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Apr 23, 2018

Bill Introduced To End ‘Rampant Exploitation’ Of Port Truck Drivers

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State Sen. Ricardo Lara introduced Senate Bill (SB) 1402 on April 11 to end “rampant exploitation” of truck drivers at California ports by calling out trucking companies with records of state labor and employment law violations, and penalizing retailers that utilize them.

If passed, SB 1402 would create a list of trucking companies with unpaid final judgments for labor violations. Retailers and other companies who later hire a listed trucking company directly or through a third party would be jointly liable for future violations by the trucking company.

“Port truckers are driving the global economy and delivering for the biggest brands, but they can barely afford to buy clothes for their families,” Lara said in a statement. “These used to be good jobs, and they can be good jobs again if retailers join us in improving labor conditions here in California and putting dignity back in the driver’s seat.”

In a press release, Lara listed examples of trucker exploitation, including companies forcing drivers to take on debt by financing their own trucks, which he said has led to situations where drivers actually owe money during some pay periods; lawsuits against companies by the California Labor Commissioner’s Office, which has won more than $45 million for more than 400 drivers; the misclassification of drivers as independent contractors rather than employees; and the fact that drivers are largely an immigrant workforce, making them more vulnerable to exploitation.

The bill is sponsored by the Teamsters Public Affairs Council and the California Labor Federation. It has also been endorsed by the mayors representing the state’s three largest ports – Long Beach Mayor Robert Garcia, Los Angeles Mayor Eric Garcetti and Oakland Mayor Libby Schaaf.

“While we have some great trucking companies working at the ports, we need to fix our system to make sure all truckers are treated fairly,” Garcia said in a press release. “We need to raise standards, and wages, in the industry while increasing efficiency to make sure our ports continue to be engines of growth.”

Groups such as the California Trucking Association (CTA) and the Harbor Trucking Association have come out in opposition of the bill. According to the CTA, the fact that companies whose workers are covered by a collective bargaining agreement are exempt from the bill’s implications proves it is a way to push out independent drivers.

“In the past, the backers of this bill tried to outright ban small-business, owner-operator truckers from working at the ports,” CTA CEO Shawn Yadon said in a statement. “Their actions were unanimously rejected by the U.S. Supreme Court. Now they’re back with SB 1402, which uses other means to accomplish the same goal.”

The country is experiencing a shortage of truck drivers, with numerous companies offering steady employment and 350,000 drivers opting to drive independently, according to the CTA. The association said many choose to become an independent driver because of the freedom and flexibility it allows, including setting their own schedules and managing their workload.

Weston LaBar, CEO of the HTA, provided the Business Journal with the following statement:

“We have serious concerns as to the intent of SB 1402. This shows yet another disconnect between an elected official and how our industry works. The majority of truckers in the port are independent contractors because they prefer to be independent contractors due to the opportunity it provides them. Yet, this bill would penalize a company if one driver feels misclassified even if hundreds of other drivers prefer their status as independent with that same company. It is time that California’s elected leaders actually attempt to learn about this industry and hear from the thousands of drivers that want to remain independent, as opposed to carrying through the political will of organized labor.”

According to Lara’s office, SB 1402 is scheduled to go before the Judiciary Committee today, April 24, and the Labor and Industrial Relations Committee on April 25.

Print Edition

State Sen. Ricardo Lara introduced Senate Bill (SB) 1402 on April 11 to end “rampant exploitation” of truck drivers at California ports by calling out trucking companies with records of state labor and employment law violations, and penalizing retailers that utilize them.

If passed, SB 1402 would create a list of trucking companies with unpaid final judgments for labor violations. Retailers and other companies who later hire a listed trucking company directly or through a third party would be jointly liable for future violations by the trucking company.

Apr 23, 2018

Upcoming PierPass Changes To Address Congestion, Truck Turn Times

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After stakeholder input and the completion of an independent study, PierPass’s OffPeak Program to regulate the movement of trucks into and out of terminals at the San Pedro Bay Ports is set to undergo changes meant to address congestion issues and improve goods movement efficiency.

The 12 terminal operators at the ports of Long Beach and Los Angeles, which oversee the OffPeak Program operated by the nonprofit PierPass, voted in mid-April to alter the current program. Currently, a traffic mitigation fee is charged on weekday daytime visits by truckers dropping off or picking up loaded containers at the terminals. The fee incentivizes truckers to arrive during off-peak hours, at night or on Saturdays, to reduce congestion and the emissions that idling trucks cause during peak times.

Under the current OffPeak Program operated by the nonprofit PierPass, trucks are incentivized to visit port terminals during night time or weekend shifts, when a fee is not charged. As a result, truckers often queue outside of terminals before the off-peak shifts, causing congestion. PierPass is changing to a flat-fee system across shifts to address the issue. (Port of Long Beach photograph)

Through the West Coast Marine Terminal Operators Agreement (WCMTOA) sanctioned by the Federal Maritime Commission, the 12 terminals at the San Pedro Bay ports voted to institute a flat fee for all terminal shifts, rather than charging a traffic mitigation fee for peak hours. “The traffic mitigation fee is currently $72.09 on a 20-foot container and $144.18 on a 40 [-foot container] and other sizes,” John Cushing, president and CEO of PierPass, said. “Payment on those containers is currently done via the PierPass website. It will be the same payment process. It’s just going to be at a lower rate: $31.52 per 20 [-foot container] and $63.04 on 40 [ foot containers] and other sized containers.”

