Charlotte, NC-based Jones Act carrier Horizon Lines announced Monday that it has finalized an agreement with former parent-firm CSX Corporation to reduce the carrier's charter payments on three vessels being leased from CSX.
Under the terms of the deal, the embattled carrier's charter hire expense on the three vessels has been reduced by $3 million per year, retroactive to January 2011, and carrying through the January 2015 expiration of the charter. The agreement, according to Horizon, will represents a total savings of $12 million for the carrier over the remaining life of the charter.
The three chartered vessels, the Horizon Anchorage, Horizon Tacoma, and Horizon Kodiak, serve in the Alaska tradelane and were built in 1987.
"We greatly appreciate the willingness of CSX to provide meaningful financial assistance as we work to refinance our debt and position Horizon Lines for long-term success," Horizon Executive VP and CFO Michael Avara said in a statement. "As our former parent company, CSX remains a valued and very important business partner."
The reduction in charter hire expense of $3 million achieved this year under the agreement was previously included in the carrier's estimated 2011 cost-savings projections of $18 million or greater.
A May 21 default by the carrier under a convertible note indenture was staved off when a federal court agreed last week to reduce Horizon's fine related to a rate and surcharge fixing conspiracy involving maritime cargo handling over a six-year period. The court agreed to reduce the carrier's fine from $45 million to $15 million.
Friday, May 6, 2011
Report: Los Angeles Port Air Quality Improved in 2010
The Port of Los Angeles announced Thursday that new air quality data from monitoring stations in and around the port show airborne elemental carbon concentrations in the port area fell in 2010 for the fourth straight year. The data, part of an annual air quality report, show that elemental carbon was down 10 percent compared to 2009 and cumulatively down 50 percent since 2006. The measured 2010 levels were the lowest since monitoring began in 2005 – despite the port handling 16 percent more cargo in last year.
Elemental carbon, used as an indicator of ambient diesel particulate matter, or DPM, is most often seen as the soot component of diesel exhaust. DPM has been labeled a toxic air contaminant and known carcinogen by California state health officials.
The port has made reducing DPM, oxides of nitrogen and oxides of sulfur a priority since adopting the omnibus environmental policy, the Clean Air Action Plan (CAAP), in 2006.
“I’m very pleased to be able to report that we are living up to our CAAP commitment – we pledged to cut Port-related emissions by 45 percent, and these results show that for diesel exhaust we did more,” Port Executive Director Geraldine Knatz said.
The new data also showed a reduction in the levels of another major air pollutant related to diesel exhaust, PM2.5 (particles less than 2.5 microns in size). The port's 2010 PM2.5 levels met federal and state standards for the third straight year, and for the first time PM10 (particles less than 10 microns in size) also met state standards in the port-abutting community of Wilmington (there is no federal standard for PM10).
The port cites this data as proof positive that the CAAP, other port actions, and significant buy-in from stakeholders and industry are improving the port-area air quality in significant ways.
”This dramatic decline in the amount of DPM and the fact that we have attained air quality standards for both kinds of PM show how effective the measures we adopted in the Clean Air Action Plan are at reducing harmful air pollutants in neighboring communities,” Port’s Director of Environmental Management Chris Cannon said. “Every year shows an improvement over the previous year, making me very optimistic that we are going to achieve our Clean Air Action Plan goals.”
A major component of the port's CAAP (adopted in conjunction with the neighboring Port of Long Beach) has been the port's self-titled Clean Truck Program. Implemented in 2008, the program required all trucks serving the two ports to be 2007 model year or newer as of Jan. 1, 2010. With the assistance of a more than $650 million investment by the trucking industry to modernize the ports-servicing truck fleet, more than 90 percent of all moves in the dual port complex are now handled by a drayage fleet of roughly 10,000 cleaner-burning 2007 or newer model year trucks.
The Port of Long Beach is expected to issue its annual air quality report within the next several months.
Elemental carbon, used as an indicator of ambient diesel particulate matter, or DPM, is most often seen as the soot component of diesel exhaust. DPM has been labeled a toxic air contaminant and known carcinogen by California state health officials.
The port has made reducing DPM, oxides of nitrogen and oxides of sulfur a priority since adopting the omnibus environmental policy, the Clean Air Action Plan (CAAP), in 2006.
“I’m very pleased to be able to report that we are living up to our CAAP commitment – we pledged to cut Port-related emissions by 45 percent, and these results show that for diesel exhaust we did more,” Port Executive Director Geraldine Knatz said.
