International Trade Law News

The California Senate's Appropriation Committee last week approved SB 974, a bill that would imposes a $30 per twenty foot equivalent unit (TEU) user fee on container cargo imported and exported through the ports of Long Beach, Los Angeles and Oakland. The revenues from the user fee would be used to develop infrastructure projects to reduce congestion and to mitigate the air quality impacts associated with the movement of freight in and out of the three ports. The bill was previously approved by the California Senate's Transportation and Housing and Environmental Quality Committees.

The California Legislature passed a similar bill last year (SB 927) that would impose user fees on containers moving through he ports of Long Beach and Los Angeles. However, California Governor Arnold Schwarzenegger vetoed the bill. In his veto statement, the Governor said that the bill was "flawed in its construction" and was drafted "to include only two ports and applies only to goods shipped in containers, ignoring all other forms of shipping and ports of entry." Governor Schwarzenegger also stated that the bill would have a negative impact on the "the sale and delivery of goods grown and manufactured in California."

The bill introduced in this session of the California Legislature addresses one of the Governor's concern by expanding the scope of the user fee to include the port of Oakland.

Last year's bill was opposed by many trade groups, including the California Chamber of Commerce, Los Angeles Area Chamber of Commerce, National Retail Federation, Retail Industry Leaders Association, California Manufacturers and Technology Association, Waterfront Coalition, Wine Institute, California Farm Bureau, California Trade Coalition, and Pacific Merchant Shipping Association. These groups are likely to oppose this year's version of the container user fee bill as well.

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