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Thursday, April 22, 2010

LA Port Wins FMC Green Award for Truck Program

One day after the start of a legal case that may determine the fate of the Port of Los Angeles' Clean Truck Program, the United States Federal Maritime Commission announced that the port had been named the recipient of the inaugural FMC Chairman's Earth Day Award for the same program.

FMC Chairman Richard Lidinsky, Jr. cited the port's "innovation and environmental leadership" in the development and implementation of the truck program. Lidinsky noted that since the truck program was first implemented in October 2008, port monitoring has recorded a 70 percent drop in truck emissions, eliminating more than 30 tons of pollutants from the skies annually.

The port was selected on the basis of the following criteria: innovation in design of sustainability-enhancing incentives, measurement, and accountability; effectiveness in increasing sustainability, efficiency, and reducing environmental impacts; and anticipated creation of green jobs through efficient ocean commerce that grows in a sustainable manner.

"Los Angeles Mayor Antonio Villaraigosa, Port Executive Director Geraldine Knatz and their team have shown real leadership in developing a Clean Truck program that, as the centerpiece of the Port's Clean Air Action Plan, combines incentives with accountability to make our nation's busiest liner shipping port complex more sustainable," said Lidinsky.

Lidinsky also noted that the port has promoted the provision of dock-side Alternative Maritime Power, or “cold-ironing,” for both cargo and passenger vessels; electric and alternative fuel drayage vehicles through demonstration projects; the first hybrid tug in operation in the United States; wildlife habitat promotion and restoration; and water quality and conservation measures.

The American Trucking Associations are currently suing the port over certain non-environmental aspects of the truck program that are currently under injunction by a District Court order. Ironically, in 2007 the FMC also sought to halt the Los Angeles truck program in court, though later dropped the case after the ATA won its injunctions.

PacNW Port Volumes: Seattle Rockets Upward, Tacoma Maintains Freefall

The two major Pacific Northwest container ports continued to move in opposite direction in March, with Seattle total box volume spiking upward nearly 40 percent and Tacoma total box volume declining just more than 11 percent for the month.

Seattle port officials said that 154,081 TEUs were handled at the port in March, a 39.4 percent increase compared to the year-ago period. Total loaded inbound box volume for March was up 31.6 percent to 55,716 TEUs and loaded outbound box volume ended the month up 34.8 percent at 43,679 TEUs, both compared to March 2009.

The nearby Port of Tacoma continued its container volume freefall, ending March at 39,063 TEUs, an 11.4 percent decline than March 2009. Total loaded inbound box volume for the month dipped 4.6 percent to 39,063 TEUs as total loaded outbound box volume dipped 29 percent to 32,030 TEUs, both compared to the same period last year.

The Port of Tacoma has not reported a month-to-month box volume increase in more than 27 months.

Report: Prince Rupert Port Generating Nearly $800M For Canadian Economy

The burgeoning Port of Prince Rupert is contributing $280 million a year to the Canadian gross domestic product and another $500 million a year to the economic output of regional and provincial economies, according to an new economic impact study commissioned by the port.

The study, conducted by InterVISTAS Consulting, Inc., also found that the port is contributing to the generation of more than 2,700 full-time jobs and pumping $150 million in annual wages into the regional economies located along the port's transportation corridor. The 2,720 full time jobs include: 1,300 in direct employment attributed to port-related operations such as the terminals; 740 indirect jobs involving supplier businesses providing services, like vessel repairs, to port operations; and 680 induced jobs providing services, such as home construction and retail, to workers employed directly and indirectly at port operations.

The port, located on British Columbia's northern Pacific Coast, opened it first container terminal in September 2007. Last year, container traffic at the port's Fairview Terminal increased 45.9 per cent to more than 260,000 TEUs.

“The economic impact study confirms that the Port of Prince Rupert is a growing economic force in Western Canada and has tremendous opportunity to contribute to significant prosperity over the next decade,” said Prince Rupert Port Authority President and CEO Don Krusel.

The study also found that the port is creating substantial revenues for all levels of Canadian government, totaling $35 million in taxes annually, including $22 million in federal taxes, $9 million to the Province of British Columbia and $4 million in municipal taxes.