The new fees were determined by examining how much fee revenue was collected in 2017 and for how many containers, according to Cushing. “Basically, it’s revenue neutral going forward.”

The WCMTOA members also voted to adopt appointment systems to schedule truck visits. According to Cushing, nine of the 12 terminals already use appointment systems, and the remaining three have now agreed to implement their own. While the ports’ recently adopted update to the Clean Air Action Plan calls for a universal appointment system across the ports, for now the terminals are each operating their systems independently, he explained.

The OffPeak Program has, by many accounts, been successful in reducing congestion and emissions; however, it has created some inefficiencies that the new arrangement is meant to address. “There were some inherent inefficiencies associated with the old program,” Anthony Otto, president of Orient Overseas Carrier Line-owned Long Beach Container Terminal at the Port of Long Beach, told the Business Journal.

The primary issue is that trucks queue outside of terminal gates between peak and off-peak shifts, from about 3 to 6 p.m., to wait to enter during off-peak hours and avoid the traffic mitigation fee, Otto explained. By instituting a flat fee, this problem should be resolved.

The terminals will leverage their appointment systems to ensure that there is an equal flow of traffic between day and night shifts, Otto said. “The appointments, which have become much more sophisticated in our industry, will allow us to regulate that flow.”

Cushing pointed out that having an appointment system would facilitate more dual transactions by truckers. In a dual transaction, a trucker would, for example, bring an empty container to a terminal and leave with a loaded container for delivery. Currently, some truckers bring empty containers back during the daytime because those loads are not subject to the traffic mitigation fee. But they then wait until the off-peak shift to come back for a loaded container in order to avoid the fee, he explained. Because there is now a flat fee for both shifts, truckers are more likely to visit a terminal once for both transactions.

Otto has been an advocate for making changes to the program and said he has been pleased with the process. PierPass conducted stakeholder meetings for about a year and a half and commissioned an independent study to come up with recommendations to make the OffPeak Program more efficient.

“The trucking industry embraces it. The ports are embracing it. The terminals obviously are, because it’s going to make our ports even more efficient than they had been,” Otto said.

Mario Cordero, executive director of the Port of Long Beach, praised PierPass for being open to changing the status quo. However, he reserved an opinion on the changes to the program until a full plan has been released. “Whatever the direction they are going to go in terms of how specifically they implement this new version of PierPass, the ultimate question for us that needs to be answered is: is the service going to be improved?” he said.

Cordero believes that creating extended gate hours for terminals would result in reduced truck turn times – the time it takes for a truck to pick up and deliver cargo and return for another load. This concept is not a part of the OffPeak Program changes. “In my view, if that objective is reached and we have extended gate hours that are predictable, reliable and efficient, then this gateway and this port will continue to be the port of choice,” he said.

In an official announcement sent out by PierPass, Gene Seroka, executive director of the Port of Los Angeles, said that he was pleased with the organization for taking a step forward in improving efficiencies at the ports.

The trucking community also gave positive feedback. “The California Trucking Association (CTA) appreciates the proposal put forth by PierPass regarding its restructuring of the TMF [traffic mitigation fee],” Alex Cherin, executive director of the CTA Intermodal Conference, stated. “This is the culmination of many collaborative discussions between the marine terminal operators and trucking communities over the last few years, and we look forward to supporting these efforts.” Weston LaBar, CEO of the Harbor Trucking Association, called the changes a “giant step in the right direction.”

Cushing said the changes should be implemented in August, pending review by the Federal Maritime Commission.

Print Edition

After stakeholder input and the completion of an independent study, PierPass’s OffPeak Program to regulate the movement of trucks into and out of terminals at the San Pedro Bay Ports is set to undergo changes meant to address congestion issues and improve goods movement efficiency.

May 04, 2018

Air quality board moves to regulate freight yards Air board will target freight facilities

Online Edition

Southern California air quality officials voted Friday to craft rules governing warehouses, distribution centers and rail yards in a controversial bid to combat transportation emissions in the nation’s smoggiest region.

The governing board of the South Coast Air Quality Management District moved to begin devising rules to regulate freight facilities as “indirect sources” of pollution because of the truck and locomotive traffic they attract.

The approach targets cargo-moving industries that are the lifeblood of the Southern California economy but responsible for much of the most harmful, smog-forming emissions.

Diesel trucks are the greatest obstacle to clean air in the region. Though regulation has helped rein in emissions from passenger cars, truck pollution controls lag behind.

Meanwhile, increases in cargo shipments through the ports of Los Angeles and Long Beach have led to a proliferation of warehouses and distribution centers across the Inland Empire — and with them, big rigs.

Communities near ports, warehouses and rail yards have for years urged such a crackdown on freight pollution, but it’s been fiercely opposed by business interests that say such rules will harm the growing logistics industry and stifle job growth in a sector that employs hundreds of thousands of people across the region.

The decision to proceed with warehouse regulation was a 7-6 vote along party lines, with six Democrats and one unaffiliated environmentalist member voting in favor of drafting rules and six Republicans voting against. The panel is made up of elected officials and appointees from a region of 17 million people across Los Angeles, Orange, Riverside and San Bernardino counties.

