Lowenthal reintroduces container fee legislation
California state Sen. Alan Lowenthal has reintroduced container fee legislation aimed at making shippers help pay for infrastructure and security upgrades at or near the state’s ports.
The bill, now making its third appearance before the state legislature, was denounced by Peter Friedmann, counsel for the Agriculture Transportation Coalition, in a newsletter sent Tuesday.
'California port user fees have a ripple effect throughout the country, hitting agriculture shipments particularly hard,' Friedmann wrote. 'The (Lowenthal) bill appears to have been drafted with input from carriers and terminal operators. It would allow the terminal operators who operate PierPASS to collect the new port fee. It would generate over half-billion dollars each year. It will cover both exports and imports, it would be paid by the cargo interest and once again, empty containers would be exempted.
'Half the revenue would be spent on projects to promote the movement of intermodal freight, and the other half will be used to fund pollution reduction projects.'
Friedmann said the bill may this year be signed by Gov. Arnold Schwarzenegger, who vetoed the Lowenthal container fee legislation last year after the state legislature approved it.
'This fee spells T-R-O-U-B-L-E,' he wrote. 'Many believe that the PierPASS fee serves as a profit center for the terminal operators. They have never made public the precise revenue they collect and the exact expenditures of the PierPASS fees. In just two and a half years of existence, the PierPASS fee has doubled.'
Friedmann also said the precedent of a California fee could spread throughout the country. A bill to add a $100-per-FEU fee through the ports of Tacoma and Seattle is still alive in Washington.
'It will be incumbent on agriculture throughout the country, and particularly California-based agriculture to start beating the drum loudly and soon,' he wrote. 'The fee will reduce profit margins, and in some cases, render the agriculture export non-competitive oversees. It cannot be passed onto the foreign customer. It may be unconstitutional. We believe exports should be exempted, and certainly agriculture exports should be exempted.
'Large importers may benefit from such a fee and 'intermodal infrastructure' enhancements. And they may be able to absorb the additional costs. But agriculture exports may not benefit equally and likely cannot absorb the cost.'