Weekly News Summary For May 3-9, 2010:
On April 26, Michigan found out that it had struck out a third time on the carp issue, and it was out—of the U.S. Supreme Court.
In a terse two-sentence ruling, the court rejected a proposal by Michigan and six other Great Lakes states to consider the carp issue under the umbrella of an agreement pursuant to an 80-year-old lawsuit. The ruling also prevents the state from filing again on the same issue in the Supreme Court.
The court didn’t explain its reasoning. But attorneys for the state of Illinois had argued in January that Michigan was wrong to file in the Supreme Court because it had not exhausted other legal remedies. Although the Supreme Court is supposed to handle disputes between states, a commonly accepted legal doctrine says it should be called upon to do so only as a last resort.
Another argument made by opponents of Michigan’s actions is that the lawsuit under which it filed its complaint is not the proper instrument for the carp issue.
The original suit, known as State of Wisconsin v. State of Illinois, No. 1, Original, was brought in the 1920s by Great Lakes states concerned that the Chicago Sanitary & Ship Channel would siphon off too much water from Lake Michigan. Hailed as an engineering marvel in its day, the project reversed the flow of the Illinois River to allow lake water to flush waste from the Chicago area down the Illinois Waterway. As a side benefit, it opened commercial navigation between the river system and the Great Lakes….
Kirby Corporation on April 28 announced net earnings for the first quarter of $24.7 million, or 46 cents per share, compared with $28 million, or 52 cents per share, for the 2009 first quarter. Consolidated revenues for the 2010 first quarter were $268.3 million, compared with revenues of $277.7 million a year ago.
“Our 2010 first quarter results reflected higher business levels in our marine transportation segment when compared with the majority of 2009,” said Joe Pyne, Kirby chief executive officer. “While we do believe that the higher demand and resulting higher equipment utilization was the result of improved petrochemical production, the improvement was also driven by plant outages. During the month of April, the improved demand has continued; however, time will tell if this improvement is sustainable. Our diesel engine services segment experienced seasonal improvement in its medium-speed marine market, along with a continued stable power generation market.”
In 2009, the company focused on operating as prudently and efficiently as possible, and reducing costs, Pyne said. Those efforts have continued in 2010, with a reduction in transportation and corporate staffs. The company reported first-quarter charges of $4.0 million last year and $4.1 million this year, before taxes, for the staff reduction.
“Since our peak headcount in October 2008, we have reduced our shore staff by 22 percent through retirements, staff reductions and attrition,” Pyne said….
Even though revenues were down and the company reported a net loss from continuing operations, American Commercial Lines officials say the company is well positioned to take advantage when the economy turns around.
ACL, Jeffersonville, Ind., reported a loss from continuing operations of $3.5 million for the first quarter, or 27 cents per diluted share. That compared to a loss from continuing operations of $4.5 million or 35 cents per diluted share in the first quarter of 2009. Revenues for the quarter were down 23 percent from a year earlier—$148.3 million vs. $192.7 million. But the company reported that EBITDA (earnings before interest, taxes, depreciation and amortization) increased, to $15.1 million with an EBITDA margin of 10.2 percent, compared with $14.2 million with an EBITDA margin of 7.4 percent a year ago.
However, the company has also cut its costs dramatically during the recession. Michael P. Ryan, president and chief executive officer, said the company had reduced selling, general and administrative (SGA) expense in the transportation segment by $4.9 million, and through reorganization efforts had trimmed another $4.7 million….
While the world was focused on spill-cleanup activities in the Gulf of Mexico after a BP drilling rig exploded and burned, killing 11 workers and causing a massive slick that was still expanding last week, the Coast Guard assured operators on the Mississippi River that shipping lanes would stay open.
“There are currently no plans to restrict traffic coming from main shipping lanes into or out of the Mississippi River, and the Coast Guard is not currently anticipating placing restrictions on traffic coming into or out of the Mississippi River through Southwest Pass,” said a Marine Safety Information Bulletin signed by New Orleans Captain of the Port Ed Stanton April 28.
The Coast Guard did establish a safety zone requiring vessels to operate at no-wake speed near booming operations in the Gulf….
A roller gate failure at Dam 25 on the Upper Mississippi River at Winfield, Mo., had the Corps of Engineers scrambling last week to make repairs to keep river traffic moving.
The failed gate is near the middle of the 15 roller gates that make up the dam. On April 22, an electrical limit switch failed and the large chain that moves the gate was torn from its connection point, leaving the 100-foot-long gate wedged between the concrete piers that support it. The failure occurred while lock maintenance personnel were lubricating the gate chains.
The gate weighs 177 tons, said Alan Dooley, spokesman for the St. Louis District.
The Corps has emergency stop logs it can put in place as a bulkhead to allow it to make repairs to the gates, but the St. Louis Engineer District determined that the aging stop logs at Dam 25 were in poor material condition because of corrosion, and not usable. Another, similar set of stop logs was available at Dam 17, in the Rock Island District. But the Corps faced the dilemma of how to get those bulkheads to Dam 25. The matter took on some urgency, as the river was falling and the St. Louis District was preparing to close the dam gates to “catch pool” above Winfield to keep the river open for navigation.
Fortunately, the St. Paul Engineer District’s mv. Warren was pushing the St. Louis District’s heavy-lift crane Sewell to St. Louis at the time. The Sewell had spent the winter up north, supporting the St. Paul District’s work at Lock 5 while the river was closed….
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