Republicans from the Inland Empire and Orange County warned that freight facility rules would kill blue-collar jobs and cause the logistics industry to flee Southern California. They pleaded to leave regulation of truck pollution to the federal government and decisions about warehouses to local cities and counties.

Democrats from L.A. County said the agency had an obligation to protect the public from asthma, lung cancer and other pollution-triggered health problems, or risk falling further behind in the smog fight.

A pivotal vote of support came from Los Angeles Councilman Joe Buscaino, a Democrat who represents the harbor area and is the Los Angeles mayor’s appointee to the panel. He had previously spoken against regulating warehouses but announced during Friday’s meeting that he had changed his position after discussions with Mayor Eric Garcetti.

Buscaino, whose parents emigrated from Italy to work on the waterfront, presented his decision in deeply personal terms, calling himself “a son of the Port of Los Angeles” who has seen communities benefit economically but suffer health effects from port operations, including family members diagnosed with cancer.

“It’s an economic engine,” he said. “But we need to remind ourselves that we should not choke on that engine.”

The panel voted 8 to 5 to draft rules on rail yards, with one Republican, Wildomar Mayor Ben Benoit, joining his colleagues in favor of the measure.

The board delayed action, for now, on whether to act on a staff proposal to craft similar regulations for new and redevelopment projects to try to reduce emissions from construction equipment. For the region’s ports and airports, the board supported staff recommendations to pursue voluntary measures only.

The impacts of the move will depend on the policy crafted by air district staff in coming months and what is ultimately approved by the board. Some possibilities include mandates that warehouses ensure visiting trucks are on average cleaner than what’s required under state emissions standards or install electric charging stations to help transition to zero-emission vehicles.

Environmentalists and advocacy groups from warehouse-adjacent communities celebrated the decision as a first step toward curbing diesel pollution and easing the health risks to people living and going to school nearby.

“We hope this will begin a shift toward zero emissions, toward electrification,” said Ericka Flores, senior community organizer for the Inland Empire-based Center for Community Action and Environmental Justice. “For once, this board has listened.”

Industry groups expressed disappointment, saying the board’s push toward regulation casts uncertainty over the entire supply chain.

“We will do everything we can to protect workers in California’s goods-movement industry, which supports a third of the state’s economy and jobs,” Chief Executive Shawn Yadon of the California Trucking Assn. said.

Left untouched by air district regulations is the Los Angeles-Long Beach port complex, which despite steep reductions in emissions under a voluntary plan remains the largest single source of air pollution in Southern California.

Amid signs that emissions progress was tapering off in recent years, the port last fall updated its clean-air plan to encourage phasing out diesel trucks in favor of natural gas and, ultimately, zero-emissions equipment. But the plan lacks new targets for reducing smog-forming emissions.

Steep cuts in freight industry pollution are crucial if the region is to meet federal health standards before key deadlines in 2023 and 2031, which require the region to cut emissions of smog-forming nitrogen oxides by more than half.

Last year, the AQMD board approved a 15-year smog-reduction plan that took a voluntary approach to freight facilities, asking them to come up with their own pollution-cutting measures. But it pledged to pivot to rule-making if progress wasn’t made within a year.

In California, the jurisdiction of local air districts is generally limited to stationary facilities such as oil refineries and factories, while state and federal regulators oversee vehicles and other mobile sources that generate more than 80% of emissions.

For more than a decade, the South Coast district has proposed a more envelope-pushing strategy: clamping down on freight facilities and developments using its authority under state law to regulate indirect sources of pollution. But to date, no such measures have made it past the drawing board.

In the San Joaquin Valley, air quality officials have since 2006 regulated indirect pollution from many new developments, including warehouses, retail centers and housing projects, and those measures have withstood legal challenges.

Backers of freight pollution regulation said the existence of such rules elsewhere obliges Southern California air quality officials to act under state law, which says air districts must work quickly to meet standards using “every feasible measure.” And they warned that failure to meet looming federal pollution-reduction deadlines could result in more devastating penalties under the Clean Air Act, including the loss of billions in transportation funds.

The move has taken on increased importance as the region’s progress fighting smog has faltered in recent years. After decades of improvement, bad air days for ozone, the lung-damaging gas in smog, have increased the last two years in a row.

Regulators expect little help from the Trump administration, which is in the midst of an industry-backed push to weaken air quality rules.

The California Air Resources Board this year declined to pursue statewide rules on indirect pollution from freight facilities and will instead seek other regulations targeting port trucks, cargo-handling equipment, rail yard locomotives and other freight operations.

Online Edition

Southern California air quality officials voted Friday to craft rules governing warehouses, distribution centers and rail yards in a controversial bid to combat transportation emissions in the nation’s smoggiest region.

The governing board of the South Coast Air Quality Management District moved to begin devising rules to regulate freight facilities as “indirect sources” of pollution because of the truck and locomotive traffic they attract.

Aug 15, 2017

San Pedro Bay Ports Break Records in July; Dockworkers Extend Contract

Print Edition

Both the Port of Long Beach and the Port of Los Angeles broke cargo traffic records in July, with Long Beach experiencing its busiest month ever and Los Angeles its strongest-ever July.

Cargo traffic through the Port of Long Beach has increased for the past five months straight, according to a port statement. The port experienced a 13.1% increase in overall cargo traffic in July compared to the same month in 2016. A total of 720,312 twenty-foot equivalent units (TEUs) of cargo moved through the port in July 2016, while exports decreased 11.7%. empty container traffic increased 27.7%.

