.u9_w Lu;lMA JULIE W. HUERTA

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1 ..,, ~~ THE PORT OF LOS ANGELES 425 S. Palos Verdes Street Post Office Box 151 San Pedro, CA TEL/TDD 310 SEA~PORT Eric Garcetti Mayor, City of Los Angeles Board of Harbor David Arion Patricia Costellanos Douglas P. Krause Anthony Pirozz~ Jr. Sung Won Sohn, Ph.D. Commissioners Vice President Geraldine Knotz, Ph.D. 1 Executive Director October 15, 2013 Honorable Members of the City Council of the City of Los Angeles CD No. 15 Attention: SUBJECT: Mr. Michael Espinosa, City Clerk's Office PERMANENT ORDER NO AMENDING PORT OF LOS ANGELES TARIFF NO. 4, SECTION TWO - ITEM 220 PENALTIES FOR VIOLATION AND SECTION TWENTY - ITEM 2040 CONCESSIONS AND TEMPORARY ACCESS PERMITS AND ITEM 2090 REMEDIES FOR VIOLATION OF CLEAN AIR ACTION PLAN PROVISIONS Pursuant to Section 653(a) of the City Charter, enclosed for your approval are Permanent Order No and a corresponding Ordinance to amend Port of Los Angeles Tariff No. 4, Section Two, Item No. 220 and Section Twenty, Item No and Item No. 2090, which were approved at the July 25, 2013 meeting of the Board of Harbor Commissioners. RECOMMENDATION: 1. The City Council approve Harbor Department Permanent Order No and a corresponding Ordinance authorizing the Amendment to the Port of Los Angeles Tariff No. 4, Section Two, Item No. 220, "Penalties for Violation," and Section Twenty, Item No. 2040, "Concessions and Temporary Access Permits," and add the new Item No. 2090, "Remedies for Violation of CAAP Provision;" and 2. Adopt the determination by the Los Angeles Harbor Department that the proposed action is exempt from the requirements of the California Environmental Quality Act (CEQA) in accordance with Article II Section 2 (f) of the Los Angeles City CEQA Guidelines; and 3. Return to the Board of Harbor Commissioners for further processing. Respectfully Submitted,.u9_w Lu;lMA JULIE W. HUERTA cc: Trade, Commerce, & Tourism Committee Councilman Rosendahl, encs. Councilman LaBonge, encs. Councilman Buscaino, encs Christine Yee Hollis, CLA, encs. Alvin Newman, CAO, encs. Lisa Schechter, CD4, encs Aaron Gross, Government Affairs, encs. Robert Henry, encs. Mandy Morales, Mayor's Office, enccs. AN EQUAl EMPlOYMENT OPPORTUNITY AFFIRMATIVE ACTION EMPlOYER " Printed on recycled paper :6~

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3 RECOMMENDATION APPROVED AND TEMPORARY ORDER NO & PERMANENT ORDER ADOPTED BY THE BOARD OF HARBOR COMMISSIONERS JULY 25,2013 L,\ THE PORT OF LOS ANGELES Executive Director's Report to the Board of Harbor Commissioners DATE: JULY 17,2013 FROM: SUBJECT: CLEAN TRUCK PROGRAM TEMPORARY ORDER NO. l'?rj141.. AND PERMANENT ORDER N0.\1,-J\4:L_ AMENDING PORT OF LOS ANGELES TARIFF NO.4, SECTION IVVO ITEM 220 PENALTIES FOR VIOLATION AND SECTION TWENTY ITEM 2040 CONCESSIONS AND TEMPORARY ACCESS PERMITS AND ITEM 2090 REMEDIES FOR VIOLATION OF CLEAN AIR ACTION PLAN PROVISIONS SUMMARY: Staff requests that the Board of Harbor Commissioners (Board) approve amendments to Items 220, 2040 and 2090 of the Port of los Angeles (POLA) Tariff No. 4 (Tariff) to clarify that Item 220 criminal penalties do not apply to violations of Tariff Section 20, Clean Air Action Plan (CAAP), This is not a change in enforcement, as existing terminal operator permits and licensed motor carrier concession agreements already provide contractual remedies for tariff violations. However, these amendments are necessary in order to provide the public with express clarification within the Tariff itself, of the remedies scheme applicable to the CAAP. RECOMMENDATION: It is recommended that the Board of Harbor Commissioners: 1. Approve the amendments to modify Items 220 and 2040 and to add a new Item 2090 in the Port of Los Angeles Tariff No.4, subject to California Association of Port Authorities (CAPA) review and approval, and authorize the Executive Director to work with CAPA to secure this approval or proceed to take independent action in accordance with CAPA procedure (Transmittal1 ); 2. Adopt a Temporary Order and a Permanent Order to amend Items 220 and 2040 and to add a new Item 2090 in the Port of Los Angeles Tariff No. 4 (Transmittals 2 and 3); 3. Authorize the Board Secretary to certify to the adoption of the Temporary Order by the Board of Harbor Commissioners and transmit the Temporary Order to the Chief Wharfinger for implementation and posting to the Port of Los Angeles website as regulated by the Federal Maritime Commission;

