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    Assemblywoman Karnette Denied Permission To Attend Roundtable With Congressmembers & LB-LA Port Officials Re Proposed Fed'l SAFE Port Legislation; List Of Invitees Excludes LB & L.A. Councilmembers But Includes Multiple Port & Industry-Related Interests

    (March 21, 2006) -- LBReport has learned that Assemblywoman Betty Karnette (D., LB-PV) -- whose district includes the Ports of LB and L.A. -- was denied permission to take part in a March 17 meeting at the Port of LB held by Congresmembers Dan Lungren (R., Sacramento) and Loretta Sanchez (D., Garden Grove), to discuss Cong. Lungren's recently proposed "Security and Accountability For Every (SAFE) Port" legislation and related security and funding matters.

    Congressmembers Lungren and Sanchez are chair and ranking member, respectively, of the Subcommittee on Economic Security, Infrastructure Protection & Cybersecurity of the House Homeland Security Committee.

    A list of invitees, provided by PoLB officials at the event, reflects a preponderance of Port and industry representatives...with no elected LB City Councilmembers (or L.A. Councilmembers) whose constituents are put at risk by security gaps tolerated in current Port operations. has not yet learned exactly how the list (below) of invited participants was assembled or by whom:

    [begin text]

    "CODEL Lungren - Roundtable (updated)"

    • United States Coast Guard: RADM Kevin Eldridge, Commander (tentative); Capt. Neffenger, Sector Commander

    • Customs & Border Protection: Kevin Weeks, Dir. of Field Operations, L.A. region

    • Long Beach Port Authority: Richard Steinke, Exec. Dir; Cosmo Perrone, Director of Security; Carl Kemp, Dir., Community Relations & Gov't Affairs; E. Del Smith, Washington, D.C. representative

    • Los Angeles Port Authority: Geraldine Knatz, Exec. Dir.; George Cummings, Dir. of Homeland Security; Chief Ronald Boyd, Acting Dir. of Operations & Emergency Mgt., Chief of Port Police

    • County of Los Angeles: Supervisor Don Knabe (invited)

    • In'tl Longshore & Warehouse Union: Chapter President of designee (invited)

    • State of CA: Governor's office representative (invited)

    • Shipping & Terminal Operator: Pacific Merchant Shipping Ass'n (invited)

    • Bearing Point: Mike Palmer, Managing Director TSA Accounts
    • Laura Jones, Business Development Mgr.

    • Additional attendees: Jay Grant, Managing Partner, Jay Grant & Associates, representing American Ass'n of Port Authorities

    Congresswoman Jane Harman (D., Southbay), a co-author with Lungren on the SAFE Ports Act and ranking member on the House Homeland Security Committee, was scheduled to participate in the March 17 PoLB event but took time off due to arrival of a grandchild. Supervisor Knabe's office says it was invited only a day before by event by telephone and the Supervisor couldn't attend. has learned that LB Mayor Beverly O'Neill's office was told of the Port meeting with Congressmembers...although at least one Councilmember indicates their office was not invited. LB Harbor Commissioners James C. Hankla and Mario Cordero were among those present in the audience while Port staff took part. Under LB's 1980's City Charter, LB Harbor Commissioners are non-elected and non-recallable (Mayor chosen, Council approved).

    Assemblywoman Karnette's office was informed she wasn't invited to participate by a staffer in the office of the House subcommittee chaired by Congressman Lungren. Asked about the circumstances by, a committee aide told

    We appreciated the Assemblywoman reaching out to us on this issue. However, as we explained at the time, this trip was specific to the Safe Port Act legislation introduced by Rep. Lungren (R., Sacramento) and Rep. Harman (D., Southbay) and co-sponsored by Rep. Loretta Sanchez (D., Garden Grove) intended to increase port security.

    The roundtable was an opportunity to get feedback from local officials, officials from the Long Beach and Los Angeles Ports and the Coast Guard on the legislation, to hear any suggestions they might have to move the bill through the committee process.

    As we said before, we'd be happy to work with Assemblywoman Karnette in the future on the issue of port security but this trip was specific to the Safe Port Act, and a chance for federal officials to correspond with the locals who deal with port security each and every day.

    District representative to Assemblymember Karnette, Robert Simpson, provided with the following emailed comment in response:

    Port security should not be a partisan issue. When we read in the newspaper that Congressman Lungren is co-authoring legislation that seeks to increase port security funding, we wanted to get involved and help in any way we could. This is an issue that really has been neglected nationally over these past few years and we are certainly glad to see that more members of Congress have now spoken out on it.

    We contacted Congressman Lungren's office to inform him that California is already on record supporting the use of customs fees to increase port security funding via the Governor's signing of Assemblymember Karnette's AJR 21 last year. We felt that the inclusion of state and local elected officials who have been calling for greater port security efforts such as Senator Alan Lowenthal, Assemblymember Jenny Oropeza, Mayor O'Neill and the city council, would have been a welcome contribution to the Congressman's roundtable discussion. We need all levels of government working together to strengthen the security of our ports.

    The American Association of Port Authorities (AAPA), in which PoLB is a member and was invited to participate via a representative at the roundtable, takes the following position on funding port-related homeland security measures:

    "The maritime community already pays billions of dollars in user fees and taxes to the federal government, including $17.5 billion in Customs duties collected in FY 03. Maritime cargo provides approximately 70% of the yearly customs collections. AAPA believes that Customs duties should be used as a source of security funds if Congress seeks a dedicated source of funding. AAPA opposes new taxes to fund security enhancements."

    The SAFE Ports Act envisions using customs duties to pay for additional security measures. PoLB Executive Director Richard Steinke indicated at the March 17 meeting that he favors maritime Customs fees as a SAFE Ports funding source, saying "the funding mechanism provides that the money that is generated from the maritime sector goes back to correct some of the things where we need to have better security."

