Dear Member,
As per the attached, the Vancouver Fraser Port Authority has published its proposed fee amendments for effect on January 1, 2024.
The amendments include a 6.8 percent CPI increase for berthage, wharfage and harbour dues rates, along with annually adjusted rates for GIF and GIF2.
As also indicated in the attached, the fee charged for harbour dues will increase from a maximum of 5 calls per vessel to 35 calls per vessel. Although it is our understanding (based on an analysis conducted by VFPA) that this change in maximum vessel calls will have a negligible impact on ships operated by Federation members, we welcome any differing input that members may have on this issue.
It is worth noting that the VFPA provided carriers with an earlier version of the 2024 tariff proposal at a closed-door meeting held in July, at which time it was proposed that the harbour dues component of the tariff be increased by 11 percent in each of the next five years, mainly due to the need to address a significant deficit in the cost of providing the services that harbour dues are designed to cover. The Federation expressed vigorous opposition to both the magnitude and duration of such an increase, and raised a number of questions as to why the port had simply let the harbour dues deficit grow, rather than implementing cost cutting mitigation measures. We also questioned the appropriateness of asking port users to cover the costs of some of the specific items that are encompassed under the harbour dues umbrella.
Although we are pleased that the port’s Board of Directors ultimately chose to approve a substantially lower harbour dues increase than the 11 percent that was originally proposed, we nevertheless have concerns regarding the 6.8 percent CPI increase that is now on the table not only for harbour dues, but for berthage and wharfage fees as well. Although the port has used the previous year’s CPI as its standard rate-setting methodology for the last two decades, we believe that a 6.8 percent increase is inappropriate in the current economic environment, and in a context where the port has reported an 8.1 percent increase in its overall expenses, driven mainly by salaries and benefits and new hires. Given the foregoing, it is our view that a more appropriate course of action would be for the port to implement measures aimed at trimming and controlling costs, with a view to reducing the increase in berthage, wharfage and harbour dues to at least the 5 percent range.
We will be submitting written comments to the port within the next few weeks, and are seeking input from members as to whether they agree with the general arguments outlined above and / or whether there are any additional points we should include in our comments. We would like to submit our comments by December 1 at the latest, in order to ensure the port has sufficient time to consider them before the January 1, 2024 implementation date of the new tariff, and would therefore ask for members to provide their input as soon as possible.
Sincerely,
Karen Kancens
Vice President