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Paying for the ports

September 07, 2006

AMONG THE MANY BILLS passed by the Legislature in the frantic final days of August was one little-heralded measure that could go a long way toward curbing two of Southern California's worst ills: traffic and smog. For it to become law, Gov. Arnold Schwarzenegger's environmental consciousness will have to triumph over his impulse to placate business interests.

SB 927 by state Sen. Alan Lowenthal (D-Long Beach) would impose a fee of $30 per 20-foot container on all cargo ships passing through the ports of Los Angeles and Long Beach. It is projected to generate $500 million a year, which would be earmarked for improving port security, cleaning up port pollution and building port infrastructure.

Port issues seldom generate much excitement among voters, but they should. The ports are the single largest generator of air pollution in Southern California, which kills an estimated 2,400 people prematurely per year. They're also a major source of traffic.

Shippers and retailers, who would be stuck with the tab under Lowenthal's plan, contend that the legislation would encourage shippers to send their goods elsewhere, that it would constitute a tax (which would require two-thirds approval in the Legislature), that it would violate the commerce clause of the U.S. Constitution and that it would hurt consumers by raising prices on many products.

These claims are exaggerated or wrong on all counts. A study commissioned by two environmental groups found that the proposed fee would increase total voyage costs to local ports by 1.5% to 2.5%. But sending goods through the Panama Canal to ports on the East Coast or in the Gulf of Mexico would add far more expense, and the only major West Coast alternatives -- Oakland, Seattle and Portland -- can handle just a fraction of the local ports' traffic. The bill clearly creates a user fee, not a tax, and the commerce clause does not prevent states from imposing such fees. And if the bill would add a few cents to the price of some consumer products, it would be worth it.

Under the bill, the ports would use a third of the proceeds to pay for better security, and the state Air Resources Board and Transportation Commission would control the rest. There are plenty of projects to go around. The Los Angeles County Economic Development Corp., a nonprofit business organization, has identified $4 billion worth of needed infrastructure projects, and a plan by the ports to cut air pollution would require billions more. Much of the money is likely to come from taxpayers; voters will be asked in November to approve $3.2 billion worth of bonds to cover port infrastructure and air quality. It's only fair that the shipping industry contribute as well.

Schwarzenegger has not said whether he will sign SB 927. Few other bills will test his commitment to the environment more. If he's truly interested in burnishing his environmental credentials before the November election, he'll sign this bill into law.

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