California ports approve another cargo fee

user-gravatar Headshot

The Long Beach and Los Angeles Boards of Harbor Commissioners on Monday, Jan. 14, in a joint meeting approved a cargo fee that will generate $1.4 billion intended for transportation projects to improve traffic flow and air quality in the harbor area. The fee is in addition to one enacted in December to help fund the ports’ Clean Trucks Program.

The transportation infrastructure funding will be used for bridge, railway and road improvements used in port-related goods movement, including replacement of the Gerald Desmond and Heim bridges, freeway connector improvements and port-area rail enhancements, which reduce the need for local truck trips.

Funds generated by the infrastructure cargo fee will be used to match Proposition 1B funds, which California voters approved in 2006 to help pay for major transportation and air quality improvement projects. Together, the cargo fee and Proposition 1B funds will finance about $3 billion in improvements.

“These infrastructure improvements will deliver major benefits to the community in improved traffic flow and reduced air pollution,” says Long Beach Port Executive Director Richard D. Steinke. “Importantly, they will also help support the economy and jobs by ensuring the continued efficient movement of cargo.”

“Proceeds from this tariff will help make our bridges safer, improve highway safety and congestion, and shift more containers from trucks to on-dock rail,” says Port of Los Angeles Executive Director Geraldine Knat. “It also generates local dollars to help our ports obtain additional state and federal funding for infrastructure and air quality projects.”

The proposed fee will be assessed on every loaded 20-foot equivalent (TEU) cargo container entering or leaving any terminal by truck or train beginning Jan. 1, 2009. The amount will fluctuate based on the current funding needs of approved projects. It is anticipated that the charge would be $15 per loaded TEU for seven years, but could vary depending on availability of public funds and timing of environmental approvals.

Funds from the proposed fee program will be used only for approved local projects. Spending will be limited to specific projects after project approval by the applicable lead agency, and fee collection will stop when those projects are completed.

Cargo fee revenue and Proposition 1B funds will pay for rail and highway projects, including improvement of the ports’ on-dock rail network, which will help reduce truck trips to the ports. Local highway improvements include replacement of the Gerald Desmond Bridge from Long Beach to Terminal Island, and construction of an interchange to allow the removal of a traffic light at Navy Way and Seaside Avenue.

The ports also propose to improve access from the Harbor Freeway to the Port of Los Angeles and upgrade the Terminal Island Freeway by replacing the Schuyler Heim drawbridge and constructing a four-lane elevated expressway between Ocean Boulevard and Alameda Street at Pacific Coast Highway. Also proposed is a highway-railroad grade separation in south Wilmington.

The projects are included in the California Goods Movement Action Plan, which was the result of collaboration during the past several years by business, transportation and environmental interests.

In December 2007, the ports approved a cargo fee of $35 per loaded TEU to generate $1.6 billion to help fund the Clean Trucks Program to replace and retrofit old, polluting trucks.