Port of Los Angeles harbor commissioners seem ready to cut some slack for some trucking companies that were paid a $20,000-per-truck incentive bonus to bring their low-emission trucks to haul port cargo, but failed to make the required 300 moves-per-year requirement. The port board was informed two months ago that up to 70 percent of the 2,200 privately financed clean trucks are not making enough moves for participants to keep the full bonus. At Thursday's board meeting, port staff outlined possible changes to help trucking companies keep all or part of the incentive money.

Based on the board discussion, staff is expected to return with a formal proposal to amend the requirements by early June.

Board President Cindy Miscikowski summed up the discussion by directing the staff to come back with a formal proposal that reflects the commission's desire to show "flexibility, accommodation and some degree of reasonableness."

However, Miscikowski added that she remains unwilling to accommodate situations in which trucks have not made a single trip to the port since the incentive was paid. Nearly 18 percent of the trucks for which the incentive was paid presently fall into that category. At issue is the proper use of public funds.

Early in the meeting, three of the four board members present indicated they had discussions with executives of two of the largest trucking companies - Swift and Knight - that participated in the program. Both are based in Phoenix.

In an unrelated action, some L.A. city officials have floated the idea of not doing business with Arizona companies to protest the state's controversial new immigration law. Although existing contracts are unlikely to be affected, Swift and Knight were among the main beneficiaries of the port incentive program. The two companies will be big beneficiaries if the port opts to relax the incentive program conditions.

In early 2009, the port paid out $44 million in incentives to 58 companies that agreed to haul port cargo with their clean trucks in order to speed up turnover of the drayage fleet under the San Pedro Bay Clean Air Action Plan. Under the terms, recipients were supposed to repay the port $4,000 per year for each truck that makes fewer than 300 moves per year to L.A. terminals over a five-year period. Those that signed on early are subject to a $3,000-per-year repayment for failure to meet the annual 300-move threshold.

The first 12-month period for calculating which companies get to keep the incentive and which must repay a portion ends June 30.

Even with the incentive, the 2,200 new trucks represent a major investment by participating trucking companies. Swift, the largest participant, has said that its 591 trucks - for which the port issued an incentive check of $11.82 million - represents an investment of $600 million.

Commissioners indicated that they don't want to punish participating trucking companies for events beyond their control, namely the economic slide that caused cargo volumes to drop 20 percent at the L.A. port.

Possible options for relaxing the requirements include:

• Crediting trucking companies for trips to both L.A. and Long Beach
• Adjusting the trip bar for the 20 percent downturn in trade
• Aligning the bar with the lower state standard of 150 trips for its grant programs
• Factoring in the overall use of the fleet - called fleet averaging - to account for differences in route lengths and trucks that are out of service for repairs
• Resetting the timeline to help companies that bought the trucks late in the year or that are building up their drayage business;
• Resetting the timeline to help companies restructuring their fleet and transferring the incentive contract

John Holmes, Port of Los Angeles deputy executive director of operations, outlined the options, which could be adopted individually or in some combination. He also identified drawbacks of altering the incentive program. Fleet-averaging could give a break to trucks that have not been in port drayage service at all, and resetting the timeline could reward companies that bought trucks on speculation.

Another issue is fairness to participants who are meeting the original requirements of the program.

The commission also is considering relaxing the terms of a related program to reward participants who made at least 600 trips to both ports - with a minimum of 300 trips to L.A. terminals - over 12 months with an additional bonus of up to $10,000. The secondary bonuses have yet to be paid because the 12-month period runs from July 1, 2009, through June 30, 2010.

The port purposely set the bar high to encourage efficiency and only half of the trucks were expected to qualify, Holmes said. Based on the same data presented in March, only 22 percent of the trucks are likely to qualify for the 600-trip bonus.

Holmes' PowerPoint

-- The Cunningham Report