The new data also showed a reduction in the levels of another major air pollutant related to diesel exhaust, PM2.5 (particles less than 2.5 microns in size). The port's 2010 PM2.5 levels met federal and state standards for the third straight year, and for the first time PM10 (particles less than 10 microns in size) also met state standards in the port-abutting community of Wilmington (there is no federal standard for PM10).
The port cites this data as proof positive that the CAAP, other port actions, and significant buy-in from stakeholders and industry are improving the port-area air quality in significant ways.
”This dramatic decline in the amount of DPM and the fact that we have attained air quality standards for both kinds of PM show how effective the measures we adopted in the Clean Air Action Plan are at reducing harmful air pollutants in neighboring communities,” Port’s Director of Environmental Management Chris Cannon said. “Every year shows an improvement over the previous year, making me very optimistic that we are going to achieve our Clean Air Action Plan goals.”
A major component of the port's CAAP (adopted in conjunction with the neighboring Port of Long Beach) has been the port's self-titled Clean Truck Program. Implemented in 2008, the program required all trucks serving the two ports to be 2007 model year or newer as of Jan. 1, 2010. With the assistance of a more than $650 million investment by the trucking industry to modernize the ports-servicing truck fleet, more than 90 percent of all moves in the dual port complex are now handled by a drayage fleet of roughly 10,000 cleaner-burning 2007 or newer model year trucks.
The Port of Long Beach is expected to issue its annual air quality report within the next several months.
State Board Approves Big Jump in Bay Area Pilot Rates, Surcharges
A California state board has approved a substantial raise to pilots that guide commercial vessels to and from dock in the Bay Area.
The California State Board of Pilot Commissioners voted Tuesday to increase rates and surcharges that the pilots charge shipping lines.
In addition to the actual pilot rate on each vessel call, shipping lines must also pay the pilots additional surcharges for pilot training, pilot pensions, and pilot fuel/equipment.
Pilot revenues are generated by applying the rate to the size of the ships they guide. Larger ships generate larger rates for the pilots. However, as the industry continues to increase the size of vessels, pilots’ incomes increase accordingly, regardless of any increase in rates.
Because pilot salaries are directly tied to the amount of total funds collected from the shipping lines, the rate and surcharge increases would raise the average annual income of the approximately 60 Bay Area pilots from about $400,000, coupled with predicted growth in shipping, to about $530,000 within the next four years.
In 2002, when the last rate increase was recommended by the state, the Board of Pilot Commissioners approved increased pilot rates by a cumulative 22 percent, but due to increased ship sizes pilot incomes actually increased by 53 percent.
If the board-approved rate and surcharge increases are approved by the State Legislature, the Bay Area pilots, already the highest paid pilots in California, would become some of, if not the most, highly paid port pilots in the entire nation.
By comparison, pilots in the Long Beach/Los Angeles port complex – the busiest container complex in the Western Hemisphere – make about $227,000, while remaining some of the most highly trained and well-respected pilots in the industry.
The Pacific Merchant Shipping Association, which represents most of the shipping lines and terminal operators on the West Coast, opposed the increases requested by the Bay Area pilots. The group proposed that rates and surcharges be adjusted so the pilots would earn about $425,000.
“We appreciate the important work done by harbor pilots everywhere and believe they should be fairly compensated for their work,” PMSA president John McLaurin said. “However, for the State of California to recommend increasing this rate and further driving up pilot compensation is irresponsible and unjustified.”
The state board approval comes after several days of hearings into the rates and surcharges increase request by the pilots.
Prior to the hearing, the San Francisco Bar Pilots Association, which represents the pilots, submitted a proposal to the Board of Pilot Commissioners requesting a rate increase of 22 percent over four years. This request would have boosted the average annual Bay Area pilot salary to more than $600,000 by 2015.
The California State Board of Pilot Commissioners voted Tuesday to increase rates and surcharges that the pilots charge shipping lines.
In addition to the actual pilot rate on each vessel call, shipping lines must also pay the pilots additional surcharges for pilot training, pilot pensions, and pilot fuel/equipment.
Pilot revenues are generated by applying the rate to the size of the ships they guide. Larger ships generate larger rates for the pilots. However, as the industry continues to increase the size of vessels, pilots’ incomes increase accordingly, regardless of any increase in rates.
Because pilot salaries are directly tied to the amount of total funds collected from the shipping lines, the rate and surcharge increases would raise the average annual income of the approximately 60 Bay Area pilots from about $400,000, coupled with predicted growth in shipping, to about $530,000 within the next four years.