“As a result of our strategic advantages and the hard work and commitment of our many partners to be a globally competitive gateway for international trade, we are experiencing impressive year-over-year growth of our container business since opening in 2007," said Krusel. "We are also seeing economic growth along the entire northwest transportation corridor, including a continued and significant increase in exports from northern British Columbia, because the new container terminal has created a more efficient access to global markets.”

Keeping Up with Other Ports

By Bill Bryant April 2010 

The future of Puget Sound ports and the tens of thousands of jobs they generate in King and Pierce counties depend on Seattle and Tacoma moving freight to the Mid West more efficiently than our competitors.

Those competitors include the ports of British Columbia and, after 2014, when the Panama Canal expands, also Houston, Charleston and Savannah.

Canada understands the connection between jobs and the efficient movement of cargo to the American mid-west. Just two months ago, the Port of Vancouver launched a $392M project that adds 49 acres and increases its capacity. The Port of Prince Rupert, with significant government assistance, is expanding its capacity and by some accounts aspires to move as much cargo as Seattle and Tacoma combined prior to the recession.

Most importantly, with significant federal funds and integrated transportation decision-making, Canada is building a freight corridor from BC directly to Chicago and St. Louis. Canada’s freight corridor is a competitive threat to Puget Sound’s ports. 

nd it’s not just Canada. The governor of Georgia just announced a project to move trucks more efficiently, and the Heartland Corridor that opens this year will shave off a day between the East Coast and the Midwest.

There is no need to hit an alarm bell, but we need to act. The Port of Seattle is.

We rejected new fees to pay for our clean air program.

Third parties determined moving cargo to the Midwest through Puget Sound is the most carbon sensitive route from Asia, and we are talking with shippers about that, and it matters to them.

We have joint marketing efforts with the Port of Tacoma to bring cargo into Puget Sound, and Port of Seattle CEO Tay Yoshitani has pulled together the directors of all the other US West Coast ports to collaboratively address common competitive issues.

Over the last ten years, the Port of Seattle spent $45M helping build overpasses and roads important to freight movement, and over the last 15 years, Seattle and Tacoma combined have spent nearly a billion dollars transforming aging port facilities into competitive 21st century terminals.

As a result of these initiatives and capital projects, within port gates, we can increase the volume of marine cargo we move, but as a state, outside port gates, Washington has underinvested in our freight infrastructure, and that could undermine future competitiveness.

To correct this we need to transform how we prioritize and fund transportation projects. The Canadian transport minister recently quipped that one advantage Canada has over the US is that Canadians consider transportation projects strategic investments, and, he said, Americans consider them pork.

He was right. We spread transportation dollars around, rather than focusing on those projects that will generate the most private sector jobs and move the most cargo and people.

Our approach is political, but it is not smart. Some mayors have told me it is easier – not easy, but easier – for them to get funds to build a new transportation project than it is get funds to maintain existing truck routes, even though we have $90M in deferred maintenance for deteriorating truck routes in South King and North Pierce counties. This reveals that our system for setting priorities is broken.

How we fund transportation also needs to be transformed. The fact that the port has spent $45M over the past ten years on roads and overpasses, or that the port needs to contribute hundreds of millions of dollars to build a state highway, reveals our system for funding transportation is broken.

The fact that projects that should be funded by the gas tax are being pushed onto local property owners indirectly through ports reveals our system is broken. 

So what do we do?

First, we consolidate decision-making authority on transportation priorities.

Second, we build the projects needed for our corridor. That means finishing highways 509 & 167; maintaining truck routes in and out of distribution centers in South King and North Pierce counties; eliminating rail bottlenecks in Southwest Washington; improving Stampede Pass rail tunnels and building rail overpasses in Kennewick and Yakima.

Third, we support new funding mechanisms such as tolling and public-private sector partnerships.

Fourth, we get going.

Not everyone appreciates the urgency. Earlier this year I was talking with a legislator about finishing highways 509 and 167, and he told me he didn’t think the state could work on those projects for a few more years.

That’s not acceptable.

Canada and Houston and Georgia are not going to politely wait for us to get our act together. If our state government’s governance and financing mechanisms cannot fund the projects we need to nurture our competitiveness and protect our jobs, we should transform our state’s transportation governance and financing. 

Make no mistake, transforming transportation governance and financing will take courage and political will. Legislators will fight to keep control over where transportation dollars are spent. Constituencies will rise up to oppose new construction. Some will oppose private sector involvement in public infrastructure. The dozens of agencies involved in transportation will fight to defend their turf. 

