Issue link: https://pma.uberflip.com/i/963018
I N D U S T R Y A S S E S S M E N T S PMA has kept assessment rates flat for four years. The newly established assessment system was used to calculate an hourly assessment rate that was put into effect for the payroll week beginning December 24, 1983. The accompanying tonnage assessment rates became effective January 1, 1984. By early 1999, the number of hours paid was approaching the 24,800,546 figure. The Coast Executive Committee (CEC) appointed a subcommittee to examine the applicability of the assessment system in relation to cargo volume and hours paid. The subcommittee recommended to the CEC that the divisor be increased in a three-step process beginning with a change to 28,556,221. The CEC in turn recommended to the Board of Directors that the divisor be increased. At the June 28, 2000 Membership Meeting, the membership voted unanimously to adopt the new figure. In October 2000, the PMA membership approved amended and restated bylaws and the following month a new Board of Directors was elected. By the Spring of 2002 the Board was ready for another review of the assessment system. A subcommittee was appointed. The first task was to review the work performed by the previous subcommittee on the proposal for a three-step phase-in of a new divisor. The first step was in place and the question was whether to do a delayed second step or move to the third step. After deliberation, the subcommittee recommended to the Board that the divisor be increased to 32,311,896 — the third step. The membership approved the new divisor on August 23, 2002. Several months after the August 2002 divisor change, a new six-year longshore agreement was reached that resulted in greater than expected increases in benefits costs. The benefits increases, coupled with a projected increase in assessable hours again raised the percentage of the benefits costs paid by the hours sector higher than the ratio of hours to tonnage reflected in the original appendix to the Membership agreement dated December 14, 1983. In order to bring the hours and tonnage cost distribution within the target range established in 1983, the Board, after careful study, recommended to the Membership that the divisor be increased to 34,189,733, using the previous incremental increase. The Membership approved the change on June 3, 2003 to be effective for benefits assessments rates calculated for the 2003/04 fiscal year. Subsequently, the Board has recommended, and the membership has approved, the following divisors: Calculation of Assessment Rates Assessments are calculated based on projected tonnage, payroll hours and benefits plans costs applicable to the future period for which the rate calculations will be applicable. The first step is to determine the projected benefits costs for each plan. After adjusting each of these numbers to reflect prior year experience, anticipated interest earnings, and a prudent level of reserves, a "net funding requirement" is determined. The payroll hourly assessment rate is calculated by dividing the sum of the plan's net to funding requirements by the divisor, 43,578,918. The result is the hourly assessment rate. The hourly assessment rate is then multiplied by the estimated number of assessable hours that will be paid in the fiscal year for which the rates will be applicable. If the result equals the total "net funding requirement" there will be no tonnage assessments. If the hourly assessment rate generates insufficient funds, the remainder of the needed money is collected from the tonnage sector. The tonnage rates are calculated in accordance with formulas described in detail on pages 32 and 33 of the 1989 PMA Annual Report. Rate Components The number of hours expected to be paid during a time period has no impact on the hourly assessment rate; only the total net funding requirement affects the hourly assessment rate. The greater the net funding requirements, the higher the hourly assessment rate becomes. Mount Rainier over Washington United Terminals at the Port of Tacoma. Fiscal Year Divisor 2007/2008 49,212,429 2008/2009 47,334,592 2009/2010 36,067,570 2010/2011 39,823,244 2011/2012 41,701,081 2012/2013 41,701,081 2013/2014 41,701,081 2014/2015 41,701,081 2016/2017 41,701,081 2017/2018 43,578,918 50 2 0 1 7 A N N U A L R E P O R T