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Revenue & Fees: Houston, Los Angeles

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The Port of Houston Authority reported that August was another "$20 million+ month," with year-to-date operating revenue increasing 4 percent. The Los Angeles Board of Harbor Commissioners on August 19 voted in favor of port staff’s recommendation to eliminate a never-used container fee created nearly six years ago to help finance major rail, highway and bridge improvement projects.

Houston: August Cargo and Revenue Gains; MOU with Marseilles Port Authority

August was "another $20 million+ month" for the Port of Houston Authority, Executive Director Len Waterworth told his port commission during its regularly monthly on September 24. "That's four out of eight this year, extremely good," said Mr. Waterworth. "Year-to-date operating revenue of $156 million increased 4 percent, or $6 million."

Net income jumped 212 percent in August (to $11 million) and 39 percent year-to-date (to $36 million), largely due to grants, which, Mr. Waters noted, "we have been aggressively pursuing for security needs, including the new emergency response vessels." A "surprise uptick in steel imports" spurred a 5 percent increase jump in cargo tonnage. The year-to-date total of 24 million tons was up 4 percent, thanks to gains of 16 percent in bulk cargo and 7.0 percent in containers.

During their meeting, the port commissioners awarded an eight-month, $325,000 contract, with an option to renew for one additional passenger cruise season, for parking services for the Bayport Cruise Terminal. Starting this November, Princess Cruises offer 77 sailings through 2016. Norwegian Cruise Line will begin sailing out of Houston next year for a total of 75 cruises through 2017.

After the meeting, a signing ceremony was held for a Memorandum of Friendship and Trade Cooperation with the Port of Marseille and the Provence Promotion Economic Development Agency. These two entities, in collaboration with the Port of Houston Authority, will perform joint marketing efforts to promote waterborne trade and economic development between Houston and France via the ports of Marseille-Fos.

Los Angeles Drops Infrastructure Cargo Fee

The Los Angeles Board of Harbor Commissioners on August 19 voted in favor of port staff’s recommendation to eliminate a never-used container fee created nearly six years ago to help finance major rail, highway and bridge improvement projects.

The Infrastructure Cargo Fee (ICF) ranging from $6 to $18 per TEU would have been assessed on all loaded containers entering and leaving the port by truck or rail. The fee was formally approved in 2008 but never implemented.

The ICF was initially established to help fund key infrastructure projects that would reduce traffic congestion, improve the flow of cargo and cut air pollution.

The fee was due to start in 2009 and expected to collectively raise $1.4 billion in order to secure matching state transportation funds for the design and construction of 17 specific highway and rail construction projects throughout the harbor district. But when the economy began to slide into a deep recession, the port put the ICF on hold and pursued other federal, state and regional grants to advance its projects.

The port has since secured 55 percent of the more than $313 million needed to pay for four capital projects underway or due to begin construction by January 2014, with the balance to be paid for from port revenues.

Port projects moving forward are the Berth 200 Railyard, the South Wilmington Grade Separation and two I-110 interchanges. Of the remaining 13 projects that the ICF was intended to support throughout the harbor complex, only one is exclusive to the Port of Los Angeles and four are joint projects. According to the port, recent traffic analyses indicate those five projects may not be needed before 2025 and can be deferred.

"It is time to take this fee off the books for good," said Port Executive Director Geraldine Knatz, Ph.D. "The fact that we never collected it illustrates how the port successfully sought funding from other sources – specifically grants – in order to develop port infrastructure in a responsible manner that makes sense for all our stakeholders and preserve our competitive advantage."
 

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