The continued existence of the New York Container Terminal, long the most productive terminal in New York harbor, is mired in negotiations with the Port Authority of New York and New Jersey.
The negotiations are over the amount of the rebate that the port agency will pay under an agreement it reached with NYCT last September to offset the increase in truck tolls over the Goethals Bridge from New Jersey to NYCT on Staten Island.
The port authority increased truck tolls in September 2011 to $12 per axle, or $15 per axle for trucks that are not equipped with E-ZPass. The increase has severely cut into the terminal’s volume and revenue.
NYCT has lost four container services and stands to lose a fifth this year. Its volume has dropped from 518,000 container lifts per year in 2010 to under 150,000 at present.
“We are on the threshold of losing those unless something is done,” said Staten Island Borough President Jim Molinaro. “There’s a responsibility on the part of the port authority and the city, too, should be involved, because if we lose the terminal, that’s 500 lost jobs and a payroll of $540 million and it hurts the city’s economy too.”
Under the agreement that New York Gov. Andrew Cuomo forged between the port authority and NYCT last September, the port authority agreed to rebate some of the toll increase to trucks hauling containers to and from the terminal. NYCT has invested $1.2 million to install E-ZPass readers that will track the trucks coming in and out of the terminal and transmit the information to the port authority, so it can provide the rebate, once it is agreed upon.
The terminal is currently conducting a test of the system with three trucking companies, according to one New Jersey trucking executive who asked not to be identified because the rebate negotiations are confidential.
“The port authority is highly committed to delivering real toll relief for the truckers who access New York Container Terminal in Staten Island,” the agency said in a statement prepared in response to a request for comment by The Journal of Commerce.
“The toll relief provided by the port authority as part of the new lease agreement will allow NYCT and its owner, the Ontario Teachers’ Pension Plan, to grow the terminal and create jobs on Staten Island over the life of the agreement,” the statement said.
The port authority last September agreed to pay a rebate that would bring the toll to $8 per axle for trucks coming in and out of the terminal, Jim Devine, CEO of Global Terminals, said at the time. Devine declined to comment on the ongoing negotiations.
The increase in truck tolls has hurt business on Staten Island outside the terminal. “Take the terminal’s payroll and multiply that by seven, and that’s the impact it has on other business, in terms of job creation, food concessions, gasoline sales,” Molinaro said.
The increase in truck tolls has also forced several companies to quit Staten Island for New Jersey. “I lost RPM Trucking, which moved to New Jersey with 130 trailers, and Colavita olive oil, which moved to New Jersey because it was costing them too much money,” Molinaro said. “It’s ridiculous to lose that.”
More broadly, he said, “[w]hen a truck goes across that bridge, it doesn’t matter whether it goes to the terminal or not. If it goes to the grocery store with a can of peas, that can of peas costs another nickel. Someone has to pay that.”