4 DATE: JULY 17, 2013 PAGE 2 OF 4 SUBJECT: ORDER AMENDING PORT OF LOS ANGELES TARIFF NO. 4, SECTION TWO - ITEM 220 AND SECTION TWENTY - ITEMS 2040 AND Direct the Board Secretary to transmit to the City Council for approval of the Permanent Order (Transmittal 3) and Ordinance (Transmittal 4) approving and authorizing the amendments to the Port of Los Angeles Tariff No. 4 pursuant to City Charter 653(a); and 5. Authorize the Board Secretary to execute the Temporary Order, Permanent Order and Ordinance amending the Port of Los Angeles Tariff No. 4, and upon its publication, transmit the Order and Ordinance to the Chief Wharfinger for implementation of the tariff change and posting the amended Port of Los Angeles Tariff No. 4 to the City of Los Angeles Harbor Department's website as regulated by the Federal Maritime Commission. DISCUSSION: Background/Context - The Port of Los Angeles' (Port) Clean Truck Program (CTP) is one of the key components of the San Pedro Bay Ports Clean Air Action Plan (CAAP) which is focused on improving air quality at the Port by replacing older polluting heavyduty trucks with cleaner heavy-duty trucks. This was accomplished in part by the POLA Tariff Section 20 provisions which required licensed motor carriers (LMCs) providing drayage services to have Concession Agreements with the Port, and for the LMCs' drayage trucks to comply with three successive bans from 2008 through Since the last ban fell into place on January 1, 2012, only heavy-duty trucks with 2007 EPA compliant engines or newer are allowed to service the Port terminals. American Trucking Association Lawsuit - In July 2008, the American Trucking Association (ATA) filed a lawsuit against the City of Los Angeles (City) challenging several provisions within the Concession Agreement. Following a bench trial, the District Court issued a decision on August 26, 2010, in favor of the City holding that the entire Concession Agreement was enforceable. The ATA appealed the trial judgment first to the Ninth Circuit and then the U.S. Supreme Court, which issued its opinion on June 13, The Supreme Court's opinion expressed questions about whether the Port intended to use the Concession Agreement's contractual remedies or the Tariff's criminal penalties for violations of the CAAP and CTP. Proposed Tariff Amendment Action - Staff recommends amendments to POLA Tariff Items 220, 2040 and 2090 to clarify for the public that the Port's scheme for enforcement of the CAAP and CTP requirements do not include criminal penalties, as follows: Item expressly states that its criminal penalties do not apply to Section 20 violations. Item clarifies that the Concession Agreement contains all of the terms and conditions, includir]g remedies, to be applied to LMCs.

5 DATE: JULY 17,2013 PAGE 3 OF 4 SUBJECT: ORDER AMENDING PORT OF LOS ANGELES TARIFF NO. 4, SECTION TWO - ITEM 220 AND SECTION TWENTY - ITEMS 2040 AND 2090 Item new tariff item is explicit about the various remedies to be applied for violations of the CTP: o Drayage Trucks, Drayage Truck Owners and Drayage Truck Operators that are non-compliant with Section 20 while on Port Property shall be denied access to Port Terminals. o Remedies against Terminal Operators failing to comply with Section 20 are set forth in their permits, leases or contractual agreements with the City. o Remedies against licensed Motor Carriers failing to comply with Section 20 are set forth in their Concession Agreements or contractual agreements with the City. o In no event shall criminal penalties apply to violations of Section 20 of the Tariff. After approval of the Permanent Order by the Board, the Order must be approved by Ordinance by the City Council pursuant to Charter Section 653(a). ENVIRONMENTAL ASSESSMENT: The proposed action is an Amendment to Port of los Angeles Tariff No. 4 to clarify that the criminal penalties of Item 220 do not apply to violations of Section 20 - Clean Air Action Plan. As an administrative activity, the Director of Environmental Management has determined that the proposed action is administrative activity exempt from the requirements of the California Environmental Quality Act (CEQA) under Article II, Section 2(f) of the los Angeles City CEQA Guidelines. ECONOMIC BENEFITS: This Board action will have no employment impact. FINANCIAL IMPACT: The requested tariff changes are administrative in nature and have no financial impact.

6 DATE: JULY 17,2013 PAGE 4 OF 4 SUBJECT: ORDER AMENDING PORT OF LOS ANGELES TARIFF NO. 4, SECTION TWO - ITEM 220 AND SECTION TWENTY - ITEMS 2040 AND 2090 CITY ATTORNEY: The Office of the City Attorney has prepared and approved as to form and legality, the Tariff, Temporary and Permanent Orders and Ordinance. TRANSMITTALS: 1. Tariff 2. Temporary Order 3. Permanent Order 4. Ordinance FIS Approval: A (initials) CA Approvai:F-Hfn1tials) CHRISTOPHER CANNON Director of Environmental Management fj'/michael R. CHRISTENSEN Deputy Executive Director l("~~~~t:ml~tl.. PPh.D. E cutive Director AUTHOR: C. CANNON BOARD MEETING: 7/25/2013 FILE: G:\_AOMIN\_BOARD REPORTS\_AIR OUAUTY\CTP\TARIFF NO.4 AMENDMENTS\JUNE 2013\CTP _TARIFF 4 ~ FINALdocx UPDATED: 7/17/201311:02 AM- YO

7 TRANSMITTAL TO DATE COUNCIL FILE NO. Geraldine Knatz, Ph.D., Executive Director Harbor Department FROM The Mayor ocr 'o s 2013 COUNCIL DISTRICT 15 PROPOSED PERMANENT ORDER TO AMEND LOS ANGELES TARIFF NO.4, SECTION TWO, ITEM 220, "PENAL TIES FOR VIOLATION," AND SECTION N0.20, ITEM 2040, "CONCESSIONS AND TEMPORARY ACCESS PERMITS," AND ITEM 2090, "REMEDIES FOR VIOLATION OF CLEAN AIR ACTION PLAN PROVISION" Transmitted for further processing and Council consideration. See the City Administrative Officer report attached. MAS:MAS: t CAO 649-d

