Port CongestionPort Congestion

Challenges & Solutions Challenges & Solutions AA California PerspectiveCalifornia Perspective

Presented to:Presented to:

AAPA AAPA -- ChicagoChicagoApril 28, 2005April 28, 2005

Paul Larking, Paul Larking, SynchroNet Marine, Inc. San Ramon, CaliforniaSynchroNet Marine, Inc. San Ramon, California

www.synchronetmarine.comwww.synchronetmarine.com

The Perfect StormThe Perfect Storm

Unprecedented Cargo GrowthUnprecedented Cargo Growth

Population GrowthPopulation Growth

Traffic CongestionTraffic Congestion

Air and Noise PollutionAir and Noise Pollution

Community Community ‘‘Quality of LifeQuality of Life’’ ConcernsConcerns

Safety and Security RequirementsSafety and Security Requirements

Infrastructure Funding LimitationsInfrastructure Funding Limitations

Motor Carrier and Labor ShortagesMotor Carrier and Labor Shortages

Legislative InvolvementLegislative Involvement

II--710 Freeway in Southern California 710 Freeway in Southern California Under Normal Conditions & During The Under Normal Conditions & During The 2002 Shut Down Of West Coast Ports2002 Shut Down Of West Coast Ports

Managing GrowthManaging Growthis a Major Challengeis a Major Challenge

Port of OaklandPort of Oakland---- 1.9 million TEU1.9 million TEU’’s in 2003s in 2003---- 4.8 million TEU4.8 million TEU’’s by 2020s by 2020

Ports of Los Angeles/Long BeachPorts of Los Angeles/Long Beach---- 11.8 million TEU11.8 million TEU’’s in 2003s in 2003---- 36.0 million TEU36.0 million TEU’’s by 2020s by 2020

Atlantic SeaboardTrade value: $34.3B

Jobs: 265,600

SouthwestTrade value: $97.9B

Jobs: 1,003,600

South CentralTrade value: $12.1B

Jobs: 141,000

SoutheastTrade value: $15.9B

Jobs: 191,500

Great LakesTrade value: $25.0B

Jobs: 283,500

Great PlainsTrade value: $8.6B

Jobs: 111,300

NorthwestTrade value: $2.2B

Jobs: 24,000

Source: OnTrac Trade Impact Study © 2001 OnTrac All Rights Reserved.

Impact of International Trade Through San Pedro Bay PortsImpact of International Trade Through San Pedro Bay Ports

Portsof LALB

Atlantic SeaboardTrade value: $34.3B

Jobs: 265,600

SouthwestTrade value: $97.9B

Jobs: 1,003,600

South CentralTrade value: $12.1B

Jobs: 141,000

SoutheastTrade value: $15.9B

Jobs: 191,500

Great LakesTrade value: $25.0B

Jobs: 283,500

Great PlainsTrade value: $8.6B

Jobs: 111,300

NorthwestTrade value: $2.2B

Jobs: 24,000

Source: OnTrac Trade Impact Study © 2001 OnTrac All Rights Reserved.

Impact of International Trade Through California PortsImpact of International Trade Through California Ports

Portsof LALB

Port ofOakland

Combined Impact

$ 235 Billion

Daily Truck Traffic to and From Daily Truck Traffic to and From California Ports Will Grow DramaticallyCalifornia Ports Will Grow Dramatically

40,000

62,000

112,000

0

20,000

40,000

60,000

80,000

100,000

120,000

2000 2010 2020

Congestion Is Hurting our Congestion Is Hurting our EconomyEconomyas well as our as well as our Quality of LifeQuality of Life

Delays, accidents, and Delays, accidents, and freight transportation freight transportation costs are increasingcosts are increasing

Goods movement Goods movement facilities have not kept facilities have not kept up with growthup with growth

Communities Communities increasingly calling increasingly calling for slow growth or for slow growth or no growthno growth

Legislative Initiatives to Mitigate Legislative Initiatives to Mitigate Impact at California PortsImpact at California Ports

Passed into Law January 1Passed into Law January 1stst 2004:2004:AB2650 AB2650 -- Limits truck waiting time outside marine terminalsLimits truck waiting time outside marine terminals

Pending Legislation Before the State Senate:Pending Legislation Before the State Senate:SB 760 SB 760 -- Levy a $30/TEU surcharge for LALB shipmentsLevy a $30/TEU surcharge for LALB shipmentsSB 761 SB 761 -- Limit truck processing time within marine terminalsLimit truck processing time within marine terminalsSB 762 SB 762 -- Establish requirements for truck registrationEstablish requirements for truck registrationSB 763 SB 763 -- Priority berthing program for low sulfur vessels Priority berthing program for low sulfur vessels SB 764 SB 764 -- Zero Net Pollution for LALB Ports (2001 baseline)Zero Net Pollution for LALB Ports (2001 baseline)SB 45 SB 45 -- Regulate detention, per diem and demurrage chargesRegulate detention, per diem and demurrage charges

Pending Legislation Before the State Assembly:Pending Legislation Before the State Assembly:AB 1276 AB 1276 -- Congestion management on key intermodal corridorsCongestion management on key intermodal corridorsAB 1678 AB 1678 -- Cold ironing facilities for cruise vesselsCold ironing facilities for cruise vesselsAB 888 AB 888 -- Rail yard emission reduction programRail yard emission reduction programAB 1222 AB 1222 -- Locomotive emission testing and replacementLocomotive emission testing and replacement

