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American ShipperIntermodal

Trade coalition calls for S. Calif. ports to abandon truck plan model

Trade coalition calls for S. Calif. ports to abandon truck plan model

In the largest salvo of criticism aimed at Southern California harbor commissioners to date, nearly three-dozen state and national trade groups have joined their collective voices to oppose a proposed container fee and a controversial truck re-regulation plan being proposed by the ports of Long Beach and Los Angeles.

   Representing the vast majority of the state's importers and exporters, the trade groups are warning the mayors of Long Beach and Los Angeles that the ports' plans will result in litigation, and are calling on the mayors to pressure the two ports' governing boards to radically alter the $1.8 billion truck plan.

   The letter, dated Oct. 5, also asks Long Beach Mayor Bob Foster and Los Angeles Mayor Antonio Villaraigosa to limit a port-proposed infrastructure container fee to support only port-area projects and devise a fee structure that does not penalize any one segment of the goods movement industry.

   In March the two five-member port commissions jointly announced the truck plan, which seeks to issue access licenses to some port trucking firms and ban the rest. To obtain a license, trucking firms must meet certain port-defined criteria including financial, environmental and labor qualifications. Under the plan, port-licensed truck fleets must meet 2007 model year or newer emission standards or face a terminal access fee. Older trucks, and those not licensed, will be banned from operating in the ports. Funds collected from the access fees, in addition to port and taxpayers funds, will go toward replacing and retrofitting older trucks in the licensed firms' fleets.

   In addition to the environmental components, trucking firms would also face social engineering requirements to be eligible for a port license, including agreeing to hire only employee drivers instead of independent owner-operators.

   Many observers believe the employee-only component — heavily supported by the International Brotherhood of Teamsters and several social justice groups — would lead to the unionization of the drayage drivers, a stated goal of the Teamsters.

   The trade groups' letter, also sent to the ports' 10 commissioners, calls on the two mayors to eliminate the employee-only requirement of the truck plan.

   'This anticompetitive proposal is almost sure to be litigated and, as such, it will not move us closer to cleaner trucks operating in the harbor,' said the Oct. 5 letter. The trade groups suggest the elimination of the social engineering components of the plan and a refocus by the ports on emission standards and mitigation fees.

      'We publicly support tighter emission standards for trucks and believe the private sector can pay for them,' said the letter. 'Indeed, some of the importers represented by the undersigned organizations have already committed privately to move freight using trucks that meet the EPA 2007 standard or higher.'

   The letter is the latest in a string of vocal industry criticisms levied against the two ports over their proposed plans.

   On Monday, the California Trucking Association called on port officials to abandon the current version of the truck re-regulation plan and adopt a new strategy to obtain the clean air goals of the plan.       The Pacific Merchant Shipping Association, the National Industrial Transportation League, and the American Trucking Association have also taken public action against the plan in recent weeks, with the ATA indicating it would sue to stop the plan from being implemented.

   A recent economic impact study of the truck plan, commissioned by the ports, found that in addition to throwing thousands out of work and raising trucking rates by 80 percent, the plan would result in 'a slowly building crisis as lack of drivers and trucks means containers are not delivered on time.'

   During the same period, the ports' delays in voting on the plan have drawn the ire of several former prominent proponents, including the National Resources Defense Council and a group of academic, labor and environmental stakeholders called by the ports as they began to develop the plan.

   Port insiders now say that while the truck plan would be voted on by the boards before the end of the year, implementation — barring legal injunctions — is not likely before next summer.

   The 34 signatories in the Oct. 5 trade group letter also expresses concern about the ports' proposed Infrastructure and Environmental Container Fee, a $26 surcharge on each loaded container moved through the ports. According to the ports, the fee — charged to the end users of the cargo — will be used to support infrastructure development in the ports. However, the trade groups oppose a stipulation in the ports' outline of the fee that would allow more than 60 percent of the funds collected to be used outside of the port in areas as distant as the Inland Empire.

   'The ports do not have the legal authority under state law to collect fees for projects that fall outside their boundaries,' the groups said in the letter, warning the mayors that, 'pursuing these projects in this manner will result in litigation.'

   While not opposed to user fees, the trade groups express concern that the IECF fee will be applied to all loaded container, including those already being charge a fee to move out of the ports along the Alameda Corridor rail expressway.

   Because the majority of the proposed projects to be paid for by the IECF fee are road projects, the groups told the mayors, 'the fee is inherently unfair and would penalize intermodal, on-dock rail users, which would be simply bad policy.'

   In addition to penalizing intermodal rail users, the groups believe the IECF fee would create an entire group of 'free riders' exempt from the fee and able to utilize the projects being funded by those being charged the fee. These free riders, according to the trade groups, include those moving empty containers, those moving bobtail rigs, bulk cargo movers, as well as non-industry civilian vehicles using the roads.

   'Given these deficiencies, the IECF is hardly a user fee,' said the letter. 'Unless restructured, it will be challenged under the Shipping Act and at the Federal Maritime Commission. It may also be challenged on constitutional grounds as a tax on foreign commerce.'

   The groups propose in the letter that the ports should charge users of the Alameda Corridor to pay for port-area rail projects, develop an infrastructure fee that does not include free riders, and develop a fee that is borne equally by all types of cargo and all types of users.

   'Our most sincere hope is to avoid litigation,' concludes the letter, 'and move forward in collaboration with the ports and the cities of Los Angeles and Long Beach to manage the growth in international trade and transportation in a more rational and environmentally sound manner.'

   The letter's signatories are:

   ' Agriculture Transportation Coalition.

   ' American Apparel & Footwear Association.

   ' American Association of Exporters & Importers.

   ' American Import Shippers Association.

   ' California Chamber of Commerce.

   ' California Grocers Association.

   ' California Independent Grocers Association.

   ' California Manufacturers & Technology Association.

   ' California Retailers Association.

   ' Coalition of New England Companies for Trade.

   ' Consumer Electronics Association.

   ' Footwear Distributors and Retailers of America.

   ' Idaho Retailers Association Inc.

   ' Illinois Retail Merchants Association.

   ' Joint Industries Group.

   ' Maryland Retailers Association.

   ' Meat Importers Council of America Inc.

   ' Minnesota Retailers Association.

   ' Missouri Retailers Association.

   ' National Customs Brokers & Freight Forwarders Association of America.

   ' National Foreign Trade Council.

   ' National Retail Federation.

   ' Pacific Coast Council of Customs Brokers & Freight Forwarders.

   ' Retail Industry Leaders Association.

   ' Retail Merchants Association of New Hampshire.

   ' Retail Merchants of Hawaii.

   ' Sporting Goods Manufacturers Association.

   ' The Waterfront Coalition.

   ' Toy Industry Association.

   ' Travel Goods Association.

   ' U.S. Association of Importers of Textiles and Apparel (USA-ITA).

   ' U.S. Council for International Business.

   ' Virginia Retail Merchants Association.

   ' The Wine Institute.

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