The PierPass Program: 5 Key Things Shippers Should Know

Introduction

As global trade continues to grow, major ports face increasing challenges with congestion, efficiency, and environmental impacts. The PierPass program at the Ports of Los Angeles and Long Beach represents an innovative approach to addressing these issues. In this article, we'll explore the key things shippers should know about PierPass and how it affects operations at these crucial West Coast gateways.

PierPass was created in 2005 by marine terminal operators at the Ports of Los Angeles and Long Beach to address multi-terminal issues like congestion, security, and air quality. As the busiest container port complex in the United States, these adjacent ports play a vital role in global supply chains. The PierPass program aims to mitigate congestion and improve efficiency through extended gate hours and financial incentives.

1. The OffPeak Program

At the heart of PierPass is the OffPeak program, which established additional shifts at all international container terminals in the two ports. Here are the key points to understand:

• Before OffPeak, 88% of container movements occurred during daytime hours on weekdays.
• The program created night and weekend shifts to spread out truck traffic.
• Now, approximately 50% of truck visits occur during OffPeak hours.
• On an average OffPeak weeknight, about 17,000 trucks visit the container terminals.
• The program can handle about 55% of daily truck-borne cargo traffic at the port complex.

By distributing container movements more evenly across all hours, the OffPeak program has significantly reduced daytime congestion and improved overall port efficiency. This benefits shippers by reducing wait times and increasing predictability for cargo pickup and delivery.

2. The Traffic Mitigation Fee (TMF)

To incentivize the use of OffPeak hours and fund the additional shifts, PierPass implements a Traffic Mitigation Fee (TMF). Here's what shippers need to know about the TMF:

• The fee is applied to cargo moving during peak daytime hours.
• As of August 1, 2020, the TMF is $33.47 per TEU (twenty-foot equivalent unit) or $66.94 for all non-exempt containers.
• PierPass is a non-profit organization and does not make money from the TMF.
• The collected fees, minus administrative costs, are allocated to terminal operators to finance labor and operational costs of the additional OffPeak shifts.

While the TMF does add a cost for daytime cargo movements, it's important to consider the broader benefits of reduced congestion and improved efficiency that the program provides. Shippers may find that the advantages of more predictable transit times and reduced wait times outweigh the fee.

3. Appointment-Based System

In recent years, PierPass has evolved to incorporate an appointment-based system. This change aims to further improve efficiency and predictability for cargo movements. Key points include:

• All marine container terminals at the Ports of Los Angeles and Long Beach now require appointments for import container pickups.
• Appointments are made through each terminal's individual system, not through PierPass directly.
• The appointment window, including grace periods, is typically two hours.
• Last appointment times are 3:30 PM for the first shift and 1:30 AM for the second shift.

This appointment system helps terminals better manage truck flow and resource allocation. For shippers and trucking companies, it provides more structure and predictability to the pickup process, potentially reducing wait times and improving overall efficiency.

4. Flat Fee Structure

Another recent change to the PierPass program is the implementation of a flat fee structure. Here's what shippers should know:

• The previous model of charging TMF only during peak hours has been replaced with a reduced flat fee applied across all hours of operation.
• This change aims to spread out truck arrivals more evenly and reduce rush hour-like congestion at the start of the nighttime OffPeak shifts.
• The flat fee structure, combined with the appointment system, is designed to provide more flexibility for cargo owners while still incentivizing the use of all operating hours.

This new approach may simplify planning and budgeting for shippers, as the fee is consistent regardless of pickup time. However, it's still important to consider terminal congestion patterns when scheduling pickups to minimize potential delays.

5. Exemptions and Special Cases

While the PierPass program applies broadly to container movements at the ports, there are some important exemptions and special cases to be aware of:

• The following types of cargo movements are exempt from the Traffic Mitigation Fee:
  • Rail intermodal containers
  • Transshipped containers (arriving on one vessel and departing on another without entering U.S. commerce)
  • Empty containers
  • Domestic cargo
  • Bare chassis
• These exemptions have remained consistent even as other aspects of the program have evolved.
• Shippers dealing primarily with these types of movements may be less impacted by the PierPass program overall.

Understanding these exemptions can help shippers better plan their operations and potentially reduce costs for certain types of cargo movements.

How FreightAmigo Can Help

Navigating the complexities of port operations, including programs like PierPass, can be challenging for shippers. This is where FreightAmigo's Digital Logistics Platform can provide valuable support:

• Our platform offers real-time visibility into appointment availability and port congestion, helping you optimize your pickup and delivery schedules.
• We can assist in calculating and managing PierPass fees as part of your overall freight costs, ensuring transparency and accuracy in your budgeting.
• Our Digital Logistics Solution includes automated document management, simplifying the process of providing necessary paperwork for container pickups.
• With our extensive network of carriers and 24/7 support, we can help you find alternative solutions if port congestion or appointment availability becomes an issue.

By leveraging FreightAmigo's technology and expertise, shippers can more effectively navigate the PierPass program and other port-related challenges, ultimately improving the efficiency and reliability of their supply chains.

Conclusion

The PierPass program represents an important effort to improve efficiency and reduce congestion at two of America's busiest ports. By understanding the key aspects of the program - including the OffPeak hours, Traffic Mitigation Fee, appointment system, flat fee structure, and relevant exemptions - shippers can better navigate these crucial gateways and optimize their supply chain operations.

As global trade continues to evolve, programs like PierPass will likely continue to adapt. Staying informed about these changes and working with knowledgeable partners like FreightAmigo can help ensure your shipping operations remain efficient and cost-effective. Whether you're new to shipping through Los Angeles and Long Beach or a seasoned importer/exporter, taking the time to understand and adapt to programs like PierPass can yield significant benefits for your business.