8 REPORT FROM OFFICE OF THE CITY ADMINISTRATIVE OFFICER Date: To: From: Reference: Subject: September 23, 2013 GAO File No Council File No. Council District: 15 The Mayor t.../, Miguel A. Santana, City Administrative Officer (W_I(~ Correspondence from the Harbor Department dated July 30, 2013; referred by the Mayor for report on August 1, 2013 PROPOSED PERMANENT ORDER TO AMEND LOS ANGELES TARIFF NO.4, SECTION TWO, ITEM 220, "PENALTIES FOR VIOLATION," AND SECTION N0.20, ITEM 2040, "CONCESSIONS AND TEMPORARY ACCESS PERMITS," AND ITEM. 2090, "REMEDIES FOR VIOLATION OF CLEAN AIR ACTION PLAN PROVISION" SUMMARY The Harbor Department (Port) Board of Harbor Commissioners (Board) requests approval of Permanent Order No and a corresponding Ordinance to amend Port of Los Angeles (POLA) Tariff No. 4 (General Rules and Regulations Manual) in Section Two, Item No. 220, and $ection Twenty, Item No and add a new Item No According to the Port, the amendment to Tariff Section Two, Item No. 220, "Penalties for Violation," seeks to clarify that Item No. 220 does not apply to violations in Tariff Section 20, Clean Air Action Plan (CAAP), Item No. 2040, "Concessions and Temporary Access Permits," and new Item No. 2090, "Remedies for Violation of CAAP Provision." Instead, these amendments will provide further clarification to the public on the content on the respective Tariffs. The permits for existing terminal operators and concession agreements for the licensed motor carriers (i.e.,, heavy duty trucks) already provide contractual remedies (resolutions) for tariff violations. Concession agreements are negotiated prior to the contracts and spell out Tariff compliances and resolutions. In accordance with Charter Section 653, the Council must approve the Ordinance to amend Tariff No. 4 before it can become effective. The abovecreferenced aspect of the proposed Order amending POLA Tariff No.4, and this report, incorporate revised information received from the Port subsequent to the initial request submittal. (See the attached revised report and tariff amendments for proposed changes to POLA Tariff No.4.) DISCUSSION In 2006, the POLA and Port of Long Beach (POLB) jointly approved the CAAP to reduce emission pollutants from port-related operations. An essential component of the CAAP is the Clean Truck Program (CTP), which implemented a phased approach to progressively ban, replace or retrofit older, heavily polluting drayage (heavy-duty) trucks with cleaner engine trucks, to comply with the U.S. Environmental Protection Agency (EPA) emission standards. Currently, only heavy-duty trucks with EPA compliant engines are allowed to conduct business in Port terminals.

9 CAO File No. PAGE Tariff No.4, Section 20 provision currently states that no Terminal Operator's drayage (heavy-duty) truck will be permitted access into any of its terminals unless the truck is registered under a concession or a temporary access permit in the Port's Drayage Truck Registry. In July 2008, the American Trucking Association (ATA) filed a lawsuit against the City of Los Angeles/POLA challenging several provisions within a concession agreement. As a result of the lawsuit and subsequent court appeals, the U.S. Supreme Court issued an opinion in June 2013, which included questions if the Port intended to use the penalty resolutions co~tained in a concession agreement or the penalty violations contained in the Tariff's sections for the CAAP and CTP. The proposed Amendments are intended to clarify the language in the respective Tariff sections on the contractual resolutions for applicable to the CAAP and CTP. The Port states that the proposed Amendments for Tariff Items 220, 2040 and 2090 will specify and clarify the following enforcement and penalty language and requirements for the CAAP and CTP: Tariff Section Two Item Specifies that misdemeanor criminal penalties do not apply to potential violators under the provisions of Port Tariff Section No. 20 (CAAP and CTP) violations; Tariff Section Twenty Item Clarifies that a concession agreement contains all ofthe terms and conditions, including remedies (resolutions), that are available to licensed motor carriers; Item Clarifies the new Tariff Item by explaining the various remedies applied to violations as they pertain to drayage truck, truck owners and truck operators within the CAAP and CTP provisions and their permits, leases or contractual agreementswith the City. ENVIRONMENTAL ASSESSMENT The Port Director of Environmental Management has determined that the proposed Tariff Amendments are administrative actions to clarify that the prescribed penalties in Item 220 do not apply to violations in Tadff Section 20. As a result, the proposed actions are exempt from the requirements of the California Environmental Quality Act (CEQA) under Article II, Section 2(f) of the Los Angeles City CEQA Guidelines. RECOMMENDATION That the Mayor approve Harbor Department Permanent Order No and a corresponding Ordinance to amend Port of Los Angeles (POLA) Tariff No.4, Section Two, Item No. 220, "Penalties for Violation," and Section Twenty, Item No. 2040, "Concessions and Temporary Access Permits," and add the new Item No. 2090, "Remedies for Violation of CAAP Provision" and return the document to the Harbor Department for further processing, including Council consideration.

