Loading ...
Sorry, an error occurred while loading the content.

Will California ports remain competitive?

Expand Messages
  • Pacific Merchant Marine Council, NLUS
    October 1 the Ports of Los Angeles and Long Beach start assessing a new $35 per container fee to help fund truckers and trucking firms to purchase new cleaner
    Message 1 of 1 , Sep 28, 2008
    • 0 Attachment
      October 1 the Ports of Los Angeles and Long Beach start assessing a new $35 per container fee to help fund truckers and trucking firms to purchase new cleaner emissions trucks hauling containers and cargo in and out of their ports. Trucks older than 1989 will not even get into the ports. Independent truck owners will be looking for other business or quit altogether. Escalated fuel prices were already making their business turn into non-profits.
      If they can stay in business they might get some hauling business expected when the Punta Colonet Port is constructed and becomes operational.
      "At the southern border, San Diego’s Otay Mesa East Port of Entry project will create a new port of entry and a 2.7-mile, four-lane highway that links to the existing California highway system to provide more capacity for traffic through the region."
      The development of a new port just a few miles east of the existing Otay Mesa Port of Entry may be the border crossing for commerce entering and leaving the proposed Punta Colonet Port linked to the USA. There is no mention of a rail crossing.
      This project will most likely be developed as private public partnership under the leadership of CALTRANS and SANDAG. This project could be operational as early as 2015.
      Thirty-one billion in trade - 1.4 million trucks expected to double by 2025, 11.8 automobiles annually crossing the border.
      Maybe I have it wrong but what I see here is California marine terminals becoming less competitive and more business going to ports north and south of the US borders. We are going to have green - eco friendly ports but will we have the commerce we once had passing through them?
      PS for previous posts on Punta Colonet see http://groups.yahoo.com/group/PMMC-NLUS/message/267 and http://groups.yahoo.com/group/PMMC-NLUS/message/268. For posts related to cleaner fuels being imposed on ships entering and leaving California ports see http://groups.yahoo.com/group/PMMC-NLUS/message/256.

      Otay Mesa East Border Entry


      DOT identifies critical border congestion relief projects

      Peters said congestion at our borders is "choking" commerce and travelers and negatively impacting air quality.


      WASHINGTON — Drivers and freight shippers will experience less delay at U.S. border crossings in California, Texas and Washington thanks to a U.S. Department of Transportation effort to prioritize and accelerate projects that ease border congestion, U.S. Transportation Secretary Mary E. Peters announced Sept. 19. 

      "Congestion at our borders is choking both travelers and commerce with excessive wait times and negatively impacting air quality,” Secretary Peters said. “By prioritizing the projects, we can improve the movement of people and goods across our borders and help to maintain these important economic lifelines.”

      Secretary Peters added that the projects would receive priority access to discretionary programs, including innovative financing. They also demonstrate the types of innovative solutions needed to immediately and effectively reduce border congestion. 

      At the southern border, San Diego’s Otay Mesa East Port of Entry project will create a new port of entry and a 2.7-mile, four-lane highway that links to the existing California highway system to provide more capacity for traffic through the region. 

      In Laredo, Texas, the East Loop Bypass Project will build a new rail bridge across the border and new rail bypass around the city, adding rail capacity and improving safety.

      At the northern border, in Blaine, Wash., the Cascade Gateway Expanded Cross-border Advanced Traveler Information System project proposes to provide real-time border-crossing wait-times and other travel information through a combination of technologies.

      All projects will explore public-private partnerships, which combine traditional federal and state funds with private-sector expertise. These types of partnerships can reduce project costs, speed project delivery and protect the taxpayer from project risks.

      "These innovative projects will bring together public-private partnerships to advance the objective of a more efficient and reliable transportation system,” said Federal Highway Administrator Thomas J. Madison.


      Ports gear up for Clean Trucks Program


      By Art Marroquin, Staff Writer
      Article Launched: 09/27/2008 11:11:14 PM PDT


      Cesar Olivarez climbs into the cab of his 1992 big rig and turns the key.