But it is not as if we have much choice. If our jobs and competitiveness depend upon transforming transportation governance and financing, we need to elect leaders who have the courage and political will to do it.

Bill Bryant is chairman of Bryant Christie Inc., and president of the Seattle Port Commission.
The views presented here are entirely his own.  

Tuesday, April 20, 2010

Bellingham Shipyard, Others, Benefit from MARAD Grants

The Fairhaven Shipyard located at the Washington state Port of Bellingham has been awarded $1.3 million in federal grant money that is scheduled to be used to improve the yard's floating drydock.

Fairhaven, owned by Puglia Engineering, plans to use the funds to outfit the firm's Faithful Servant drydock with an 80-ton crane and coating equipment, according to the firm's grant request.

The Fairhaven award is part of $14.7 million in grant awards announced Monday by the US Department of Transportation’s Maritime Administration to help improve 17 small shipyards in 16 states.

“These grants will help modernize small shipyards and strengthen our economy by making sure we maintain the ability to build and repair ships in the United States,” said US Transportation Secretary Ray LaHood in announcing the awards.

Other West Coast ports benefiting from the grants include: Kapolei, Hawaii where ship maintenance and repair firm Marisco, Ltd. was awarded just over $1 million for cranes, forklifts, welding machines, compressors and dust collector equipment; Coos Bay, Oregon where Sause Bros. subsidiary tug and barge shipbuilder Southern Oregon Marine, Inc. was awarded $173,749 for a water blast system, sandblasting equipment and big top shelter; and, Seattle, Washington, where Pacific Fishermen Shipyard and Electric LLC was awarded $643,095 for a worker training program, sand blast and paint booths, sand blast grit recovery systems, man lifts and a 15-ton crane.

“Small shipyards are an important part of our nation’s shipbuilding industry,” said David Matsuda, Acting Maritime Administration Administrator. “Shipyards on both coasts, the Great Lakes and our inland waterways will be able to increase productivity and be more competitive as a result of these grants.”

The grants, part of the Assistance to Small Shipyards program, were available to shipyards around the country that provide essential services to commercial and government ships. MARAD received over 160 grant applications requesting $180 million in assistance.

ATA vs. Los Angeles Port Clean Truck Plan Heads to Court

Testimony begins Tuesday before a United States District Court judge in Los Angeles in the American Trucking Association’s lawsuit challenging an access license component of the Port of Los Angeles Clean Truck Program.

The court proceedings before District Court Judge Christina Snyder, which are expected to last at least through the end of this week, are likely to focus on the issue of federal preemption – whether local entities such as the port can create and enforce regulations that supersede federal regulations.

The case centers around the port truck scheme that took effect in October 2008 requiring port-servicing drayage firms to sign so-called concession agreements to gain access to port terminals. Firms without such an access license are barred from entering port facilities. The plan was originally conceived by the port as a means to bar older polluting trucks and force drayage firms to use newer and cleaner burning vehicles, thereby cutting port-generated diesel emissions.

To obtain an access license, drayage firms must agree to a long list of port-defined criteria contained in the concession agreements. These include financial, maintenance, insurance, safety, parking and labor criteria.

Shortly before the port program began implementation, the ATA filed suit against the port claiming, among other things, that the concession agreements violated federal interstate commerce laws. The ATA, which did not oppose the environmental aspects of the truck plan – such as progressive bans on older model year trucks – also sought an injunction against the concession agreements.

After an appeal to the Ninth Circuit Court of Appeals, Judge Snyder issued an injunction against certain criteria contained within the concession agreements, while allowing the port to implement other aspects such as requiring drivers to have federal transportation worker identification.

These injuncted criteria included a contentious requirement that drayage firms must phase out per-load independent owner-operators in favor of per-hour employee drivers by 2013. At the start of the truck program, more than 80 percent of the drayage fleet drivers were independent owner-operators.

The ATA argues that local entities such as the port are prevented by federal deregulation legislation from passing regulations that affect "routes, rates and services" of interstate trucking. Under federal law, the ATA argues, these local regulations are pre-empted by federal interstate commerce laws. Previous court cases have determined that containers, regardless of destination, fall within the bounds of interstate commerce.

