Carnival to repay costs of rescue: What's the tab?
Carnival plans to repay the U.S. government for responding to the disabled Carnival 'Triumph' and 'Splendor' cruise ships, which left thousands of passengers stranded for days.
Gerald Herbert / AP / File
Carnival Corp. said Monday it will repay the U.S. government an unspecified amount for the costs to taxpayers of responses to disabling accidents on its Triumph and Splendor cruise ships, both of which left thousands of passengers stranded at sea for days.
The world's largest cruise line company said the payments were being made voluntarily to the U.S. Treasury Department and that no government agency had requested reimbursement for either accident.
But Carnival had come under pressure from U.S. Sen. Jay Rockefeller, who was highly critical last week of Carnival's indirect responses to his inquiries about its willingness to pay.
Rockefeller, chairman of the Senate Commerce Committee, estimated the Coast Guard's costs in dealing with the crippled "Triumph" earlier this year at nearly $780,000. The 2010 engine fire that left the "Splendor" adrift off of Mexico, he said, cost the Coast Guard and Navy about $3.4 million. The Navy work in that case included delivering food from the aircraft carrier USS Ronald Reagan.
In both cases, passengers were left in uncomfortable and even squalid conditions before the ships made it back to port.
Carnival's statement did not say if it would pay those amounts or something else. But the company insisted that it never flatly rejected the idea of reimbursement.
"It should be clearly noted that at no point in time has Carnival stated that it would refuse to reimburse federal agencies if they sought remuneration," said the company statement.
Last week, in response to written questions from Rockefeller about repaying the costs, Carnival released letters responding to the senator stating that its policy in such situations is to "honor maritime tradition" requiring assistance to those in need at sea from all maritime interests. Carnival also said in those letters that it frequently participates in rescues at Coast Guard request and strongly defended its safety record.
Rockefeller had labeled that initial response as "shameful" and indicated then that he might hold hearings or propose legislation.
"I'm glad to see that Carnival owned up to the bare minimum of corporate responsibility by reimbursing federal taxpayers for these two incidents," Rockfeller said in a statement Monday. "I am still committed to making sure the cruise industry as a whole pays its fair share in taxes, complies with strict safety standards, and holds the safety of its passengers above profits."
The 900-foot (274-meter) "Triumph" was disabled during a February cruise by an engine room fire in the Gulf of Mexico, leaving thousands of passengers to endure cold food, unsanitary conditions, and power outages while the ship was towed to Mobile, Ala. It is still undergoing repairs there.
The 952-foot (290-meter) "Splendor" was also hobbled by an engine fire in January 2010, leaving its thousands of passengers to endure similar difficult conditions for three days in the Pacific Ocean while it was towed to San Diego. The "Splendor" is now back in service and cruises out of New York, according to Carnival's web site.
In both cases, Carnival gave passengers refunds, free cruise vouchers, and other forms of reimbursement.
Carnival is also dealing with last year's grounding and capsizing of the Costa "Concordia" off the coast of Italy, which killed 32 people and spawned both criminal investigations and lawsuits. Costa is one of Carnival's six cruise brands.