      Black fumes spew from the exhaust pipe as he settles into the driver's seat and prepares for another haul from the Port of Long Beach to a local warehouse, a ritual he's practiced for the past 27 years.

      A week's worth of work brings the independent trucker $1,500, but a third of his earnings are guzzled up by rising fuel costs. On top of that, Olivarez shells out money for repairs to his 16-year-old rig, parking fees and the occasional traffic citation from police patrolling the ports.

      "There are so many expenses just for work that it's hard to pay the rent and buy food sometimes," said Olivarez, 49, of Long Beach. "We're living in very hard times right now."

      Beginning this week, new challenges are in store for truckers serving the twin ports of Los Angeles and Long Beach. The Clean Trucks Program, a $1.6 billion initiative designed to reduce diesel truck emissions by 80 percent within five years, takes effect Wednesday.

      Under the plan's first phase, trucks built before 1989 will be banned from the ports beginning this week. By 2012, all trucks entering the twin ports will be required to meet 2007 vehicle emissions standards.

      The truck replacement program is funded by a $35 cargo container fee. To help get cleaner-burning big rigs on the road, the Port of Los Angeles is offering grants to trucking companies, while Long Beach also extends the monetary assistance to independent drivers.

      Under the program's terms, Olivarez won't have to give up his truck until Jan. 1, 2010. In the meantime, he's trying to land a permanent job with a trucking company.

      "I thought I would make more money by having my own truck, but I was wrong," Olivarez said with a tone of regret in his voice. "I would like to become an employee driver, but I hope the companies don't think I'm too old."

      Under the program, both ports are requiring trucking companies to obtain "concession contracts" to access port terminals. As of Friday, nearly 600 trucking companies with about 18,000 trucks had applied for concessions with the Port of Los Angeles, while the Port of Long Beach collected applications from about 600 motor carriers with some 8,000 trucks.

      Both ports have enough trucks to get the program started without any major disruptions in delivering cargo, according to officials.

      "Our principal goal is making sure we don't affect the flow of commerce in any way," said John Holmes, deputy executive director of the Port of Los Angeles. "The last thing we need is a back-up in deliveries, but I don't see that happening."

      The Clean Trucks Program is part of the larger Clean Air Action Plan adopted by the ports of Los Angeles and Long Beach as a way to allow for expanded operations while also reducing harmful diesel emissions.

      Over the coming months, officials at both ports plan to roll out a series of terminal expansion proposals that heavily rely on pollution-reduction steps outlined in the Clean Trucks Program.

      "I always felt that this was something that had to be done," said Jim Hankla, president of the Long Beach harbor commission.

      "There's no denying that the ports provide a toxic footprint because of their reliance on diesel fuel," Hankla said. "The trucks that service the port are among our biggest polluters, so we focused our attention on fixing that problem."

      Port officials are gearing up for full enforcement of the Clean Trucks Program by Wednesday. Police from both ports started pulling over trucks on Sept. 15 for a series of "courtesy stops" to remind drivers that the program's start date was around the corner.

      On Wednesday, port police officers will closely examine vehicle registrations to make sure pre-1989 trucks don't slip by. Police will also make sure port-issued stickers are prominently displayed on the windshields of preapproved trucks trying to access terminals.

      "We're ready to roll it out," Holmes said. "There's no going back from here."

      The Port of Los Angeles plan requires the trucking firms to hire drivers as employees, leading to a gradual ban of independent owner-operator truckers within five years. Currently, 85 percent of the 16,800 drivers at the ports work as their own boss.

      The Port of Long Beach chose to go down a separate road and adopted a plan that allows both employee and independent owner-operator truckers to continue hauling goods to the port, as long as their vehicles meet the program's new emissions standards.

      "We have different philosophies, but it doesn't mean that either of us is wrong," Hankla said.

      "We believe that an independent owner-operator can own their own clean trucks and that they should have as much access to the port as an employee driver," he said. "Essentially, it's the way we operate now, so we don't see any problems with that."