In 2002, when the last rate increase was recommended by the state, the Board of Pilot Commissioners approved increased pilot rates by a cumulative 22 percent, but due to increased ship sizes pilot incomes actually increased by 53 percent.
If the board-approved rate and surcharge increases are approved by the State Legislature, the Bay Area pilots, already the highest paid pilots in California, would become some of, if not the most, highly paid port pilots in the entire nation.
By comparison, pilots in the Long Beach/Los Angeles port complex – the busiest container complex in the Western Hemisphere – make about $227,000, while remaining some of the most highly trained and well-respected pilots in the industry.
The Pacific Merchant Shipping Association, which represents most of the shipping lines and terminal operators on the West Coast, opposed the increases requested by the Bay Area pilots. The group proposed that rates and surcharges be adjusted so the pilots would earn about $425,000.
“We appreciate the important work done by harbor pilots everywhere and believe they should be fairly compensated for their work,” PMSA president John McLaurin said. “However, for the State of California to recommend increasing this rate and further driving up pilot compensation is irresponsible and unjustified.”
The state board approval comes after several days of hearings into the rates and surcharges increase request by the pilots.
Prior to the hearing, the San Francisco Bar Pilots Association, which represents the pilots, submitted a proposal to the Board of Pilot Commissioners requesting a rate increase of 22 percent over four years. This request would have boosted the average annual Bay Area pilot salary to more than $600,000 by 2015.
Tuesday, May 3, 2011
Study Tracks Truck Turn Times at SoCal Ports
The results of a major study of truck turn times at the ports of Long Beach and Los Angeles has found that nearly 60 percent of all truck visits to the ports take less than an hour and more than 90 percent of truckers spent less than an hour waiting to get into a terminal.
Commissioned by PierPass Inc. and Ability/Tri-Modal Transportation Services Inc., the Turn Time Study used Global Positioning System equipment to track 250 trucks and develop a representative model of the 10,000-truck strong drayage fleet servicing the two ports.
The study was developed as a tool to help the ports community discuss visit times based on factual information rather than on anecdotes, and provides the ports stakeholder with a common set of metrics regarding truck turn times.
The study evaluated three time periods: queue time, i.e., time spent waiting in line outside the gates; terminal time, i.e., time spent from the entry gate to the exit gate; and visit time, the sum of queue and terminal time.
Key findings of the study include:
The study also determined that when cargo volumes rebounded in the spring and summer of 2010, the decisions by terminal operators in the two ports to open additional service hours to hold down congestion proved effective. While cargo volumes increased 6 percent from May to October of last year, the study found that visit time decreased 13 percent.
Dr. Val Noronha, President of Digital Geographic Research Corporation that conducted the study, said that a major conclusion of the study is that "there is plenty of capacity in the ports. A surge in truck volume causes just a slight ripple in visit time. A very important aspect, in my view, is that the parties have come together to address this issue cooperatively. That is huge. That communication opens up possibilities in terms of strategies that we can use in the future."
Commissioned by PierPass Inc. and Ability/Tri-Modal Transportation Services Inc., the Turn Time Study used Global Positioning System equipment to track 250 trucks and develop a representative model of the 10,000-truck strong drayage fleet servicing the two ports.
The study was developed as a tool to help the ports community discuss visit times based on factual information rather than on anecdotes, and provides the ports stakeholder with a common set of metrics regarding truck turn times.
The study evaluated three time periods: queue time, i.e., time spent waiting in line outside the gates; terminal time, i.e., time spent from the entry gate to the exit gate; and visit time, the sum of queue and terminal time.
Key findings of the study include:
- The median queue time in October was 20 minutes and the terminal time 31 minutes, for a total median visit time of 51 minutes.
- The vast majority of visits take less than two hours: 27 percent are under 30 minutes, 58 percent under an hour, 75 percent under one and a half hours, and 86 percent under two hours. A further 12 percent of visits take two to four hours, and 1 percent to 2 percent of visits take between four and eight hours.
- About 91 percent of queue times were under an hour.
- The median queue and visit times include trucks that choose to arrive early to wait for the 6:00 p.m. off-peak gate period to start.
- The study found that daytime visits are shortest for trucks that arrive at 3 p.m. Median visit time for trucks arriving between 3 p.m. and 4 p.m. was 45 minutes, while for trucks arriving between 5 p.m. and 6 p.m. median visit time was 90 minutes, reflecting the 5 p.m. dock worker meal break.
The study also determined that when cargo volumes rebounded in the spring and summer of 2010, the decisions by terminal operators in the two ports to open additional service hours to hold down congestion proved effective. While cargo volumes increased 6 percent from May to October of last year, the study found that visit time decreased 13 percent.