10 CAO File No. PAGE FISCAL IMPACT STATEMENT Approval to amend the Port of Los Angeles (POLA) Tariff No. 4, Section Two, Item No. 220, and Section Twenty, Item No. 2040, and to add the new Item No. 2090, requires no additional expenditure of funds. The proposed Tariff amendments change administrative language in POLA Tariff Section Two and Twenty to provide further clarification to the public on the content on the respective Tariff provisions. The proposed amendments will not impact the City General Fund. TIME LIMIT FOR COUNCIL ACTION Pursuant to Charter Section 653, the Harbor Department's Board of Harbor Commissioners can authorize Order No. 13"7143, the Amendment to Tariff No.4, for a period not to exceed 90 days without Council approval. Approval of the Order to amend the Tariff must be approved by the Mayor and Council. The Charter does not specify a time limit for this action by the Council and Mayor. Attachment MAS:ABN:

11 ORDER NO A permanent Order of the Board of Harbor Commissioners of the City of Los Angeles amending the Port of Los Angeles Tariff No. 4. THE BOARD OF HARBOR COMMISSIONERS OF THE CITY OF LOS ANGELES DOES HEREBY ORDER AS FOLLOWS: Section 1. The Port of Los Angeles Tariff No.4, adopted July 12, 1989, by Order No. 5837, and Ordinance No. 165,789, adopted April10, 1990, as amended, is further amended to revise Items 220, 2040 and 2090, as set forth in Exhibit "A," attached hereto and incorporated herein by reference. The Executive Director is directed to submit this amendment to the California Association of Port Authorities (CAPA) to secure approval or proceed to take independent action in accordance with CAPA procedure. Section 2. The Director of Environmental Management has determined that the proposed action is an administrative activity that is exempt from the California Environmental Quality Act (CEQA) under Article II, Section 2(f) of the Los Angeles City CEQA Guidelines. Section 3. The Board Secretary shall certify to the adoption of the temporary Order by the Board of Harbor Commissioners and cause the same to be published once in a newspaper printed and published in the City of Los Angeles, to take effect prior to adoption by Ordinance for a period not to exceed 90 days pursuant to Charter Section 653(b). Section 5. The Board Secretary shall transmit to the City Council for approval the permanent Order and Ordinance approving the amendment to Tariff No. 4 pursuant to City Charter 653(a). Section 6. The Board Secretary shall execute the proposed permanent Board Order and Ordinance amending Tariff No.4, and upon its publication, transmit the permanent Order and Ordinance to the Chief Wharfinger for implementation of the tariff change and posting the amended Tariff No. 4 to the Port's website as regulated by the Federal Maritime Commission. I HEREBY CERTIFY THAT the foregoing Order was adopted by the Board of Harbor Commissioners of the City of Los Angeles at its meeting held on 1 Board Secretary"

12 APPROVED AS TO FORM AND LEGALITY '/:<...s '2013 Ml EL. FEUER, City Attorney Jan a B. Sidley, General Counsel 2

13 EXHIBIT A PORT OF LOS ANGELES- TARIFF NO.4 Second Revised Page Cancels First Revised Page SECTION TWO GENERAL RULES AND REGULATIONS - Continued Item No. UNLAWFUL TO FAIL OR REFUSE TO PAY TARIFF CHARGES Every person who fails or refuses to pay, or by false returns or in any manner avoids the payment of all or any portion of any charge for dockage, wharfage, wharf demurrage, wharf storage, or any other charge or fee which may be due to the Board from any source or cause, as 215 provided for by this Tariff, is, in addition to the general penalties provided for in this Tariff, liable for and shall pay to the Board twice the amount of such charge or fee, and in addition, the sum of $100.00, except as may be othetwise specifically provided in this Tariff. PENALTIES FOR VIOLATION + Every violation of this Tariff that is established as a misdemeanor, or is charged as a misdemeanor, unless provision is otherwise made, shall be punishable by a fine of not more than One Thousand Dollars ($1,000.00) or by imprisonment in the County Jail for a period of not more than six ( 6) months, or by both a fine and imprisonment. + Every violation ofthis Tariff that is established as an infraction, or is charged as an Infraction, is punishable by a fine as set forth in this Tariff section, or as otherwise provided in this Tariff, not to exceed Two Hundred Fifty Dollars ($250.00) for each violation. + Each person shall be guilty of a separate offense for each and every day during any portion of which any violation of any provision of this Tariff is committed, continued or permitted by that person, and shall be punishable accordingly. See Item 10 for explanation of abbreviations and symbols. Order No. Adopted I Con ection No. Ordinance No. Adopted EFFECTIVE: I

