Risk seen in port plan

The nation’s busiest seaport could lose at least 3% of its cargo container business if it adopts a controversial proposal requiring shipping companies to employ the thousands of short-haul truck drivers who work on a contractual basis, a new study says.

The analysis, conducted by Boston Consulting Group, said that “substantial diversions” of the Los Angeles port’s business probably would shift to the neighboring port of Long Beach or to other harbors. The port moved 8.5 million containers in 2007, easily topping its sometime partner and rival, No. 2 Long Beach.

“Some CEOs will say, ‘Well, maybe it will cost more to move goods through L.A. so let’s go someplace else,’ ” Boston Consulting Group spokesman Simon Goodall said. “Higher prices will cause diversions as high as 3%,” and that figure could rise if Long Beach follows through in adopting a plan that businesses could find more palatable, he said.

The report adds another note of concern to the increasingly contentious issue of cleaning up the high levels of pollution emitted by old and often dilapidated trucks used to haul containers.

Long Beach harbor commissioners last month agreed to replace polluting trucks with cleaner models starting Oct. 1. The plan satisfies the call for environmental improvements in the clean-air plan adopted by both ports last year, but it doesn’t require shipping companies to employ drivers.

Now, what began as an unusual show of cooperation between the ports could deteriorate into court battles for both. The ports’ boards had agreed to a groundbreaking $1.6-billion plan for removing 17,000 exhaust-spewing diesel trucks from service. A $35 fee on each cargo container handled would pay for cleaner trucks.

But Long Beach Mayor Bob Foster and the Long Beach board decided that the plan’s final piece, the employee mandate and subsequent driver unionization, would be impossible to defend in court. A coalition of environmental groups and unions has threatened to sue them for the shift.

In Los Angeles, Mayor Antonio Villaraigosa and his commissioners argue that truck drivers, most of whom are independent contractors, need to be well-paid employees to take care of the trucks that the ports plan to help them buy. That would give the International Brotherhood of Teamsters a window to recruit the drivers, who hold some of the cargo industry’s lowest-paying jobs. The American Trucking Assn. has said it would sue over the issue.

Caught in the middle are the businesses that use the ports to import and export goods. In what already figures to be a lean year for many, the headache of trying to figure what they will have to do to comply is hardly appreciated.

“Why do we need all this social engineering detracting from the real issue, which was cleaning up the air?” asked Brian Oken, chief executive of Ventura Transfer Co. in Long Beach. Oken’s firm uses Teamsters and independent drivers.

He’s hardly the only person who isn’t happy.

“The idea of having separate plans is not something I wanted to see,” said Geraldine Knatz, executive director of the Port of Los Angeles.

The Boston Consulting Group argued that L.A. had the better plan in the long term and probably could win back any lost cargo.

But it’s also the third report commissioned by one or both ports to study the issue. And the author of the first one, economist John Husing, said fundamental issues remained unresolved, such as how to deal with the turnover of as many as half of the drivers. Many won’t be able to replace their trucks, won’t want to be company employees or might not meet strict requirements for new federal identification cards for seaport workers, he said.

One important player in the debate said he wasn’t worried about losing business because of the clean-truck plan.

“They’re not going to send tennis shoes to Anaheim through Seattle,” said S. David Freeman, president of the Los Angeles harbor board.

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ron.white@latimes.com

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louis.sahagun@latimes.com