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Truck Fee Faces Further Challenges at West Coast Ports

Clean Trucks Progam brings controversy and uncertainty.

The twin ports of Los Angeles and Long Beach, the nation’s largest and the main entry point for goods from Asia, are facing another challenge to the implementation of their Clean Trucks Program.

This story first appeared in the December 23, 2008 issue of WWD.  Subscribe Today.

The Federal Maritime Commission is seeking more information from the ports about how plans to collect a $35 fee per 20-foot container would affect competitiveness, transportation costs and services. As a result of the panel’s request, the ports cannot begin collecting the additional fee until 45 days after they have submitted the information and documents.

“Given the significant changes in the nation’s economic situation, the commission must continue to fulfill its statutory obligations to ensure that the agreement will not unreasonably reduce competition in the Ports of Los Angeles and Long Beach,” the federal panel said. “Such reduction would raise prices at a time when the American consumer can least afford any added costs and at a time when independent owner operators can least afford to be driven out of the port.”

The Clean Trucks Program seeks to lower air pollution 80 percent by 2012. On Oct. 1, all truck models older than 1988 were barred from the port complex. Truck models manufactured between 1989 and 1993 and models from 1994 to 2003 that haven’t been retrofitted will be banned as of Jan. 1. The ports are counting on the container fee program to raise about $1 million a day, or as much as $1 billion over the next several years, to finance the replacement of 17,000 trucks.

Ports officials denounced the commission’s request for answers to 20 questions on the fee program, calling it a stall tactic and noting that the ports had already responded to a previous set of questions. It is the second 45-day waiting period triggered by the commission.

“This truck financing fee is a critical, long-planned part of our Clean Trucks Program to protect the public health and improve air quality and security,” said Richard Steinke, executive director of the Port of Long Beach.

Geraldine Knatz, executive director of the Port of Los Angeles, said, “This ruling by just two of three FMC commissioners — made again behind closed doors — is a misuse of the FMC’s administrative process to stop the implementation of our Clean Trucks Program. The FMC is attempting to take the decision regarding their legal challenges away from the courts by administratively imposing what is, in effect, it’s own injunction to stop our Clean Trucks Program.

“Despite providing extensive information to the FMC and requesting that they provide a specific analysis of their concerns about our program, our efforts have not been reciprocated constructively by the FMC, which seems to prefer litigation to communication,” Knatz said.

The commission filed a federal lawsuit on Oct. 31 challenging portions of the program. U.S. District Court Judge Richard J. Leon has said he will rule on whether to grant the federal panel’s request for a preliminary injunction in 2009.

Knatz said the commission has consistently waited until the end of the 45-day review periods to ask for information. She also noted that only three commissioners are serving on what is supposed to be a five-member board.

The ports expect to respond to the questions within several days.

“With the current credit crisis, it will be impossible for truckers to replace all their trucks without our financial assistance program,” Steinke said. “Every day’s delay will make it harder for truck owners to meet our deadlines.”