The ports have argued that safety and security exemptions provided for within the federal pre-emption language allow the ports to set regulations determining who can and cannot enter the ports.

Since the truck program began, two bans on certain model year trucks have been imposed, with only 2003 or newer model year trucks now able to enter the port. A final ban set to take effect at the end of this year will ban all but 2007 and newer trucks from the port.

Spurred by the bans, the trucking industry and local drivers have put more than 6,000 cleaner-burning 2007 or newer model year trucks into the local drayage fleet. According to port emission monitoring, port-generated diesel emissions have been cut by 70 percent since 2006, which is used as a baseline by the port for air quality.

Supporters of the truck scheme's employee mandate, including the International Brotherhood of Teamsters which originally proposed the employee-only mandate to the port, also argue that only per-hour employee drivers can afford to maintain the newer trucks – which cost more than $100,000 and can require thousands of dollars per year to maintain. The employee-only mandate would also allow the Teamsters to fulfill a decades-old national goal of unionizing port drivers. Independent owner-operators are currently prohibited from unionizing under federal law.

Once deliberations are complete in the current case, District Court Judge Christina Snyder could rule immediately or take the matter under consideration and issue a ruling some time in the future. She could ban the concession agreement scheme in its entirety, rule that concession agreements are legal, or rule, as in the injunction case, that only portions of the concession agreements are illegal.

Regardless of the outcome, the case is certain to set a precedent that will be utilized at other ports around the nation, either as a guide to implement identical plans to Los Angeles' or to offer guideposts on how to implement a truck program without facing litigation from the trucking industry.

Long Beach Port Volumes Continue Rise, Los Angeles Totals Up But Imports Slide

The three month cargo volume rally that began at the Port of Long Beach in December continued in March, lending further credence to analysts predicting the increases are the first signs of a general long-term cargo recovery. Strong gains in total box volume and total export volumes were reported at both the Long Beach and Los Angeles ports in March, though import box volumes at Los Angeles returned to the negative column after jumping into the positive during February for the first time in over a year.

The Port of Long Beach handled 422,774 TEUs in March, a 13 percent increase over March 2009. Total loaded outbound box volume also increased, moving up 10.9 percent to 130,495 TEUs for the month compared to the year-ago period. Total loaded outbound boxes also increased a similar amount, up 10.8 percent for March to 206,652 TEUs compared to the same period last year.

For the first three months of the year, the port is up 13 percent in total box volume compared to the January to March period in 2009.

Officials across the bay at the Port of Los Angeles reported that 550,250 TEUs moved across the port's wharves in March, an increase of 4.5 percent over the same period last year. Total loaded outbound box volume also jumped 15.8 percent to 161,817 TEUs compared to the year-ago period. Total loaded inbound box volume, however, fell 2.9 percent to 269,634 TEUs compared to March 2009. This marks 18 of the past 19 months that the Los Angeles port has recorded declining total inbound box volumes, with only February 2010 showing an increase.

So far this year, total volume at the port is up 8 percent compared to the first three months of 2009.

Economic and port experts have argued that the upturn in cargo volumes at the two ports could either suggest a long-term upward cargo trend serving as a bellwether for a general economic recovery taking place, or as the first peak-before-the-trough of a "W" shaped recovery that would signal a more gradual and longer overall economic recovery.

CKYH Alliance to go Green

Ocean carrier members of the CKYH Alliance announced Monday that the group plans to rebrand itself as "CKYH - the Green Alliance," as the group continues to focus on reducing its collective environmental footprint.

The announcement was one of several key decisions coming out of the alliance members' 2010 Summit Meeting held last week in Zhenjiang, China.

At the summit, alliance members COSCO, "K" LINE, Yang Ming, and Hanjin Shipping also decided that all members will take "positive action to take full advantage of regional transship hubs," focus on building up extensive feeder networks, extend cooperation to the north/south trades and new emerging markets, and widen the scope of cooperation to "other sections of the transport chain by optimizing the alliance’s resources such as terminals, chassis, intermodal facilities and equipment," according to an alliance statement.

According to vessel and route tracking service ComPair Data, CKYH operates 17 transpacific routes, including 12 to the US West Coast and five to the US East Coast. ComPair Data also lists eight CKYH Asia-Europe routes and one transatlantic service.