The Economic and Environmental Implications of Container Fees Levied to Finance Port Related Transportation Infrastructure Improvement Projects

At the macro level this paper addresses the economic and environmental implications of fees imposed on inbound and outbound containers at ports, to finance port infrastructure improvement projects. At the micro level, this paper examines the potential impact of proposed container fees on international trade related jobs in five counties surrounding the Ports of Los Angeles and Long Beach. We do this using forecasted loss of container traffic and a formula measuring jobs that is correlated to import and export container volumes. We also analyze pollution and traffic congestion data during the 2002 lockout at the Ports of Los Angeles and Long Beach, in order to gain a clearer picture of the impact of container truck traffic on the environment. Our findings suggest the potential for substantial job loss when certain container fees are imposed, particularly fees on export containers. Our findings also suggest that infrastructure improvements which decrease container truck traffic surrounding a port can actually lead to a substantial increase in pollution coming from automobile traffic that moves in to make use of increased freeway capacity, thereby negating the intent of the infrastructure improvement. We conclude the paper with several recommendations for how to more strategically think about and move forward on future container fee proposals and infrastructure improvement projects