Long Beach Port Approves Labor Agreement for Terminal Redevelopment

The governing board for the Port of Long Beach on Monday approved a project labor agreement for the first phase of a 10-year $750 million Middle Harbor container terminal redevelopment plan.

The project labor agreement, or PLA, provides that any contractor or subcontractor can bid on work for the Middle Harbor project if they agree to the PLA's basic tenets, which include: a 30 percent local hire goal; adherence to a prevailing wage scale; a promise of no labor actions such as pickets or strikes; an arbitration process to resolve labor disputes; and, substance screening for workers.

The PLA covers the roughly $150 million worth of Phase I work on the Middle Harbor project, which ultimately will redevelop and join three aging terminals into a single highly-efficient mega-terminal.

Proponents of the PLA, which includes nearly two dozen local labor unions, said the agreement would reduce potential costs on the terminal project and assure workforce security during construction.

Opponents of the PLA, including the Long Beach Chamber of Commerce, argue that the agreement will reduce competition and result in more costly wage payouts during the project life.

LA Port Nixes Battleship Museum Plan

The Port of Los Angeles has fired a full broadside salvo into a historical group's plans to bring the World War II battleship USS Iowa to the port as a museum piece.

Port officials said late last week that the USS Iowa plan by the Pacific Battleship Center was rejected because it would complicate and interfere with an ongoing development of the port's public waterfront area.

The PBC group is not the only group vying for the battleship, and according to the port, the Navy has only made the mothballed ship available to a group trying to bring the warship to Vallejo in Northern California. The Northern California effort has also faced funding problems in finding a permanent home for the USS Iowa.

The Navy continues to maintain the USS Iowa in an "on hold" status as part of a government program that donates vessels to museum groups.

The USS Iowa is the last remaining battleship in the world that has not been placed in a museum.

Port of Los Angeles officials said that all seven port sites proposed by the PBC group were inconsistent with the port's own plans for the waterfront area, which ironically includes the San Pedro Bay's only maritime museum.

Vivian Leon Named to Number Two Slot at Guam Port

The governing board of the Port Authority of Guam has named Vivian Castro Leon as the authority's interim deputy general manager.

Leon, a 33-year veteran of the PAG, will be the first woman to serve as the port authority's deputy general manager.

Her years of experience serving in various PAG positions, including her most recent stint as the PAG's corporate services manager, earned praise from the PAG Board of Directors and Guam Governor Michael Cruz.

Leon will fill the deputy general manager position vacated by Rick Agustin who recently took the helm of the PAG as general manager following the resignation of Glenn Leon Guerrero.

Fidley Watch: Show Us the Money

by Chris Philips, Managing Editor

The concept of divide and conquer has been around as long as man has been walking upright. Sun Tzu discussed it in the Art of War, 2,500 years ago. Julius Caesar used it to enlarge the Roman Empire, Machiavelli wrote about it in The Prince. Quoting the Bible’s book of Matthew, Abraham Lincoln said, “A house divided against itself cannot stand.” This year the concept is being used to pit two commercial maritime associations and former allies against each other.

On July 1st the commercial shipping industry in Washington State will be required to take over operation of the emergency rescue tug in Neah Bay. Under state law, companies that operate large vessels in the strait have to share in the costs of paying for a stand-by tug to help prevent an oil spill by a drift grounding. According to a recent story in the Bremerton, Washington Kitsap Sun, the issue of allocating the cost of the tug among carriers has not been resolved.

Frank Holmes, Northwest manager for the Western States Petroleum Association (WSPA), has been making the case that non-oil-carrying vessels are just as likely to need help from a tugboat as oil-carrying vessels, so the assessment should be based largely on the number of vessels passing through the Strait. “Clearly, the tug is being required to be there as an insurance policy for vessels that encounter a mechanical integrity problem, steering problem, engine problem or electrical problem,” he says.

Mike Moore, vice president of the Pacific Merchant Shipping Association (PMSA), says the tug is intended to prevent oil spills, which relates to the amount of oil or fuel on board a disabled vessel. Moore notes that cargo ships in Puget Sound have never spilled oil except during fuel transfers, which are subject to other requirements.

