June - July 2000
Congratulations to McCABE, HAMILTON & RENNY CO, LTD. on their 100th anniversary this year. See McCabe’s special anniversary insert in this issue.
CSX LINES announced the retirement of Jack Sutherland who has served as vice president and general manager of CSX (formerly Sea-Land Service) Hawaii/Guam service for the last nine years. Sutherland joined Sea-Land in 1968 as a sales representative, and later held management positions in the Mediterranean, Northern Europe , the U.S. East Coast and Alaska before moving to Hawaii. His retirement becomes effective July 1. Brian W. Taylor has been named as Sutherland’s replacement, effective June 1. He will relocate from the company’s Puerto Rico operations where he has been vice president and general manager since 1998. Taylor began his career with Sea-Land in 1984.
YOUNG BROTHERS LTD. promoted Wendell Kam to Kauai manager, succeeding Donald Lindsey who retired. The company also named Rowland Lee as manager for Maui and Lanai.
Valerie King, formerly the vice president of marketing for Atlantis Adventures, was promoted to the new position of president of NAVATEK I CRUISES. In April, Atlantis purchased the 400-passenger tour boat and its associated operating permits from Pacific Marine. King joined Atlantis in 1990.
At Matson Navigation subsidiary MATSON INTERMODAL SYSTEM, Ronald J. Forest was promoted to president and CEO, responsible for overseeing the continued growth of Matson’s largest subsidiary. He will direct the activities of the entire Matson Intermodal network of offices in more than 20 cities in the United States and Mexico. Forest has more than 20 years of experience in the industry, including five years with Matson.
Michael J. Radak was appointed assistance vice president, operations for Matson Intermodal System. Based at the company’s Oakbrook Terrace (Ill.) office, he will oversee all operations and customer service activities. Thomas E. Anderson also has joined the company as manager, district sales, based in Oakbrook Terrace.
Getting it straight
The Harold K.L. Castle Foundation awarded a capital grant of $750,000 to the Oceanic Institute for the expansion of the Center for Applied Aquaculture and Marine Biotechnology. An incorrect amount was stated in our April/May News Briefs.
Legislature 2000: “Pretty good session” for maritime industry
by Mele Pochereva
Hawaii’s maritime community is pleased with the outcome of this year’s legislative session, following the passage of two bills that preserve waterfront lands for maritime-related uses and help finance improvements to cruise ship facilities.
“It was a pretty good session,” concludes Clint Taylor of CSX Lines, who has been a key legislative liaison for the industry in the past several years. “We started with five bills; three of them died and two survived.”
Measures that passed were Senate Bill 2301,which establishes a definition for maritime lands, and Senate Bill 2303, which transfers a portion of the public service company tax generated by domestic cruise ships to the harbor and boating special funds for facility improvements.
While not transferring any additional waterfront lands to the Department of Transportation, SB2301, SD2, HD1, establishes a “water dependency” criterion for the state when land use decisions are being made by defining maritime lands as any public lands required for commercial and industrial activities that are dependent on being adjacent to the harbor. The bill excludes the Sand Island Business Association industrial lease area, state boating facilities and lands under the jurisdiction of the Hawaii Community Development Authority (HCDA).
The bill also restricts Piers 1 and 2 at Fort Armstrong for maritime use, though it remains under the jurisdiction of HCDA. HCDA’s master plan already designates Piers 1 and 2 for maritime use, but this bill reinforces the plan and protects the land from possible changes to the master plan in the future.
The second bill to pass, SB2303, SD2, HD2, CD1, provides a way for domestic cruise lines – American Hawaii Cruises and its new sister company, United States Lines – to help finance much-needed improvements to passenger ship facilities around the state.
The bill designates approximately 15% of the public service company tax revenues for cruise ship facility improvements over the next 25 years. Some funds would go to the DOT-Harbors Division for harbor improvements and some would go to the Department of Land and Natural Resources for improvements to cruise ship tendering facilities at small boat harbors.
“It’s a good way for the industry that uses the facilities to help maintain and improve them,” points out CSX’s Taylor.
Currently, all of the PSC tax revenue – about $2.9 million a year – goes into the state’s general fund. With the arrival of United States Lines’ MS Patriot later this year, and two new cruise ships destined for Hawaii service in the next five years, projected PSC tax revenues over the next 25 years will be $420 million. Fifteen percent of that would generate millions of dollars for improvements, at no expense to taxpayers.
Maritime-related bills that did not pass include SB2299 which would transfer authority of Piers 1 and 2 from HCDA to DOT; SB2300 which would allow private development of maritime facilities on state land with reimbursement over time through fee and lease rent rebates; and SB2302 which would grant DOT greater authority over harbor back-up lands.