14 EXHIBIT A PORT OF LOS ANGELES- TARIFF NO.4 Revised Page SECTION TWENTY CLEAN AIR ACTION PLAN- GENERAL RULES AND REGULATIONS- Continued Item No. CLEAN TRUCK FUND The first Terminal Operator to handle any containerized merchandise subject to the Clean Truck Fee shall collect and remit the Clean Truck Fee to the Port of Los Angeles, and the monies shall be used by the Board of Harbor Commissioners exclusively for programs for the replacement, repower and retrofit of Drayage Trucks and the rapid transition to 2007 Drayage Trucks serving the Ports of Los Angeles and Long Beach. *CONCESSIONS AND TEMPORARY ACCESS PERMITS * I. Beginning October I, 2008, at 8:00a.m., no Terminal Operator shall permit access into any Terminal in the Port of Los Angeles to any Drayage Truck unless such Drayage Truck is registered under a Concession or a Temporary Access Permit from the Port of Los Angeles in the Drayage Truck Registry. * 2. The terms and conditions (including all remedies) for the Concession are set forth in the Port of Los Angeles Concession Agreement between the Port of Los Angeles and the Licensed Motor Carrier. Copies of the Port of Los Angeles Concession Agreement, Concession Application and Temporary Access Permit Terms and Conditions are posted on the website. Licensed Motor Carriers seeking to apply for a Concession or Temporary Access Permit may also obtain information and an application for Concession or Temporary Access Permit from the Port of Los Angeles, Attention: Concession Administrator, 425 South Palos Verdes Street, San Pedro, CA The Concession Fee shall be $2,500 and the annual fee shall be $100 per Drayage Truck operating under the Concession (collectively the "Concession Fees"). The Temporary Access Permit Fee shall be $30 per Temporary Access Permit trip, plus the cost of the RFID or other required alternative identification. Concession Fees and Temporary Access Permit Fees shall be paid by the Licensed Motor Carrier applying for or holding the Concession or Temporary Access Permit. *TARIFF AND ARB DRAY AGE TRUCK RULE COMPLIANCE + I. While on any Port Property or public streets in or immediately adjacent to Port Property, Licensed Motor Carriers, Drayage Truck Owners and Drayage Truck Operators shall (i) operate only Drayage Trucks that comply with Terminal access requirements ofltems 20 I 0, 2015 and 2020 and (ii) shall not transfer, switch or cause cargo originating from or destined for Port Property to be moved to Drayage Trucks that do not comply with Terminal access requirements of Items 2010,2015 and Terminal Operators, Licensed Motor Carriers, Drayage Trucks, Drayage Truck * Owners and Drayage Truck Operators shall comply with the requirements of the CARB Drayage [C]+ Truck Rule, including without limitation, registry, dispatch, and operation of compliant Drayage 2041 Trucks and timely reporting of information to ARB or to the Port of Los Angeles as the reporting port authority in accordance with Schedule A of Section 2027(d)(6) of the CARB Drayage Truck Rule. * 3. Drayage Trucks seeking entry upon Port Property after December 31, 2009 shall comply with the requirements of the CARB Drayage Truck Rule and the CARB Truck and Bus Rule in accordance with the transition schedule required by CARB, including without limitation, registration in the State DTR and compliance with Drayage Truck emissions requirements. See for a copy of the CARB Drayage Truck Rule and the transition to the CARB Truck and Bus Rule. See Item 10 for explanation of abbreviations and symbols. I OrderNo. Adopted Ordinance No. Adopted I EFFECTIVE: 2035 [C]+ 2040

15 EXHIBIT A PORT OF LOS ANGELES- TARIFF NO. 4 Original Page 195 SECTION TWENTY CLEAN AIR ACTION PLAN- GENERAL RULES AND REGULATIONS - Continued Item No. REMEDIES FOR VIOLATION OF CLEAN AIR ACTION PLAN PROVISIONS No person, firm or corporation shall fail, refuse or neglect to comply with any of the provisions of the rules and regulations prescribed by Section 20 of this Tariff. A Drayage Truck, + Drayage Truck Owner or Drayage Truck Operator that is non-compliant with Section 20 while on 2090 Port Property shall have any non-compliant Drayage Trucks denied access to Port Terminals. Remedies against Terminal Operators failing to comply with Section 20 are set forth in their permits, leases or contractual agreements with the City. Remedies against Licensed Motor Carriers failing to comply with Section 20 are set forth in their Concession Agreements or contractual agreements with the City. In no event shall criminal penalties apply to violations of Section 20 of this Tariff. SEVERABILITY If any provision of Port of Los Angeles Tariff No.4 shall be determined by court or agency of competent jurisdiction to be unenforceable, unlawful or subject to an order of temporary 2095 or permanent injunction from enforcement, such determination shall only apply to the specific provision and the remainder of the provisions of this Tariff No.4 shall continue in full force and effect. See Item I for, of Order No. Ordinance No. (ion< one! Adopted Adopted I EFFECTIVE

16 MICHAEL N. FEUER CITY ATIORNEY REPORT NO. R O z? 4 SEP REPORT RE: DRAFT ORDINANCE TO APPROVE A BOARD ORDER AMENDING PORT OF LOS ANGELES TARIFF NO. 41TEM 220- PENALTIES FOR VIOLATION AND ITEMS 2040 AND CLEAN AIR ACTION PLAN REMEDIES The Honorable City Council of the City of Los Angeles Room 395, City Hall 200 North Spring Street Los Angeles, California Honorable Members: This Office has prepared and now transmits for your consideration the enclosed draft ordinance, approved as to form and legality. Pursuant to Charter Section 653(a), this draft ordinance would approve Board of Harbor Commissioners Order No amending the Port of Los Angeles (POLA) Tariff No. 4, Section 20- Clean Air Action Plan, Items 220, 2040, and Charter Findings On July 25, 2013, pursuant to Los Angeles City Charter Sections 652(a), 652(c), and 653(a), the Los Angeles Board of Harbor Commissioners adopted Order No , approved the enclosed draft ordinance, and recommended that the City Council adopt it. Under Charter Section 653(a), BOHC Order No must be approved by the City Council by ordinance in order to become effective. City Hall East 200 N. Main Street Room 800 Los Angeles, CA (213) Fax (213)

17 The Honorable City Council of the City of Los Angeles Page2 Background On November 20, 2006, the Los Angeles and Long Beach Boards of Harbor Commissioners approved the San Pedro Bay Ports Clean Air Action Plan (CAAP) which is focused on improving air quality at the ports from various sources such as trucks, ships, rail, cargo handling equipment and harbor craft. The Port of Los Angeles' (Port) Clean Truck Program (CTP) is one of the key components of the CAAP, replacing older polluting heavy-duty trucks with cleaner heavy-duty trucks. This was accomplished in part by the POLA Tariff Section 20 provisions that required licensed motor carriers (LMCs) providing drayage services to have Concession Agreements with the Port, and for the LMCs' drayage trucks to comply with three successive bans from 2008 through Since the last ban fell into place on January 1, 2012, only heavy-duty trucks with 2007 EPA compliant engines or newer are allowed to service the Port terminals. The Los Angeles Harbor Department desires to clarify that the criminal penalties provisions of POLA Tariff Section 220 Penalties for Violation do not apply to violations of the Concession Agreement or POLA Tariff Section 20- Clean Air Action Plan. Summarv of Ordinance Provisions The proposed ordinance approves the Order that amends POLA Tariff No. 4 as follows: (1) Item 220- expressly states that its criminal penalties do not apply to Section 20 -Clean Air Action Plan violations and that remedies are set forth in Item (2) Item clarifies that the Concession Agreement contains all of the terms and conditions, including remedies, to be applied to LMCs. (3) Item new tariff item is explicit about the various remedies to be applied for violations of the CTP: A Drayage Truck, Drayage Truck Owner and Drayage Truck Operator that is non-compliant with Section 20 while on Port Property shall have any non-compliant Drayage Truck denied access to Port Terminals. Remedies against Terminal Operators failing to comply with Section 20 are set forth in their permits, leases or contractual agreements with the City. Remedies against Licensed Motor Carriers failing to comply with Section 20 are set forth in their Concession Agreements or contractual agreements with the City. In no event shall criminal penalties apply to violations of Section 20 of the Tariff.