“The fairest way to allocate tug costs would seem to be on the basis of how much oil is carried on ships navigating the strait,” says Moore, in a recent opinion piece on the subject. “Vessel operators should pay on the basis of how much oil is moved through the strait on their ships,” he says. “Cargo ships carry about 20 percent of the oil (as fuel), tankers about 80% of the oil (as cargo and fuel). It seems that a fair share is pretty straight forward.”

A few years ago, WSPA and PMSA were united in their opposition to increasing the rescue tug at Neah Bay to year-round service. Now they find themselves on opposite sides of the issue of funding the tug. Now the house is divided, and the two associations are butting heads over who should fund a service forced upon them by the State of Washington.

In 1996, my father wrote an editorial about the rescue tug. He noted that then Governor Mike Lowry wanted President Clinton to tie lifting the export ban on Alaska North Slope Crude to the stationing of a dedicated rescue tug to protect the Coast, the Strait of Juan de Fuca and the marine sanctuary off the North coast of the State of Washington.

In his editorial, my father pointed out that most of the land being protected by the tug is either Indian Reservation, National Park, National Forest or National Marine Sanctuary, and not under the jurisdiction of the State of Washington. He noted, “Since all of this real estate is being administered by the Federal Government for the citizens of all the United States, it is only fair that the citizens of all the United States should pay for its protection.”

Shortly after my father wrote these words, Governor Mike Lowry was replaced by Governor Gary Locke, who served until 2005. It was under Gary Locke’s leadership that the Neah Bay tug was funded for part-time operation, and on his watch that the scheme was hatched for full-time operation. 

In 2009, President Obama appointed former Governor Locke to the position of US Secretary of Commerce, where he is responsible for fostering, promoting, and developing the foreign and domestic commerce of the United States. Secretary of Commerce Locke is well aware of the importance of shipping to the State of Washington and the country as a whole. As my father noted 14 years ago, most of the rescue tug’s beat is Federal land. It’s time for PMSA and WSPA to get back on the same page and, united, urge Secretary Locke’s office to foot the bill for the boat.

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At press time this month Tom Bringloe, of the Glosten Associates, alerted us to the passing of the prominent naval architect and founder of the firm, Lawrence “Larry” Glosten. Tom remembers first working for Larry as an intern in 1965. Larry, Ben Jensen and our father, Richard all had office space on the second floor of the Poulson Building, across from the Seattle waterfront. Ben and Larry were architects, and our father was at the time editor of Pacific Fisherman, later bought by National Fisherman.

“Most days the three of them would get together for lunch at the old Colman Lunch,” says Bringloe. “Standard fare was the special: half of the daily special sandwich, a cup of the soup of the day and a cup of coffee, all for 95 cents! Even a starving college student could afford to join them.”

Mr. Glosten, who graduated from Webb Institute in 1940, served as Chairman of the Board of The Glosten Associates until his retirement in 2001. He is survived by his wife of 64 years, Lois Peterson “Pete” Glosten, his three children and the renowned naval architecture legacy he helped created.

ATA Loses Appeal Over SoCal Trucking Plan, But Comes Out Ahead

The US Court of Appeals for the 9th Circuit on Wednesday handed the American Trucking Associations a small win over the Southern California ports' Clean Truck Program, but refused to block the entire program as the ATA had requested.

This was the second visit before the appeals panel by the ATA regarding the ports of Long Beach and Los Angeles truck programs. Last year, a different three-member 9th Circuit panel blocked portions of the two ports' truck programs, including a controversial component of the Port of Los Angeles' plan that would allow the port to mandate that only per-hour employees operate ports' servicing drayage trucks. Following a lower court's imposition of the earlier injunction, the ATA went back to the appeals court late last year arguing that the lower court injunction did not go far enough.

Wednesday's ruling upheld the previously injuncted portions of the ports truck plan and also found that an additional component of the plan should also be injuncted.

