Traffic Mitigation Fees Increase in California Ports!

As of July 1st, 2017, long-shore wage and assessment rates have a combined increase of 2.3% at the Ports of LA/LB. To match these adjustments, the West Coast MTO Agreement announced that the Traffic Mitigation Fee (TMF) at the Ports of Los Angeles and Long Beach will also increase by 2.3%, taking effect on August 1st, 2017.

Beginning August 1st, the TMF will be $72.09 per TEU or $144.18 per forty-foot container. This charge will only be on containers that are moved on weekdays, between 3:00am and 6:00pm. For containers moved during OffPeak shifts (6:00pm to 3:00am on weekdays or 8:00am to 5:00pm on Saturdays), there will not be a TMF.

The use of OffPeak is intended to allow regular night and Saturday work shifts to handle the moving of containers via trucking at the 13 container terminals in the two adjacent ports. The OffPeak program was launched by PierPass in 2005, with the intent to reduce cargo-related congestion and air pollution on roads around the ports of Los Angeles and Long Beach. PierPass is a not-for-profit company created by marine terminal operators at the Port of Los Angeles and Port of Long Beach to address multi-terminal issues. PeirPass implemented TMF to help offset the cost of operating extended gate hours, leading to a reduction in labor costs. This fee is used as an incentive for cargo owners to use the OffPeak shifts to avoid TMF, as a result nearly half of all port truck trips presently take place during the OffPeak shifts.

According to an analysis by maritime industry consultants SC Analytics, in 2016 it cost the terminals $224.7 million to operate the OffPeak program. As a result of TMF, the terminals received $182.7 million that year, offsetting about 81% of the program’s costs.

Issues have been brought up in regards to the OffPeak program. The incurred issues include unjustified rate increases, gate operation inconsistencies, and PiersPass’s lack of correlation between the gate charge during the day versus during night operations.