46 C.F.R. §§ 404.101–404.109

§404.101. Ratemaking step 1: Recognize previous operating expenses.

46 C.F.R. § 404.101

The Director uses an independent third party to review each pilotage association's expenses, as reported and audited for the last full year for which figures are available, and determines which expense items to recognize for base ratemaking purposes in accordance with § 404.2 of this part.

Notes, amendments, and revision history

Authority

Authority: 46 U.S.C. 2103, 2104(a), 9303, 9304; DHS Delegation No. 00170.1, Revision No. 01.4.

Source

Source: USCG-2015-0497, 81 FR 11941, Mar. 7, 2016, unless otherwise noted.

§404.102. Ratemaking step 2: Project operating expenses, adjusting for inflation or deflation.

46 C.F.R. § 404.102

The Director projects the base year's non-compensation operating expenses for each pilotage association, using recognized operating expense items from § 404.101. Recognized operating expense items subject to inflation or deflation factors are adjusted for those factors based on the subsequent year's U.S. government consumer price index data for the Midwest, projected through the year in which the new base rates take effect, or if that is unavailable, the Federal Open Market Committee median economic projections for Personal Consumption Expenditures inflation.

Notes, amendments, and revision history

Amendments

[USCG-2017-0903, 83 FR 26193, June 5, 2018]

Authority

Authority: 46 U.S.C. 2103, 2104(a), 9303, 9304; DHS Delegation No. 00170.1, Revision No. 01.4.

Source

Source: USCG-2015-0497, 81 FR 11941, Mar. 7, 2016, unless otherwise noted.

Amendments

[USCG-2017-0903, 83 FR 26193, June 5, 2018]

§404.103. Ratemaking step 3: Estimate number of registered pilots and apprentice pilots.

46 C.F.R. § 404.103

(a)

The Director projects, based on the number of persons applying under 46 CFR part 401 to become U.S. Great Lakes registered pilots, and on information provided by the district's pilotage association, the number of pilots expected to be fully working and compensated.

(b)

The Director projects, based on the number of persons applying under 46 CFR part 401 to become Apprentice Pilots, traffic projections, information provided by the pilotage association regarding upcoming retirements, and any other relevant data, the number of Apprentice Pilots and Apprentice Pilots with Limited Registrations expected to be in training and compensated.

Notes, amendments, and revision history

Amendments

[USCG-2017-0903, 83 FR 26193, June 5, 2018, as amended by USCG-2021-0431, 87 FR 18524, Mar. 30, 2022]

Authority

Authority: 46 U.S.C. 2103, 2104(a), 9303, 9304; DHS Delegation No. 00170.1, Revision No. 01.4.

Source

Source: USCG-2015-0497, 81 FR 11941, Mar. 7, 2016, unless otherwise noted.

Amendments

[USCG-2017-0903, 83 FR 26193, June 5, 2018, as amended by USCG-2021-0431, 87 FR 18524, Mar. 30, 2022]

§404.104. Ratemaking step 4: Determine target pilot compensation benchmark and apprentice pilot wage benchmark.

46 C.F.R. § 404.104

(a)

In a full ratemaking year, the Director determines base individual target pilot compensation using a compensation benchmark, set after considering the most relevant currently available non-proprietary information. For supportable circumstances, the Director may make necessary and reasonable adjustments to the benchmark.

(b)

In an interim year, the Director adjusts the previous year's individual target pilot compensation level by the Bureau of Labor Statistics' Employment Cost Index for the Transportation and Materials sector, or if that is unavailable, the Director adjusts the previous year's individual target pilot compensation level using a two-step process:

(1)

First, the Director adjusts the previous year's individual target pilot compensation by the difference between the previous year's Bureau of Labor Statistics' Employment Cost Index for the Transportation and Materials sector and the Federal Open Market Committee median economic projections for Personal Consumption Expenditures inflation value used to inflate the previous year's target pilot compensation.

(2)

Second, the Director then adjusts that value by the Federal Open Market Committee median economic projections for Personal Consumption Expenditures inflation for the upcoming year.

(c)

The Director determines each pilotage association's total target pilot compensation by multiplying individual target pilot compensation computed in paragraph (a) or (b) of this section by the number of pilots projected under § 404.103 or § 401.220(a) of this chapter, whichever is lower.

(d)

The Director determines the individual Apprentice Pilot wage benchmark at the rate of 36 percent of the individual target pilot compensation, as calculated according to paragraphs (a) or (b) of this section.

(e)

The Director determines each pilot association's total Apprentice Pilot wage benchmark by multiplying the Apprentice Pilot compensation computed in paragraph (d) of this section by the number of Apprentice Pilots and Apprentice Pilots with Limited Registrations projected under § 404.103(b).

Notes, amendments, and revision history

Amendments

[USCG-2017-0903, 83 FR 26193, June 5, 2018, as amended by USCG-2018-0665, 84 FR 20578, May 10, 2019; USCG-2020-0457, 86 FR 14220, Mar. 12, 2021; USCG-2021-0431, 87 FR 18525, Mar. 30, 2022]

Authority

Authority: 46 U.S.C. 2103, 2104(a), 9303, 9304; DHS Delegation No. 00170.1, Revision No. 01.4.

Source

Source: USCG-2015-0497, 81 FR 11941, Mar. 7, 2016, unless otherwise noted.

Amendments

[USCG-2017-0903, 83 FR 26193, June 5, 2018, as amended by USCG-2018-0665, 84 FR 20578, May 10, 2019; USCG-2020-0457, 86 FR 14220, Mar. 12, 2021; USCG-2021-0431, 87 FR 18525, Mar. 30, 2022]

§404.105. Ratemaking step 5: Project needed revenue.

46 C.F.R. § 404.105

The Director calculates each pilotage association's base projected needed revenue by adding the projected adjusted operating expenses from § 404.102 (step 2) and the total target pilot compensation from § 404.104 (step 4).

Notes, amendments, and revision history