University of Southern California Dissertations and Theses

Institutional analysis of stakeholder collaboration in freight movement at the ports of Los Angeles and Long Beach

(USC Thesis Other)

Institutional analysis of stakeholder collaboration in freight movement at the ports of Los Angeles and Long Beach

PDF

Download a page range

Download transcript

Copy asset link

Request this asset

Transcript (if available)

Content INSTITUTIONAL ANALYSIS OF STAKEHOLDER COLLABORATION IN
FREIGHT MOVEMENT AT THE PORTS OF LOS ANGELES AND LONG
BEACH

by

Swati Chaudhuri

A Dissertation Presented to the
FACULTY OF THE GRADUATE SCHOOL
UNIVERSITY OF SOUTHERN CALIFORNIA
In Partial Fulfillment of the
Requirements for the Degree
DOCTOR OF PHILOSOPHY
(URBAN PLANNING)

May 2008

Copyright 2008 Swati Chaudhuri

ii
Dedication

In loving memory of Dr. Anjan Paul,
my uncle, who plied me with tea and conversation,
and gave me intellectual curiosity and respect for wisdom

iii
Acknowledgements

Immense gratitude and thanks are due to my advisor Dr. Niraj Verma for his
unwavering support and guidance through the duration of my research. Dr.
Verma’s sober analysis and advise helped me avoid many pitfalls in my work and
complete my research successfully.

I am also extremely grateful to the members of my Dissertation Committee, Dr.
Tridib Banerjee and Dr. Najmedin Meshkati for their insightful feedback and
comments on my work. Additionally, I was privileged to work with Dr. Banerjee
as his teaching assistant and benefit from his academic mentoring.

A special note of thanks for Dr. Hanh Le Griffin, who succeeded in making a “port
lady” out of me by managing to transfer her incredible enthusiasm for ports and
the shipping industry to me. To all the respondents and contributors to my research
project, I am very grateful for their valuable inputs and access to vast knowledge
on intermodal freight.

I would be remiss if I do not mention the intellectual and institutional support
provided by my excellent professors, including Dr. Hugh Evans, Dr. James
Fawcett, Dr. Dowell Myers, Dr. Koichi Mera, Dr. Peter Robertson, and Dr.
Genevieve Giuliano.

iv
I was also fortunate to find at USC a circle of friends who became my home away
from home, providing affection and support when I needed it the most. Many
thanks to Emil Ettelaie, Rebecca Jenkins, Dr. Sudha Nair and much affection for
Spyro Spyropoulos.

To Sujata, Sabyasachi, Dr. Sumit Panja, Arijit, Moumita, soon to be Dr. Sukanya
Ray and Suparna, I attribute my perseverance and determination. Above all, I owe
everything to my loving and generous parents my Baba and Ma, and my beloved
sister Sutapa, without whose encouragement, this endeavour would have never
been undertaken.

v
Table Of Contents

Dedication ii

Acknowledgements iii

List of Tables vii

Abstract viii

Chapter 1:Introduction 1

Chapter 2: Developing an Institutional Framework for
Analyzing Stakeholder Collaboration 24
Theoretical Paradigms for Examining Collaboration 27
Reasons and Incentives for Collaboration 33
Barriers to Collaboration 38
Governance Mechanisms for Collaborative Arrangements 43

Chapter 3: Institutional Context for Freight Movement at POLA/LB 49
Growth of Container Traffic at POLA/LB 51
Creation of Appointment System for Truckers and PierPass 61
Performance of PierPass and Appointment System till date 75
Issues in the Institutional Environment of Freight Movement 85

Chapter 4: Research Design 94
Defining the Problem 95
Research Questions 97
Selection of Methodology 99
Identifying Interview and Survey Respondents 101
Stakeholder Survey 106
Administering Key Stakeholder Interviews 114

vi

Chapter 5: Survey on Intermodal Freight Movement
and Stakeholder Interviews 120
Incentives – Differences Between Public-Private and Intra-Private
Stakeholders 122
Barriers to Collaboration – Trust and Free Rider Problem 129
Information Costs for Inter-Stakeholder Collaboration 134
Governance Mechanism for Collaboration 137
Identifying Issues for In-Depth Stakeholder Interviews 140
Discussion of Interview Results 141
Trust Issues between Stakeholders 143
Cost-Benefit Imbalance: Free Rider Problem at Multiple Levels 148
Information Dissemination and Exchange Issues of PierPass and
Appointment System Implementation 151
Performance of PierPass and Appointment System 156
Institutional Environment and Implementation of PierPass
and Appointment System 159
Summarizing Interview Discussions 167

Chapter 6: Conclusions 169
Institutional Analysis of
Stakeholder Collaboration in Freight Movement 170
Institutional Environment Impact on Freight Movement 178

References 185

Appendices 199

vii
List Of Tables

Table 3-1 California legislation (enacted and proposed) related to freight
movement at POLA/LB 63

Table 3-2 List of initial members of the
West Coast MTO Agreement by June 10, 2004 72

Table 4-1: Coded List of Interviewees 117

Table 5-1: Ranking of Public Stakeholders based on
Cost-bearers and Beneficiaries from Pier Pass and Appointment System 125

Table 5-2: Two Strongest Advocates of the
Pier Pass and Appointment System (in percentage of respondents) 130

Table 5-3: Ranking of Private Stakeholders based on Cost-bearers and
Beneficiaries from Pier Pass and Appointment System 132

Table 5-4: PierPass system has been effective in balancing the interests of all
groups of stakeholders in intermodal freight movement. 139

viii

Abstract

The primary focus of this study has been the identification of the incentives and
barriers to collaboration between stakeholders in freight movement at the Ports of
Los Angeles and Long Beach (POLA/LB). Additionally, I also discuss how these
incentives and barriers influence specific governance mechanisms required for the
management of such partnerships.

In this study, I attempt to identify characteristics of the collaboration necessary for
the alignment of institutionalized practices and information sharing between
stakeholders. Employing a theoretical framework that combines new institutional
economics and partnerships, I synthesize a theoretical framework that incorporates
factors affecting partnerships.

To address my research questions, I utilized a combination of a survey of freight
movement and interviews with key representatives of selected stakeholder
organizations.

Using the theoretical framework, review of institutional context and data from
survey and interviews, I argue that for the successful implementation of
ix
stakeholder collaboration in freight movement at POLA/LB, the following are
necessary but not sufficient conditions. The incentives and barriers to
collaboration, specifically, differences between private and public entities, the risk
of mistrust and free riders and information gaps should determine the governance
mechanism to monitor the partnership.

The presence of a large number and types of stakeholders, free riders, and mutual
distrust between stakeholders means that the governance mechanisms should , a)
be determined by contracts that try to cover substantially the risk from future
uncertainties due to mistrust and free riders; b) have an independent arbitration
body that maintains the mutuality and parity between partners; and c) relies on the
pre-existing informal arrangements between stakeholders and industries to
reinforce the collaboration.

Chapter 1

1

INTRODUCTION

A growing body of literature has been focusing on the inadequate infrastructure,
congestion and pollution affecting freight movement at rapidly expanding urban
ports, especially the port complex of Los Angeles and Long Beach.

It has been argued that in the short run, given insufficient infrastructure
expenditure, and the attendant problems such as environmental pollution
associated with more construction, productivity gains in freight movement will
result from operational efficiency measures that result in more intensive use of
existing infrastructure.

These measures rely greatly on coordination between stakeholders in freight
movement, provision of incentives and removing barriers to cooperation. In this
study, I analyze the incentives and barriers to cooperation between stakeholders in
freight movement at the Ports of Los Angeles and Long Beach. My focus is on
identifying measures that can help promote institutional coordination and incentive
alignment between stakeholders.

Framework of the Study
2

The study is situated within a framework of new institutional theory, planning and
the literature on partnerships. It identifies incentives to stakeholder collaboration,
barriers and costs such as information gathering and risk management and
governance of stable institutional arrangements between stakeholders.

The study contributes to the growing literature on ports and the intermodal freight
movement network, creating one of the few case studies on operational efficiency
measures (Pier Pass and appointment system) at the Ports of Los Angeles and
Long Beach (POLA/LB), one of the biggest port complexes in the world.

The Context of Ports and Urban Regions

This study mirrors the growing interest in the study of urban ports as they
reconcile the pressures of rapid growth with the challenges posed by rapidly
growing urban agglomerations within which they are located. I also examine how
local decision-makers have to account for global institutional changes in planning
for local development.

In addition to contributions made towards understanding the nature of
collaborative arrangements and their governance mechanisms, the study also
3
documents experiences related to innovative operational practices by intermodal
freight movement actors at POLA/LB that would provide useful lessons for other
ports facing similar challenges.

Growth in Global Trade

The changing nature of global trade has had a tremendous impact on the
transportation sector in general and ports in particular. In recent times, a
combination of factors such as outsourcing, just-in-time inventory, and global
supply chains, there has been a surge in freight movements between the Pacific
Rim and the United States.

Over the years, the POLA/LB complex has recorded steady and impressive growth
in container flows. Nearly 40 percent of all US containerized imports pass through
the port complex.

