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FMC questions fee hike as LA-LB's PierPass marks 10th birthday

THE chairman of the US Federal Maritime Commission (FMC) Mario Cordero has asked terminal operators to justify a recent increase in PierPass fees, which they claim still do not fully pay for night and Saturday operations.

PierPass Inc is marking the 10-year anniversary of its OffPeak Programme, which established regular night and Saturday work shifts at the port of Los Angeles and port of Long Beach, the American Shipper reported.

While the programme, which was created by terminal operators in the two ports to ease traffic congestion and reduce pollution, is being praised by local officials, Mr Cordero is pressing terminal operators to justify a recently announced increase in PierPass fees.

PierPass said since July 23, 2005, OffPeak has taken 34 million truck trips out of daytime southern California traffic and diverted them to less congested nights and weekends. It said half of the 150,000 weekly truck trips to the two ports occur at night and on Saturdays.

Trucks coming to terminals during the day pay a traffic mitigation fee (TMF) that is then used to subsidise the operation of the 13 terminals at the two ports at night and on Saturday. The fee is not charged during the evening and Saturday off peak hours in order to provide an incentive for truckers to use the terminals at those times.

PierPASS announced at the end of last month a four per cent increase in its TMF, from US$66.50 to $69.17 per TEU, effective August 1. In 2005, when the programme was first implemented, the TMF was $40 per TEU.

"In light of this fee increase, I believe that PierPASS and the 13 terminals at the ports of Los Angeles and Long Beach should justify the continued need for the TMF, as well as the sustainability of annual TMF increases," Mr Cordero said in a statement.

PierPass says OffPeak was created "as a private sector solution to what in 2005 was then a critical public problem: drayage trucks causing severe congestion on the roads, highways and neighbourhoods around the ports, while thousands of idling trucks caught in this traffic every day added to air pollution".

"To avoid dissatisfaction from customers due to increased fees, PierPASS must be more transparent about the cost to operate off-peak shifts and the revenue collected from the TMF," Mr Cordero said.

But the president of PierPass, John Cushing, said there is no plan to sunset the programme. If the TMF was ended, there would be no way to fund the additional cost of night shifts, and he said port truck traffic would once again snarl local roads and freeways.