A new $5.00 chassis fee at the Port of Los Angeles – Long Beach is scheduled to be effective September 1. The fee will apply to each chassis movement into and out of the terminal gates, and may add costs of operating at the port by $29 million.
Terminal operators say the fee is a reimbursement for services that they have been providing chassis users and lessors for free. Terminals use their land to store chassis, and pay longshore labor to deliver the chassis for trucker use. Per John Cushing, President of PierPass, “We are providing these services, and we want to be compensated just as everyone wants to be compensated for the services they provide”.
Until relatively recently the shipping lines owned and provided chassis with little or no charge to importers and exporters, now that they are out of this business, the terminals have received no compensation from the shipping lines for the chassis services.
The Federal Maritime Commission (FMC) is reviewing the matter to see if the fee is legal under Section 10 of the Shipping Act of 1984, which addresses anti-competitive provisions and unreasonable practices. FMC Chairman Mario Cordero has questioned the basis for the fee, as prior to when the majority of carriers got out of the chassis business, the re-positioning of chassis was part of the contractual relationship between terminals and carriers.
Shippers have said the new fee is adding another layer to their costs and reduces the competitiveness of the port. Jonathan Gold, Vice President of Supply Chain and Customs Policy at the National Retail Federation commented, “We continue to be concerned about the increases in fees”. Mr. Gold also said, “There was no transparency. No discussion.”, when lamenting the fact that there were no prior consultations with Beneficial Cargo Owners.