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Download: Port of Los Angeles spending almost 60% more next year on capital improvements

PortandTerminal.com, June 11, 2019

The 2019/20 plan is cautious on revenue, bullish on capital improvements spending. A copy of the budget is available below for download.

Los Angeles, CA – The Los Angeles Board of Harbor Commissioners has approved a $1.6 billion fiscal year (FY) 2019/20 Annual Budget for the Port of Los Angeles.

The approved budget lines up with the Port’s 2018-2022 Strategic Plan priorities, with an additional emphasis on sound financial management.

Cautious on revenue

As America’s largest container port, the Port of Los Angeles is especially sensitive to any threats to cargo volumes on which it charges wharfage fees

Shipping services are by the far the most important source of revenue at POLA accounting for 82% of the port’s revenues. Over 90% of the port’s shipping services are made up of wharfage fees, which are charges assessed by the port on incoming or outgoing cargo.

Wharfage fees are the lifeblood of the Port of Los Angeles and depend entirely on cargo volumes.

While the Port of Los Angeles achieved record cargo volumes in 2018, this budget takes a purposeful and measured approach as we move into the next fiscal year

Jaime Lee, President of the Harbor Commission.

The approved budget forecasts a slight decrease in FY 2019/20 cargo volumes over the record-setting levels of the previous year with an estimate of 9.4 million TEUs (twenty-foot equivalent units). 

Capital improvements spending

Funding priority: To accommodate larger ships major improvements, budgeted at $29.5 million for FY 2019/20, are underway at the Everport Container Terminal

The Port has allocated $144.4 million to Capital Improvement Projects (CIP), a 58.8% increase over the previous fiscal year.

Of that amount, $64.7 million will go to terminal improvements, $38 million to maritime services, $11.7 million to transportation upgrades and $8.5 million to security-related projects.

This CIP budget also includes $21.5 million for LA Waterfront projects, $20.9 million of which comes from the Public Access Investment Plan. The Plan allocates 10% of operating income annually to public access infrastructure projects and also provides additional investment in continued maintenance and programming of the LA Waterfront totalling more than $40 million annually committed to operations and capital investment in the LA Waterfront. 

The Port of Los Angeles

The Port of Los Angeles (POLA) is the largest container port in the United States and the 19th largest in the world. In 2018 POLA handled 9.5 million TEUs.

An estimated $1.2 billion worth of cargo comes in and out each day at the LA Port which is serviced by 86 ship-to-shore container cranes and 27 terminals of various types.

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