18 The Honorable City Council of the City of Los Angeles Page 3 Fee Notice Requirement The enclosed draft ordinance contains references to a previously adopted Clean Truck Fee, Concession Fee and Temporary Access Pass Fee. Authority to charge and enforce such fees is given to the Board of Harbor Commissioners under Los Angeles City Charter Sections 652(e) and 653(a). Pursuant to Charter Section 653(a), the City Council must approve by ordinance the Board of Harbor Commissioners' Order setting these fees, which fees go to the Harbor Revenue Fund. The Board of Harbor Commissioners and Los Angeles City Council previously held public board meetings, during which such fees were presented and discussed by the Board, the City Council and the public prior to adoption of BOHC Orders adopting and modifying said fees as set forth in Exhibit A. The requirements of Government Code Sections and requiring City Council public fee hearings are not applicable to these types of fees. CEQA Findings The proposed action is an Amendment to Port of Los Angeles Tariff No. 4 to clarify that the criminal penalties of Item 220 do not apply to violations of Section 20 - Clean Air Action Plan. As such, the Director of Environmental Management has determined that the proposed action is administrative activity exempt from the requirements of the California Environmental Quality Act (CEQA) under Article II, Section 2(f) of the Los Angeles City CEQA Guidelines. Council Rule 38 Referral The Harbor Department, through staff responsible for administration and implementation of the Tariff amendments, is the proposing department, and the Tariff amendments were discussed and debated before the Board of Harbor Commissioners with Harbor Department management and staff present, in a full public hearing of the Board of Harbor Commissioners on July 25, If you have any questions regarding this matter, please contact Assistant City Attorney Joy Crose at (310) She or another member of this Office will be present when you consider this matter to answer any questions you may have. PBE:JC:pj Transmittal Very truly yours, MICHAEL N. FEUER, City Attorney By~~ PEDRO B. ECHEVERRIA Chief Assistant City Attorney M:\Proprietary_OCC\Port\ORDINANGES AND REPORT\JOY GROSE\Gouncil Report- POLA Tariff FINAL Corrected Order No. ( ) (2).docx

19 11/7/ /27/ Created progressive ban of older port drayage trucks 12/20/ /27/ Established Clean Truck Fee and Clean Truck Fund to fund retrofit and replacement of older drayage trucks banned from Port 3/20/ /17/ Established Drayage Truck Concessions and exemptions from the Clean Truck Fee 8/21/ /5/ Authorized incentive funding program and day pass program and certain exemptions from ban and Clean Truck Fee 10/23/ /5/ Clarified drayage truck registry and terminal gate access management by marine terminal operators and container-length basis of Clean Truck Fee assessment, and fee exemption for military cargo. 4/2/ /14/ Modified the collection date for the Clean Truck Fee to commence on February 19, 2009 instead of October 1, 2008, and reduced the amount of the Day Pass Fee from $100 to $30 per pass 6/18/ /14/ Modified definitions of Drayage Truck and Program Funds and required marine terminal operators to comply with the California Air Resources Board's Heavy Duty Drayage Truck Rule 8/13/ /27/ Further modified definitions of Program Funds to exempt certain grant funded trucks from Clean Truck Fee

20 11/19/ /12/ Established extension from truck ban for certain grant funded trucks 12/10/ /12/ Further modified definition of "Pending Replacement Drayage Truck" in Item 2000 in order for the Port ban extension in Item 2015 to be consistent with December 2009 revisions to CARS's statewide ban extension under the CARB Statewide Drayage Truck Rule. 3/18/ /27/ Aligned the POLA Tariff with the CARB statewide Drayage Truck Rule providing (1) extension of time for model year engines for which no CARSverified retrofit is available to comply with a truck ban, and (2) diesel fuel ignited LNG trucks fall within the definition of an alternative fueled vehicle. 12/16/ /11/ Required Class 7 trucks to comply with the truck ban applicable to Class 8 trucks and prohibited the practice of "drayoffs," switching cargo from compliant trucks to noncompliant or fee-assessable trucks on Port property 10/18/ /21/ Modified definition of "Drayage Truck" to include Class 4 trucks; required Marine Terminals without RFID or OCR readers to require compliance stickers of Drayage Trucks; and required Marine Terminal Operators to report information regarding Drayage Truck access compliance.

