New Jersey Gov. Chris Christie signed a bill to eliminate a cargo facility charge that is being challenged before the Federal Maritime Commission. New York also must approve repeal legislation before it takes effect.
Both houses of the New Jersey legislature voted unanimously for the legislation, S2747/A4150. New York Sen. Michael Ranzenhofer introduced S6156 on Jan. 8, and that bill was referred to the Senate Transportation Committee.
The cargo facility charge is assessed on cargo loaded on or discharged from vessels. The charge is $4.95 per TEU for containers, $1.11 per vehicle, or 13 cents per metric ton for bulk or heavy-lift cargoes.
The charge is designed to cover costs of road and rail projects and post-9/11 security improvements. It replaced an intermodal rail lift fee of $57.50 per container and a volume-based Sea-Link truck registration fee of $2,500 to $10,500 per quarter.
“This legislation goes a long way in ensuring that the Port of New York & New Jersey remains competitive with ports across the country,” said Doug Morgante, director of state government relations at Maersk Line. “We are grateful that Governor Christie recognized how critical removing this onerous fee is to the vitality of the maritime industry.”
Maersk said the fee costs Maersk about $3.5 million a year. Carriers have said competition prevents them from passing the cost to customers.
New York-New Jersey imposed the charge to recoup infrastructure and security costs, and to encourage use of the port’s ExpressRail intermodal terminals. Port officials said they expected the charge to generate $26 million a year.
Nine container ship lines asked the FMC to declare the CFC illegal on grounds it discriminates among carriers by requiring all of them to pay for facilities, such as ExpressRail, that some may not use, and that it requires terminals to refuse service to carriers that didn’t pay the fee.
During the last two years, all of the carriers but “K” Line have dropped out of the case, which has been bogged down by disputes over voluminous requests for legal discovery of information.
“K” Line last month asked FMC Administrative Law Judge Erin M. Wirth to halt the discovery process and dismiss the complaint on its merits, so that the issue can be decided by the full FMC.
“K” Line contends the fee is an illegal tax on cargo that “if left in place will spawn copycat taxes by other ports.”