The truck programs began as a single plan in 2007, jointly developed by the Long Beach and Los Angeles ports and seeking to cut diesel truck emissions by up to 80 percent by 2012. The original plan called for the ports to implement progressively more restrictive bans on older model trucks until only 2007 or newer trucks were operating in the two ports. However, the two plans quickly morphed into a trucking re-regulation plan that sought to use an access-licensing scheme to limit which trucking firms could and could not operate in the ports. This access-licensing scheme would require all trucking firms wishing to do business in the port to meet certain ports-defined criteria including financial, labor, security and safety issues.

The ATA, which represent more than 37,000 motor carriers nationwide, filed suit in federal court in July 2008 arguing that the access license system is preempted by federal laws that govern the routes, rates, and services of interstate commerce. The ports argued that they are exempt from federal preemption under a motor vehicle safety clause.

Eventually the two ports developed slightly differing plans, with the Long Beach port adopting a registration-type system focused on turning over the older trucks as quickly as possible and the Los Angeles port sticking to the access license system that among other things required trucking firms to hire only per-hour employees.

Late last year, the Port of Long Beach reached an agreement with the ATA to remove itself from the litigation, while still moving forward with the clean air provisions of their truck plan. Los Angeles port and City Hall officials have repeatedly declared that they will continue to fight the ATA suit and not abandon the employee-mandate.

Wednesday's appeals panel ruling, while not blocking all of the portions of the truck program access licensing scheme the ATA had sought, upheld the earlier injunction against certain portions of the truck plans and also blocked an additional component that required – as part of obtaining a port-issued access license – drayage trucks to carry a placard with port-defined wording. The appeals panel ruled that federal law covering the placement of placards on trucks involved in interstate commerce preempts local regulation.

"Yesterday's ruling maintained the status quo and added an additional item – the placards – to the injunction," said Curtis Whalen of the ATA.

However, the appeals panel on Wednesday did list eight provisions of the Los Angeles port's access license criteria that could remain in place because these items were determined to fall under the federal preemption exception for motor vehicle safety.

These include: requiring that access license recipients be licensed motor carriers in good standing; requiring that access license recipients use only “permitted trucks;” mandating that motor carriers are solely responsible for their drivers and employees; requiring that motor carriers prepare a truck maintenance plan and holding motor carriers responsible for vehicle condition and safety; mandating that motor carriers keep records of driver enrollment in the Transportation Worker Identification Credential (“TWIC”) program; requiring that motor carriers ensure that each truck entering and leaving Port property is equipped with a means of Clean Trucks Program Compliance Verification; ensuring that motor carriers comply with federal, state, municipal, and port security laws; and requiring that motor carriers update and maintain accurate data in the port-operated drayage truck registry, access license registry, and driver registry and allowing Los Angeles port officials to inspect motor carriers’ property and records regarding compliance with the access license agreements. None of these items were previously injuncted and remain in effect at the Los Angeles port.

On Thursday, US District Court Judge Christina Snyder considered motions by both sides for summary judgment in the case. The Los Angeles port argued that the entire case, and injunction, should be thrown out. The ATA argued the opposite. Judge Snyder denied both motions and determined that the matter should be settled in full court. She set April 20 as the start of the trial.

The ATA has argued that the truck plans violate federal interstate commerce laws that preempt any local regulation. The appeals panel, in issuing the first injunction last year, determined that the port is likely to lose on the employee-mandate issue on the grounds of federal preemption. The appeal panel also found that the ATA is likely to prevail on other aspects of the case involving the already injuncted components of the access license scheme.

In the meantime, numerous press outlets reported Wednesday's ruling as a victory for the Los Angeles port, despite the ATA walking away from the court with additional items of the truck plan being injuncted.

Several local media outlets, including the Los Angeles Times went so far as to report that the employee-mandate portion of the injunction had been rescinded by the ruling, an action that the court did not take.

Background On the ATA Lawsuit Against the SoCal Ports

The Southern California ports' trucking plans began as a single jointly-developed plan in 2007 which sought to cut ports-generated diesel truck emissions by up to 80 percent by 2012.

The original plan called for the ports to implement progressively more restrictive bans on older model trucks until only 2007 or newer trucks were operating in the two ports. However, the two plans quickly morphed into a trucking re-regulation plan that sought to use an access-licensing scheme to limit which trucking firms could and could not operate in the ports. This access-licensing scheme would require all trucking firms wishing to do business in the port to meet certain ports-defined criteria including financial, labor and safety issues.