With their size and freight volumes, POLA/LB certainly present some unique
problems; however, the congestion and pollution debates surrounding them are
echoed for most urban ports located in proximity to large metropolises.
The port complex receives more container traffic than any other US port, and these
volumes are expected to nearly treble by the year 2020.

It is also projected that by 2020 freight transport by rail and truck will increase by
4
240 percent and 65 percent respectively (SCAG 2002). At present, the container
traffic (loaded and unloaded) for both ports reached a total of 11.8 million TEUs in
2003, an increase of 11.3 percent over the last year and exceeding Port of Los
Angeles (POLA) and Port of Long Beach (POLB) forecasts.

Congestion and Environmental Externalities

At the same time that this explosion in shipping is happening, increased
congestion on city streets and on freeways near the ports is resulting in delays for
commuters and increased costs for shippers and truckers (Journal of Commerce.
September 27, 2004, Regan and Golob 2000).

Intermodal truck traffic accounts for nearly a third of all truck moves in the Los
Angeles County, and this traffic is concentrated within three key freeways – I-710,
I-10 and the state freeway number 5.

These developments have led to heightened concern in local communities about
the negative externalities associated with freeways and traffic and consequently
increased unwillingness to bear additional externalities of freeway expansion (LA
Times, September 12, 2004).

Besides congestion, intermodal truck traffic has also been related to serious levels
of pollution and related health problems in the port basin. A study by the Keck
5
School of Medicine (Gauderman et al. 2004) found higher incidence of lung
impairment among children living in areas downwind from the ports and a NRDC
report (NRDC 2004) has documented poor environmental performance of both
ports.

Numerous studies have documented the deleterious impact on local air quality due
to diesel emissions. The ports have been identified as a major factor in Southern
California’s non-compliance with federal air emission standards (Gauderman et al.
2004).

There is concern over the environmental impact of the projected increase in the
number of trucks to move increasing freight volumes. Numerous studies have also
highlighted the transportation infrastructure gap in the region, and argued for
additional infrastructure capacity to deal with the projected freight growth rates in
the next two decades (California Department of Transportation. 2002).

Limited Resources for Infrastructure Improvements

6
However, it has been difficult to raise investments for projects, as public resources
at the federal and state level have been inadequate for the task. There have been
efforts to tap into private financing for infrastructure enhancements, through
creation of bond measures by the state government, and the success of Alameda
Corridor in bringing together public and private finance has encouraged such
efforts.

But any additions to infrastructure capacity will take several years to materialize,
and would in all probability involve long drawn planning processes and efforts to
form local and regional consensus on them, as demonstrated by the difficulties
encountered by the I-710 project.

The dual squeeze, by way of increased demand from the ports on one hand and the
difficulty of infrastructure addition on the other, suggests that future capacity gains
are likely to come from better operational management of existing trucking and
port operations.

Operational Efficiency Measures: PierPass and Appointments for Truckers

7
Thirty five percent of all imported cargo is bound for destinations in Southern
California and is transported in a point-to-point delivery system using trucks.
Regulating the movement of truck traffic through appointments for truckers and
the transfer of traffic to non-peak hours has considerable potential to reduce
congestion and increase efficiency as evidenced by two recent major initiatives at
the POLA/LB complex.

One initiative has focused on extending the hours of operation while the other has
concentrated on the appointment system for freight pick-up and drop-off by
truckers.

In response to the AB 2650 legislation that imposed a hefty fine for idling at
terminal gates, terminal operators sought solutions that would lead to less
congestion and waiting time for truckers.

A prominent option was an appointment system for truckers, for which an
incentive was provided within the AB 2650 legislation as well by exempting
terminals implementing an appointment system from the idling fine.

There are two appointment systems have been used by various terminals at the
port complex. One of them, the eModal Scheduler was developed with the support
of the Port of Long Beach. Currently five terminals at the port complex (3 in Long
Beach, 2 in Los Angeles) are using the eModal Scheduler service.
8

Another service that also provides an online appointment system is the Premier
Appointment System (PAS) that forms part of Voyagertrack, an information
technology tool that provides real time information concerning gate activity,
payment of demurrage and related calculations, import/export status and vessel
schedules. Three terminals (2 in Los Angeles, 1 in Long Beach) make use of this
system.

A recent development has been the creation of the PierPass system, which was
initiated by the West Coast Terminal Operators Agreements and approved by the
Federal Maritime Commission in June 2003 with its mandate extended in August
2004 (Associated Press. August 23, 2004, Journal of Commerce. August 30,
2004).

Under this system, initially each container passing through the POLA/LB was
assessed a fee of $20 per TEU. This is refunded within 10 days for freight moving
during off-peak hours (outside the 8 a.m. to 5 p.m. window) and by rail on the
Alameda corridor.

Additionally all the terminals are required to implement a program of extended
9
hours including a full day shift every Saturday and adding a weekend or weekday
night shift every subsequent month.

The immediate imperative for the two measures seems to be the threat of
legislative intervention on the movement of freight during peak hours. Extended
hour operation and appointment system were adopted only in late 2003 and early
2004 for the bulk of cases and it is too early to evaluate the impact of these
arrangements.

However, initial analyses of the implementation of the measures indicate certain
problems associated with collaboration between intermodal stakeholders A large
range and number and range of stakeholders are required to collaborate for
ensuring that industry-wide practices are changed in accordance with the
operational efficiency changes. The range and number of stakeholders is large.

Private actors are a diverse group including warehouse operators, third party
logistic providers, truckers, shippers, ship operators, terminal operators, and the
labor union (ILWU).

While the public agencies, including POLA and POLB management, and other
regional and local transportation authorities are more involved in setting up policy,
10
the private actors bear direct responsibility for making decisions regarding moving
freight during off-peak hours and utilizing the appointment system.

There is concern, for instance, that the decisions are interdependent but the
practices, even when they follow institutional norms, are independent.

A key issue seems to be information sharing between the various constituencies.
Institutional constraints that enforce the dominance of existing practices should be
analyzed before collaborative arrangements can be implemented to ensure that
voluntary measures for solving congestion are actually implemented.

Indeed, in a related study of empty container movement, a SCAG report
emphasizes that institutional considerations may even dominate other technical or
purely economic ones—“(the) major barrier to rationalizing the empty container
movements are not technical or economic, but institutional.” (TIOGA Group for
SCAG 2002: 68).

Further corroboration of this general idea is also found in a related METRANS
study by Le Dam Hanh (Hanh 2003) as well an earlier study that sought to study
stakeholder implications of introduction of extended hour operations at the marine
terminals (Mallon and Magaddino 2001).
11

A preliminary analysis of the issues involved in extended hours of operation and
appointment system for truckers indicates that it is crucial for the operational
practices of the stakeholders involved in freight movement to be in alignment with
those of others in the network for the measures to succeed.

In a freight movement network where the actions of stakeholders are
interdependent, the mismatch and misalignment of practices will cancel out any
gains that any one set of stakeholders seek to achieve using operational
improvements.

To ensure the success of collaborations, I need to identify the incentives that
enable cooperation and collaboration between stakeholders, as well as delineating
the factors that act as barriers to such collaboration.

Questions Addressed in the Study

12
A key basis for this study is that future gains in freight handling efficiency through
extended hours of operation and appointment scheduling are likely to come from
negotiated agreements between key stakeholders, better information sharing, and
joint streamlining of logistics and supply chains, rather than by regulatory efforts.

I am particularly interested in the alignment of practices of terminal operators with
other actors in the freight distribution network. Under this broad umbrella I will
ask the following questions:

a) What are the areas of convergence and divergence between the
preferences and practices of terminal operators and those of other actors in
the intermodal network?
b) What are some institutional barriers or transaction costs that might prevent
greater convergence between the two groups?
c) How might these transaction costs be aligned to reduce conflicts and
engender cooperation?

Institutional Analysis of Incentives and Barriers to Collaboration

13
An entire body of scholarship called the “new institutionalism” helps us to analyze
incentives to collaborations, barriers to collaboration, and can be adapted to
suggest ways of overcoming them. It also helps us to understand the conditions
under which negotiated agreements between various actors, public and private,
become feasible.

This literature uses the idea of “transaction costs” to explain how customs,
practices, and conventional wisdom emerge in a field. This literature includes the
pioneering work by Oliver Williamson (1985) and Douglas North (1990), who
have been among the most insightful contributors to the literature on dissecting the
components of “transaction costs.”

The other body of literature that contributes to my theoretical analysis is the work
on public-private partnerships. Using the framework developed through the new
institutional analysis and the study of partnerships, this study makes the following
arguments regarding the partnerships between stakeholders for implementing
freight efficiency measures at POLA/LB:

Research Methodology
14

To answer these questions my core method consists of developing primary data
that helps to understand how various actors collaborate, and the factors that
determine the nature and stability of these collaborative arrangements.

My approach uses a combination of survey, in-depth personal interviews, and
secondary data and documents to gauge these categories. The key steps in the
method employed in this research are:

Literature Review

The literature review synthesizes research on new institutional theory that focuses
on hybrid arrangements and the scholarship on partnerships. The framework thus
created allows us to examine the role of stakeholders within the dynamics of the
freight movement network. It allows us to form the conceptual categories for
transaction costs that act as barriers for operational cooperation on freight
movement.

