Friday, August 5, 2011

LA Port Postpones Infrastructure Cargo Fee Until 2014

The governing board for the Port of Los Angeles on Thursday delayed the implementation of a per-TEU infrastructure fee that is hoped to pay for $1.4 billion in port-area projects until at least Jan. 1, 2014.

The Infrastructure Cargo Fee (ICF) was first proposed more than three years ago as a funding mechanism to support development of port-area infrastructure, but has faced several delays and has yet to be implemented.

In early 2008, Los Angeles officials, along with official from the neighboring Port of Long Beach, approved moving forward with a $15-per-TEU fee on all containers moving in or out of the two ports by truck or rail. Originally envisioned to last for seven-years, the fee was initially set to go into effect on Jan. 1, 2009.

The estimated $1.4 billion in collected funds were to be used for a handful of projects identified by port officials as “critical” to the future growth of the two neighboring ports. At the time, these included: the replacement of the aging Gerald Desmond Bridge with an taller and wider version for more than $800 million, replacing the Commodore Heim lift bridge with a fixed and wider structure at a cost of more than $650, expanding a short freeway heading to one of the ports’ main intermodal yards, and expanding on-dock rail capacity at several locations. The ICF project list now includes five in the Los Angeles port, two in Long Beach, and one for the Alameda Corridor Transportation Authority.

Following the worldwide economic downturn, the 2009 start date was later delayed for further consideration by the two ports and in April, 2010, the ports approved delaying the collection of the ICF until Jan. 1, 2012.

Los Angeles port officials, in approving the 2014 delay this week, cited the current national economic uncertainties and adequate funding in port coffers to cover port infrastructure projects through the end of fiscal year 2012.

The Port of Long Beach is expected to approve a similar delay next week.