The West Coast Marine Terminal Operator Agreement (WCMTOA) announced a 2.5% increase in the Traffic Mitigation Fee (TMF) at the Ports of Los Angeles and Long Beach CA, in order to address labor cost increases scheduled to take effect July 1, 2012.
Beginning August 1, the TMF will be increased by $1.50 per TEU (20-foot equivalent unit) to $61.50 per 20-ft container or $123 per 40-ft container. Current TMF rates are $60 and $120, respectively.
On August 1, 2011, the TMF increased for the first time since 2006. The $10 per TEU increase came after hourly labor costs increased more than 31% for the same period. At that time, WCMTOA announced that beginning in mid-2012 it would begin adjusting the TMF annually to address labor cost increases.
The TMF helps pay for the night and Saturday marine terminal shifts created by the PierPass OffPeak program to relieve daytime congestion in and around the ports. It also provides a financial incentive to move cargo during less-congested times. The TMF is charged for non-exempt containers moving during peak hours (Monday through Friday, 3 am to 6 pm). Refer to www.pierpass.org for more information.
The terminals have operated the OffPeak gates at a loss since the program’s start in 2005, when they doubled the number of shifts per week, essentially spreading the same number of containers over twice the working hours. Cargo volume since 2005 has been essentially flat. The shortfall between TMF revenues and OffPeak gate costs was $55 million in 2011 and $52.3 million in 2010.
Created in 2005, the program has been successful in its primary goal of easing congestion in and around the ports. Over the past seven years, PierPass OffPeak gates have grown to handle approximately 55% of all container traffic at the ports, accommodated more than 21 million truck transactions, and eased congestion on city streets and nearby freeways during daytime business hours.