Survey Questionnaire

Previous work in this area has emphasized surveys (Regan and Golob 2000),
including a METRANS study that gathered data on truckers to establish freight
movement performance measures (Barber and Grobar 2001). My survey
15
questionnaire was developed from the categories already identified through a
review of literature in the field.

This was used to document incentives barriers, and governance mechanism
components for cooperation between actors in intermodal freight movement. The
questionnaire was sent to 2000 organizations belonging to all the major groups of
stakeholders.

Selected in-depth interviews

The data obtained from the survey questionnaire was supplemented with
qualitative data gathered from in-depth interviews conducted with key
representatives of selected stakeholders. The interviews allowed for a more
rigorous and comprehensive analysis of the issues associated with freight
movement and supplemented the data already obtained through the survey.

Interviews were semi structured, with a set of predetermined questions
supplemented with extensive discussions of specific issues associated with
collaboration, appointment system and PierPass.

The data obtained was supplemented with secondary data obtained from past
research projects related to the current research. The analysis focuses on
identifying the factors affecting my conceptual triptych of incentives, barriers and
16
governance mechanism for freight movement.

Drawing from this analysis, recommendations are offered regarding the
mechanisms and incentives that can be created to promote cooperation between
stakeholders, and increase the possibility of voluntary regulation between
stakeholders.

Organization of the Study

The study is organized into four main chapters. Each chapter represents a
chronological step in the research process, culminating in the analysis of data and
developing conclusions for policy development and pointers for further research.
The chapters are being summarized briefly here.

Theoretical Framework: New Institutionalism and Partnerships

My literature review draws from two major bodies of literature that are inter-
disciplinary in nature. I derive important theoretical insights from a survey of
literature on new institutional theory, specifically, debates that relate to
coordination between stakeholders in the freight movement network.

These debates relate to the questions of hybrid organizations and multi-actor
17
governance and draw from the perspectives of contracts and governance.

The literature on new institutional theory is important for understanding the
dynamics of inter-organization coordination and cooperation; however it is also
supplemented with discussions from public-private partnerships, to provide us a
rigorous analytical framework for analyzing my research questions.

Such a framework suggests appropriate normative governance mechanisms and
incentives for the creation and maintenance of effective stakeholder cooperative
arrangements.

The review is organized around three broad categories. Within my first category, I
examine the issue of stakeholder incentives, exploring differences between public
and private organization structure, as well as different private entities in incentives
to collaborate.

The second broad category collates the salient factors that pose significant barriers
to the creation and maintenance of partnerships. These include the issue of trust
perceptions between stakeholders, free rider problem and information issues in
collaboration.

To broadly summarize, my literature review indicates that the governance
18
mechanism needs to be structured uniquely for incentives and barriers within a
specific case of partnerships.

Additionally, my theoretical analysis also finds that in the absence of a mix of
governance mechanisms that are contractual, include arbitration bodies and
informal mechanisms, the collaboration is subject to the uncertainty risks of
mutual stakeholder distrust and free rider behavior by some stakeholders.

Institutional Environment for Freight Movement at POLA/LB

In my second chapter, I examine the factors leading to rapid freight growth at
POLA/LB, exacerbating congestion and pollution problems at the port complex. I
highlight the changes in the maritime industry and retail and wholesale practices
leading to surge in container imports through POLA/LB. Also, forecasts predict
that the container moves will grow exponentially, and by some accounts, will
treble by 2025.

In the next section of the chapter I recount the extent and impact of congestion and
pollution attributed to growing freight movement at POLA/LB. Growing
19
congestion on freeway networks used for intermodal traffic has affected the
productivity and time schedules of shippers, as well as causing delays for
commuters sharing freeway space with truckers.

The rise in pollution and related health impacts has led to port neighbors and
environmental agencies lobbying for greater control of emissions from trucks and
other terminal equipment.

The next section of the analysis of background information traces the development
and discussions around the appointment system for truckers and the PierPass
system of off-peak truck movement at the POLA/LB complex.

I trace the factors influencing the creation of appointment system and PierPass,
including debates on infrastructure gaps, legislation on intermodal truck movement
and the collaboration of freight actors for creating cooperative efficiency
measures.

The final section of the chapter discusses the implementation and performance of
the appointment system and PierPass so far, discussing the salient issues in
20
implementation, the benefits and costs accruing to stakeholders and the barriers to
the implementation of the measures and alignment of stakeholder practices.

The section highlights the effects of difference in organization structure,
incentives, the presence of the free rider problem and mutual distrust between
stakeholders as some of the issues that emerge from analysis of implementation of
efficiency measures.

Research Design

My chapter on research design details formulation of research questions for the
study, the selection of methodology, the selection of sample set for data collection
and administration of the survey as well as interviews with key stakeholders.

In the first section I outline how the research questions framing the objectives of
the study are derived from my theoretical framework and analysis of institutional
environment of freight movement.

These questions are aimed at clarifying the three critical categories of analysis for
my study, namely the nature of the incentives, barriers to cooperation and
governance mechanism associated with collaboration between actors in freight
movement at POLA/LB.
21

I proceed to discuss the selection of methodology for the study, arguing for the use
of a combination of survey and interview methods, as well as debating the pros
and cons of administering the survey through an email and internet-based method.

This section also provides information on the identification of stakeholder groups
important to the freight movement network, and how specific methods were
applied to gather responses from stakeholders in specific industries.

The final section describes the administration of the survey and the interviews, the
details of respondents surveyed and stakeholders interviewed as well as the time
frame for the survey and interviews.

I discuss the nature of the questions and issues covered in the survey and
interviews, as well as how information gaps in the survey were covered through
in-depth interviews.

Discussion of Survey and Interviews and Analysis of Results

In this chapter, I provide a comprehensive overview of the results from my data
collection, describing the results obtained through my survey and interviews, and
comparing and contrasting the results with existing information obtained through
existing data on freight movement and other studies on related topics.
22

The first section broadly covers the responses to my freight movement survey, and
the results are organized according to the categories of analysis obtained through
my theoretical and background analysis, as well as incorporated into my survey
questions.

The second section of the chapter describes creation of categories of queries and
analysis for stakeholder interviews, the administration of the interviews and
analysis of stakeholder responses.

Conclusions and Policy Recommendations

My concluding chapter summarizes the insights obtained within the various steps
and tasks involved in the study, explaining how a specific process in the study
informed the next research stage.

I recount the main categories of analysis identified through my literature review,
presenting the argument that a governance mechanism tailored to the specific
incentives and barriers related to a partnership is essential for the stability of the
arrangement.

I also briefly discuss the factors identified within the categories of incentives,
barriers and governance that are crucial to an understanding of collaboration
23
between actors within a freight movement network.

My analysis of the institutional environment of freight movement is summarized
here, providing enumeration of the salient issues leading up to the creation of the
appointment system and PierPass.

The issues in the creation and implementation of the two systems are presented,
and they are compared and contrasted with the categories created through my
theoretical analysis.

Finally I present the most crucial conclusions to emerge from my data collected
through freight movement survey and interviews with key stakeholders. The data
is contrasted with the conclusions emerging from the theoretical framework and
institutional environment analysis.

The information that emerges in my study distinct from the existing information
on freight movement and theoretical predictions are highlighted. Finally, in my
concluding policy recommendations, I discuss a few normative features for
governance mechanisms to emerge out of my theoretical framework, background
information analysis and data from survey and stakeholder interviews.

Chapter 2
24

DEVELOPING AN INSTITUTIONAL FRAMEWORK FOR ANALYZING
STAKEHOLDER COLLABORATION

The research questions of the study are: what are the incentives to collaborate for
stakeholders; what factors constitute barriers to collaboration; how and under what
conditions are collaborations formed; and, what are the normative requirements to
ensure successful collaborative arrangements.

The research agenda identified here point to three variables that can help organize
my understanding of collaboration and partnerships. These include, reasons or
incentives to collaborate for stakeholders, barriers to collaboration for
stakeholders, and the institutional requirements for successful collaboration.

The conceptual triptych of incentives, barriers and governance provides the tools
to construct an analytical framework, formulate my survey instrument, and design
the semi-structured interview schedule for the study.

In practice, collaboration and partnerships between different organizations are
25
promoted in the fields of management, governance, policy implementation,
regulation and economic development.

Debates within numerous disciplines inform ideas regarding collective action
using different theoretical perspectives. However, because they originate in
different fields, these multiple literatures on collaboration do not constitute a
coherent, unified debate.

For example, these discussions have rarely intersected to produce a common pool
of insights that could be taken as the established paradigm for an understanding of
stakeholder collaboration (Osborne 2004).

To bring this vast literature to bear on the specific case of intermodal freight
movement at POLA/LB, I draw on two major literatures namely, new institutional
theory and public-private partnerships. The scholarship in these disciplines focuses
on distinct aspects of collaboration, and insights from one complement the
conclusions of the other to produce a rigorous understanding of the issues
involved.

