BCOs hit by Proposed California Container Fee

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BCOs hit by Proposed California Container Fee

Those involved in freight transportation are trying to push regulators away from regulating a $100 per 20-foot container fee at the ports of Los Angeles, Long beach, and Oakland according to recent reporting from joc.com.

If charged, the fee would help eliminate diesel emissions at the terminals. The fee was proposed by the South Coast Air Quality Management District (AQMD) to help decrease the effect of diesel emissions that trucks and cargo-handling equipment produce. The fee is projected to generate as much as $1.1 billion each year.

If implemented, the fee will take effect July 1, 2018. While most attempts at levying container fees have failed, the Pacific Merchant Shipping Association (PMSA) is taking this recent proposal very seriously.

One of the main concerns that the PMSA has regarding container fees on international and domestic commerce is that major legal issues may be presented if the revenue generated is not equal to the benefits that the fee payers receive. Of the revenue generated from this bill, only 10 percent would go back into maritime sources.

Laws regarding container fees were introduced at the federal level in 2008 and 2015, but were turned down by congress. The three container ports located in California handle huge volumes of containers. Last year alone, more than 17 million Twenty-Foot Equivalent Units (TEUs) passed through California ports.

In 2006, Los Angeles and Long Beach established a clean truck program, including a gate fee, which was charged to vehicles who chose not to retire their older trucks. Any trucks conforming to the clean truck guidelines were not charged the fee. They decided to charge a fee to encourage the transition from older trucks that cause pollution to newer cleaner trucks. The current clean truck programs in these areas have banned trucks older than 2007. By doing so, they have encouraged the deployment of trucks that emit less discharge. Over the next 15 years, the ports, as well as the AQMD, hope to transition to strictly electric powered trucks.

The PMSA has agreed to help lead groups in the shipper and container industry to work with the AQMD to make sure that the laws are not passed. The PMSA has a letter drafted stating that the fee’s AQMD has proposed will fund programs that aren’t relevant, and that there has been no examination of the affects that the fees will have on ports as well as the businesses they serve.