L.A. ports impose 'clean truck' fee
New program raises costs, restricts access
By Larry Thomas -- Furniture Today, October 6, 2008
HIGH POINT — HIGH POINT – A controversial program aimed at cleaning the polluted air around the ports of Los Angeles and Long Beach, Calif. — which receive far more furniture imports than any other North American ports — is likely to raise costs for everyone in the supply chain, logistics experts agree.
The program, which took effect Oct. 1, requires a $70 “clean truck” fee on each 40-foot container that is hauled out of the ports by trucks that do not meet strict 2007 emissions standards for diesel-powered vehicles.
It also bans any truck built before 1989 from entering the ports at all because the vehicles cannot be retrofitted to meet the standards.
By 2012, all trucks not meeting the 2007 standards will be banned, with “clean truck” fees being pooled to provide loans or grants for trucking companies to replace their older vehicles.
“The net result is very simple — higher trucking costs,” said David Bennett, vice president for sales and business development at logistics provider Globe Express Services, which has numerous furniture industry clients. “This is just another charge that has to be passed on to the end user.”
Bennett and others are quick to point out they're in favor of cleaning up the air around the ports, but they believe truckers are being unfairly burdened since there are many other sources of air pollution, notably the cargo ships themselves.
Not only are most trucks entering the two ports subject to the fee (which is being collected by marine terminal operators), trucking companies must now sign a concessionaire's contract in order to operate on port property.
The concession agreement requires, among other things, that truck companies submit a maintenance plan for their vehicles, install a radio frequency identification device (RFID) in each truck, register each driver and vehicle in the port's drayage truck registry, and provide various types of insurance for drivers.
While the regulations may seem minor, they represent a significant burden to small trucking companies that operate a majority of the 16,000 trucks that work at the port, said Gary Kendle, senior transportation manager of Performance Team, the West Coast logistics partner of Global Link Logistics.
“They're picking on the little guy. It's easier to go after them than one of the larger carriers,” said Kendle, whose company has about 70 trucks operating at the ports.
But what really rankles Kendle, Bennett and many other logistics executives is a requirement by the Los Angeles port that all drivers must be employees of the trucking company by Dec. 31, 2013. No independent contractors or owner operators will be allowed to enter the port after that date.
They see that provision as a thinly-veiled effort to make it easier for the International Brotherhood of Teamsters to organize drivers.
“Basically, they want to limit access to just a few large companies so the Teamsters can go in and organize them,” said Clayton Boyce, vice president of public affairs for the American Trucking Assn., a trade group for trucking companies.
And although the Long Beach port's concession agreement would allow independent contractors and owner-operators, Boyce said the Los Angeles provision effectively bans them from Long Beach because the two ports are adjacent and truckers routinely pick up containers at both ports.
In July, the ATA filed suit in federal court to stop the clean trucks program from being implemented, alleging that the two ports overstepped their jurisdiction by imposing a number of regulations that have nothing to do with the environment or public safety.
“This amounts to re-regulation of the trucking industry, and that's illegal,” Boyce said.
After several weeks of legal wrangling and a flurry of filings by both sides, U.S. District Court Judge Sandra Snyder denied ATA's request for a temporary injunction on Sept. 9. Port officials almost immediately declared victory, but Boyce said ATA has filed an appeal with the Ninth Circuit Court of Appeals and hasn't given up hope of getting the program stopped.
“We support the replacement of the old trucks, and the funding mechanism,” he said. “But it's our position that they can't regulate who can and can't drive the trucks.”
Port officials, on the other hand, are proceeding full speed ahead with what they call a “landmark environmental program.”
“A concession-based trucking system is central to the sustainability of the 'clean truck' program and critical in our efforts to aggressively clean the air and operate a safe, secure port,” said Geraldine Knatz, executive director of the Los Angeles port.
For his part, Kendle said Performance Team has reluctantly signed concession agreements with the two ports, while Bennett said Globe Express and its trucking partners are debating whether is might be more cost-effective to replace older trucks now, even with the $100,000-plus price tag for each new vehicle.
“Companies that buy trucks that meet the new (emissions) standards will raise rates,” Bennett said. “I don't see how it can be avoided.”