My literature review is divided into four sections. The first section briefly
introduces the discussions within new institutional theory and public private
partnerships that are relevant to my analysis of stakeholder interaction at
POLA/LB. The second section examines the incentives to stakeholder
26
collaboration, specifically the effect of differences in organization structure on
these incentives.

The third section reviews literature on barriers to collaboration, focusing on the
risks to collaboration from trust issues, free rider problem and information issues.
The final section uses these ideas to demonstrate how they determine specific
governance mechanisms that ensure effective mutuality between stakeholders and
the stability of partnerships.

Through my literature review, I discuss a set of ideas that constitute the analytical
framework of the study. Primarily, I identify the specific incentives available to
actors for joining the collaboration on freight movement initiatives.

I discuss how the incentives differ for public and private stakeholders, affecting
the collaborative process as well as the creation of an appropriate governance
mechanism addressing stakeholder differences.

I analyze the key barriers to collaboration as indicated by the institutional literature
– the free rider problem and future risk in committing investments to
collaboration.

My review argues that for the success of partnerships, it is crucial to conceive of a
27
governance mechanism which addresses the issues of benefits, trust, risk and
information costs for stakeholders. These factors are balanced not merely through
the formal instruments of contracts and arbitration, but also through informal
mechanisms such as reputation effect and frequency of interaction.

Theoretical Paradigms for Examining Collaboration

Information regarding the barriers to collaboration and the governance
mechanisms required to maintain their stability is provided by debates derived
from new institutional theory.

The literature on public private partnerships, on the other hand, contributes to an
understanding of why collaborations take place, namely, the incentives for
collaboration. Within this section, I summarize briefly the discourses within the
two disciplines that are most relevant to the study at hand.

The work of economists, political scientists, and other social scientists has led to
better understanding of how norms and practices emerge and are sustained over
long periods of time (Alston, Eggertsson and North 1996; Brousseau and Glachant
2002; Coase 1988; Furubotn and Richter 1997).

Within this tradition, an important body of work has been the new institutional
28
economics, that uses the notion of “transaction costs” to uncover the rationale for
institutions and explains how norms and practices have an institutional basis to
them (Masten and Williamson1999).

The new institutionalist theoretical paradigm, primarily argues that institutions are
crucial to an understanding of economic exchange, where ‘[i]nstitutions are the
humanly devised constraints that structure political, economic and social
interaction’ (North 1991: 97).

Institutions bring stability and predictability that help to minimize the costs of
information, reduce uncertainty, and increase the reliability of arrangements. The
new institutional theorists contend that institutions are determined in accordance
with the objectives associated with optimizing resources and minimizing
transaction costs (Williamson 1975, 1985).

The literature on transaction costs emphasizes the examination of the comparative
costs of adopting, planning and monitoring of alternative governance structures,
where governance is a broader term than government or public sector but refers
instead to the arrangements used for delivery of goods and services (Eggertson
1990; Mantzavinos 2001).

Within this literature, studies on governance, property rights and contracts in
29
particular have been particularly prominent (Menard and Shirley 2005).

The economic transaction serves as the unit of analysis here, and
institutions/organizations are shaped by both contracts and governance structures
(Hodgson 1998).

Williamson argues that ‘[t]ransaction costs are economized by assigning
transactions (which differ in their attributes) to governance structures (the adaptive
capacities and associated costs of which differ) in a discriminating way’ (1985:
18).

The governance branch of the transaction costs literature focuses mainly on
questions of institution design. Thus, ‘[t]he object is not merely to resolve conflict
in progress but also recognize potential conflict in advance and devise governance
structures that forestall or attenuate it’ (1985: 29)

The governance approach supplements the property rights dimension that
concentrates on ex-ante incentive alignments and assets(Menard 1995). The core
idea within the property rights literature is that ownership matters, and that fact
determines the specific institutional mechanisms adopted and their efficacy.
Overlapping the concerns of the property rights literature is the theory on contracts
and private ordering (Menard 2001).

30
Here it is stated that institutions and organizations provide avenues of private
ordering, as court ordering is time-consuming and inefficacious. Particular
attention is also trained at the ex-post support institutions for the contract, which
include arbitration mechanisms.

Within new institutional economics there has been a growing focus on the
phenomenon of hybrid organizations that is crucial to my understanding of
collaborative arrangements (Menard 2004, 2005a).

Although the literature on hybrids concentrates on “inter-firm networks”, the
broad theoretical insights are extremely useful in understanding the dynamics of
all kinds of stakeholder cooperation, including the collaboration between
stakeholders at POLA/LB which my study focuses on.

Another body of work within the institutional literature that is relevant to my
discussion is the study of multilateral governance, which like the discourse on
hybrid organizations, also draws primarily from the work on governance and
contracts.

For the of barriers to collaboration and its governance mechanisms, I rely
31
primarily on the analysis of governance and contracts within new institutional
theory.

However to explain the reason and incentives for stakeholders to collaborate, I
draw on the substantial literature on public private partnerships, both theoretical
and empirical, providing us with a nuanced understanding of stakeholder
motivation under differing circumstances.

In the last two decades, public-private partnerships have been central to the
changes in governance and the role of the state. There has been an increase in the
use of alternative modes of governance like outsourcing, privatization, networking,
and partnerships by governments(Mackintosh1993).

The greater role of the private sector in governance has been analyzed from
multiple perspectives, using the theoretical frameworks of urban regimes, new
public management, networks and the literature on local economic development
initiatives.

Depending on the perspective adopted for the study of partnerships, there are
specific questions that have dominated the respective debates. Within the new
public management literature, partnerships are studied innovations in governance
practices that allow for a more proactive role to be played by the private sector in
shaping service delivery and development.
32

In the networks literature, the potential of partnerships for equitable collaboration
and as an alternative to hierarchical arrangements is explored. Within local
economic development, the changing role of local government promotes
partnerships to the forefront of regeneration efforts.

In this review, I mostly draw on the discussion focusing on the incentives for
stakeholder collaboration, highlighting the effect of organizational differences
between public and private stakeholders.

In the next three sections, I discuss the three categories that make up my
framework of analysis using new institutional theory and public-private
partnerships.

Beginning with outlining the factors affecting incentives for actors to cooperate, I
elaborate on the barriers to collaboration, and discuss the governance mechanism
appropriate for addressing the incentives and barriers.

Reasons and Incentives for Collaboration

33
One of the early important contributors to an understanding of incentives to group
action was Olson (1965), who argued that a “selective” incentive (as distinguished
from a collective good) available specifically to individuals would motivate them
to act in the interests of the group.

This dilemma of collective action is highlighted in a discussion of government
regulation, which may benefit or harm everyone equally (Getz 1997). However,
some research studies on self-regulation argue that both privileged and in need of
protection stakeholders may participate in collaboration/collective action, even in
the face of a free rider problem, partly attributed to a reputation effect and desire to
effect industry-wide change (King and Lenox 2000).

Reputation effect though, is but one factor within the stakeholder incentive matrix,
which also includes the rents derived by stakeholders from the deployment of their
respective assets within the collaboration.

Generally, stakeholders enter into collaborative arrangements to realize the
synergistic value that a pooling of resources within a partnership framework
provides. The combination of specialized and complementary assets produces
quasi-rents and benefits for the stakeholders involved (Madhok and Tallman,
1998).

Within the discourse of hybrids it is argued that “inter-firm networks” develop
34
when a project requires complementary or mixed investments that can be
undertaken by multiple partners without the loss of autonomy.

I can examine these rents within two distinct approaches. Using the resource-based
perspective, the resources are complementary and non-duplicated, whereas in the
transaction cost approach the focus is joint investments undertaken by the
stakeholders which are non-redeployable (Menard 2004).

In both perspectives, the benefits obtained by a joint use of stakeholder resources,
over and above those that can be obtained from alternative organizations, form the
core incentive for collaboration.

In public private partnerships, the question of incentives for partnership creation is
dealt with at length, in three perspectives that are distinct and yet overlapping.
Important within this scholarly tradition are the distinctions between public and
private organizations in motivation and benefits derived from collaborations.

According to the new public management perspective partnerships are sought as
they bring greater exchange of ideas and practices between different sectors
(Chandler, J. A. 1998).

This include the outsourcing to the private sector of services traditionally produced
and provided by the public sector, incorporation of private management styles in
35
public agencies and the increased cooperation between the state and non-state
entities in matters of governance.

Broadbent and Laughlin (2003) argue that partnerships lead to changes in the way
public services are provided and lead to improvement in efficiencies in the public
sector, especially in fiscal practices and service delivery.

As Hodge (2004) informs, partnerships are also adopted to facilitate the transfer of
risk to private parties, thus increasing efficiency in the financing of public
infrastructure.

Writing within the networks perspective, Van Ham and Koppenjan (2001) argue
that the condition of inadequate expertise in either sector and the dependencies that
exist between public and private organizations form the basis of partnerships
between them.

Thus resources exclusive to each sector are brought together to address the
increasingly complex contemporary governance issues. Unlike the hierarchical
36
top-down relationships between the public sector and other non-public
stakeholders in the past the current emphasis on networks allows for greater
participatory decision-making involving multiple actors(Rowe and Devanney
2003).

