Fixes on the horizon for sluggish interisland cargo lines as rate hike looms

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The waiting game to send and receive ocean cargo between the islands has gotten so long that it’s on the radar of everyone from businesses and consumers to lawmakers and regulators.

Those who ship interisland say their patience is being tested with long delays at the pier, costing businesses and consumers money.

“The truckers tell me they can spend easily two to three hours either taking cargo to Young Brothers or picking cargo up from Young Brothers,” said Michael Hansen, Hawaii Shippers Council.

It’s a sentiment Always Investigating has heard from others. Some days, the line spills into the streets nearby.

“(There’s) a lot of waiting. Even on the road you see a lot of backup just right there at the light,” explained Charles Choice, who works nearby. “It kind of slows down traffic.”

So what’s going on? “With the recession, Young Brothers had lost cargo volume considerably,” Hansen said, “and they had cut back some of their receiving times.”

The cutback was to half-days twice a week. Since then the economy’s revved up with cargo volume bumping up.

But the shortened days and staffing did not.

“Congestion creates a situation that adds cost to them and it often delays the cargo moving to the neighbor islands,” Hansen said. “This is something that’s adding friction to our economy. This is something that really needs to be solved.”

It’s even on the radar of the carrier’s state regulators.

“Their service levels, the wait times is one element of that,” said Del Won of the Public Utilities Commission. “It’s an issue and we will be looking into it.”

The wait times aren’t the only complaint, but also what major retailers and wholesalers call a shortage of containers to move goods interisland, especially around crunch times like the holidays.

Always Investigating brought this all up with Young Brothers. Vice president Roy Catalani told us, “We recognize that problems in service may occur in these extensive operations. We believe that fixing problems is a part of the service that all customers should expect.”

Customers will likely demand more with something else coming up: a possible price hike by Young Brothers.

Young Brothers has filed a notice of intent for a rate increase with the Public Utilities Commission.

“When they file their formal application as a normal part of our evaluation of that application,” Won explained, “we will look not only at the financial aspects but we will be looking at the service aspects.”

Young Brothers told Always Investigating it anticipates a low, nominal increase. In 2014, the PUC approved 2.2 percent, and rates stayed flat in 2015.

“We’re not so naive to not understand that increased service costs some money,” Won said. “As part of our evaluation, we just need to strike the appropriate balance insofar as meeting the public interest. We believe that as the monopoly interisland carrier for the state, Young Brothers has an obligation to provide a certain standard and level of service.”

Young Brothers told Always Investigating its rate case is about a month from formal filing with the PUC. Meanwhile, it’s getting a jump on fixing service issues.

It says wait times have come down since December and January, and within this coming month, it will:

  • Hire up two more machine operators and three more freight clerks to move the line;
  • Provide 5.5 percent more chassis inventory;
  • Provide 12 percent more dry container inventory; and
  • Implement text, email, phone and fax pickup alerts for containerized, car and roll-on-roll-off customers.

Young Brothers is also mulling whether to expand receiving hours on one of their half-days, Friday, to a 3:30 p.m. cutoff for containerized-cargo clients.

The carrier points out that delays in pick-up and drop-off aside, their barges have maintained an on-time port arrival record.

Sen. Lorraine Inouye, D, Hawaii Island, heads the Senate transportation committee. She said she hopes to see some attention to the pallet-sized customers too, so that “our local businesses as well, who don’t use the large containers, are recognized and they receive their goods on a timely basis as well, and that their goods get to the market.”

Industry experts see a need for more technology than the text alerts, and even more elbow room.

“There are available new electronic systems for receiving cargo so that you reduce the amount of clerical time involved with paperwork, ” Hansen suggested, “and normally in a situation like this, it’s a better terminal design. Perhaps they need more space on the waterfront for their terminal.”

Modernization of a new interstate container terminal spanning a section of Kapalama has been long in the making, but construction should start in January 2017 and help other harbor tenants.

“It will be opening up space for Matson to move out and give more space to Young Brothers,” Inouye said.

“Department of Transportation Harbors Division has been working with YB and others for nearly a year to try to address improving flow through the cargo yard. However, there is no additional space within Piers 39-40 to dedicate to this space-intensive service,” Department of Transportation spokesperson Tim Sakahara told KHON2 in a statement. “Issues like this, multiplied through space constraints endured by many harbor users and cargo operators throughout the State’s commercial harbors, make more urgent the need to move forward with harbor improvement projects and harbor modernization.”

“Young Brothers is both interested in and working with DOT for possible additional space in both a short-term and long-term context,” Catalani told KHON2. “We worked with DOT on an initiative on traffic issues in which DOT improved an unused road that goes through Kapalama Container Terminal to take truck traffic off public roads. We are also working with DOT on other potential uses.”

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