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California is facing aggressive deadlines to meet new emissions standards set forth by the federal Clean Air Act. One method that California is pursuing in order to meet the emissions standards is by imposing a $100 fee per 20-foot shipping container proposed by the South Coast Air Quality Management District (AQMD). Several organizations in the freight transportation industry are lobbying for regulators to NOT impose the fee proposed by the South Coast AQMD that is supposed to take effect on July 1, 2018. The fee would include the ports of Los Angeles, Long Beach, and Oakland and would be used to mitigate diesel emissions at terminals. Beneficial Cargo Owners (BCOs) will be responsible for this fee. The South Coast AQMD has stated the fee would generate $1.1 billion annually to lessen the impact of diesel emissions produced by trucks and cargo-handling equipment.

In the past, there have been numerous attempts by regulatory entities to try and impose container fees but those attempts have always failed. The Pacific Merchant Shipping Association (PMSA) is taking this attempt seriously and wrote a letter to the South Coast AQMD explaining that the fee would put California’s sea ports at a competitive disadvantage. The South Coast AQMD spokesperson Sam Atwood declined to comment on the proposed fee measure because the agency hasn’t submitted a formal bill to the California State Legislature. Mike Jacob, PMSA vice president and general counsel, submitted the letter to the South Coast AQMD and in it noted that in 2006, the ports of Los Angeles and Long Beach established their “clean-truck programs” and have since banned trucks older than 2007. Jacobs argued that “the fee encouraged rapid transition to clean trucks rather than to become an indefinite revenue-raising fee” and believes the idea of the AQMD charging a container fee is another fee that provides no incentive. Click here for further reading.

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