Cargo Infrastructure Fee

In January 2008, the Los Angeles and Long Beach Boards of Harbor Commissioners approved a cargo fee that would generate $1.4 billion for transportation projects to improve traffic flow and air quality in the harbor area. The fee is in addition to one enacted in December 2007 to help fund the ports’ Clean Trucks Program.

The transportation infrastructure funding will be used for bridge, railway and road improvements used in port-related goods movement, including replacement of the Gerald Desmond and Heim bridges, freeway connector improvements, and port-area rail enhancements, which reduce the need for local truck trips.

Funds generated by the infrastructure cargo fee will be used to match Proposition 1B funds, which California voters approved in 2006 to help pay for major transportation and air quality improvement projects. Together, the cargo fee and Proposition 1B funds will finance about $3 billion in improvements.

The fee will be assessed on every loaded 20-foot equivalent (TEU) cargo container entering or leaving any terminal by truck or train beginning January 1, 2009. The amount would fluctuate based on the current funding needs of approved projects. It is anticipated that the charge would be $15 per loaded TEU for seven years, but could vary depending on how quickly the ports move forward with their projects.

Funds from the fee program will be used only for approved local projects. Spending is limited to specific projects after project approval by the applicable lead agency and fee collection would stop when those projects are completed.

Cargo fee revenue and Proposition 1B funds will pay for rail and highway projects including improvement of the ports’ rail network, which will help reduce truck trips to the ports. Local highway improvements include replacement of the Gerald Desmond Bridge from Long Beach to Terminal Island and construction of an interchange to allow the removal of a traffic light at Navy Way and Seaside Avenue. The ports also propose to improve access from the Harbor Freeway to the Port of Los Angeles and upgrade the Terminal Island Freeway by replacing the Schuyler Heim drawbridge and constructing a four-lane, elevated expressway between Ocean Boulevard and Alameda Street at Pacific Coast Highway. Also proposed is a highway-railroad grade separation in south Wilmington.

The projects are included in the California Goods Movement Action Plan, which was the result of intensive collaboration during the past several years by business, transportation and environmental interests.