An important catalyst in the formation of networks, including partnerships are the
efficiency gains and surplus garnered from cooperation between distinct
institutions. This is different from the goal of efficiency gains within the public
sector that motivates the sharing of resources and ideas under the new public
management perspective.

Within the networks discourse, both the private and public parties receive
efficiency increases through collaboration. Thus, when solutions are mutually
interesting to actors, then they devise methods to join forces and invest in
cooperation (Andersen 2004, Klijn and Teisman 2004).

The added value that such cooperation gives rise to is gained when there is an
active investment in the relationship and a linking of interactions between the
partners. This pinpoints the key rationale for the birth of networks as they “are
characterized by a limited substitutability of resources, which, ensures that
sustainable social relations are created between actors” (Klijn and Teisman 2004:
37
p. 27).

Within local economic development, there has been much interest in the
emergence of the ‘entrepreneurial’ city or local authority, which acts proactively to
attract and retain business within the region to ensure its economic well-being
(Eisinger 1988; Hall and Hubbard 1998). According to Sagalyn (1997),
partnerships facilitate redevelopment incentives, industrial incentives and job
creation, bargaining tools for the attraction of benefits from private firms by city
governments and other public agencies.

Within the local economic development perspective, the symbolic appeal of
partnerships is also crucial. This imputes value to the very act of collaboration
between public and private entities, perceived as proactive intervention on behalf
of local communities that mobilizes resources from private enterprises (Pierre
1998).

As Austin and McCaffrey (2002) argue, “[p]ublic-private partnerships (PPPs) and
cross-sector collaborations provide important structural vehicles on which urban
governance and regime dynamics ride” (p. 35).

Barriers to Collaboration

38
Any governance mechanism for ensuring stable cooperative arrangements between
actors has to address the barriers that stakeholders face in forging collaborative
arrangements.

Specific organization characteristics, resource mismatch, free riders, and trust are
some of the issues that are raised frequently within the new institutionalist
literature dealing with issues surrounding hybrid organizations and multi-actor
governance (Elsner 2004; Brousseau 2007).

A crucial barrier to the success of collaborative relationships is the failure to
recognize at the outset of the relationship the need for collaboration-specific
investments by stakeholders.

Menard (2004) argues that the deployment of resources within the collaboration
can be on the basis of complementarity and the unique characteristics of resources
contributed by stakeholders, or the resource yielding more rent to the stakeholder
in joint deployment compared to other alternative uses.

Both perspectives stress the need for stakeholders to make investments that are
specific to the collaboration, which would help them derive benefits that
exclusively accrue to them.

39
Another impediment to collaboration that must be addressed through ex-ante
contracts and governance mechanisms is the loss of autonomy felt by stakeholders
in committing to joint decision-making within the collaborative framework.

As I stated in my discussion of stakeholder incentives, the presence uncertainties
in investment and operational decision would serve to make the loss of decision-
making autonomy acceptable to the stakeholders involved. The loss of autonomy
is also compensated by the fact that according to the transaction cost approach, a
collaborative arrangement would economize on the transaction costs involved in
alternative decision-making.

Within cooperative arrangements such as the appointment system for truckers and
PierPass, the participation of many kinds of stakeholders is necessary to ensure the
success of the measures implemented.

To illustrate, it involves the cooperation of marine freight terminals, typically
large, global corporations as well as truckers, where a large majority are owner-
operators who are price-takers. Given that these collaborative arrangements are
voluntary in nature, it is important for the collaboration to reflect both the
intentionality and mutuality of the stakeholders.

Thus Menard (2004) argues that “they are usually built on principles respecting
some symmetry among participants, at least formally” (p.20). This symmetry and
40
mutuality needs to be reflected both within the contracts as well as the governance
mechanisms adopted by the stakeholders.

Though the stakeholders agree to pool their resources, plan joint decision-making
and share information, the fact remains that those who share the same industry
continue to remain competitors, operating within the same markets and often
targeting the same clients.

In this case, the issue of benefit sharing, trust, sharing of information and dispute
resolution become very important. Often, stakeholders are reluctant to cooperate
when it means sharing key proprietary information with competitors, inadequate
dispute resolution mechanisms and the lack of a trusted arbitration or governing
body that is able to maintain neutral equidistance between the stakeholders
involved.

Apart from the issue of competition between stakeholders involved, there is also
the issue of regulatory authorities perceiving collaborations as anti-competitive in
nature as they would involve the adoption of some common industry-wide
practices by the stakeholders involved. This would deprive consumers of a choice
in features offered by firms within an industry.

Perhaps the issue that is discussed most frequently within the new institutionalist
literature with respect to hybrids, collaborations and multi-actor governance is the
41
matter of stakeholder trust.

Within discussions on principal-agent relations, scholars have noted the problem
of moral hazard, where the delegation of authority and the possession of
specialized information by the agent may lead to a greater risk of non-compliance
or problematic behavior.

The chances of moral hazard increase with autonomy of agents involved as well as
the specialized knowledge available to the agents (Holmstrom 1979, Grossman
and Hart 1983).

Related to the notion of moral hazard is the free rider problem, dealing with
stakeholders or actors who over-consume in disproportion to the their share of
common resources. Additionally, they bear less than the correct proportion of the
costs of producing those common resources.

Within collaboration for implementing the efficiency measures at POLA/LB, it is
essential for all stakeholders to adopt changes in operational measures equally for
42
the collaboration to be successful. However, it is possible for many of the
stakeholders to eschew adoption of the measures, but at the same time, acquire the
full benefits that accrue from the efficiency measures adopted throughout the
industry and region by others.

With autonomous decision-making and distinct property rights, there is always the
danger of stakeholders being exposed to opportunistic behaviour by other
stakeholders.

Free-rider behaviour in one aspect of collaboration could lead to the unraveling of
the cooperative arrangement if not checked by an adequate governance
mechanism. The incomplete nature of contracts, and the difficulties in adequate
monitoring of the behaviour of stakeholders leads to the risks from opportunism.

Such opportunistic behaviour or free-ridership may also arise because the
conditions at the time of the implementation of the terms and tasks of
collaboration may differ substantially from the conditions that prevailed when the
collaboration was initially forged.

The difference in the operational environment may make it more attractive or
feasible for a stakeholder to indulge in opportunistic behaviour. It is because the
danger of opportunism is ever present that the enforcement procedures in a
collaboration become of critical importance.
43

As I discuss in the following section, these enforcement procedures may be
contractual, or be constituted as formal governance mechanism, or they might be
informal measures that are industry or society-specific.

The problem of opportunism by actors involved after the formation of networks or
partnerships is crucial to the success or failure of the arrangements.

Governance Mechanisms for Collaborative Arrangements

Using the discourses on property rights, contracts and transaction costs, new
institutional scholars have discussed extensively the question of governance
mechanism that maintain the stability of the collaborations.

Given the free-rider problem, the loss of autonomy in decision-making, mutual
distrust between stakeholders, and the risk of changes in the institutional
environment in future, there is always the danger of the collaboration dissolving
due to the non-cooperation or opportunism by one or more stakeholders
(Brousseau and Raynaud 2004).

In such circumstances, it is essential for there to be effective governance
mechanisms in the form of formal arbitration processes, institution for overseeing
44
collaboration, informal measures, contract clauses, etc.

Menard (2004) identifies three mechanisms that have been identified in the
literature for the governance of such networks. These include the reputation effect,
existence of formal negotiations among partners monitored by negotiators and the
creation of a formal authority for the regulation of the partnership arrangements.

These institutional mechanisms are voluntary in nature, and are designated by
partners to monitor the arrangement and the actions and decisions taken under the
partnership.

The literature indicates that the degree of uncertainty, determined by the risks or
barriers to collaboration pervading the process of the partnership determines how
formal the governance mechanism is. These uncertainties include the danger of
moral hazard, free riders, and changes in institutional environment.

Hence, “it is the combination of opportunism, or the risk of opportunism, and of
miscoordination, or the risk of miscoordination, that largely determines the
mechanisms characterizing hybrid organizations” (Menard 2004: p. 25).

The problem of opportunism by actors involved after the formation of networks or
partnerships is crucial to the success or failure of the arrangements. The literature
45
on hybrids suggests that rules taking into account the observable components of
the tasks assigned to the partners should be supplemented with other mechanisms
that are non-contractual, such as the reputation effect (Brousseau and Glachant
2001).
According to Menard (2004), there are a few characteristics of collaborations that
determine the types of governance mechanisms that are used for monitoring them.
The number of stakeholders involved in a collaboration is very important. Quite
obviously, there is greater ease in monitoring the less the number of stakeholders
involved.

However, less number of stakeholders also means that there is greater dependency
of the collaboration on any one or few of those stakeholders. With more
stakeholders, greater problems in monitoring creep in. However, there is less
pressure on stakeholders as a whole, and there is ease of benchmarking to motivate
stakeholders with reference to the performance of the best performing stakeholders
(Grajzl and Murrell 2007).

