A fee at the Port of New York and New Jersey that ocean carriers are challenging before the Federal Maritime Commission is also under fire in the New Jersey Legislature.
Although they are not part of the case before the Maritime Commission, officials with the Maersk Line said the “cargo facility charge” is unfair and could eventually negatively effect customer services. The carrier has already paid out more than $4 million because of the fee.
Maersk is not passing the fee on to customers, but if it was, one large fresh fruit importer who brings produce to the U.S. from South Africa would have faced an additional $7,400 in charges in 2012, said Tim Simpson, Maersk’s director of communications for North America.
New Jersey state Sen. Robert Gordon is concerned the fee will drive away carriers such as Maersk. He introduced a bill in May to prohibit the port authority from imposing a “cargo facility charge.”
“The elimination of cargo facility charges … will make the port authority more competitive with other ports located along the Eastern seaboard of the U.S.,” according to Gordon’s bill.
To kill the fee, Gordon’s bill will have to be approved by the New Jersey Legislature and a similar bill would have to be introduced and approved by the New York State Assembly.
Opponents say the port fee illegally subsidizes intermodal rail shipments because it forces ocean carriers to pay for infrastructure they don’t use, according to the case before the Federal Maritime Commission. Nine container ship lines filed the complaint in 2011 after the fee was introduced. The case is still pending.
Steve Coleman, deputy director of media relations at the port authority, confirmed the fee rate and provided a copy of the action the authority took when it enacted the fee, but he did not respond to other questions.
The fee is $4.95 for 20-foot containers and $9.90 for 40-foot containers, loaded or empty. The rate for vehicle cargo is $1.11 per unit. Bulk cargo is charged 13 cents per metric ton.
“The big problem is the assumption on the port authority’s part that the fee is being passed on,” said Doug Morgante, Maersk’s director of state government relations.
Morgante said the Maersk Line is not passing along the fee because it would cost more to pay for the staff time to process the paperwork for the carrier’s “thousands of customers” than the fee costs.
“(The authority) thinks it is passed along by us to our customers who then pass it on to consumers who end up paying a penny more for a bunch of bananas,” Morgante said. “But it’s falling on the ocean carriers to absorb this cost.”
The port authority eliminated two fees when it enacted the cargo facility charge — a rail lift fee of $57.50 for each container and a Sea-Link terminal subscription fee that varied depending on volume.
However, Maersk spent 13% more on the cargo facility charge in 2012 than it would have spent on the rail lift fee alone, company officials said.
When the port authority enacted the cargo facility charge it stated the money would be used for three primary purposes:
- recovery of construction costs related to ExpressRail infrastructure;
- recovery of the costs of port roadway projects; and
- recovery of costs associated with post 9-11 security expenses.