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Icebreaking Fees

Dear GLIN folks,

	The Administration included a provision in its FY 1998 budget request to 
develop and implement a fee for icebreaking services performed by the U.S. Coast 
Guard.  The fee would take effect in FY 1999.  During ice season, a fee of 63 
cents per ton of cargo loaded or unloaded would be charged at U.S. ports in the 
Great Lakes and Northeast.  The charge would cover the costs of maintaining and 
operating icebreaking vessels which is approximately $25 million per year.

	Through the leadership of Congressman Oberstar, 50 Senate and House 
members signed letters to the Secretary of Transportation and the Commandant of 
the U.S. Coast Guard to oppose such a fee-for-service.  The Great Lakes 
delegation believes that an icebreaking fee is economically detrimental and 
unfair to cold-weather states.  The Coast Guard does not plan to charge fees for 
services in other regions of the country.  Thus, the fee would create an unfair 
economic incentive for shippers to move cargo through other ports, undermining 
the Great Lakes regional economy.  The fee would have adverse economic 
consequences not only to those directly charged, but also to the nation.  The 
Great Lakes region encompasses nearly half of America's agricultural and 
industrial output, producing more than 70% of our nation's raw steel.

	At the request of the Office of Manangement and Budget, the Coast Guard 
has developed a proposal to charge icebreaking fees and has submitted it to the 
Department of Transportation.  Parties who wish to express their opinion on the 
icebreaking fees should write letters to Coast Guard, Department of 
Transportation, and the Office of Management and Budget.  For more information, 
please contact Patricia Cicero at the Northeast-Midwest Institute