Siding with business and the shipping industry, Gov. Arnold Schwarzenegger vetoed a bill Friday that would have provided $500 million a year to improve security, expand rail networks and reduce air pollution at the ports of Los Angeles and Long Beach.
The legislation by state Sen. Alan Lowenthal (D-Long Beach) called for a fee on shipping containers that pass through the ports. Had the bill been approved, owners of cargo, such as retailers and manufacturers, would have been assessed $60 for a typical 40-foot container.
Environmentalists, state regulators and local government officials viewed the measure as an effective way to fund much-needed security, transportation and air-quality improvements for the fifth-largest harbor complex in the world. Revenue from the export and import of containerized cargo would have been divided equally among the three areas.
Shipping companies and businesses that rely on marine transportation opposed the bill, contending that it was unconstitutional, difficult to implement and a tax that would discourage companies from sending their cargo through the state's ports. The California Chamber of Commerce included the legislation on its list of "job killer" bills.
Schwarzenegger said he vetoed the container fee because it could have hurt U.S. exports by raising shipping costs and did not provide for public-private partnerships that could boost funding for port and transportation projects.
"It is very important," the governor said, "that any measure to increase fees that impact exporters not have the unintended consequence of negatively impacting the sale and delivery of goods grown and manufactured in California."
Schwarzenegger said he was committed to improving the state's ports and the transportation system through an infrastructure bond issue his office had developed for the November election.
The ballot measure calls for $100 million for port security; $1 billion for improving air quality in California, which could benefit local harbors; $1 billion to solve port environmental problems; and $2.1 billion for trade infrastructure such as harbors, roads and railways.
Shipping industry groups and trade associations representing some of the nation's largest retailers praised the governor's veto Friday. More than 50 business organizations, shipping companies, marine terminal operators and retailers opposed the container fee.