“Given the unprecedented change in the industry, we are pleased to see shippers choosing Long Beach,” Long Beach Harbor Commission President Lou Anne Bynum stated. “We thank our industry partners for having confidence in this port, and we pledge to continue to provide the best service and the best facilities”.

The Port of Los Angeles  experienced its busiest July ever with a total of 796,804 TEUs coming through its facilities. Overall cargo traffic increased 16% comparted to July 2016, according to an official statement. Imports through the port increased by 13% and exports increased by 17%. Empty container traffic increased by 20%.

“As we strive to maintain our competitive edge with these record volumes, its important to acknowledge the Pacific Maritime Association and the good men and women of the International Longshore and Warehouse Union who just extended their contract with terminal operators until 2022,” Gene Seroka, executive director of the Port of Los Angeles, stated. “The certainty that comes from this decision builds further long-term confidence in our supply chain as we continue to focus on superior infrastructure, innovative leadership and extraordinary customer service.”

Labor negotiations between the International Longshore and Warehouse Union (ILWU) and their employer group, the Pacific Maritime Association (PMA), came to a head in 2014 and resulted in a cargo traffic slowdown at West Coast ports that lasted for months. As the business journal has previously reported, this caused some business to move to other ports on the East Coast.

Last year, the two groups hinted they might extend their current contract, which was due to expire in 2019. The ILWU formally ratified the 2022 extension, which applies to 29 West Coast ports, in early August.

“The first-of-its-kinds contract extension is great news for the maritime industry and the nation, setting the stage for reliable and productive cargo operations for years to come. This agreement also continues to provide ILWU workers with a generous wage and benefits package during a time of great change in the global maritime business,” PMA president James McKenna said in an official release. “With this agreement in hand, PMA looks forward to working with the ILWU to bolster the West Coast waterfront’s standing as a leader both nationally and globally.”

“The rank-and-file membership has made their decision and expressed a clear choice,” ILWU International President Robert McEllrath stated. “During the past year, we saw a healthy debate and heard different points of view, with concerns raised by all sides. The democratic process allowed us to make a difficult decision and arrive at the best choice under the circumstances.”

 

Print Edition

Both the Port of Long Beach and the Port of Los Angeles broke cargo traffic records in July, with Long Beach experiencing its busiest month ever and Los Angeles its strongest-ever July.

Apr 28, 2018

Retrenchment from global trade will hurt U.S. workers and logistics network

Online Edition

The ports in Southern California, and all the vast freight rail and intermodal infrastructure that support them, are on the front lines of the current uncertainties surrounding U.S. trade policy. The volatility surrounding international trade has been intense, particularly with China and our North American trading partners. While this dynamic underscores the strength and importance of U.S. trade, these heightened tensions also illuminate the vulnerability of the healthiest U.S. economy since the 2008 recession.

It also obfuscates a key point: Trade is good for American workers and our national economy.

At the core of the nation’s economic strength is the ability to move goods efficiently, a modern-day phenomenon that trucks, railroads, ships and ports make possible with a sophisticated logistics network. With it comes quality jobs and the ability to sell and consume goods seamlessly and globally, as we now come to expect in the digital era. Actions that would inhibit trade could have sizable negative repercussions to American jobs and the economy.

For future prosperity and the ability to enjoy these present-day realities, federal policymakers must recognize that an unnecessary trade war would do far more harm than good.

This starts with understanding the value of trade to key sectors that directly and indirectly employ millions, chiefly the seaport and private freight rail sectors we represent.

The cargo activity through U.S. ports supports a whopping 23 million American jobs, and every $1 billion worth of goods shipped through U.S. seaports — some of which, including in Southern California, connect closely to railroads — create 15,000 jobs. In total, seaports handle 2 billion tons of cargo annually, including food, clothing, medicine, fuel, raw materials, components, building materials, electronics and toys. And these materials flow out as well as in for domestic companies to use and consumers to enjoy.

Freight railroads, equally essential to the flow of goods and similarly reliant upon sensible trade policy, conservatively estimate that international trade — which includes commerce across North America as well as Asia and Europe — accounts for more than 40 percent of rail traffic. The sustained movement of goods via rail reduces highway congestion, provides environmental benefits and supports some 1.5 million jobs.

Surprisingly, railroads deliver nearly twice as much to export as they import. This is only possible, of course, with healthy ports that account for over one quarter of U.S. economic activity.

To maintain this economic powerhouse, we encourage the Trump administration and Congress to consider the economic and employment impact on seaports, rail hubs and their surrounding communities prior to imposing trade sanctions on imports from other nations.

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Promulgating thoughtful trade policy — that which favors reciprocal international trade liberalization on a fair and equitable basis — also means correcting what is sometimes misunderstood.

For example, the North American Free Trade Agreement, which negotiators are cautiously optimistic will be resolved in early May, has been a net positive to the U.S. economy — especially for U.S. railroads and auto manufacturers. Trade among Canada, Mexico and the U.S. has tripled since its enactment in 1993 while U.S. manufactured exports to Canada and Mexico account for 2 domestic million jobs. The ability to invest across the continent helps supports industries that may otherwise flee the region altogether.

