saint-Lambert Lock, except the waters of Chaleur Bay, south of Cap d'Espoir. The Authority also prescribes tariffs of pilotage charges that are fair, reasonable and sufficient to permit the Authority to operate on a self-sustaining financial basis. The tariff increase for 2007 is 4.5%. This increase is necessary to help the Authority become financially self-sustaining, after two years of deficits exceeding $3 million in 2004 and 2005, and an operational loss before accounting adjustment that will be lower, but still significant, in 2006. The current loss is primarily due to the delay in implementing the 2006 tariff increase. The financial loss resulting from this delay must be recovered in 2007; it is an amount of $1,000,000, which is 1.45% of the projected increase for this year. The recurring increase in pilotage corporation fees also requires an increase that corresponds with the consumer price index, which is about 2.5%. Agreements with pilotage service suppliers to compensate for the tariff length ceiling requires a 0.48% increase. The significant increase in marine traffic resulted in increased expenses for the Authority. The need to recruit more apprentices resulted in a tariff increase of 0.59%. An additional 0.73% will be paid to the Pilotes du Saint-Laurent central inc. because the pilots' workload will be well above the average of 120 assignments. Alternatives The Authority's objective is to provide safe and efficient pilotage services at the minimum cost. To do this, it once again reduced its administrative and operational expenses by 0.25%. It also successfully froze costs associated with pilot boats in Quebec City and Sorel. In addition, some projects were postponed, including the creation of a $2,000,000 reserve. Despite these efforts, the tariff increase is still required to cover the costs of service contracts with the two pilots corporations and the collective agreement with pilots employed in the Port of Montreal. These commitments account for about 84% of the Authority's expenditures. Since the Authority is in a deficit situation, a status quo position is not an acceptable option and it is necessary to increase tariffs to reflect the actual costs of providing pilotage services. Benefits and Costs The 4.5% tariff increase will generate approximately $2,710,000 for 2007. For the second consecutive year, the Authority's deficit exceeded $3 million in 2005. As of December 31, 2005, the accumulated deficit was $10.2 million, and the working capital was negative $7.4 million. If it does not address its financial situation, the Authority may find it impossible to fulfill its mandate. Furthermore, the Auditor General has brought the Authority's accumulated deficit to the attention of the Government of Canada. The tariff change will result in an average fee increase of $110 for each pilotage assignment. In accordance with the 1999 Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, and the Transport Canada Policy Statement on Strategic Environmental Assessment, a strategic environmental assessment (SEA) of this amendment was conducted, in the form of a preliminary scan. The SEA concluded that the amendment does not have any impact on the environment. Consultation During 2006, the Authority regularly consulted users' associations such as the Canadian Shipowners Association, Shipping Federation of Canada, the St. Lawrence Ship Operators and even contacted a number of users directly. These discussions dealt with all areas of the Authority's activities, including financial, operational, and regulatory activities. The Authority pre-published the proposed amendments in the Canada Gazette, Part I, on October 7, 2006. The Pilotage Act (the Act) provides that interested persons having reason to believe that any charge in a proposed tariff pilotage charge is prejudicial to the public interest may file an objection with the Canadian Transportation Agency (CTA). Pursuant to subsection 34(4) of the Act, where a notice of objection is filed, the CTA shall make such investigation of the proposed charge, including the holding of public hearings, as in its opinion is necessary or desirable in the public interest. If, however, the CTA recommends a charge that is lower than that prescribed by the Authority, the Authority shall reimburse to any person who has paid the prescribed charge the difference between it and the recommended charge with interest in accordance with subsection 35(4) of the Act, unless this recommendation was modified or cancelled by the Governor in Council. By implementing the new tariff, the Authority will re-establish its financial situation to ensure financial self-sufficiency. Compliance and Enforcement Section 45 of the Act provides the enforcement mechanism for the Regulations. It states that no customs officer at any port in Canada shall grant a clearance to a ship if the officer is informed by an Authority that pilotage charges in respect of the ship are outstanding and unpaid. Section 48 of the Act provides a penalty of up to $5,000 if the Regulations are contravened. Contact
Réjean Lanteigne
S.C. 1998, c. 10, s. 150 SOR/2001-84 |
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