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Container Fee Funding Extended Gate Times at LA Ports to be Increased

Friday, July 07, 2017
Sandler, Travis & Rosenberg Trade Report

A fee imposed on cargo containers to fund extended gate times at the ports of Los Angeles and Long Beach will go up 2.3 percent Aug. 1 to $72.09 per twenty-foot unit or $144.18 per 40-foot container.

The PierPASS traffic mitigation fee is assessed on loaded containers entering or exiting any of the 13 international container terminals at these ports during peak hours (Monday through Friday, 3:00 a.m. to 6:00 p.m.). The TMF is intended as an incentive to move goods during off-peak hours to address issues such as congestion, security, and air quality, and TMF revenues are used to fund the operation of off-peak gate openings.

PierPASS and the TMF have come under increasing scrutiny in recent years. In 2015 former Federal Maritime Commission Chairman Mario Cordero called on PierPASS and participating terminals to justify the continued need for the TMF as well as the sustainability of annual TMF increases. A subsequent third-party analysis validated the methodology used to calculate the costs of the off-peak gate openings and determined that these costs are not fully offset by the TMF. In 2016 California Assembly member Patrick O’Donnell introduced legislation aimed at overhauling the PierPASS program, which he called “an outdated relic” that has failed to modernize the gate system at these ports and left trucks continuing to experience long delays waiting to pick up and drop off cargo.

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