Broad base support
“As an industry, we are very encouraged that we got two bills passed,” says Kraig Kennedy, executive vice president of McCabe Hamilton & Renny Co., Ltd. and current chairman of the Chamber of Commerce Maritime Committee. “We were pleased with the broader base of support from legislators this year, and legislators were very helpful in suggesting ways to draft legislation that would achieve our purposes without inadvertently causing a negative impact on other commercial interests.”
There is some skepticism within the maritime community that the bills will survive Governor Cayetano’s June 22 veto deadline, since the bills restrict flexibility in land use and monies usually destined for the state’s general fund.
Kennedy admits that the governor has some tough decisions to make, but is hopeful the Administration will be supportive of the needs of the maritime industry.
“The issues addressed (in these bills) are not going to go away,” he says.
According to cruise industry projections, Hawaii can anticipate a quadrupling in cruise ship visits in the next four to six years.
“If we don’t get the facilities in a reasonable amount of time, I personally believe that Hawaii’s cruise business will be stagnated or will decline in the coming years,” says Kennedy. “We’ve heard from the cruise industry – especially the foreign cruise industry – that there are other destinations (they’ll visit).”
And with the growth in container volume and other signs that Hawaii’s economy is coming alive again, Kennedy says, “we have got to be able to support economic growth since most goods come in over the water.”
Matson, CSX augment Hawaii service
In response to Hawaii’s improving economy and growth in the container market, Matson Navigation Company has added capacity and increased service frequency to its Hawaii Service, and CSX Lines is replacing two C7 vessels with larger SL-18 ships for a 24% capacity increase in its weekly California Hawaii Express (CHX) service.
On May 14, Matson added a seventh vessel, the SS Lihue, to its Hawaii Service fleet, allowing the company to increase the number of round-trip voyages from 156 to 182 per year.
With the new schedule Matson’s service will feature seven arrivals from West Coast ports every 14 days.
CSX Lines has chosen to increase the capacity of its regularly scheduled Wednesday CHX service by replacing the smaller CSX Discovery and CSX Challenger with the CSX Consumer and CSX Producer. The new vessels each have a capacity of 1,664 TEUs; the ships they replace had a capacity of 1,342 TEUs.
Cruise ship construction to begin July 4
Construction of the first American Classic Voyages (AMCV) cruise ship will start on July 4 this year at Ingalls Shipbuilding in Mississippi.
A year ago, the cruise ship company signed the $1.4 billion Project America contract for two new 72,000 GT passenger vessels, with an option for a third. The first ship will enter service in Hawaii in 2003, followed by the second ship a year later. The 840-foot, 1,900-passenger liners will be the first large cruise ships to be U.S. built in more than 40 years.
Meanwhile, the company will put the 1,212-passenger MS Patriot into its Hawaiian Islands service, beginning December 9. Acquired from Holland America Line last year, the former Nieuw Amsterdam will be home-ported in Honolulu, visiting five Hawaii ports on a 7-night itinerary. All three ships will sail under the new United States Lines banner.
American Hawaii Cruises, a subsidiary of American Classic, will continue to offer 7-night inter-island cruises on its 1,021-passenger SS Independence, which will be re-located from Honolulu to Kahului on November 11.
Council bans bottom longline gear
At a meeting in May in Honolulu, the Western Pacific Fishery Management Council agreed to strengthen the protection of sharks by banning the use of bottom longline gear in the federally managed waters off Hawaii (3 to 200 miles from shore). The gear consists of a mainline of more than one nautical mile that lays on the ocean bottom and from which branch lines with hooks are attached.
In 1998 and 1999, a newly arrived vessel to the Islands used the gear type to catch sharks, taking up to 20 metric tons of mostly nearshore sharks per trip. While the council did have regulations banning the take of sharks by drift gill nets, there were no federal or state laws regulating bottom longline gear for Hawaii waters at that time.
Maritime pilots convene
More than 400 delegates representing maritime pilots from around the world attended a five-day conference in Honolulu in May. It was organized by the International Maritime Pilots’ Association and hosted by the American Pilots’ Association.
Keynote speaker W. O’Neil, secretary general of the International Maritime Organisation (IMO) spoke about competition in pilotage and the current penchant for governments to privatize everything simply to cut costs.
CEROS to fund 15 projects
The National Defense Center of Excellence for Research in Ocean Sciences (CEROS), a project affiliated with the state’s Natural Energy Laboratory of Hawaii Authority, announced the selection of 14 companies that will receive a total of over $6.3 million this year for 15 new technology development projects.
The following casualty information is provided by the USCG Marine Safety Office Honolulu.
3/19/00 WAIMEA BAY, OAHU.
3/22/00 PACIFIC OCEAN.
3/27/00 HONOLULU HARBOR.
4/15/00 NUALOLO POINT, KAUAI.
© 2002 Hawaii Ocean Industry