Date: Friday, March 17, 2006

Re:	PIERPASS - TRAFFIC MITIGATION FEE INCREASE

Dear NASA Member:

Received the following from PierPASS regarding increase to Traffic Mitigation Fee:

Today we are announcing an adjustment to the current Traffic Mitigation Fee (TMF) assessed on container traffic using marine terminal day gates under the OffPeak program. This adjustment, which will go into effect April 3, 2006, comes after the first regular review of program costs since OffPeak was launched in July of last year. The new TMF rate will be $50.00 per TEU (twenty-foot equivalent unit), up from the original $40.00 per TEU rate. Those fees collected are used to finance the labor, operational and administrative costs of the very successful OffPeak night gate and Saturday gate operations at the Ports of Los Angeles and Long Beach.

From the kick-off of the OffPeak program, we have said PierPASS will regularly review the program costs and adjust the TMF as needed. As planned, PierPASS conducted its first audit of the OffPeak program, working with the independent industrial engineering firm the JWD Group. The initial $40.00 per TEU rate was based on a 2004 market analysis and in-depth consultation with marine terminal management. It was the best estimate possible in the existing business and trade environment. However, as the review demonstrated, the realities of current labor costs, coupled with our increased understanding of the actual operations of the OffPeak program, establish that an adjusted fee is necessary to run a balanced operation.

It is equally significant to remember that our best estimate at the outset of OffPeak was that we would divert 15 to 20 percent of our daytime movements to nights and weekends by the end of the first year. Yet, during the first six months, between 30 and 35 percent of all gate activity went to OffPeak operations.

In the end, the fee adjustment is both a testament to the achievement of OffPeak to move container traffic in a new way and a challenge to marine terminals to improve operational efficiency and make every dollar count.

Additional information on the TMF adjustment may be found in the document "TMF Adjustment Overview" available on the PierPASS website, http://www.pierpass.org

Best regards,

North American Shippers Association (NASA)
Joan Barrett
NASA Administrator