The duration of a collaboration is also essential in determining governance
mechanism (Rysman and Simcoe 2007). Also, the more specific the contracts
governing the collaboration arrangement, the less elaborate the governance
mechanism required to monitor them (Menard 2005a).

If the contracts are less specific, then a more aggressive governance mechanism is
46
required. It is also important to build in flexibility and adaptability into contracts
governing collaboration. Even though it is difficult to anticipate every change
within the institutional environment within which the stakeholders operate, it is
still possible to have clauses that provide wider flexibility to deal with transactions
and future uncertainties (Meran and Hirschhausen 2004).

Despite the sophistication of contracts and governance mechanisms, collaborations
remain less than completely determined in practice (Menard 2005b). Hence, there
is always the possibility of risk and barriers arising in future that were not
predicted or incompletely predicted at the time the collaboration was conceived.

There are also other governance mechanisms that are more informal, based on
either pre-existing relations between the stakeholders or the reputation effect
within a social or industry group. Trust based on either relation or reputation is a
key way to secure relationships between stakeholders in the absence of rigidly
formulated contractual measures governing the relationship between the actors
(Brousseau 2007).

The recurring of transactions between actors serves to cement the trust between
them and helps to put the reputation effect in place and sustain the collaboration.
However, it is difficult to rely on reputation effect or trust in an institutional
environment where mutual distrust between stakeholders prevail due to either
prevailing institutional cultures, or suspicions developed over time (Ianuzzi 2002).
47

Though the actors involved in a collaboration maintain the substantive autonomy
of decision-making and property rights within a collaboration, for creating an
effective governance mechanism, it is also essential to have a set of decisions
overseen by an institution created specifically for the governance of the
stakeholder actions pertaining to the collaborative agreement (King and Lenox
2000).

The authority given to this institution reflects the parity and equity between
stakeholders, as the arbitration of the actions is not dealt with in a hierarchical
fashion (Haufler 2001).

Symmetry between the partners is respected. Studies indicate that the
centralization of powers within the governing body or institution depends on the
degree of mutual dependence and complexity as well the nature of the
environment within which the collaboration is operating (Dwyer and Oh, 1988;
Menard, 1995).

To summarize, the governance mechanism for overseeing stakeholder
collaboration is determined by the specific incentives and barriers that affect the
48
characteristics of partnerships in freight movement.

The governance mechanism can be broadly characterized as reputation effect,
negotiation of contract and arbitration process between stakeholders. Additionally,
the governance mechanism is also affected by some features of the collaboration
such as number of members, duration of the partnership and the extent and nature
of risks affecting the partnership.

Chapter 3

49

INSTITUTIONAL CONTEXT FOR FREIGHT MOVEMENT AT POLA/LB

The need for stakeholder collaboration over implementation of operational
efficiency measures arises in an institutional environment affected by rapid
changes at the global as well as the local scale.

Globally, increase in Pacific Rim trade, outsourcing and changes in the maritime
industry has led to exponential growth in container freight at the POLA/LB
complex. Further, some forecasts indicate that the container traffic at the port
complex is set to triple over 2000 base figures by 2025.

On the other hand, the rapid increase in freight and related intermodal truck traffic
has led to an increase in pollution and congestion levels in adjoining
neighborhoods, where the residents are increasingly unwilling to bear the freight
50
growth related negative externalities (Hendrix 2001).

The creation of the appointment system and PierPass offer cost effective solutions
to mitigate congestion and pollution while bypassing the resource constraints for
infrastructure funding(Associated Press. August 23, 2004).

However, there are many challenges associated with their implementation, which
make the analysis of stakeholder collaboration a crucial matter in the success of
these measures (Brown 2004).

In this chapter I trace the issues leading to the creation of appointment system for
truckers and PierPass, their implementation and the problems associated with
them. The chapter is divided into three sections.

The first section examines the factors leading to the growth of container freight at
POLA/LB, forecasts of future growth and the problems of congestion and
pollution accompanying rapid growth. The second section details the creation of
51
the PierPass and appointment system. The final section examines the
implementation of appointment system and PierPass to date and outlines the
challenges associated with them.

Through my analysis, I examine the evolving institutional environment within
which the stakeholders in intermodal freight operate, and the impact of these
institutional factors on the efforts to collaborate between them.

Growth of Container Traffic at POLA/LB

The changing nature of global trade has had a tremendous impact on the
transportation sector in general and ports in particular. In recent years, due to the
movement of manufacturing from the United States to Pacific Rim nations, and
supply chains sourcing from many different locations, there has been a surge in
freight movements across the world.

Due to the trade imbalance between Asia and the United States, the freight in-flow
to the United States exceeds the out-flows. This has been helped by the launch of
post-Panamax ships that can only service the West coast ports from Asia
(Hoffmann 1998).

Additionally, West coast ports offer a time saving of 7 days over the East coast
ports for delivery of goods. With the just-in-time inventory management practices,
52
time saving becomes of critical importance, especially around peak seasons of
delivery (Ioannou and Chassiakos. 2002).

Throughout the 1990s there has been steady growth in the freight passing through
the POLA/LB complex (Caltrans. 2004). The growth spiked sharply in the late
1990s, especially starting from 1996-97.

A combination of factors contribute to this phenomenon, including: the shift of
manufacturing overseas, primarily to Pacific Rim; flexible inventory management
techniques like just-in-time with tight distribution schedules; the consolidation of
the shipping industry with bigger containerships; the launch of post-Panamax
ships; fewer ports-of-call; and growth of the local market in Southern California.

This has resulted in the concentration of freight and the emergence of the
POLA/LB complex as a mega port, handling nearly 40 per cent of all US imports.
With greater reliance on imports, ports have emerged as main nodes in intermodal
distribution networks (Gordon and Pan. 2001).

According to one estimate, about 75 per cent of the total non-local freight is
handled at West coast ports. About 60 per cent of the total freight is transported by
land bridges to the hinterland (Calix and Cheng. 2003).
53

It is estimated that about 50 per cent of the imports coming into Los Angeles
county are destined for local destinations and the balance is transported to
locations outside the county (Cartwright 2004). The POLA/LB complex handles
about 60 per cent of Chicago’s imports.

Over the years, the POLA/LB have recorded steady and impressive growth. This
growth has been significant during the decade of 1990-2000, as well as from 2000
to present. In the late 1990s the rate of growth of container traffic in the POLA and
POLB remained in two digits due to rapid economic expansion during this period
(Division of Transportation Planning. 2004).

The tremendous growth in freight routed through POLA/LB has led to urgent
concern regarding the congestion and delays at the ports, causing added cost
burden for shippers, pressure on local transportation network, and environmental
costs for local communities (Brown et al. 2001; Barber and Grobar. 2001,
California Department of Transportation. 2001).

The port complex has greatest freight share of all US ports, and the container
traffic at the ports is expected to nearly treble by the year 2020. A SCAG transport
study projects that by 2020 freight transport by rail and truck will increase by 240
54
percent and 65 percent respectively (SCAG 2002).

The container traffic (loaded and unloaded) for both ports reached a total of 11.8
million TEUs in 2003, an increase of 11.3 percent over the last year and exceeding
Port of Los Angeles (POLA) and Port of Long Beach (POLB) forecasts. The
widely cited Mercer forecast (Hanh 2003, POLA 2004a) anticipates a
containerized freight volume of more than 35 million TEUs for both ports by 2020
while the internal numbers from the ports put the figure at nearly 47 million TEUs
by 2025 (POLA 2004b).

There are several environmental concerns associated with the ports. These include
the fact that emissions in the port basin are much higher than federal emission
standards. This has resulted in non-compliance with federal standards and
limitations in federal funding for environmental mitigation (Daly 2003).

There is considerable diesel emission from trucks, yard equipment and ships. A
recent study by the Keck School of Medicine (Gauderman et al. 2004) found
higher incidence of lung impairment among children living in areas downwind
from the ports and a NRDC report (NRDC 2004) has documented poor
environmental performance of both ports.

Numerous studies have documented the deleterious impact on local air quality due
to diesel emissions (Garrett 2003). High levels of pollution in the air basin are
55
contributed by containership emission, the single largest source of pollution at the
port complex. There is concern over the environmental impact of the projected
increase in the number of trucks to move increasing freight volumes (Journal of
Commerce. September 20, 2004).

According to the Southern California Air Quality Management District
(SCAQMD), the Los Angeles and Long Beach port basin has the worst air quality
of any region in the nation. This has led to increasing health costs for the region’s
residents and the air pollution cleanup costs for the area are increasing every year
as well (Journal of Commerce. September 30, 2004).

SCAQMD also asserts that there have been nearly 2000 premature deaths in the
port basin that can be attributed to the levels of pollution in the area. Also, 70 per
cent of cancer cases can be traced to diesel emissions from trucks and ships. It has
been predicted that there would be a near 60 per cent increase in emissions by
2020 due to the tripling of cargo predicted by numerous studies.

There has been congestion and idling at terminal gates, leading to greater
emissions. There are other pollutants and particulate matter in the port basin that
also contribute to the pollution in the region (Journal of Commerce. September 29,
56
2004).