On June 30, 2008 the American Trucking Associations filed in US District Court, Central Division, for a preliminary injunction blocking implementation of the port’s mandatory access license scheme under the Federal Aviation Administration Authorization, or FAAA, Act of 1994 and the Supremacy Clause of the Constitution. U.S. District court judge Christina Snyder refused to grant the ATA-requested injunction, ruling that while the access license agreements “related to a price, route, or service” of motor carriers which would generally render them preempted under the FAAA Act, she believed that the ATA was unlikely to succeed on the merits because the concession agreements likely fell under the FAAA Act’s motor vehicle safety exception and therefore ATA had not established a proper basis to be granted a preliminary injunction.

The FAAA Act provides that "a State, political subdivision of a State, or political authority of two or more States may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route, or service of any motor carrier."

The ATA appealed the lower court ruling to the Ninth Circuit, which reversed the lower court ruling, remanded the case back to the lower court, and instructed Judge Snyder that many provisions of the access license agreements were likely preempted by the FAAA Act.

Once the case returned, the lower court followed the Appeals Court’s order and determined that some of the access license agreement provisions were likely preempted while others were not. Those components of the access license scheme that were injuncted by Judge Snyder included: the independent operator phase-out, hiring preferences, financial disclosure requirement, health insurance requirement, compliance with truck routes and parking restrictions, mandatory access license fees, and Clean Truck Tariff program

The ATA again appealed the lower court ruling to the Ninth Circuit, arguing that Judge Snyder, in issuing the limited preliminary injunction (1) erred in concluding several provisions were not preempted by the FAAA Act; and, (2) erred in concluding that Port of Los Angeles has authority to preclude motor carriers from entering the Port for failing to comply with the access license agreements; and (3) abused its discretion by not enjoining enforcement of the access license agreements in their entirety.

On Wednesday, Feb. 24, the Ninth Circuit panel concluded that each item that Judge Snyder blocked should remain injucted and added an additional item should also be covered under the injunction. This portion of the access license agreements called for each truck to carry a placard with a phone number on it. The appeals panel ruled that the federal government reserves the right to place placards on the truck.

On Thursday, Feb. 25, Judge Snyder denied motions from both sides calling for summary judgment and set April 20 as the trial date.

Pickens LNG Firm Plans to Expand SoCal Fueling Network

Billionaire T. Boone Pickens' Clean Energy Fuels Corp. announced plans Monday to aggressively develop a network of liquefied natural gas truck fueling stations in Southern California.

The Seal Beach, Calif.-based Clean Energy currently operates two LNG fueling stations located in or near the ports of Long Beach and Los Angeles, serving about 500 LNG drayage vehicles.

The Clean Energy plan calls for the development of additional fueling stations along key truck routes in Southern California including locations in Los Angeles, Commerce, Industry, Fontana, Riverside, Tulare, Barstow, and Otay Mesa/San Diego.

Set to be developed over the next several years, these hub stations will then be linked by additional stations located along the truck routes to form a complete Southwest region network.

The two ports' proposed truck modernization program that eventually morphed into the current Clean Trucks Program originally called for 50 percent of the more than 19,000 trucks servicing the two ports at the time to be replaced by LNG or other alternative fuel vehicles. However, this goal was subsequently dropped during the development of the overall trucking program. In the end, the 500 LNG trucks currently servicing the two ports were subsidizing through various government funding mechanisms.

The push toward LNG in the original ports' truck modernization plan was based on certification data of a single LNG truck engine available at the time showing that no diesel engines at the time were cleaner burning than the LNG engines. However, current diesel engines are now producing less of three of the four major pollutants looked at in certification tests.

As of Monday's public meeting, the Long Beach Board of Harbor Commissioners have moved away from their original "cleaner-burning" argument for LNG to an argument based on the concept of "diversification of energy" and "reducing domestic dependence on foreign oil."

It worth noting that while current LNG trucks and current diesel trucks are both equally clean compared to models just a few years ago, LNG trucks still cost nearly 50 percent more.