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Web posted Sunday, March 11, 2007

Container tax stalled for now, but likely to reappear

By Rob Stapleton
Alaska Journal of Commerce


  Container trailers, like those used by Lynden, TOTE, Horizon Lines and others, could be charged a tax if the states of Washington and California pass proposed laws. The Alaska transportation industry, businesses and Gov. Sarah Palin have opposed the idea, saying would raise the cost of living in Alaska. ARCHIVE PHOTO/Rob Stapleton/AJOC    
It's too late this year for a container tax to be enacted in the Washington state Legislature, but that doesn't mean the proposed tax on shipping containers won't be back next year, according to transportation experts in Alaska.

“This will rear its ugly again next year,” said Aves Thompson, executive director of the Alaska Trucking Association. “Washington is hoping to work with California to pass this as law.”

The proposal for a $100 tax for every 40- foot container coming and going to and from the state of Washington has raised the ire of the Anchorage businesses, Alaska transportation industry, the Alaska Legislature and Gov. Sarah Palin.

The original proposed fee would raise an estimated $287 million for freight congestion relief projects for the state of Washington in the next two years, and would grow to an estimated $433 million for 2009-2011.

The implications of the legislation triggered a response from the Alaska Legislature, which issued a joint resolution Feb. 7 opposing the tax. The resolution urges the Washington state Legislature to consider alternative means for raising revenue to be used for port infrastructure improvements.

Alaska statistics indicate that 97 percent, by weight, and 60 percent, by value, of all goods shipped to Alaska are shipped by marine transportation.

“The cost of shipping has a direct effect on the cost of living in Alaska,” Palin wrote in a letter to Washington state Gov. Christine Gregoire. “This is particularly true of our rural communities where prices on many shipped goods are already exorbitant. Additional taxes or fees applied to the cost of shipping only makes for increased costs for our residents.”

The Anchorage Economic Development Corp. also weighed in the idea.

“The bill will raise the cost of moving goods and materials to Alaska, and it will stifle the quality of life and the sustainable economy we've built here,” said Bob Poe, executive director of AEDC. “Our economic interdependencies ensure that this tax will negatively affect people, communities and businesses in both of our states.”

Alaskan industry members think this tax was intended for international cargo carriers only.

“We think that this proposal was intended for international cargo containers, and that it will be re-worked,” said Linda Leary, vice president of marketing for Carlile Transportation in Tacoma, Wash.

Port officials at both the ports of Seattle and Tacoma are opposed to the container fee. Officials said it would raise the cost of moving containers from $200 to $300 per container, making it harder to compete. The price for moving a container in Portland, Ore., and Vancouver, Wash., is still $200 or less.

California Gov. Arnold Schwarzenegger vetoed a similar bill in California last fall that would have charged shippers $60 per 40-foot container.

Thompson, who added that the Alaska Trucking Association is against the measure, thinks that the measure will be back next session.

“There no doubt that the states of Washington and California are looking for funding for their projects,” Thompson said. “Until the international carriers come into the opposition openly, this won't go away. After all, they are the ones who will be footing the bill at 2,000 to 3,000 containers per shipload if this becomes law.”

Rob Stapleton can be reached at

rob.stapleton@alaskajournal.com.


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