Country’s largest shipper organization believes waiving fee would reduce congestion issues.
The nation’s largest group of shippers has asked terminal operators in
the Port of Los Angeles and Port of Long Beach to waive the PierPass
traffic mitigation fee that is used to encourage truckers to pick up and
deliver containers to container terminals after 6 p.m.
And the head of Agriculture Transportation Coalition (AgTC) is
suggesting that the Federal Maritime Commission use its injunction power
to terminate the agreement that allowed terminal companies to create
and run PierPass.
“PierPass can make a positive contribution by temporarily suspending the Traffic Mitigation Fee,” wrote Bruce Carlton, the president and chief executive officer of the National Industrial Transportation League.
“Whereas
the PierPass fee was meant to alleviate highway congestion, under
today’s circumstances, it is having the unintended reverse effect of
adding to the congestion problems currently plaguing shippers. Lifting
the fee now could provide an economic incentive to get truckers out of
long lines in the late afternoon and shifted to the less congested
earlier hours of the day,” Carlton wrote in his letter to Bruce Wargo, PierPass’ chief executive officer, and John Cushing, the company’s president.
“Like you, league members are well aware of the complex interplay of factors that are contributing to the now excessive (and unacceptable) delays in moving containers in and out of these two critically important ports. Significant growth in the U.S. economy, dislocations in the chassis business model, the absence of a concluded contract between the ILWU and PMA, the larger vessels now calling these ports, rail service issues — these matters and more are all elements of the dynamic forces impacting port operations,” Carlton wrote. “Neither PierPass nor the league can alter the effect of those forces, but we believe PierPass can make a positive contribution by temporarily suspending the Traffic Mitigation Fee.”
The Agriculture Transportation Coalition is calling on the Federal Maritime Commission to terminate the agreement that has allowed PierPass and have it taken over by the Port of Los Angeles and Port of Long Beach.
Peter Friedmann, the executive director of AgTC, wrote in a note to members of the press that “PierPass was originally a good idea to address congestion on freeways leading into the Ports of L.A. and Long Beach — charge a fee for containers moving through the gates during the day, to pay for additional labor to operate gates at night, and to encourage trucks to use those night gates.
“Since then, it has become a big part of the problem, a costly burden ($133/FEU) on importers and exporters — agriculture exporters in particular.”
He said the AgTC has been told by the port directors of the two ports that “changes are needed” and that at recent meetings with FMC Chairman Mario Cordero and other commissioners, he and a major agricultural exporter that is a member of his group have asked the FMC to take action. He said AgTC’s proposal is that the “FMC should seek to terminate the agreement which has allowed the terminals to create and run PierPass, by using the injunction process under the Shipping Act.”
Then, he continued, the two ports should start over by taking over PierPass. “If there needs to be a fee, understand that it benefits those who use the day and night gates, so spread the cost around so that all gate moves pay it, including the carriers bringing in their empties,” he said. “Loaded, empty, day or night — the fee would thus be a fraction of what it is now.”
He noted that Bobby Olvera, Jr., president of ILWU Local 13, has called for 24 hour operations.
“We agree and believe that if the ports take over PierPass, that it will finally be transparent, so those who pay the fee can see how every penny is spent. We believe this will result in a lot more night gates,” said Friedmann.
Friedmann complained about what he perceived as a lack of transparency on how the PierPass fees are used and also questioned why there no fee on empties.
“Currently, the fee is only paid by the cargo, not by the carriers. But isn’t a gate move, a gate move? Doesn’t a truck with an empty box take as much room on the freeways as truck with a loaded container?” He also said that “for agriculture, the PierPass fee is not only an unwelcome expense, but can make the difference between an export sale or not. For agriculture, it is often difficult to move at night. U.S. agriculture and forest products exports are low-margin and face relentless competition from other sourcing countries.”
NIT League, AgTC join request for suspension of PierPass Fee