Similarly, efficiency aiding technologies — not free trade agreements — have contributed most significantly to generational job shifts and a new-look U.S. economy. Yet this is nothing new. Cars displaced horses years ago, while digital banking now replaces tellers. All told, the U.S. is at record low unemployment and many high-skilled jobs remain unfilled.

Clearly, trade continues to support us all. Policymakers in Washington must work swiftly to restore market certainties and forge paths to expand U.S. exports, rather than create new import restrictions.

Additionally, we strongly encourage continued U.S. participation in comprehensive negotiations to expand trade of goods and services on a fair and equitable basis. Flirtations with rejoining the Trans-Pacific Partnership (TPP) are a positive development, as are signs that China is coming to the table. We hope progress will continue.

Online Edition

The ports in Southern California, and all the vast freight rail and intermodal infrastructure that support them, are on the front lines of the current uncertainties surrounding U.S. trade policy. The volatility surrounding international trade has been intense, particularly with China and our North American trading partners. While this dynamic underscores the strength and importance of U.S. trade, these heightened tensions also illuminate the vulnerability of the healthiest U.S. economy since the 2008 recession.

Mar 01, 2018

International Intermodal News - Port Development

Print Edition

In New Jersey two Democratic party members of Congress, Donald Payne and Albio Sires, asked Governor Phil Murphy, also a Democrat, to revive a ban on pre 2007 trucks at the port complex. The Port Authority of New York and New Jersey, which oversees air quality on the docks, rejected that apporach two years ago in favor of offering financial incentives to buy newer trucks.

Print Edition

In New Jersey two Democratic party members of Congress, Donald Payne and Albio Sires, asked Governor Phil Murphy, also a Democrat, to revive a ban on pre 2007 trucks at the port complex. The Port Authority of New York and New Jersey, which oversees air quality on the docks, rejected that apporach two years ago in favor of offering financial incentives to buy newer trucks.

Aug 17, 2017

Too Aggressive Or Not Ambitious Enough? Mixed Feedback On San Pedro Bay Ports' Draft Clean Air Action Plan

Print Edition

The next iteration of the San Pedro Bay Ports Clean Air Action Plan was released as a draft document in mid-July, and various industry stakeholders are still combing through its pages as they formulate formal responses.

Initially, feedback appears mixed. Some groups have expressed satisfaction with certain provisions in the document, while others are wary of its reliance on technologies that are not yet available and potential cost impacts to private industry. Still others argue the plan is not aggressive enough.

The plan has changed somewhat from what was included in a draft discussion document released late last year due to the ports’ desire to tie their goals to upcoming state requirements.

Heather Tomley, director of environmental planning for the Port of Long Beach (POLB), is pictured in front of Long Beach Container Terminal, which features a variety of zero-emission technologies. POLB and the Port of Los Angeles recently unveiled their joint draft Clean Air Action Plan, which details goals for achieving zero-emissions from cargo handling equipment by 2030, among other strategies aimed at reducing pollution and greenhouse gas emissions. (Photograph by the Business Journal’s Larry Duncan)

“The majority of the strategies that we laid out in the discussion document have remained as they were presented in that document but with a little bit more detail, clarification, backup information, analysis, that sort of thing,” Heather Tomley, director of environmental planning for the Port of Long Beach, told the Business Journal.

“There were a couple strategies that have changed from the discussion document. Primarily, that is related to feedback that we got and then also activities that have taken place with regulatory changes or legislative changes,” Tomley explained.

Goals related to the Clean Trucks Program, which sets goals and requirements for integrating cleaner-running trucks in the dual port complex, are one such change. The discussion document set timeline goals for phasing out old trucks in 2018, 2020 and 2030, with the ultimate goal of only zero-emission trucks operating in 2035. State law caused the ports to change these requirements in the draft CAAP document.

Senate Bill (SB) 1, a bill taxing gas and creating a fee system based upon the model year of vehicles to fund infrastructure improvements, was signed into law in November and ultimately had an impact on the CAAP. The law creates requirements for phasing out old semi-trucks with cleaner ones but includes a “useful life” provision for existing trucks on the road.

Under SB 1, truck owners will not be required to purchase a new vehicle until their existing truck has reached 13 years from the certified model engine and emissions control system year, or until the truck has traveled 800,000 miles so long as the engine and emissions control system does not reach 18 years past their original certification date.

“Essentially what that means is the state is not going to be doing a new regulation on trucks anytime soon,” Tomley said. “What worked the last time around with our truck program is the state had their regulation that they were developing at the same time as we were doing our program. And we structured our program to essentially just accelerate the timelines,” she explained.

“Now that there won’t be a state regulation, we are not in that same position,” Tomley continued. “We won’t be able to accelerate anything that the state is doing. So, within the authority that we have, we are looking at the ways we can try to guide the turnover of the trucks into the type of trucks that we want to see.”

The draft CAAP, if passed, would require new trucks registering at the ports to be model year 2014 or later starting in 2018. In 2023, a state regulation requiring operation of near-zero emission trucks kicks in, and the ports would require that trucks meet this standard at that time.

“Then we have also proposed to establish a truck rate structure where all trucks would have to pay a rate after a certain year,” Tomley said. “But then we would provide exemptions to that rate for trucks that meet zero or near-zero emissions. So that would provide an economic incentive for use of those trucks.”