Operational Initiatives to MitigateOperational Initiatives to MitigateImpact at California PortsImpact at California Ports

Appointment Systems Appointment Systems -- eModal or VoyagertrackeModal or VoyagertrackExtended Gate Hours Extended Gate Hours -- PierPassPierPassPort Wide Chassis PoolsPort Wide Chassis PoolsIntermodal Rail Services Intermodal Rail Services -- Alameda CorridorAlameda CorridorShort Sea Services Short Sea Services -- Humboldt Bay BargeHumboldt Bay BargeIncreased use of OnIncreased use of On--Dock RailDock RailLocal Shuttle Trains Local Shuttle Trains -- Inland Empire & ShafterInland Empire & ShafterTrucking CoTrucking Co--operatives operatives -- Efficient Dispatch Efficient Dispatch Virtual Container Yard Virtual Container Yard -- Equipment MatchingEquipment Matching

The VCY connects Trucking Companies with Shipping Lines through a neutral technology platform to:

$ - Reduce marine terminal congestion and empty storage

$ - Reduce direct transportation costs and truck idling time

$ - Reduce traffic congestion and toxic diesel emissions

$ - Improve driver efficiency and effective land use

The “VCY” enables users to share information and to interchange empty container equipment, off-dock, via the Internet

The Virtual Container YardThe Virtual Container Yard“VCY” Solution“VCY” Solution

Equipment Re-Use or Street-Turn Scenario Stockton Area

Marine Terminal

Loaded Leg

Empty Leg

Supplying Trucker

Receiving Trucker

Ocean Carrier

Port of Oakland

Stockton

On-line approval for valid Motor Carriers

Single party billing for equipment damage

Liability transfer between Motor Carriers

Automatic updates to Shipping Line systems

CommunicationCommunicationProcess:Process:

AutomatedAutomatedPostingPosting

of Equipment of Equipment InformationInformation

ExecutionExecutionProcess:Process:

Integrated with Shipping Line

Equipment ControlSystems

Virtual Container Yard Architecture

InternationalStreet-Turn

EmptyDispatch Depot

Direct On-Hire

InternationalRe-Use

InterchangeRe-Use

Standard community guidelines & standard EIR

terms

Liability transferred,Additional free days provided

Continued single party billing for equipment damage

Shipping Linevisibility to

approval and confirmation

process

Shipping Linebusiness

rules, special terms and conditions

Addresses Legal and Liability Issues

Online Community Member Integration

Portfolio of Off-Dock Equipment Matching Opportunities

EmptyDispatch Rail

InterchangeStreet-Turn

Direct Off-Hire

VCY Benefits for Northern California

= Approximately 125,000 less truck trips per year

= $30 Million in transportation cost savings

= Three Million truck miles saved

= 500,000 gallons of diesel fuel saved

= Measurable quality of life improvements (emission reductions and commute time)

= $100-$200 Million in deferred capital cost (Port and Public transportation infrastructure)

Full implementation of the VCY in Northern Californiawill deliver a 10% gain in operating efficiency:

Benefits multiply as trade volumes continue to grow

Examples of CollaborationExamples of Collaborationand Coalition Building Effortsand Coalition Building Efforts

AB2043 AB2043 -- Port Master Plan Task Force BillPort Master Plan Task Force BillTo create a body that will review issues such as To create a body that will review issues such as port security, environmental consequences and port security, environmental consequences and mitigation measures for growth, as well as mitigation measures for growth, as well as improved statewide coordination of California Ports. improved statewide coordination of California Ports. The bill calls for a strategic plan by Jan 2006The bill calls for a strategic plan by Jan 2006

MTODA MTODA -- West Coast Marine Terminal West Coast Marine Terminal Discussion AgreementDiscussion Agreement

LALB LALB -- Integrated Work Program to Reduce Integrated Work Program to Reduce Truck TrafficTruck Traffic

Oakland Oakland -- Port Access Task ForcePort Access Task Force

Truck Co-operativesFor Efficient

Land use

ExtendedGates

& ShuttleServices

Truck Route

& TruckRetrofit

ITS InitiativeSmart

Corridor& 511

StreamlinedAppointment

Systems

Virtual Container

Yard

Marine Terminal

Access & PortSecurity

EnvironmentalConsiderations

& Quality of Life

Issues

Port-WideChassis

Pool

OaklandPort Access

Growth in Trade

2004 -20202.0 - 4.5

Million TEUS

SecurityRequirements

& LegislativeObligations

TruckCongestion,Port Access

& GoodsMovement

CoalitionBuilding

InformationSharing

- Community Considerations

- Elements of a Regional Information Community Portal

Collaborative Vision for Greater Efficiency

Call to ActionCall to Action

Congestion is a National Phenomenon Congestion is a National Phenomenon

There is no single solution (Silver Bullet) to this There is no single solution (Silver Bullet) to this problem. Progress will be made through series problem. Progress will be made through series of initiatives and integrated solutionsof initiatives and integrated solutions

The Transportation Community is encouraged:The Transportation Community is encouraged:

To engage Innovative Technology Solutions To engage Innovative Technology Solutions

To foster Process Automation and Data IntegrationTo foster Process Automation and Data Integration

To streamline Applications for Ease of Use To streamline Applications for Ease of Use

To continue Coalition Building efforts and embrace To continue Coalition Building efforts and embrace opportunities for Public/Private Collaborationopportunities for Public/Private Collaboration

Thank You

Thank YouThank You