The local communities have been increasingly unwilling to bear the additional
negative environmental externalities of growth in port traffic and infrastructure
expansion projects associated with facilitating freight movement.

Given predictions of freight growth and the already serious environmental
concerns, the effective use of existing infrastructure in the region becomes
important(Journal of Commerce. September 27, 2004d). I outline the existing
transportation network connected to the POLA/LB complex and their limitations.

With regard to freeway congestion and pollution, what concerns us the most are
truck movements connecting the ports and near-dock and off-dock intermodal
yards and distribution centers (California Department of Transportation. 2002).

A large number of distribution centers are located in near-dock areas around the
port in cities such as Carson, Paramount, Wilmington, City of Commerce, City of
Industry, etc. In recent years, many distribution centers have also been located in
the Inland Empire area within San Bernardino county.

Also, a lot of freight gets trucked to regions across the Rocky Mountains. The
local transportation corridors that handle the maximum amount of international
trade are I-710, I-10, I-5 and the State Route 60 (Calix and Cheng. 2003).
57

Even though the existing infrastructure is impressive and confers a distinct
advantage to the ports, the infrastructure is limited and is unable to handle the
growing levels of freight as predicted in the studies. According to SCAG
estimates, there is a 60 per cent slowdown in travel time on a few highways in Los
Angeles due to the port traffic (Haveman and Hummels 2004).

According to representatives of Gateway Cities’ Council of Governments, there is
growing congestion at the 91 and 105 and 605 freeways, due to the movement of
freight to distribution centers located further away from the ports (Tier2
Community Advisory Committee. 2004).

A study on the feasibility of an I-710 freight corridor initiated by the Gateway
Cities’ Council of Governments revealed that there has been growing intrusion in
neighborhoods, increasing noise and environmental pollution in cities around the
port complex due to growth in intermodal truck traffic (Tier2 Community
Advisory Committee. 2004).

There has also been pavement disruption in many of the cities due to the frequent
movement of trucks, as well as growing congestion on side streets taken by trucks
as connectors between freeways.
58

This includes the route Whitter Blvd.-Clement Road – 60 freeway-91-freeway-710
freeway. There has been a decline in health and air quality and the slower and idle
traffic has contributed to an increase in pollution in the area.

According to a MARAD report the key unacceptable conditions of intermodal
access routes to ports in the US were: local access roads to the ports; at-grade rail
crossings; rail access issues; availability of truck-only routes; and importance of
traffic information (MARAD 2002). It is evident that the port complex of Los
Angeles and Long Beach are hardly isolated in their infrastructure needs to meet
growing freight volumes.

A number of infrastructure enhancement projects need to be undertaken to meet
the growing needs of intermodal freight movement (Booz and Hamilton Inc.
2000). These include increasing the capacity and adding truck lanes to the I-710,
replacing the Gerald Desmond Bridge, ATMIS for POLA/LB, connecting the
Terminal Island Freeway to the I-405, etc (MTA and Net. 2002a; 2002b).

The lack of funding for and public opposition to infrastructure improvement
projects has meant that the short-term solution to the freight movement crisis is a
more efficient utilization of the existing transportation infrastructure(Busch et al.
1999). Change in many existing operational practices is required to improve the
efficiency of freight movements to and from the ports.
59

Till recently the terminals at the ports of LA/LB only operated terminal gates
during the peak business hours between 8:00 a.m. and 5 p.m. This not only added
to the congestion on already overcrowded freeways, but also led to greater delays
and increased waiting time for truckers at the terminal gates. Additionally, there
had been no system to regulate the arrival of truckers and hence long queues could
be seen at almost all terminal gates at the Ports of LA/LB.

The arrival of trucks at terminal gates had been largely unregulated and trucks
have been processed through gates on a first-come-first served basis. Hence the
terminal would not be equipped with advance information, paperwork and
container location for a specific trucker, leading to considerable delays in
processing truck movements.

The increase in freight had increased the delays and it became common for
truckers to wait for hours to enter a container terminal (Hall 2004b). Mostly, the
trucks would keep their engines running while idling, leading to a large quantity of
emissions. Thus the long waiting time for trucks not only led to waste of time and
reduced productivity, it also contributed to increasing the pollution levels in an
area with some of the poorest air quality in the nation.
60

The consequent delays related to peak-hour truck movement and idling at terminal
gates affect the delivery schedules of shippers who often operate with small
inventories and very tight time margins. Also, concern about the worsening
congestion and environmental problems associated with idling trucks have
galvanized community action and prompted several bills to be introduced in the
state legislature.

These challenges prompted the terminal operators at the POLA/LB complex to
come up with measures that would address the increasing congestion and attendant
productivity losses, as well as the environmental externalities being created by
growth of truck movement to and from the port.

Creation of Appointment System for Truckers and PierPass
61

A number of alternative options have been discussed within the freight community
and public debates to mitigate the congestion and pollution in the area. These
include: expanding the existing rail network by creating more tracks; expanding
existing freeways; short-sea shipping; limits on growth of ports; and more efficient
use of existing infrastructure.

I would argue that in the face of limited funding for infrastructure improvement
projects to accommodate growing freight, the more efficient use of existing
infrastructure through operational changes and improvements acquires urgency.

In this direction, policymakers within California have been trying to enact policy
measures and legislations that would provide an incentive for stakeholders to
change their practices to facilitate the regulated movement of intermodal trucks
and their off-peak movement.

The California Assembly has seen a few important measures introduced to address
62
the questions of congestion and pollution at the ports, most of them being
sponsored by Assemblyman Alan Lowenthal (Journal of Commerce. April 26,
2004). A few of these measures were made into legislation, most prominently, a
measure to reduce idling of trucks outside terminal gates. The bills introduced by
Assemblyman Lowenthal relevant to freight movement at POLA/LB are
enumerated in Table 3-1.

63

Table 3-1 California legislation (enacted and proposed) related to freight
movement at POLA/LB

Number Date Introduced Task
AB 23 (vetoed) 12/7/1999 Transfer of portion of
710 freeway from
City and Port of Long
Beach to Caltrans

AB 1775 (passed) 1/24/2000 Speed up enclosure of
open petroleum coke
piles in Long Beach
and San Pedro

AB 2650 (passed) 2/22/2002 Fines terminal
operators $250 for
each truck that spends
more than 30 minutes
idling at terminal
gates

AB 1971 2/12/2004
AB 2041 (proposed) 2/17/2004 Create a charge for
moving freight by
commercial vehicles
into my out of
POLA/LB during 8
a.m. to 5 p.m., from
Monday to Friday
AB 2042 (vetoed) 2/17/2004 Limits emissions
from ships,
locomotives and
trucks to 2004 levels
starting in January
2006

Table 3-1: Continued
64

AB 2043 (passed) 5/20/04 Requires the State
Lands Commission to
request the
California Marine and
Intermodal
Transportation
System
Advisory Council to
meet, hold hearings,
and compile
data on port
congestion and
growth.

65
Of these bills, AB2650 and AB2041 have had a significant impact on freight
movement at POLA/LB and arguably could be said to be crucial in providing
incentives for the creation of the measures under discussion here.

Concerns about the worsening air quality due to emissions from idling trucks led
to the formulation and eventual adoption of AB 2650, sponsored by the local
representative to the California Senate, Alan Lowenthal (Journal of Commerce.
September 27, 2004b).

The bill, which became law from Jan 1, 2003 (although it took effect from July 1,
2003 after a six-month grace period) fines terminal operators $250 per vehicle per
violation. The idling of a truck for more than 30 minutes outside the gates counts
as a violation.

Significantly, the law states that “if a marine terminal implements a scheduling or
appointment system for trucks to enter the terminal, the terminal shall be subject to
a fine pursuant to subdivision (a) only for a truck that makes use of the system and
whose engine idles for more than 30 minutes while waiting to enter the gate into
the terminal, commencing from the start of the appointment or the time the truck
arrives, whichever is later”(Assembly Bill 2650 Chapter 1129: p. 5).

Thus, the law provided a strong incentive for terminals to implement appointment
66
systems to be able to streamline their truck traffic and partially avoid fines due to
idling. Before AB 2650, only one terminal, the Pacific Container Terminal in Long
Beach had an appointment system for its inbound freight.

Within terminal operators the law spurred a discussion regarding the importance of
implementing a combination of extended gate hours and appointment system. The
more cost-effective option of the two, the appointment system, was preferred by
terminals at the time. To date, two appointment systems have been used by various
terminals at the port complex.

One of them, the eModal Scheduler was developed with the support of the Port of
Long Beach. Initially, in 2003 four terminals at the Port of Long Beach started
using the eModal Scheduler. These terminals were International Transportation
Service (ITS), Long Beach Container Terminal (LBCT), Pacific Container
Terminal (PCT), and SSAT’s Pier A facility.

In 2004, the terminals using the eModal Scheduler service are Pacific Container
67
Terminal (PCT) Long Beach, International Transportation Services (ITS) Long
Beach, Long Beach Container Terminal (LBCT) Long Beach, Eagle Marine
Services (APL) Los Angeles, and APM Pier 400 (Maersk Terminal) Los Angeles
(Gunnar Gose, eModal, personal communication). As of November 2006, the
clients of the eModal service are APL-GGS Los Angeles, APM Los Angeles, YTI
Los Angeles and Trapac Los Angeles (based on eModal.com list of clients).