21 ORDINANCE NO An ordinance approving Order No of the Board of Harbor Commissioners of the City of Los Angeles amending the Port of Los Angeles Tariff No. 4, Section 20- Clean Air Action Plan Clean Truck Program. THE PEOPLE OF THE CITY OF LOS ANGELES DO ORDAIN AS FOLLOWS: Section 1. Order No , passed and adopted by the Board of Harbor Commissioners of the City of Los Angeles on the 25th day of July 2013, amending Port of Los Angeles Tariff No. 4, is hereby ratified, confirmed, and approved. This Order is in words and figures as follows: "ORDER NO A permanent Order of the Board of Harbor Commissioners of the City of Los Angeles amending the Port of Los Angeles Tariff No. 4. THE BOARD OF HARBOR COMMISSIONERS OF THE CITY OF LOS ANGELES DOES HEREBY ORDER AS FOLLOWS: Section 1. The Port of Los Angeles Tariff No.4, adopted July 12, 1989, by Order No. 5837, and Ordinance No. 165,789, adopted April10, 1990, as amended, is further amended to revise Items 220, 2040 and 2090, as set forth in Exhibit "A," attached hereto and incorporated herein by reference. The Executive Director is directed to submit this amendment to the California Association of Port Authorities (CAPA) to secure approval or proceed to take independent action in accordance with CAPA procedure. Section 2. The Director of Environmental Management has determined that the proposed action is an administrative activity that is exempt from the California Environmental Quality Act (CEQA) under Article II, Section 2(f) of the Los Angeles City CEQA Guidelines. Section 3. The Board Secretary shall certify to the adoption of the temporary Order by the Board of Harbor Commissioners and cause the same to be published once in a newspaper printed and published in the City of Los Angeles, to take effect prior to adoption by Ordinance for a period not to exceed 90 days pursuant to Charter Section 653(b). Section 5. The Board Secretary shall transmit to the City Council for approval the permanent Order and Ordinance approving the amendment to Tariff No. 4 pursuant to City Charter 653(a). 1

22 Section 6. The Board Secretary shall execute the proposed permanent Board Order and Ordinance amending Tariff No. 4, and upon its publication, transmit the permanent Order and Ordinance to the Chief Wharfinger for implementation of the tariff change and posting the amended Tariff No.4 to the Port's website as regulated by the Federal Maritime Commission. I HEREBY CERTIFY THAT the foregoing Order was adopted by the Board of Harbor Commissioners of the City of Los Angeles at its meeting held on Sec. 2. Pursuant to the provisions of Section 653 (b) of the City Charter, the Board of Harbor Commissioners shall have the power to suspend, modify, or amend temporarily any of the rules or regulations, or any of the rates, tolls, or charges prescribed by this Order of the Board of Harbor Commissioners for periods not exceeding 90 days, and shall have power to place in effect for a like period of time any temporary rule or regulation, or rate, toll or charge for the Harbor District. 2

23 Sec. 3. The City Clerk shall certify to the passage of this ordinance and have it published in accordance with Council policy, either in a daily newspaper circulated in the City of Los Angeles or by posting for ten days in three public places in the City of Los Angeles: one copy on the bulletin board located at the Main Street entrance to the Los Angeles City Hall; one copy on the bulletin board located at the Main Street entrance to the Los Angeles City Hall East; and one copy on the bulletin board located at the Temple Street entrance to the Los Angeles County Hall of Records. I hereby certify that this ordinance was passed by the Council of the City of Los Angeles, at its meeting of JUNE LAGMAY, City Clerk By ~--~ Deputy Approved Mayor Approved as to Form and Legality MICHAEL N. FEUER, City Attorney By~. JOY M. CROSE Assistant City Attorney Date ~~~/$ File No M:\Proprietary_OCC\Port\ORDINANCES AND REPORnJOY CROSE\Tariff Items Ordinance ( FINAL).docx 3

24 EXHIDIT A PORT OF LOS ANGELES- TARIFF NO.4 Second Revised Page Cancels First Revised Page SECTION TWO GENERAL RULES AND REGULATIONS -Continued Item No. UNLAWFUL TO FAIL OR REFUSE TO PAY TARIFF CHARGES Every person who fails or refuses to pay, or by false returns or in any manner avoids the payment of all or any portion of any charge for dockage, wharfage, wharf demurrage, wharf storage, or any other charge or fee which may be due to the Board from any source or cause, as 215 provided for by this Tariff, is, in addition to the general penalties provided for in this Tariff, liable for and shall pay to the Board twice the amount of such charge or fee, and in addition, the sum of $100.00, except as may be otherwise specifically provided in this Tariff. PENAL TIES FOR VIOLATION * (a) It shall be unlawful for any person to utilize or make use of any wharf, landing, watercraft, facility, utility, structure, improvement or appliance under the jurisdiction of the Board, or to make use of the navigable waters of Los Angeles Harbor, without paying to said Board the proper toll, charge or fee therefor as may be fixed and specified in this Tariff and every person, firm or corporation violating any of the provisions of these Tariffs, respecting the payment of any such toll, charge or fee, shall be deemed guilty of a misdemeanor and upon conviction thereof shall be punishable by a fine of not more than One Thousand Dollars ($1,000.00), or by imprisonment in the County Jail for a period of not more than six months, or by both such fine and imprisonment, consistent with the Los Angeles City Municipal Code. [C] + * (b) No person, firm or corporation shall fail, refuse or neglect to comply with any of the 220 provisions of the rules and regulations prescribed by this Tariff, and any person, firm or corporation violating any of the provisions of these rules and regulations except for Section 20 (which has remedies set forth in Item 2090) shall be guilty of a misdemeanor and upon conviction thereof shall be punishable by a fine of not more than Five Hundred Dollars, or by imprisonment in the County Jail for a period of not more than six months, or by both such fine and imprisonment. + Every violation of this Tariff that is established as a misdemeanor, or is charged as a misdemeanor, unless provision is otherwise made, shall be punishable by a fme of not more than One Thousand Dollars ($1,000.00) or by imprisonment in the County Jail for a period of not more than six ( 6) months, or by both a fine and imprisonment. + Every violation of this Tariff that is established as an infraction, or is charged as an Infraction, is punishable by a fine as set forth in this Tariff section, or as otherwise provided in this Tariff, not to exceed Two Hundred Fifty Dollars ($250.00) for each violation. + Each person shall be guilty of a separate offense for each and every day during any portion of which any violation of any provision of this Tariff is committed, continued or permitted by that person, and shall be punishable accordingly. See Item 10 for explanation of abbreviations and symbols. Order No. Adopted I Correction No. Ordinance No. Adopted EFFECTIVE: I

