SHIPPERS DECRY PROPOSED PORT SECURITY FEES

SHIPPERS DECRY PROPOSED PORT SECURITY FEES    Shippers could be faced with increased fees to contribute to security costs, if a proposal added to the U.S. port and maritime security bill goes through.
   At a Conference Committee last week, the issue was raised by U.S. Sen. Ernest Hollings, D-S.C. to implement a Port Security Fee to fund port security as Congress debates the bill. Under Hollings’ fee proposal, there would be security fees of $15 per regular TEU, $20 per TEU containing hazardous materials, $4 per vehicle, and up to $1 per metric ton of product depending on the cargo.
   The fee, collected by the U.S. Customs Service, would be deposited in a new port security trust fund. Half of the money would be distributed to ports for security enhancements. The remainder of the funds would be split between discretionary grants to protect maritime assets and shipper security programs, and security programs at the Maritime Administration, the Transportation Security Administration, Customs and the U.S. Coast Guard.
   Peter Gatti, vice president of the National Industrial Transportation League, argued that such fees, while they may be necessary, should be shouldered by all players in transportation, and not just shippers. “Overall, shippers are supportive of efforts to increase security,” Gatti said. But 'such fees would place a burden on a specific segment of the freight transportation industry — the shippers.”
   Gatti said the fees, coupled with the likely mandate for advanced transmission of detailed shipment information as well as the use of electronic seals on containers, could layer more costs onto shippers and industry in general.
Dennis Bryan, senior counsel for Holland & Knight LLP, said Hollings’ proposal may not go any further, but that shippers should be aware of such moves long before they may be written into legislation. “It’s my suspicion that he was just putting up a trial balloon,” he said of Hollings’ proposal. “It’s unclear how far he might go to pursue this. I think industry needs to be very concerned.”