The draft CAAP also outlines goals to create a universal truck appointment system and to require all truckers entering the ports to make appointments at terminals. “Currently, nine of the 13 terminals have appointment systems, but they’re all independent systems that don’t communicate with each other,” Tomley said. “What we want to do is make sure we have an overlay where all of the systems can talk to each other so that if you are delayed at one terminal, you can make adjustments on your next appointment. So it can all be seamlessly integrated.”

Alex Cherin, intermodal conference chair of the California Trucking Association (CTA), told the Business Journal that the CTA is still reviewing the draft CAAP and reaching out to its members for feedback.

“I can tell you, though, initially, that we see that it tries to strike a balance between the need to continue robust trucking operations at the port while still incentivizing those who want to invest in newer and cleaner trucks,” Cherin said. “We are initially pleased to see that there is no hard ban on equipment and that the updates seem to tie themselves to what the California Air Resources Board has proposed.”

Cherin said the organization will submit an official comment letter to the ports within a few weeks after receiving comments from members. “There is always a concern about the costs. But again, I think the way that this CAAP update is written, it tries to strike a nice balance,” he said.

The Coalition for Renewable Natural Gas would like to see more aggressive requirements for trucks.

“When you compare the discussion document to the draft CAAP, the draft CAAP took some significant walks away from some of the aggressive parts of the discussion draft,” Greg Roche, vice president overseeing sustainable trucking for coalition member Clean Energy, told the Business Journal. Clean Energy is a provider of natural gas fuels and fueling stations.

“It waits until 2023 before it starts imposing fees to encourage changeover of trucks,” Roche said of the draft CAAP. “And there is a significant delay in when emission reductions would occur between the draft CAAP and the original discussion draft.”

Roche pointed out that near-zero emission RNG-fueled semi-trucks will be commercially available in 2018. “Our view is that with the technology available, we could complete the transition to clean trucks by 2023 versus getting started then,” he said.

Tomley said the ports’ power to make such requirements without state guidelines in place is limited. “We don’t have the same authority that the air agencies have to implement requirements, develop rules, that sort of thing,” she said. Requiring new trucks registering at the ports to have newer engines and imposing rates are within the port’s authority, she noted.

The draft CAAP’s requirements for cargo handling equipment also changed from the discussion document. Originally, the discussion document included a goal to require all cargo handling equipment to be zero emission by 2030.

Now, the California Air Resources Board is developing regulations to achieve the goal of all such equipment operating at up to 100% zero emissions by 2030. “The state identified that they will be moving forward with amendments to their regulation,” Tomley said. “So our process that we’ll be going through will be participating in their rule-making effort to identify ways that we can help ease barriers to implementation, accelerate the timeline where we can and stay on track for meeting the 2030 timeline, but [also] participate in the rule-making process.”

While Long Beach Container Terminal now has mostly zero-emissions equipment at Middle Harbor, that equipment is automated, and the ports would not be requiring a switchover to automated terminals, according to Tomley. “It doesn’t require automation. Traditional operations we think will also be feasible,” she said.

But zero-emission versions of equipment such as top picks and yard tractors are not yet available. “One of the comments that we hear from folks is ‘This equipment is still just being developed.’ Some of it hasn’t even been developed as a prototype yet,” Tomley said. “But we’re working through that process.” She noted that several demonstrations of zero-emission yard tractors are underway. The Port of Long Beach has a Technology Advancement Program which primarily uses grant funding to demonstrate new, cleaner technologies, she added.

A Moffatt & Nichol study commissioned by the Pacific Merchant Shipping Association (PMSA) found that converting the San Pedro Bay ports to all-electric, zero-emission equipment would cost as much as $29 billion, according to Thomas Jelenic, PMSA vice president.

It would cost about $2 billion to install infrastructure necessary to support zero-emissions cargo handling equipment, according to the draft CAAP. It “may cost upwards of $1.8 billion to replace the existing fleet with zero-emissions equipment,” the document also states.

Jelenic does not believe these cost estimates stand up to scrutiny. “The concern is with assumptions. First, the fact is the equipment doesn’t exist,” he said. He also argued that the batteries necessary to power zero-emission equipment at terminals would not last long enough, which would require investing in multiple machines to carry out the tasks that one used to do.

Tomley acknowledged that the draft CAAP relies upon assumptions and that those assumptions differ from PMSA’s views. “With our study, we assumed that . . . the technology will be developed to a point that it can do the job of sort of traditional diesel equipment,” she said. The assumption in the document is that technology would exist to make one-for-one replacement of technology feasible, she explained. “We assume that the battery technology will continue to advance.”

While the ports will make investments and seek grants to aid in funding these changeovers, Jelenic said the cost to private industry would still be significant. “It’s still an enormous amount of money, particularly for an industry that is struggling with overcapacity, that has lost money pretty much every year for the past decade,” Jelenic said.

“Is there still room to revise it? Absolutely. Which we think they should,” Jelenic said.

The draft CAAP also lays out plans to invest in more on-dock rail infrastructure and continue to reduce emissions produced by harbor craft and ships.

Overall, the ports estimate it could cost between $7.3 billion to nearly $14 billion to implement the proposals in the draft CAAP.

A public workshop on the draft CAAP is being held on August 30 at 5 p.m. at Banning’s Landing, located at 100 E. Water St. in Wilmington.

The public comment period for the draft CAAP closes on September 18. Comments, questions or requests for presentations may be sent to caap@cleanairactionplan.org.

