Opinion ID: 1141408
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Heading: The Role of the Public Service Commission in Pilot Fee Regulation

Text: The Governor is authorized to appoint and commission river port pilots certified as qualified by the Board of River Port Pilot Commissioners for the Port of New Orleans. La.R.S. 34:992, 993. Commissioned river port pilots have the exclusive right to pilot vessels between Pilottown and New Orleans, within the Port of New Orleans, and on other inland waterway routes connecting with the port. La.R.S. 34:996. The pilots are authorized to organize by forming a river port pilots association. La.R.S. 34:995. See Kotch v. Board of River Port Pilot Commissioners, 330 U.S. 552, 67 S.Ct. 910, 91 L.Ed. 1093 (1946); Brechtel v. Board of Examiners of Bar Pilots, 230 F.Supp. 18 (E.D.La.1964); Hendrix v. Louisiana Public Service Commission, 262 La. 420, 263 So.2d 343 (La.1972); A. Parks, The Law of Tug, Tow and Pilotage, 513-519 (1971). Originally, pilots' fees were regulated directly by statute. La.R.S. 34:997-999. In 1968, however, the legislature established pilot fee commissions composed of four members of the pilots' association and four members of the steamship industry. La. R.S. 34:1121. The pilot fee commissions have authority to fix reasonable and just... fees for pilotage services to ships and vessels, giving due regard to the length, draft and tonnage of the vessels ..., the difficulty and inconvenience of the particular service and the skill required to render it, the supply of and demand for pilotage services, the public interest in maintaining efficient, economical and reliable pilotage service and other factors relevant to the determination of reasonable and just rates.... La.R.S. 34:1122. In the event that the pilot and industry commissioners are unable to resolve any dispute as to pilotage rates or any other legitimate business, the question may be referred to the Louisiana Public Service Commission by commissioners representing either pilots or industry. La.R.S. 34:1121. If the question of reasonable and just pilotage fees or any other matter is so referred, the decision of the Public Service Commission shall constitute the decision of the pilotage commission. Id. Under this court's previous interpretation of this statutory scheme, the Public Service Commission's regulatory authority is invoked when the question of reasonable and just pilot fees or other matters are referred to it. Hendrix v. Louisiana Public Service Commission, 262 La. 420, 263 So.2d 343 (1972). Accordingly, in a case appealed directly from the district court, we held that pilot fees fixed by the Public Service Commission in default of an agreement by a majority of the pilot fee commission should be affirmed by the courts unless they are found to be arbitrary, capricious, or without support by evidence in the record. Id. 263 So.2d at 350. The industry commissioners challenge our construction of the legislative aim. They argue that the statute only empowers the Public Service Commission to act as a tiebreaker in the event that a majority of the pilot fee commission is unable to agree upon rates. Accordingly, they contend that the Public Service Commission is not authorized to regulate pilot fees but must restrict itself to voting yes or no on fee schedules or other questions referred. Consequently, they urge, judicial review of the Public Service Commission's decision in this capacity is not governed by the constitutional and statutory rules applicable to review of its actions as a regulatory authority. In support of their arguments, the industry commissioners point to statutory provisions requiring the Public Service Commission to serve as a member of each pilot fee commission in the event that the pilot and industry commissioners are unable to resolve any dispute as to pilotage rates, La. R.S. 34:1121, and authorizing suits before courts of competent jurisdiction to contest the validity of any decision of the pilot fee commission. La.R.S. 34:1127. They contend these provisions indicate a legislative design under which the Public Service Commission acts as one member of the pilot fee commission and the fees fixed by the pilot fee commission are amenable to review by general judicial procedures. Reexamination of the statute, however, convinces us that our original conclusion in Hendrix v. Louisiana Public Service Commission, supra , was correct. The legislative aim was to provide the Public Service Commission with additional regulatory authority and not merely to make it the functionary of a statutory board. The statute emphatically dictates that, if a question is referred to it, [t]he decision of the Public Service Commission shall constitute the decision of the pilotage commission. La.R.S. 34:1121. The Public Service Commission is authorized to decide any legitimate business of the [pilot fee] commission referred to it, La.R.S. 34:1121, which may include the fixing of reasonable and just pilotage fees. La.R.S. 34:1122. Its charter does not restrict it to voting yea or nay upon the fee schedules which may be submitted to it by one interest group or another represented on the pilot fee commission. To so hobble the Commission would prevent it from using its own expertise and exercising its independent judgment as to just and reasonable rates charged for an important public service. That the legislative aim was to relegate the Commission to such a minor role in a vital area of public service regulation is unlikely in view of its position as a constitutional regulatory authority and its historic dominance of rate-making in Louisiana. Furthermore, if the statute did not delegate regulatory authority to the Public Service Commission or call upon the courts to review its actions as a ratemaking body, several bizarre results would follow. An attempt by the Commission to adopt a rate schedule different from that upon which the industry and pilot commissioners had reached a tie vote would result in a failure of the pilot fee commission to take any action which could be reviewed. The courts would be forced to dismiss or remand any case appealed in which the Commission failed to cast a simple yes or no, tie-breaker vote. In any case, the administrative record made before the Public Service Commission could have little significance on judicial review since it could support only one out of nine votes on the pilot fee commission. We do not understand even the industry commissioners to argue for these strange consequences. They wish to have the case fall outside the Public Service Commission's jurisdiction in order to avoid a direct review of the district court's judgment by this court, but they either overlook or ignore the many other implications of their argument. Article 4, § 21(B) of the 1974 Louisiana Constitution provides that the Public Service Commission shall regulate common carriers and public utilities and have such other regulatory authority as provided by law. For the reasons assigned, we conclude that the statutory scheme under consideration, La.R.S. 34:1121-1127, provides other regulatory authority to the Public Service Commission in cases in which the regular members of a pilot fee commission are unable to agree upon reasonable and just pilotage fees or any other legitimate business of the pilot fee commission. In essence, the statute provides that, in the absence of bargained pilot fees, the Public Service Commission shall regulate rates. Accordingly, appeals from actions by the Public Service Commission in regulating pilot fees are governed by Article 4, § 21(E) of the constitution, which provides that an appeal may be taken from any action by the Commission to the district court in its domicile and that a direct appeal from any judgment of the district court shall be allowed to the supreme court. Our conclusions are consistent with the judicial review section of the pilot fee commission statute. La.R.S. 34:1127 provides that [p]roceedings may be brought before courts of competent jurisdiction under state law for the purpose of contesting the validity of any decision of the [pilot fee] commission hereunder. This section provides a rule of judicial review for a case in which the pilot fee commission decides a question by a majority vote without referring it to the Public Service Commission. Since the Public Service Commission is not empowered to serve as a member of the pilot fee commission merely for the purpose of casting its vote, but is authorized to exercise its own regulatory authority to fix rates in cases referred to it, appeals from its actions in regulating pilot fees are not governed by La.R.S. 34:1127 but by Article 4, § 21(E) of the constitution.