    Congressman Dana Rohrabacher (R., HB-LB-PV), whose district includes the Ports of LB/LA, and Assemblywoman Karnette, whose state legislative district also includes the Ports, have both previously -- and prior to introduction of the SAFE Ports Act -- supported using container fees to help defray public security costs.

    As reported by, in August 2005 the Port of LB's DC lobbyist E. Del Smith, also a participant in the meeting, told LB's Board of Harbor Commissioners that his office helped block legislation by Congressman Rohrabacher that would empower Ports to levy container fees (that could produce revenue defraying public costs for security).

    At the March 17, 2006 PoLB event, Congressman Lungren indicated that he'd spoken with Congressman Rohrabacher and said he "likes the thrust" of the Lungren-Harman SAFE Ports Act but "he has a little bit of a disagreement with respect to the funding mechanism, but we are still talking." [Lungren didn't say container fees were the issue, although we pursued the point at a news conference, salient transcript below.]

    In 2005, Assemblywoman Karnette introduced state legislation to levy a container fee for security purposes, opposed by Port-related interests, and amended the bill to call only for a report on required levels of funding for port security. The measure was still vetoed by Governor Arnold Schwarzenegger.

    The recently introduced SAFE Ports Act (HR 4954) has drawn national attention following the Dubai Ports World controversy. As of March 17, it had 45 listed co-sponsors including southland Congressmembers Jane Harman (D., Southbay) [ranking member of the House Homeland Security Committee], Grace Napolitano (D, Norwalk), Adam Schiff (D., L.A.), Mary Bono (R., Palm Springs)...and Loretta Sanchez (D., Garden Grove).

    Since Cong. Rohrabacher wasn't listed as a co-sponsor on the bill, followed up during a press Q & A: ...On the funding mechanism, what would backfill the customs duties to be used to fund this now and do you support [Congressman] Rohrabacher's [previously floated concept] of a container fee to help defray some of the costs?

    Congressman Dan Lungren: Well, I'll tell you, the first thing is we in our committee do not have the jurisdiction to decide where you backfill certain things. This will probably be sequentially referred to the Ways and Means committee because it does deal with taxes, that is customs fees. My belief is, and Loretta can speak for herself on this, but my belief is, and I've spoke with Jane [Congresswoman Harman] on this, that someone needs to set that mark out, saying a dedicated stream of fund must be created for this purpose.

    Our feeling in coming up with this approach was that if you look at customs receipts, customs fees across the country, quite a slug of it comes through the Ports...

    ...So we think it's a natural connection since the Ports are the greatest generator of these fees, and the loss of the ports for any significant time would basically stop those fees from coming in, doesn't it make sense to use part of those fees for the kind of capital investment necessary to secure our ports?

    And on the second question [container fees], it's not original with Dana [Congressman Rohrabacher], there was an [op-ed piece by a third party in a national newspaper] suggesting that there be a $20 charge per container. At least that has a connection with the process.

    I would like to stick with the fees that are already existing. I don't know what the trade implications are with that. I'm not sure what the total tax implications are from that. All I'm saying is we at least start the debate going with a dedicated source of funds or stream of funds for this purpose ought to be established. If they want to find it some other way, I'm happy to engage in that debate but at least we're saying we think it's that important this ought to be dedicated for this purpose.

    Congresswoman Loretta Sanchez: It's always a very orchestrated dance, you know. I'm a businesswoman so, you always worry what's the cost? What's the cost of not doing this? And that's what you have to weigh and I think we have participants here from all over, from the Longshoremen, the different Ports that are represented, we have federal agencies represented, we're going to go out and see an operator after this to take a look at what's really happening, and we will get input. We've gotten input from the Association's report, we'll get input from the operators who of course are looking at the fact that 'what are you going to do, raise fees on me? Maybe I can't get my business done.' We understand that. Mr. Lungren and I understand the issues of we don't want to put a fee that you don't need or that won't really help the commercial values that we have here, but at the same time you have to be able to protect yourself as much as you can from something really shutting down these ports...

    In a March 3, 2006 freewheeling telephone interview prior to introduction of the SAFE Ports Act, asked Congressman Rohrabacher about the Port of LB's opposition to container fees for security, reflected by an August 2005 boast by PoLB's DC legislative advocate that he had helped killed Rohrabacher's container fee legislation. ["There has been an effort to increase container fees, a piece of legislation that we helped defeat just recently," E. Del Smith told LB's Board of Harbor Commissioners in August 2005.]

    Congressman Rohrabacher: ...It's pretty grotesque. This is the Ports beating themselves in the head with a hammer and then bragging about it. I mean it's insane. Well, isn't this sufficient to show that the Port of Long Beach, or at least the people running it now, are putting the interests of their rent-paying tenants ahead of the interests of taxpayers and the public around here?

    Congressman Rohrabacher: I can't say what their interest is and what their decisionmaking is. All I know is that there's a tremendous arrogance in the Ports, and in Long Beach and in Los Angeles in those people involved around the Ports, and when you have arrogance coupled with basically naivete, it's really a very destructive force.

    And that's what you've got here. They're involved in a powerful dynamic in our society, the ports. This is an incredibly powerful dynamic, but they are nowhere near as sophisticated as they think they are. And in fact, their parochialism would be funny if it wasn't so destructive, and their opposition to the container fee idea is the best example of that.

    However, if you have a good idea and you keep pushing it, and you are someone who doesn't mind being put down for a number of years until people realize that you are right, it's OK.

    Useful references:

  • Quick fact sheet on SAFE Port Act/HR 4954
  • Full text of SAFE Port Act.

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