According to Tomley, the joint boards of harbor commissioners are expected to vote on the final CAAP in November.

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The next iteration of the San Pedro Bay Ports Clean Air Action Plan was released as a draft document in mid-July, and various industry stakeholders are still combing through its pages as they formulate formal responses.

Initially, feedback appears mixed. Some groups have expressed satisfaction with certain provisions in the document, while others are wary of its reliance on technologies that are not yet available and potential cost impacts to private industry. Still others argue the plan is not aggressive enough.

Apr 10, 2018

Nation's Largest Zero-Emissions Port Project Launched in Long Beach

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Officials from the Port of Long Beach, Southern California Edison (SCE) and the California Energy Commission launched a pilot project on April 4 to test zero-emissions terminal equipment at the Pacific Container Terminal, one of three terminals included in the program.

“The Zero-Emissions Terminal Transition Project kicks off a new era in transportation electrification and the ports’ own transformation zero emissions,” Long Beach Harbor Commission President Lou Anne Bynum said during the launch event. “We are grateful for the partnerships with the Energy Commission and Southern California Edison that are making this a reality.”

The project is the nation’s largest zero-emissions pilot for cargo handling equipment for seaports. Under the project, zero-emissions equipment such as cranes and vehicles will be in use for one year to “test their performance in a real-world setting,” according to a port press release. Nine diesel-electric rubber tire gantry cranes will be converted into fully electric equipment at one terminal, while two other terminals will receive 12 batter-electric yard tractors. Four liquefied natural gas trucks will also be converted into plug-in hybrid trucks for a drayage trucking firm that operates within the terminals.

The project is a direct result of the San Pedro Bay ports’ 2017 approval of an updated Clean Air Action Plan, which set the goal of all terminal equipment being converted to zero-emissions technology by 2030.

“The projects we are kicking off today will help to address some of Southern California’s biggest challenges – cleaning up the air and reducing harmful greenhouse gases that cause climate change,” SCE President Ron Nichols said. “SCE’s vision for a clean energy future means partnering with the port and other SCE customers to electrify transportation, as well as working hard to make sure the electricity that we provide to power those vehicles is produced with clean, renewable resources.”

The port anticipates the project will reduce greenhouse gases more than 1,323 tons and nitrogen oxides by 27 tons annually. The transition will also save an estimated 270,000 gallons of diesel fuel. The zero-emissions port project is mostly funded by a $9.7 million grant from the California Energy Commission.

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Officials from the Port of Long Beach, Southern California Edison (SCE) and the California Energy Commission launched a pilot project on April 4 to test zero-emissions terminal equipment at the Pacific Container Terminal, one of three terminals included in the program.

Mar 19, 2018

Chicago's Perfect Storm

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 Major delays are plaguing shippers and logistics providers in Chicago because of a perfect storm of winter weather, intermodal railyard delays, chassis shortages, and tighter truck capacity exacerbated by the electronic logging device (ELD) mandate.

Although not limited to Chicago, the top US freight hub has been cited for the most severe gridlock and so much drayage demand that some motor carriers will not accept new customers until April.

Multiple trucking executives told The Journal of Commerce they are charging accessorial fees on some hauls and imposing $75 to $150 detention penalties after sitting one hour at an intermodal railyard.

“this is the most prolonged and sustained period of tightness in Chicago that I’ve ever seen; its unprecedented. But I think it may be the new normal,” said Phil Shook, director of intermodal at C.H. Robinson Worldwide.

“It is about as bad as we’ve ever seen it historically, outside of weather emergencies like blizzards,” said Clint Dvorak, managing director, Global North American at MIQ Logistics, which recently issued an alert to shippers about the delays.

Jason Hilsenbeck, president of Drayage.com, said clicks on his website from the Chicago metropolitan area have surged since the beginning of the year. During that time, his intermodal directory website generated more than 90,000 clicks. Per day, the average hovers between 2,000 and 3,000, indicating a significant interest to search his online directory of drayage providers serving Chicago.

 “When we had the labor problems in Los Angeles and Long Beach a few years ago, we started to hit 70,000 or 80,000 clicks over 60 days, but I’ve never seen this in Chicago except after blizzards,” Hilsenbeck said.

Trucking and logistics executives have expressed frustration at intermodal railyard operations since the beginning of the year, worried the slowdown will further alienate the driver pool.

Canadian National Railway in Harvey, Illinois, and Union Pacific Railroad’s four Chicago-area terminals, to a lesser extent, were identified as having multihour turn times in some cases, according ot the sources who spoke on the condition of anonymity.

In a statement, CN blamed the delays on the weather, driver shortages, and ELDs.

“We continue to work with our supply chain partners to manage traffic flows and alleviate the delays. We are working to secure more driver power in the Chicago area to increase terminal fluidity, and have encouraged carters to schedule appointments at off hours, such as nights and weekends,” the railway wrote.

The delays are happening as truckers contemplate whether to leave the industry ahead of the hard enforcement date of ELDs on April 1. Owner-operators fed up with the Chicago dray market may consider this the right time for a change.

“I would say 50 percent of the drivers or more are considering flipping to (over-the-road) to avoid the ramps. Owner-operators just get fed up and no longer want to do rail freight because of the time wasted at ramps. It’s a vicious circle,” said Susan Keldani, vice president of On Track Transportation in Illinois.

