The Long Beach Board of Harbor Commissioners voted today to postpone the collection of a container fee that will be used to pay for construction and improvements to local highways and railroads, including the aging Gerald Desmond Bridge. The decision will be revisited in six months.
Staff recommended the decision to the Board because the projects slated under the proposed Infrastructure Cargo Fee (ICF) were not close enough to being ready for construction. Despite reports from some publications that the decision was due to the poor economy, Managing Director of Environmental Affairs and Planning Bob Kanter says that the opposite is true.
“The primary driver of this decision was the readiness of the projects,” he said this afternoon, calling the postponement and the poor economy a “lucky coincidence.”
The “tariff,” as Kanter called it, would be assessed on every container brought into the Port at a fee of $15. The price would be expected to fluctuate between $10 and $18 over the years, until the projects are completed. At that point, the ICF would be removed.
“Importers and exporters are the ones that would be paying that fee, so right now is not the best time to start collecting. It just doesn’t make a lot of sense,” he said. “But the economy was definitely not the driver [of the postponement].”
Kanter says that five highway projects and one rail project are planned once the fees are ready. The postponement could be a blow to the Port’s plans to implement a greater use of the local rail system, which would benefit substantially from an influx of funds generated by the ICF. In addition to using cleaner trucks, the Port has expressed a desire to utilize rail in order to cut down on pollution.
Mainly, the use of “on-dock rails” would be expanded. On-dock rails refer to systems that allow cargo to be placed on rail directly from container ships, providing much easier access.
“It’s an important time to get projects going that will generate jobs, particularly in construction,” Kanter said.
More than $1 billion is expected to be generated from the ICF, and the state must match that total under Proposition 1B. In total, the ICF is expected to bring in near $3 billion for infrastructure improvements. The Harbor Board of Commissioners will revisit the decision in six months.
By Ryan ZumMallen, Managing Editor
Disclosure: The Port of Long Beach is an advertiser of the lbpost.com.