Dr. Val Noronha, President of Digital Geographic Research Corporation that conducted the study, said that a major conclusion of the study is that "there is plenty of capacity in the ports. A surge in truck volume causes just a slight ripple in visit time. A very important aspect, in my view, is that the parties have come together to address this issue cooperatively. That is huge. That communication opens up possibilities in terms of strategies that we can use in the future."
Phillips to Retire as Head of Southwest Washington Business Recruitment Group
The long-time president of the Columbia River Economic Development Council has announced that he will retire from the business recruitment non-profit effective May 21.
Bart Phillips, hired as CREDC president in 2000, tendered his resignation at a Monday morning meeting of CREDC's board of directors.
CREDC, which is funded through member dues and government grants and made up of 130 members governed by a 41-member board of directors, has come under recent fire by the Washington-state Port of Vancouver and Clark County officials for the group's perceived lackluster performance in luring new businesses to Southwest Washington state.
The CREDC board said it will begin a search for a new president, a position that was earning Phillips $150,000 a year. In the interim, Southwest Washington Workforce Development Council executive director Lisa Nisenfeld will handle the day-to-day operations of CREDC.
Last November, the governing board for the Vancouver port cut 25 percent of its annual financial support for CREDC citing disappointment with the non-profit's recent inability to create local jobs.
The port move comes after a similar shellacking of CREDC's efforts by the Clark County Board of Commissioners around the same time. The county board criticized the non-profit for a lack of communication with area partners and failing to support local companies.
CREDC describes its mission as promoting "job creation and investment while maintaining the county's exceptional environment and high quality of life." Clark County currently faces an unemployment rate over 12 percent.
Port commission President Jerry Oliver told The Columbian in November 2010 that a year prior CREDC had promised 12 leads to businesses that could benefit the port by expanding or relocating. Oliver said that not one lead that met the criteria materialized.
While the port board split 2-1 in its vote to reduce funding to CREDC, the lone dissenter Oliver stated that he actually wanted more drastic cuts to port funding for the group. Following the approval of the $10,000 cut to CREDC funding by the port, the commissioners signaled that further cuts could be expected if CREDC did not address the port's concerns by June of this year.
Bart Phillips, hired as CREDC president in 2000, tendered his resignation at a Monday morning meeting of CREDC's board of directors.
CREDC, which is funded through member dues and government grants and made up of 130 members governed by a 41-member board of directors, has come under recent fire by the Washington-state Port of Vancouver and Clark County officials for the group's perceived lackluster performance in luring new businesses to Southwest Washington state.
The CREDC board said it will begin a search for a new president, a position that was earning Phillips $150,000 a year. In the interim, Southwest Washington Workforce Development Council executive director Lisa Nisenfeld will handle the day-to-day operations of CREDC.
Last November, the governing board for the Vancouver port cut 25 percent of its annual financial support for CREDC citing disappointment with the non-profit's recent inability to create local jobs.
The port move comes after a similar shellacking of CREDC's efforts by the Clark County Board of Commissioners around the same time. The county board criticized the non-profit for a lack of communication with area partners and failing to support local companies.
CREDC describes its mission as promoting "job creation and investment while maintaining the county's exceptional environment and high quality of life." Clark County currently faces an unemployment rate over 12 percent.
Port commission President Jerry Oliver told The Columbian in November 2010 that a year prior CREDC had promised 12 leads to businesses that could benefit the port by expanding or relocating. Oliver said that not one lead that met the criteria materialized.
While the port board split 2-1 in its vote to reduce funding to CREDC, the lone dissenter Oliver stated that he actually wanted more drastic cuts to port funding for the group. Following the approval of the $10,000 cut to CREDC funding by the port, the commissioners signaled that further cuts could be expected if CREDC did not address the port's concerns by June of this year.
Railroads and Major Union Reach Tentative Labor Pact
The nation's largest railroad operating union and a group representing the nation's leading railroads have reached a tentative five-year labor deal.
The United Transportation Union, which represents about a third of the nation's railroad workers, and the industry-representing National Carriers' Conference Committee, announced the deal Monday.
The UTU is the largest railroad operating union in North America with more than 600 locals, and all told, represents about 125,000 active and retired railroad, bus, mass transit and airline workers in the United States. The UTU is representing about 38,000 railroad employees in the negotiations, which began in January 2010.
The NCCC represent more than 30 railroads nationwide, including the West Coast Class I railroads BNSF and Union Pacific, as well as the other Class I railroads CSX Transportation, Kansas City Southern, and Norfolk Southern.