“You spend three hours getting the chassis and the container, and when you terminate, its another two hours. It’s leaving very little time for drivers,” added Kevin Lhotak, president of Reliable Transportation.

That is when there are even chassis available to take the container.

Tracy Davis, president of Acme Transportation Company, said truckers often arrive at railyards only to discover no available chassis or a small number of defective units.

“There may be 10 chassis one day, but when you go to pick it up, the person says it’s reserved or the chassis are red-tagged and cannot go out on the road,” Davis said.

Mediterranean Shipping Co. (MSC) sent a warning notice in early February to customers urging customers to promptly return equipment to alleviate the shortage.

“If there is not a drastic decrease in long dwelling equipment on the street in the coming days, we will have no choice but to enforce a ‘no chassis in, no chassis out’ policy at the rails and CYs in order to release any more equipment for loading,” the MSC notice said.

Consolidated Chassis Management pegged the utilization rate at 63 percent for the Chicago-Ohio Valley Consolidated Chassis Pool, including an ample supply near the CN Harvey Terminal.

Neither TRAC Intermodal or Direct ChassisLink INc. were available for comment at the time of this report.

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 Major delays are plaguing shippers and logistics providers in Chicago because of a perfect storm of winter weather, intermodal railyard delays, chassis shortages, and tighter truck capacity exacerbated by the electronic logging device (ELD) mandate.

Although not limited to Chicago, the top US freight hub has been cited for the most severe gridlock and so much drayage demand that some motor carriers will not accept new customers until April.

Mar 19, 2018

Seeking team status - Teamsters union and drayagedrivers escalate actions in Long Beach-Los Angeles on misclassification issue

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The teamsters union is ramping up its efforts to have owner-operator truck drivers classified as employees. The union in late February enlisted the Long Beach City Council to join state and local efforts on the misclassification issue.

Drivers also filed a class-action lawsuit in Los Angeles against XPO Logistics and XPO Cartage, seeking penalties and back wages for hundreds of drivers, and asking the court to prevent further misclassification of XPO drivers.

Long Beach, the second-largest US container port, is an agency of the city. The council at its regularly scheduled meeting unanimously adopted a three-point recommendation from Mayor Robert Garcia to work with state and federal agencies that have jurisdiction over labor regulations to address harbor drayage issues.

In a general sense, the thrust of the Teamsters-backed initiative is to fix what the union calls a “broken system” of drayage and “misclassification of employees” at US ports. They cited port congestion, which reduces the earning potential of harbor truckers, and the inability of independent contract drivers to qualify for the same types of protections and benefits that employees usually have.

An attorney for harbor truckers in the class-action lawsuit, Julie Gutman Dickinson, said that although the workers in question drive for XPO Cartage at the ports, railyards, and distribution facilities in Southern California, the misclassification issue exists throughout the US. “It is a nationwide problem,” she said.

The class-action lawsuit filed in the Superior Court of California in Los Angeles charges that because drivers who shuttle containers between the ports of Los Angeles and Long Beach and area distribution centers and railyards are improperly classified as independent contractors, XPO fails to pay the drivers at least the minimum wage, as well as for missed meal breaks, business expenses involving the trucks and waiting time at cargo facilities. The attorneys did not have an exact number of drivers covered and damages that could be paid.

In a narrower sense, the Teamsters union wants owner-operators to be legally declared direct employees of the motor carriers and retailers that contract with them to haul containers to and from US ports. Union are prohibited from organizing independent contractors, but they are free under federal law to attempt organize employees.

The Port of Los Angeles, in its original clean-air plan 10 years ago, attempted to limit port access to trucks driven by employee drivers. In 2013, the US Supreme Court struck down the employee mandate as interference with interstate commerce laws.

Since then, the Teamsters have targeted individual motor carriers and, through legal challenges, attempted to demonstrate that the owner-operator drivers were misclassified and the companies exerted the same amount of control over them as if they were employees. The Teamsters or others who represented the drivers have won a number of cases.

However, those victories were achieved, on a case-by-case basic, and did not set precedent on the misclassification issue. Therefore, the Teamsters in recent years have pursued the legislative route in cities and states that are viewed as being labor-friendly. Because California is considered to be the friendliest of all, many of the efforts have taken place before state agencies such as the California Employment Development Department. The Teamsters and drivers have also won cases before the National Labor relations Board, and in recent years have won millions of dollars in fines and restitution.

The Long Beach decision calls for support of language in state and federal legislative agendas to improve working conditions in the harbor for truck drivers, a request to the city attorney to cooperate with the California attorney general for regulatory efforts, and a request to the Harbor Commission to hold hearings on truckers’ working conditions in the harbor.

The Harbor Trucking Association (HTA), which represents drayage companies in Los Angeles – Long Beach, supports freedom of choice for motor carriers. The HTA notes that some drayage companies have employee drivers, some contract with owner-operators, and some companies operate with both models.

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The teamsters union is ramping up its efforts to have owner-operator truck drivers classified as employees. The union in late February enlisted the Long Beach City Council to join state and local efforts on the misclassification issue.

Drivers also filed a class-action lawsuit in Los Angeles against XPO Logistics and XPO Cartage, seeking penalties and back wages for hundreds of drivers, and asking the court to prevent further misclassification of XPO drivers.