On Monday, January 14th the L.A. and Long Beach Board of Harbor Commissions are expected to jointly pass an amendment to their tariffs instituting the much anticipated Infrastructure Cargo Fee (ICF). The fee will pay for on-dock rail, road and highway intermodal connector projects and replacement of the Gerald Desmond Bridge - all totaled at roughly $1.4 billion. Revenue generated from the fee will be used to match Prop 1B bond funds approved by the governor last year.

Digest of the Fee

The ICF is initially set at $30 per FEU and will go into force on January 1, 2009 as the first of several projects are completed. When the Gerald Desmond Bridge project is completed (sometime in 2010) the fee will increase to $36 per FEU. The fee will then increase further around in 2012 when the SR-47 Expressway project is completed. According to documents published by the ports, the fee will then sunset around 2024 when all projects are fully funded.

Both Harbor Commissions intend to assess the fee on cargo owners while marine terminal operators are to collect the fee. The ICF will be assessed on loaded import and export containers moving by both rail and truck. Empties are exempt.

Problems with the Fee

No relationship exists between BCO and marine terminal operator.
There exists no business relationship between BCO and marine terminal operator to allow for payment of the ICF. The approved tariff change does not outline payment of the fee from cargo owners moving consolidated shipments.

Containerized BCOs are singled out.
The fee is designed to force cargo owners moving freight through the port to pay for infrastructure projects. However the fee does not apply to beneficial cargo owners moving non-containerzed bulk and project cargo that also use port infrastructure.

The fee unfairly falls on cargo owners moving freight by rail.
Secondly, the fee is assessed on both rail and truck shipments. However, the majority of projects are road and bridge projects. Shippers solely moving intermodal freight would subsidize road and highway projects.

More Information

Click here to read a detailed memo on the ICF
Click here to download a project list
Click here to read an alternative proposal to container fees to fund needed infrastructure
Click here to read about other Clean Truck Fee proposed by the ports of L.A and Long Beach ports
Click here to read about the Clean Air Action Plan proposed by the ports of L.A and Long Beach ports