Terms of the tentative agreement have not been released pending a vote on the deal by the UTU members. If approved, the deal would apply retroactively to January 1, 2010.
Deals between the NCCC and two labor groups representing 11 other unions, remain in mediation.
The United Transportation Union, which represents about a third of the nation's railroad workers, and the industry-representing National Carriers' Conference Committee, announced the deal Monday.
The UTU is the largest railroad operating union in North America with more than 600 locals, and all told, represents about 125,000 active and retired railroad, bus, mass transit and airline workers in the United States. The UTU is representing about 38,000 railroad employees in the negotiations, which began in January 2010.
The NCCC represent more than 30 railroads nationwide, including the West Coast Class I railroads BNSF and Union Pacific, as well as the other Class I railroads CSX Transportation, Kansas City Southern, and Norfolk Southern.
Terms of the tentative agreement have not been released pending a vote on the deal by the UTU members. If approved, the deal would apply retroactively to January 1, 2010.
Deals between the NCCC and two labor groups representing 11 other unions, remain in mediation.
California Bill Seeks to Make Drayage Drivers Employees, Ban Independent Operators
A bill set to appear before the California Assembly's Committee on Labor and Employment on Wednesday, seeks to make all drayage drivers in the state employees of the trucking firms they work for and effectively ban independent owner operators from working in the state's ports.
The vast majority of more than 15,000 drayage drivers in the state are currently independent owner operators.
Assembly Bill 950, introduced by Speaker of the Assembly Rep. John Perez (D-Los Angeles), would dictate that "for purposes of state employment law (including workers' compensation, occupational safety and health, and retaliation or discrimination) a drayage truck operator is an employee of the entity or person who arranges for or engages the services of the operator."
The bill by Perez, a union organizer and cousin of Los Angeles Mayor Antonio Villaraigosa, mirrors a recent move by the International Brotherhood of Teamsters to attack independent owner operators status as a "misclassification." Teamsters president James Hoffa has repeatedly stated that a primary organizing goal of the Teamsters is to unionize the nation's drayage drivers. Hoffa worked closely with Villaraigosa to develop "employee-only" language in the Port of Los Angeles Clean Truck Program – language that remains in litigation.
Under current law, per-load independent owner operators cannot be unionized, only per-hour employees.
More than 30 labor, environmental, and social justice groups have signed onto the bill as supporters.
"The indisputable reality is that port drivers misclassified as "independent contractors" do exactly the same work as the much smaller group of port drivers who some trucking companies have hired as 'employees,'" the California Teamsters Public Affairs Council wrote in its statement to the bill.
Two-dozen industry groups, representing the vast majority of the intermodal industry in the state and including several groups representing drayage drivers, have tendered their opposition to the bill.
"Rather than address potential misclassification, this bill reaches too far in eliminating a class of drivers and small businesses that represent the dominate model for the drayage industry," the California Trucking Association said in its opposition statement to the bill.
The vast majority of more than 15,000 drayage drivers in the state are currently independent owner operators.
Assembly Bill 950, introduced by Speaker of the Assembly Rep. John Perez (D-Los Angeles), would dictate that "for purposes of state employment law (including workers' compensation, occupational safety and health, and retaliation or discrimination) a drayage truck operator is an employee of the entity or person who arranges for or engages the services of the operator."
The bill by Perez, a union organizer and cousin of Los Angeles Mayor Antonio Villaraigosa, mirrors a recent move by the International Brotherhood of Teamsters to attack independent owner operators status as a "misclassification." Teamsters president James Hoffa has repeatedly stated that a primary organizing goal of the Teamsters is to unionize the nation's drayage drivers. Hoffa worked closely with Villaraigosa to develop "employee-only" language in the Port of Los Angeles Clean Truck Program – language that remains in litigation.
Under current law, per-load independent owner operators cannot be unionized, only per-hour employees.
More than 30 labor, environmental, and social justice groups have signed onto the bill as supporters.
"The indisputable reality is that port drivers misclassified as "independent contractors" do exactly the same work as the much smaller group of port drivers who some trucking companies have hired as 'employees,'" the California Teamsters Public Affairs Council wrote in its statement to the bill.
Two-dozen industry groups, representing the vast majority of the intermodal industry in the state and including several groups representing drayage drivers, have tendered their opposition to the bill.
"Rather than address potential misclassification, this bill reaches too far in eliminating a class of drivers and small businesses that represent the dominate model for the drayage industry," the California Trucking Association said in its opposition statement to the bill.
