Several news reports out of Southern California contain surprising information about the Port of Los Angeles’ billion dollar truck replacement program.
Many of the trucks purchased so far aren’t being used enough, and some trucks haven’t been used at the port at all.
According to the Cunningham Report, the port has reviewed progress of its $44 million truck incentive program that began purchasing 2,200 trucks for motor carriers last year. The port found that about 70 percent of trucks the port purchased through the grant program haven’t met the minimum number of port calls required by contract, and nearly 20 percent of the trucks hadn’t made any port calls.
Pacific Maritime Magazine reported that for each truck that doesn’t meet the minimum port call requirement, those motor carriers could be forced to pay $4,000 for a clause that’s in the incentive contract.
Two of the biggest recipients of port truck grants were mega-carriers like Swift Transportation and Knight Transportation, which received a reported $20,000 per truck in grant monies. Swift was issued a check last year of $8.24 million in port money to buy 412 trucks through the program.
Joe Rajkovacz, OOIDA director of regulatory affairs, said the manipulation of large motor carriers to take port grant money and use trucks elsewhere hurts the port and small-business truckers.
“This is a typical example of larger motor carriers siphoning grant money to subsidize their operations,” Rajkovacz said. “They undermine legitimate small businesses.”
OOIDA Executive Vice President Todd Spencer said the carriers who moved the trucks away from the port may accept the $4,000 penalty.
“As for only having to maybe pay back $4,000 from a $20,000 grant – Bernie Madoff would love that deal,” Spencer said.
– By Charlie Morasch, staff writer