L.A. port: Needs ability to regulate trucking

L.A. port: Needs ability to regulate trucking    The Port of Los Angeles and several of its supporters said a change in federal law is needed to give ports a freer hand in regulating local port drayage business to meet air pollution laws.
   'As the largest goods movement complex in the most extreme non-attainment area in the country, the Port of Los Angeles must reduce emissions to continue to grow and survive,' John Holmes, deputy executive director of the Port of Los Angeles, told Congress. 'Solving air pollution is a challenging task. Most seaport container trade is heavily concentrated in only a handful of gateways in the U.S. As such, air pollution is indeed a localized issue. We do not support a 'one-size-fits-all' approach to ports.
   'Federal law should recognize and provide flexibility with respect to the types of measures local entities like ports have at their disposal to address these challenges,' he added.
   Homes made his comments Wednesday as witnesses offered widely differing views on the need for more port trucking regulation before the House Transportation and Infrastructure Committee's Subcommittee on Highways and Transit.

DeFazio

   Rep. Peter A. DeFazio, D-Ore., chairman of the subcommittee, said he found some of the testimony submitted to the committee 'disturbing and quite contradictory.'
   The neighboring California ports of Los Angeles and Long Beach were lauded by congressmen for the success they have had with clean truck program launched in 2008, with Los Angeles reducing port truck emissions by 70 percent and Long Beach by 80 percent.
   But Rep. John Duncan, R-Tenn., ranking member the committee, said he was concerned about Los Angeles's desire to require trucking firms serving the port regularly to use employee drivers rather than independent owner-operators.
   The requirement, which would be part of a concession agreement that Holmes likened to taxi licenses to operate at airports, has been enjoined by the 9th Circuit U.S. Court of Appeals after the American Trucking Associations filed a lawsuit against the two ports. A District Court is considering whether the ban should be made permanent.
   Chris Lytle, deputy executive director of the Port of Long Beach, noted his port has reached a settlement with the ATA and is allowing licensed motor carriers at the port to use either employee drivers or independent contractors.
   'For fear that this litigation may not go in their favor, some have asked Congress to change this federal law and allow the ports to regulate the trucking industry and require employee drivers,' Duncan said. About 80 percent of the 800 trucking companies calling Los Angeles are small businesses with fewer than 50 trucks, he added.
   'History has shown, throughout many different industries, that when an industry is heavily regulated, small businesses are forced out and we are left with only a few large companies dominating the market. This reduces competition, hurts small businesses, and results in higher prices,' Duncan said.
   'Because both ports have been very successful to date, this drastic step toward reregulating the trucking industry is a solution in search of a problem. It's fixing something that isn't broken,' he added.
   The hearing came a week after Rep. Jerrold Nadler, D-N.Y., and 78 other members of Congress called for federal legislation to allow major container ports to implement stronger environmental standards on trucks. Nadler said he planned to introduce such legislation in the coming weeks.

Oberstar

   At Wednesday's hearing Rep. James Oberstar, D-Minn., the powerful chairman of the committee, said it was 'not clear whether the pre-emption provisions of federal motor carrier law protect the rights of a state or local government to pursue policies to address environmental concerns.
   'As long as a standard or requirement can be construed to affect the price, route or service of a motor carrier, it could be subject to legal challenge. Such a challenge could undermine the progress that has been made in cleaning up the air in Los Angeles and Long Beach to date,' he added.
   Fredrick Johring, owner of Golden State Express and a founding member of the Clean Truck Coalition, an association of 10 family-owned trucking firms in the San Pedro Bay area, said his group opposed proposals to amend the Federal Aviation Administration Authorization Act to allow reregulation of port trucking, saying it would give port officials the power to 'adopt new regulations that serve local political interests.'
   Such local regulation of trucking could result in some shippers diverting cargo to 'less regulated, business friendly seaports,' he said.
   In comments submitted to the committee, the Retail Industry Leaders Association said a ban on owner-operators could jeopardize “the efficiency and productivity of the retail supply chain,” reduce the number of drivers and “could increase the transportation costs of our member companies, and these costs could translate to higher prices for products in stores.”
   RILA also complained allowing state and local entities to regulate trucking “could create chaos for interstate commerce ' A truck operating legally in one city or state might be forbidden in the next, which would cause a serious disruption to the flow of interstate commerce.”
   Robert Digges, vice president and chief counsel of the American Trucking Associations, told the subcommittee that while it is suing Los Angeles over the port's concession plan, its aim 'is not to block or hinder implementation of the truck retirement-clean air portions of these programs. What we are opposing is the use of a concession contract wherein the port grants to itself the sole discretion of selecting which otherwise federally qualified motor carriers can participate in port transportation services.
   'And, within the Port of Los Angeles concession contract requirements, we are opposing the fact that motor carriers that are selected by the port must adhere to specific employee mandates, off-street parking, financial disclosure and maintenance plan requirements that we believe are unnecessary, anticompetitive and illegal.'
   Melissa Lin Perrella, a staff attorney for the Natural Resources Defense Council, noted, 'the Port of Los Angeles has invested tens of millions of dollars to modernize the port truck fleet,' but 'it does not intend to subsidize the industry in perpetuity. The purpose of the concession model was to gradually and permanently shift the costs of environmental cleanup onto licensed motor carriers so that when newer trucks are needed, e.g., 10 years from now, the Port of Los Angeles can impose the requirement without future monetary investment.'
   James Jack, executive director of the Coalition for Responsible Transportation, a group that includes shippers and trucking companies, said his group has created a financial model where beneficial cargo owners 'agree to pay an increased rate to their trucking company to support the purchase of clean trucks that will move their cargo.'
   But Fred Potter, director of the Teamsters port division, told the panel that rather than investing in equipment, the trucking industry is making 'leasing or owning a truck a condition of employment, thereby shifting the burden of capital investment to individual workers.
   'This system is wrong. As ports have tried to clean up emissions, the phony independent contractor system is putting U.S. taxpayers in the bizarre position of subsidizing the trucking industry and its global multibillion-dollar clients,' he said, pointing to some retailers that Jack said are members of the coalition.
   Potter said trucking companies 'force their low-wage workforce to bear all the costs and risks of trucking operations.'
   Joe Rajkovacz, director of regulatory affairs for the Owner-Operator Independent Drivers Association, also complained that drayage motor carriers widely ignore federal leasing regulations.
   'In port drayage, motor carriers regularly ignore federal authority and demand owner-operators sign leases with them that flagrantly violate' the Federal Motor Carrier Safety Regulations that govern leases, he said.
   He also said the clean truck programs at Los Angeles and Long Beach have 'opened the door for rampant abuses of drivers through lease purchasing or essentially renting to own the new trucks,' where the worker has little chance of successfully fulfilling his debts or obligations and ownership remains intangible. Lease purchasing schemes by motor carriers are unregulated and make the much maligned payday loan industry look like and honest business practice in comparison.' ' Chris Dupin