Approved Revenue, Spending Plan Supports LA Port Priorities

(Port of Los Angeles Photograph)

The Los Angeles (Calif.) Harbor Commission on June 6 signed off on a $2.6 billion Fiscal Year (FY) 2024/25 budget for the City of Los Angeles Harbor Department that it said will support the “community investment, decarbonization of port-related operations, workforce development, and cargo infrastructure modernization” priorities of the Port of Los Angeles.

“Buoyed by steady cargo volumes over the last nine months,” the approved FY 2024/25 revenue and spending plan forecasts a total of 9.1 million TEUs (Twenty-Foot Equivalent Units), a 2% increase over the previous fiscal year’s adopted budget, according to the Port. This cargo boost is expected to lead to a 4.9% increase in FY 2024/25 operating revenues, forecast at $684.7 million, with shipping services comprising about 75% of those revenues, the Port said.

Proposed operating expenses in the FY 2024/25 budget are forecast at $403.7 million. This is up 8.4% from the prior fiscal-year budget, the Port said, due largely to increased staffing needs and the filling of open positions at the Harbor Department.  

Additionally, the budget dedicates $257.7 million to the Port’s capital improvement program (CIP), a 19% increase over the previous fiscal-year budget. Major CIP appropriations include $44.3 million for the State Route 47/Vincent Thomas Bridge & Front Street/Harbor Boulevard Interchange Reconfiguration; $15.3 million for the Zero-Emission Port Electrification and Operation program; $14.2 million for restoration and improvements at the Pasha Terminal; and $12.5 million for Marine Oil Terminals Maintenance Standards projects, among other initiatives. Another $28.5 million in CIP funds will go toward LA Waterfront public access improvements in both Wilmington and San Pedro; the major projects to be funded in FY 2024/25 include the San Pedro Waterfront Promenade–Phase II, and the Wilmington Waterfront Avalon Pedestrian Bridge & Promenade Gateway.

The CIP budget also includes $4 million toward planning for the Port of Los Angeles and Port of Long Beach Good Movement Workforce Training Facility. The $150 million facility is said to be the first in the U.S. dedicated to the goods movement sector and career training in longshore work, trucking, and warehousing. The project’s environmental review process kicked off earlier this year.

“With a healthy economy, continued consumer spending, and a strong U.S. labor market, we are optimistic about cargo volumes for the next fiscal year,” Port of Los Angeles Executive Director Gene Seroka said. “We’ve prepared a budget that leaves room for unanticipated changes in the global trade market or other uncertainties that may arise.”

“This year’s budget takes a prudent approach that carefully balances revenues and expenses, and sets up the Port well for the future,” Los Angeles Harbor Commission President Lucille Roybal-Allard said. “Most importantly, the plan will allow us to stay the course and follow through on many strategic priorities and industry leading initiatives in the coming year.”

Gene Seroka echoed the port priorities supported by the budget in his Jan. 10, 2024, “State of the Port” address.

Among the initiatives he highlighted for 2024 and beyond:

10-Year Infrastructure CIP:

• Completion is expected this year on the Port’s $73 million Pier 400 Corridor Expansion.
• Work will continue on roadway, rail and site design for the $195 million Terminal Island Maritime Support Facility.
• Final design is expected for the $52 million on-dock rail yard expansion at the Pier 300 Fenix Marine Services terminal, which is slated to break ground in 2025.
• Seismic upgrades will take place at the Shell Oil and PBF Energy liquid bulk facilities at the Port.

Environment:

• The Port in the coming year will accelerate its green hydrogen plans, bolstered by the announcement last fall of up to $300 million in federal grants funding for development of “hydrogen hub” operations in the San Pedro Bay port complex, according to Seroka. The ports of Los Angeles and Long Beach plan to match the funding with up to $300 million in combined investments. The Port of Los Angeles is slated to use that funding to deploy “dozens of hydrogen-powered cargo-handling equipment” for construction of the necessary hydrogen-fueling terminal infrastructure. Additionally, plans are under way to add more zero-emission Class 8 over-the-road trucks to the ports, where 195 are already in operation, according to Seroka, who said this will be accomplished, in part, by offering incentives under the Port’s Clean Truck Fund Rate program, which has collected more than $115 million to date to help facilitate a changeover to cleaner trucks serving the port complex.
• The Port in 2024 is slated to “further its commitment” to creating Green Shipping Corridors that focus on reducing carbon emissions along key international shipping routes through use of zero-emission trucks and terminal equipment, and gradually cleaner vessels fuels. It noted that five of the major ocean carriers that call on the San Pedro Bay ports will be testing lower-carbon fuels in the coming years as part of these various corridor programs. To date, the Port has established Green Shipping Corridor partnerships with eight ports in China, Japan, Singapore and Vietnam. “We have to focus on solutions that benefit both our regional and our global community,” said Seroka, referring to the value of the Port’s Green Shipping Corridor initiatives.

Workforce Development:

• Design will be under way this year on the Goods Movement Training Campus, a jobs and training initiative of the ports of Los Angeles and Long Beach, International Longshore and Warehouse Union, Pacific Maritime Association and the state of California.

Community:

• The $77 million Wilmington Waterfront Promenade will open in 2024.
• The Port in 2024 will break ground on the $65 million Avalon Promenade and Gateway Project, which will connect the Wilmington community to its waterfront.
• Seroka said construction is progressing in San Pedro on the 42-acre West Harbor retail and dining development, with Phase 1 expected to open in 2025. “While the Port is completing the final phase of the San Pedro Waterfront Pedestrian Promenade, West Harbor is building 375,000 square feet of indoor and outdoor retail, entertainment and dining space––even a dog park that will offer craft beer and other refreshments,” Seroka said.
• AltaSea at the Port of Los Angeles has broken ground on a 180,000-square foot buildout of its warehouse space at the Port’s historic City Dock No. 1, according to Seroka. The $28 million project—funded in part by the state and Port—is slated to transform AltaSea’s Center for Innovation into a “critical mass” of marine and blue-tech related research, education and technology enterprises.
• Among several transportation projects to ease truck and commuter traffic is the Port’s new Harbor Boulevard onramp and offramp upgrade between the Vincent Thomas Bridge and Harbor Freeway, which will break ground this year.