      The American Trucking Associations warned that the ports' costly concession contracts and expenses associated with hiring drivers as employees would eventually drive small trucking firms out of business. A federal judge turned down the ATA's request to temporarily block the program from starting. A federal appeals court issued the same ruling last week.

      "The reporting requirements and concession fees will significantly increase costs that the little guys simply can't afford," said ATA spokesman Clayton Boyce. "The concessions will lead to fewer trucking companies serving the ports, and that is an improper and illegal incursion to free market operations."

      "Joe," the owner of a Long Beach trucking company, said he deals with 10 independent owner-operator drivers that haul goods for him. They provide the trucks, and Joe pays for the insurance and supplies them with a steady stream of work orders.

      The cost of hiring those truckers as full-time employees would force Joe to close the business he's worked to build over the last dozen years, he said.

      "I can't afford to hire these guys as employees and offer them benefits and health insurance," said Joe, who asked to go by an assumed name out of fear of retaliation from port officials.

      "A lot of local companies are going to go out business real quick because of this program," he said. "I'm all for cleaner air, but this isn't the way to do it."

      After much soul-searching, Joe said he reluctantly submitted the necessary paperwork recently, along with a $250 fee to the Port of Long Beach and a separate $2,500 fee to the Port of Los Angeles.

      Joe said he intends to stay in business for only another year, allowing enough time for him and his drivers to find jobs elsewhere.

      "We're going to go with the flow and see what happens," Joe said. "I'm just trying to buy us enough time to find something stable."

      Critics of the program said that larger trucking firms will gradually squeeze out smaller companies, like the one owned by Joe. Port officials had said that they hoped to weed out companies that can't keep up.

      "The fees are not out of line to ask from responsible companies wanting to work in the drayage market, no matter how big they are," the Port of L.A.'s Holmes said.

      Last month, the Port of Los Angeles boasted a coup when Swift Transportation and Knight Transportation - two major national carriers based in Phoenix - agreed to sign up for a concession, collectively bringing along 2,000 new trucks meeting 2007 emissions standards.

      The freight haulers are members of the American Trucking Associations, but a lawsuit filed by the agency did not stop Knight and Swift from wanting to do business at the ports.

      "We think that the ATA had raised some legitimate points that need to be heard," said David Berry, a spokesman for Swift Transportation. "But in the final analysis, we decided to sign up because the air needs to be cleaned up and customers have goods that need to be moved."

      A report released earlier this year by the Boston Consulting Group had warned that adopting the employee mandate could lead to a 3 percent loss in business at the Port of Los Angeles. Shipping companies would likely move to the neighboring Port of Long Beach or another West Coast harbor to avoid the high costs associated with the plan.

      Economists had predicted that anticipated growth in cargo volumes would absorb losses and higher wages for drivers. However, both ports have suffered a significant decline in cargo shipments this year as the country's economy continues to falter.

      "At this point, it's too early to sort out the net effects of how this program will play out for the local economy, given the slump we're experiencing," said Nancy D. Sidhu, vice president and senior economist for the Los Angeles Economic Development Corp.

      "The high cost of purchasing clean trucks will lead to higher shipping rates and, to that extent, the shippers might try to find other ways to bring goods into the United States," Sidhu said. "Both ports have a lot at risk with this plan, but there are no hard figures at this point, and it's too hard to tell what the long-term financial impact will be."

      The bleak outlook was not shared by environmentalists, who said that reductions in diesel emissions will lead to healthier lives for those living near the ports and across the region.

      Each year, about 1,200 deaths are attributed to port pollution, according to the California Air Resources Board.

      "Economists and trucking associations made a lot of doomsday predictions that shippers would leave and the industry would collapse, all in the name of clean air, but I don't see that happening," said Melissa Lin Perrella, staff attorney for the National Resources Defense Council, which helped the ports craft the Clean Trucks Program.

      "Truck pollution from the ports is taking people's lives and we needed to find a way to stop it," she said. "I'm relieved to see this finally taking hold on Wednesday."

    Your message has been successfully submitted and would be delivered to recipients shortly.