Bill Mongelluzzo | Aug 04, 2009 3:00PM EDT
Marine terminal operators in Los Angeles-Long Beach will maintain the PierPass traffic mitigation fee at the current level of $50 per TEU despite declining cargo volumes.
"By keeping rates the same, the marine terminal operators continue to lose money on night gate operations, but the goods movement industry retains flexibility and adaptability to weather the economic downturn while preserving and increasing gains on environmental protection and congestion relief," said Bruce Wargo, president of PierPass Inc.
PierPass is the extended gates program that is designed to reduce truck congestion and pollution at the ports of Los Angeles and Long Beach by encouraging more traffic to move during the off-peak hours.
Importers and exporters who ship during the peak daytime hours pay a traffic mitigation fee of $50 per TEU. Revenues are retained by marine terminal operators to cover the additional costs associated with operating night and weekend gates.
Terminal operators say the fees have never been enough to fully cover the increased cost of operating extended gates, and the shortfall has worsened due to declining cargo volumes this past year.
Rather than increasing the fee and causing additional financial hardship for cargo interests, though, terminal operators have attempted to reduce their costs of operation. Earlier this year they eliminated one of the five night and weekend extended gates under PierPass.
This action did not please some truckers who say the full menu of extended gates has helped to reduce congestion and improve the efficiency of their operations in the harbor. Some cargo interests complained that when the terminal operators dropped one extended gate each week, they should have reduced the traffic mitigation fee.
PierPass was established in 2005 when Los Angeles and Long Beach were struggling with congestion at marine terminals and on local freeways. The program has since shifted about 40 percent of the port complex's container volumes to the less congested off-peak hours.
Contact Bill Mongelluzzo at bmongelluzzo@joc.com.