Report Title:

Wharfage Rate Adjustments

 

Description:

Directs department of transportation to fix wharfage rates that apply fairly to all cargo shipped through Oahu.

 

THE SENATE

S.B. NO.

206

TWENTY-FIRST LEGISLATURE, 2001

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO WHARFAGE.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. Domestic overseas or foreign cargo transshipped to the neighbor islands via Honolulu on through bills of lading are exempted from wharfage fees at the incoming intermediate port. However, other domestic overseas or foreign cargo bound for the neighbor islands, which must be stored, repackaged, or processed in Honolulu before being shipped on to its ultimate destination is assessed the incoming wharfage fees at the intermediate port, as is cargo shipped between neighbor islands.

The waiver of incoming wharfage fees on cargo transshipped on through bills of lading discriminates against local merchants and manufacturers who must store, repackage, or process the goods they ship in from domestic or foreign ports before shipping them to the neighbor islands. The additional wharfage fee makes it difficult for local merchants and manufacturers to compete with mainland concerns that can ship their goods on through bills of lading straight to the neighbor islands. As these local businesses are primarily Honolulu-based, this exemption from wharfage charges by the State hurts the local economy.

Cargo shipped to the neighbor islands after a stop in Honolulu bears a disproportionately larger share of the cost recovery intended to be accomplished by the wharfage fees. For example, under the current rules, a forty-foot container shipped on a through bill of lading to a neighbor island destination would be charged $129.60 in wharfage fees. That same container shipped and warehoused in Honolulu for a short period of time before moving on to the neighbor island would be assessed $182.00 in wharfage fees, despite the fact that the usage of state facilities by both containers is exactly the same.

In order to provide equitable treatment to all users of state wharves, the purpose of this Act is to structure more fairly the inter-island and intra-island wharfage fees charged to all users.

SECTION 2. Section 266-2, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) The department of transportation shall:

(1) Have and exercise all the powers and shall perform all the duties which may lawfully be exercised by or under the State relative to the control and management of commercial harbors, commercial harbor and waterfront improvements, ports, docks, wharves, piers, quays, bulkheads, and landings belonging to or controlled by the State, and the shipping using the same;

(2) Have the authority to use and permit and regulate the use of the commercial docks, wharves, piers, quays, bulkheads, and landings belonging to or controlled by the State for receiving or discharging passengers and for loading and landing merchandise, with a right to collect wharfage and demurrage thereon or therefor;

(3) Subject to all applicable provisions of law, have the power to fix and regulate from time to time rates and charges for:

(A) Services rendered in mooring commercial vessels;

(B) The use of commercial moorings belonging to or controlled by the State;

(C) Wharfage or demurrage[;] pursuant to section 266-17;

(D) Warehouse space, office space, and storage space for freight, goods, wares, and merchandise; and

(E) The use of derricks or other equipment belonging to the State or under the control of the department;

(4) Make other charges including toll or tonnage charges on freight passing over or across docks, wharves, piers, quays, bulkheads, or landings;

(5) Appoint and remove clerks, harbor agents and their assistants, and all such other employees as may be necessary, and to fix their compensation;

(6) Adopt rules pursuant to chapter 91 and not inconsistent with law; and

(7) Generally have all powers necessary to fully carry out this chapter."

SECTION 3. Section 266-17, Hawaii Revised Statutes, is amended to read as follows:

"§266-17 Rates, how fixed. (a) The department of transportation shall adjust, fix, and enforce the rates assessable and chargeable by it in respect to dockage, wharfage, demurrage, and other rates and fees pertaining to harbors, wharves, and properties managed and operated by it. The department shall fix wharfage rates and charges for incoming domestic overseas cargo, incoming foreign overseas cargo, and outgoing overseas cargo. The department shall establish interisland and intraisland incoming and outgoing wharfage rates that are fairly applied to all incoming and outgoing interisland and intraisland cargo.

(b) The department shall fix rates and fees so as to produce from the rates and fees, in respect to all harbors, wharves, and other properties, except those that are principally used for recreation or the landing of fish, revenues sufficient to:

(1) Pay when due the principal of and interest on all bonds and other obligations for the payment of which the revenue is or has been pledged, charged, or otherwise encumbered, or which are otherwise payable from the revenue or from a special fund maintained or to be maintained from the revenue, including reserves therefor, and to maintain the special fund in an amount at least sufficient to pay when due all bonds or other revenue obligations and interest thereon, which are payable from the special fund, including reserves therefor;

(2) Provide for all expenses of operation and maintenance of the properties, including reserves therefor, and the expenses of the department in connection with operation and maintenance; and

(3) Reimburse the general fund of the State for all bond requirements for general obligation bonds which are or have been issued for harbor or wharf improvements, or to refund any of the improvement bonds, excluding bonds, the proceeds of which were or are to be expended for improvements which are or will be neither revenue producing nor connected in their use directly with revenue producing properties.

[(b)] (c) When weather, road closures due to special events, or road repairs do not permit the loading or unloading of passengers at Kewalo Basin, cruise boats holding a Kewalo Basin sublease approved by the State shall be allowed to use Honolulu Harbor facilities on a space available basis, and the fees for the use of facilities shall be in accordance with the Hawaii administrative rules of the department of transportation relating to fees for use of facilities for private gain."

SECTION 4. Section 266-19, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) There is created in the treasury of the State the harbor special fund. All moneys received by the department of transportation from the rates and fees pursuant to section [266-17(a)(1)] 266-17(b)(1) shall be paid into the harbor special fund. The harbor special fund and the second separate harbor special fund heretofore created shall be consolidated into the harbor special fund at such time as there are no longer any revenue bonds payable from the second separate harbor special fund. The harbor reserve fund heretofore created is abolished.

All moneys derived pursuant to this chapter from harbor properties of the statewide system of harbors (excluding properties principally used for recreation or the landing of fish, except properties located at Kewalo Basin, ewa of Ala Moana Park, Honolulu) shall be paid into the harbor special fund and each fiscal year shall be appropriated, applied, or expended by the department of transportation for the statewide system of harbors for any purpose within the jurisdiction, powers, duties, and functions of the department of transportation related to the statewide system of harbors (excluding properties principally used for recreation or the landing of fish, except the properties located at Kewalo Basin, ewa of Ala Moana Park, Honolulu), including, without limitation, the costs of operation, maintenance, and repair of the statewide system of harbors and reserves therefor, and acquisitions (including real property and interests therein), constructions, additions, expansions, improvements, renewals, replacements, reconstruction, engineering, investigation, and planning, for the statewide system of harbors, all or any of which in the judgment of the department of transportation are necessary to the performance of its duties or functions."

SECTION 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 6. This Act shall take effect upon its approval.

INTRODUCED BY:

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