25 EXHIBIT A PORT OF LOS ANGELES- TARIFF NO. 4 Revised Page SECTION TWENTY CLEAN AIR ACTION PLAN- GENERAL RULES AND REGULATIONS- Continued Item No. CLEAN TRUCK FUND The first Terminal Operator to handle any containerized merchandise subject to the Clean Truck Fee shall collect and remit the Clean Truck Fee to the Port of Los Angeles, and the monies shall be used by the Board of Harbor Commissioners exclusively for programs for the replacement, repower and retrofit of Drayage Trucks and the rapid transition to 2007 Drayage Trucks serving the Ports of Los Angeles and Long Beach. *CONCESSIONS AND TEMPORARY ACCESS PERMITS * 1. Beginning October 1, 2008, at 8:00a.m., no Terminal Operator shall permit access into any Terminal in the Port of Los Angeles to any Drayage Truck unless such Drayage Truck is registered under a Concession or a Temporary Access Permit from the Port of Los Angeles in the Drayage Truck Registry. * 2. The terms and conditions (including all remedies) for the Concession are set forth in the Port of Los Angeles Concession Agreement between the Port of Los Angeles and the Licensed Motor Carrier. Copies of the Port of Los Angeles Concession Agreement, Concession Application and Temporary Access Permit Terms and Conditions are posted on the website. Licensed Motor Carriers seeking to apply for a Concession or Temporary Access Permit may also obtain information and an application for Concession or Temporary Access Permit from the Port of Los Angeles, Attention: Concession Administrator, 425 South Palos Verdes Street, San Pedro, CA The Concession Fee shall be $2,500 and the annual fee shall be $100 per Drayage Truck operating under the Concession (collectively the "Concession Fees"). The Temporary Access Permit Fee shall be $30 per Temporary Access Permit trip, plus the cost of the RFID or other required alternative identification. Concession Fees and Temporary Access Permit Fees shall be paid by the Licensed Motor Carrier applying for or holding the Concession or Temoorarv Access Permit. *TARIFF AND ARB DRAYAGE TRUCK RULE COMPLIANCE + 1. While on any Port Property or public streets in or immediately adjacent to Port Property, Licensed Motor Carriers, Drayage Truck Owners and Drayage Truck Operators shall (i) operate only Drayage Trucks that comply with Terminal access requirements ofltems 20 I 0, 2015 and 2020 and (ii) shall not transfer, switch or cause cargo originating from or destined for Port Property to be moved to Drayage Trucks that do not comply with Terminal access requirements of Items 2010, 2015 and * 2. Terminal Operators, Licensed Motor Carriers, Drayage Trucks, Drayage Truck Owners and Drayage Truck Operators shall comply with the requirements of the CARB Drayage [C]+ Truck Rule, including without limitation, registry, dispatch, and operation of compliant Drayage 2041 Trucks and timely reporting of information to ARB or to the Port of Los Angeles as the reporting port authority in accordance with Schedule A of Section 2027( d)( 6) of the CARB Drayage Truck Rule. 3. Drayage Trucks seeking entry upon Port Property after December 31, 2009 shall comply with the requirements of the CARB Drayage Truck Rule and the CARB Truck and Bus Rule in accordance with the transition schedule required by CARB, including without limitation, registration in the State DTR and compliance with Drayage Truck emissions requirements. See for a copy of the CARB Drayage Truck Rule and the transition to the CARB Truck and Bus Rule. See Item l 0 for explanation of abbreviations and symbols. I OrderNo. Adopted I Ordinance No. Adopted " - "- I EFFECTIVE: 2035 [C]

26 EXHIBIT A PORT OF LOS ANGELES- TARIFF NO. 4 Original Page SECTION TWENTY CLEAN AIR ACTION PLAN- GENERAL RULES AND REGULATIONS -Continued Item No. REMEDIES FOR VIOLATION OF CLEAN AIR ACTION PLAN PROVISIONS No person, firm or corporation shall fail, refuse or neglect to comply with any of the provisions of the rules and regulations prescribed by Section 20 of this Tariff. A Drayage Truck, + Drayage Truck Owner or Drayage Truck Operator that is non-compliant with Section 20 while on 2090 Port Property shall have any non-compliant Drayage Trucks denied access to Port Terminals. Remedies against Terminal Operators failing to comply with Section 20 are set forth in their permits, leases or contractual agreements with the City. Remedies against Licensed Motor Carriers failing to comply with Section 20 are set forth in their Concession Agreements or contractual agreements with the City. In no event shall criminal penalties apply to violations of Section 20 of this Tariff. SEVERABILITY If any provision of Port of Los Angeles Tariff No. 4 shall be determined by court or agency of competent jurisdiction to be unenforceable, unlawful or subject to an order of temporary or permanent injunction from enforcement, such determination shall only apply to the specific provision and the remainder of the provisions of this Tariff No.4 shall continue in full force and effect. See Item 10 for of Order No. I ()rdinance No. Adopted Adopted I EFFECTIVE