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+--- Thread: PUC approves emergency 46% rate increase for Young Brothers (/showthread.php?tid=21889)
PUC approves emergency 46% rate increase for Young Brothers - terracore - 08-18-2020
HONOLULU, Hawaii (HawaiiNewsNow) - In a decision expected to drive up the already high cost of living on the Neighbor Islands, the Public Utilities Commission on Monday approved a jaw-dropping 46% rate increase for the state’s only inter-island cargo shipping company.
The PUC, acknowledging the economic strain the pandemic has put onto Young Brothers, approved the emergency rate increase to restore the company’s “pre-COVID” sailing schedule by Sept. 1.
The added routes will reduce delays of freight for customers, but also means much higher shipping costs for inter-island services.
“It’s really going to be a big problem here for our island because you know, we going to have to raise our prices. But one of the things that we’re really glad about is that the barges coming to Hilo again,” Derek Kurisu, Executive Vice President of KITA Superstore, said.
On July 7, the company filed a request with the PUC to help regain revenue lost, save jobs, and keep service going throughout the islands.
In a statement, the company said: “Young Brothers understands that our communities and customers are struggling right now as we all cope with the impacts of COVID-19. That’s why we cut costs and pursued every avenue of assistance before asking the Public Utilities Commission to approve a temporary, emergency rate increase totaling $27 million, which does not include profit of any kind.”
The conditions of the approval include:
- A 12-month “stay-out” period for additional general rate increases.
- Young Brothers is required to provide six months advance notice to the PUC and state if the company decides to discontinue regulated inter-island service in the future.
- They must develop and implement a comprehensive customer service plan.
- A financial management audit will now be conducted by a third party, selected by the PUC.
The significant increase comes after the company was unsuccessful in securing federal funding to cover revenue shortfalls.
“We recognize that this is a huge cost burden on Hawaii’s customers at this time, but really what is at stake here is the lifeline to the neighbor islands,” said Jay Griffin, PUC chair.
“We hope that this will provide the stability that Young Brothers has been asking for, but mostly the peace of mind for folks on the neighbor islands to continue the services that we know are so essential,” he added.
Kurisu also adds that KTA will do everything they can to avoid raising costs for customers.
https://www.hawaiinewsnow.com/2020/08/17/puc-approved-emergency-percent-rate-increase-young-brothers/
Of note to add to above article. The company that owns Young Brothers (Saltchuk) is primarily a petroleum distribution company. Look them up online.
This is nothing more than a "Our fossil fuel businesses are suffering so we are going to put poor rural Hawaii farmers and outer island consumers over a barrel, and make you all pay if you want to keep getting sh!t from Oahu" money grab. And the PUC fell for it hook, line, and sinker.
Not disgusting enough? Saltchuk owns Aloha Air Cargo... the company that has the Amazon contract.
RE: PUC approves emergency 46% rate increase for Young Brothers - TomK - 08-18-2020
Economist required. How much does a 46% rate increase by Young Brother's increase the cost of living on the Big Island? A simpler question - how much will a typical Big Island family's food budget increase on average?
RE: PUC approves emergency 46% rate increase for Young Brothers - kalakoa - 08-18-2020
Not to snark, but I'm sure it's "pennies", just like the GET increase.
RE: PUC approves emergency 46% rate increase for Young Brothers - eightfingers2.0 - 08-18-2020
Only a matter of time when Matson and Pasha ask for “theirs”.
RE: PUC approves emergency 46% rate increase for Young Brothers - HereOnThePrimalEdge - 08-18-2020
Compare food costs at Honolulu Walmart ($43.85) to Hilo Walmart ($62.35). The difference is most likely the added inter island shipping. It’s certainly not the value of real estate (a factor in the cost of doing business) as land in Hilo is cheaper than anywhere on Oahu:
![[Image: ON-NOW-9.png]](https://civilbeat-aws-dotorg.s3.amazonaws.com/wp-content/2015/04/ON-NOW-9.png)
https://www.civilbeat.org/2015/04/living-hawaii-how-much-does-shipping-increase-the-cost-of-living/
RE: PUC approves emergency 46% rate increase for Young Brothers - randomq - 08-18-2020
The difference is most likely "because they can". The only competition is Costco. I wonder who they use for shipping?
RE: PUC approves emergency 46% rate increase for Young Brothers - terracore - 08-19-2020
The crazy thing is that barging goods is way cheaper than using rail, and rail is WAY cheaper than using trucks. The cost to barge something from HNL to the BI "should" be a fraction of what it costs to truck something between two nearby west coast cities. The simple fact that I can get stuff delivered here via online ordering shipped on an airplane from the mainland (the most expensive form of transportation) cheaper than what "should" be the cheapest form of transportation pretty much "says it all". There are hundreds of airlines willing to fly to the BI. There is only ONE barge company allowed.
It's all unions, regulations, and corruption at play. I'm sure none of these things doomed the Superferry.
https://www.maritime-executive.com/editorials/comparing-maritime-versus-railway-transportation-costs