The Scheduler is a web-based interface that allows truckers to book appointments
for containers when they are ready for pickup at the terminal. The service is paid
for by terminal operators and operated by a third party provider through an already
existing freight information system on www.emodal.com.

After registration with eModal, subscribers are provided with activity folders
where they can add containers at participating terminals and track the time that
they will be available for pickup. When they are available for pickup, truckers can
set an appointment using the web interface and print a receipt for confirmation at
terminal gate. (http://www.emodal.com/about/help.asp#9)

Another service that also provides an online appointment system is the Premier
Appointment System (PAS) that forms part of Voyagertrack, an information
technology tool that provides real time information concerning gate activity,
payment of demurrage and related calculations, import/export status and vessel
68
schedules. The PAS module comes standard with Voyagertrack 5.0.

It was initiated by the Marine Terminal Corporation in July 2003 in the wake of
AB 2650 legislation in conjunction with its partners. In the ports of Los Angeles
and Long Beach, in 2004, the terminals using the system were Total Terminals
International (TTI) Long Beach, Seaside Transportation Services (STS) Los
Angeles, and West Basin Container Terminal (WBCT) Los Angeles
(http://www.eyefortransport.com/print.asp?news=43112).

However, as of November 2006, the terminals using Voyagertrack are TTI Hanjin
Long Beach, Evergreen Los Angeles, WBCT Los Angeles and Lloyd Treistino
Los Angeles (based on Voyagertrack website list of clients).

PAS is not administered directory by terminal operators; rather it is operated by
Marine Terminal Corporation in partnership with the participating terminal. PAS
provides truckers access to real time information about container availability. It
gives truckers a choice between using a web-based interface
(www.voyagertrack.com) or an automated telephone system (Voyager Voice).

For using PAS, a trucker has to fill out an account request form at the
VoyagerTrack website. After completion the trucker receives a logon name and
password for website access as well as ID and PIN for telephone access. The lead-
time allowed for making an appointment ranges from 7-10 days to an hour. The
69
appointment window is one hour. The trucker does not pay any charges for usage
of the service as the terminal operator provides PAS as part of other freight
information services. The following information needs to be provided by the
trucker:
(http://www.synchromet.com/lnk/Oakland_Appointment_Systems.pdf)

The creation of the PierPass system was also a response to the prospect of the
adoption of AB 2041, which would have led to the imposition of a fee on the peak
hour movement of intermodal trucks through terminal gates at POLA/LB (Journal
of Commerce. August 30, 2004).

The fees collected through the AB 2041 provision were to be deposited in a
Congestion Management Fund, which was to be used for projects aimed at
relieving congestion caused by peak hour movement of freight (Journal of
Commerce. January 23, 2004).

A crucial exception was made within the proposed AB2041 proposed legislation,
70
allowing for the creation of the PierPass. The AB2041 states that:
[t]he bill would provide that if the secretary determines on January 1,
2005, that a local transportation agency or authority that has jurisdiction
at, or near, the ports, has established a fee on container cargo moving
through those ports and that at least 20% of inbound cargo transported on
commercial motor vehicles at the ports occurs at times other than during
the hours of 8 a.m. to 5 p.m., inclusive, on Monday to Friday, inclusive,
the provisions of the bill would not become operative.”(Assembly Bill
2041: p.2)

The Bill also made the provision that the charge should be paid by the person
ordering the shipment, and it should not be passed on directly or indirectly to truck
operators. In addition to the provisions built into the bill, Assemblyman Lowenthal
had also promised to drop the proposed legislation if an alternative plan was
offered by the private sector by the close of the legislative session on August 31,
2004.

In response to the challenge, the terminal operators began conceiving of an
alternative system of imposing fees for peak-hour movement of freight. On May
16, 2003 the Federal Maritime Commission had approved of the creation of the
West Coast MTO Discussion Agreement through agreement number 201143. The
agreement has been variously referred to as WCMTOA or WCMTODA.

According to the Federal Maritime Commission ruling, “[t]he proposed agreement
71
would allow the parties to discuss and agree on rates, charges, rules, regulations,
procedures, practices, terms and other conditions of service pertaining to the
transport, handling, receipt, or delivery of cargo by marine terminal operators.”
(FR Doc. 03-12750 Filed 5-20-03; 8:45 am)

The WCMTOA sought an amendment to the agreement from the Federal Maritime
Commission that would allow it to discuss the creation and implementation of a
system for imposing fees for peak hour intermodal truck movement. The
amendment was granted by the FMC on June 10, 2004, overriding an objection
field by the Teamsters Inc. union of truck drivers.

The new amendment to the WCMTOA “changes the name of the agreement and
adds authority to discuss, agree upon, implement and enforce rules, procedures and
charges intended to encourage the use of off-peak hour services, as well as to
adopt and implement related procedural and administrative mechanisms” (FR Doc.
04-13594 Filed 6-16-04; 8:45 am).

Table 3-2 List of initial members of the West Coast MTO Agreement by June
10, 2004
72

APM Terminals
Pacific
California United
Terminals, Inc.
Eagle Marine
Services, Ltd.
Husky Terminals,
Inc.
International
Transportation
Service, Inc,
Long Beach
Container Terminal,
Inc.
Marine Terminals
Corp.
Metropolitan
Stevedore Company;
Pasha
Stevedoring &
Terminals, L.P.
Trans Bay Container
Terminal, Inc.
Trans Pacific
Container Service
Corporation
Yusen Terminals, Inc.
SSA
Marine
Pacific
Maritime Services,
L.L.C.
SSA Terminal (Long
Beach), LLC)

After the approval of the amendment to the WCMTOA by the FMC, on August
23, 2004 the commitment of the agreement to a program of full-service extended
gate hours was announced. The name of PierPass was announced and a program of
imposing a fee of $20 per TEU of freight moved during peak hours was also
unveiled.

However, even before the PierPass program was announced, a few terminals had
already offered full-service off-peak hour operation of their terminal gates, starting
in late 2003. These terminals included Hanjin Long Beach, Evergreen Los Angeles
and Maersk Sealand Los Angeles. Note that of these three, only Maersk is
represented (through APM) in the list of stakeholder terminals participating in the
WCMTOA.

73
Even though PierPass was announced in August 2004, and was expected to
commence from November 1, 2004, the formal operation of the fee system did not
start till July 2005 (Journal of Commerce. September 20, 2004; September 22,
2004).

This was due to the fact that the Pacific Maritime Association (PMA) had
indicated to PierPass the problems with a consistent supply of labor for extended
shits till the first half of 2005. After ensuring the consistent supply of labor for
extended hours (made possible by the hire of 3000 new labor at the POLA/LB
complex in 2005), the PierPass program was finally implemented in July 2005.

According to PierPass rules and regulations, “off-peak hours” referred to the time
6:00 p.m. through 2.59 a.m., Monday through Friday and all day (24 hours) on
Saturdays, Sundays and holidays. “Peak hours” referred to 3:00 a.m. to 5:59 p.m.,
Monday through Friday (excluding holidays).

Each container passing through terminal facilities of a member of WCMTOA is
assessed a traffic mitigation fee (TMF) of: U.S.$50.00 per 20-foot container (as of
November 2006, at the initial implementation of PierPass in July 2005, the fee was
US $40 per 20-foot container) U.S.$100.00 per all other sizes of container
The fee is not applicable to the following categories –
74
a) Empty containers or empty chassis
b) Freight passing through a terminal facility during off-peak hours
c) Freight that is subject to a fee imposed by the Alameda Corridor Transportation
Authority; and
d) Transshipment Freight

The rules and regulations for PierPass also state that “unless other arrangements
are made, the Fee on Import Cargo must be paid before the Container leaves the
Terminal Facility during Peak Hours. All Users shall be jointly and severally liable
for the payment of the foregoing Fee with respect to a shipment of Export Cargo
or Import Cargo” (PierPass. 2005)

The traffic mitigation fee (TMF) system is accompanied by provisions for extend
hours of operation for terminal gates. Thus in addition to the existing Monday-
Friday 8:00 a.m. through to 5:00 p.m. peak hour arrangements, this system
provides for additional days of full-service terminal operations (Wargo 2004).

When the program was announced, all the participating terminals were to
implement a program of extended hours including a full day shift every Saturday
and adding a weekend or weekday night shift every subsequent month. The fee
75
collected through the system was to be refunded within 10 days for freight covered
under the four exceptions to the traffic mitigation fee.

Performance of Peer Pass and Appointment System till date

Since the initiation of the two appointment systems in July 2003, there have been a
few assessments of the effectiveness of the two systems. Some comprehensive
studies of the appointment systems have been undertaken, and some of the
information is gleaned from the perceptions of representatives of specific
terminals. These have been supplemented with some qualitative assessments by
respondents to a few of my stakeholder interviews.

Marine Terminal Corporation, the company that operates PAS has claimed that by
August 2004, 98 per cent of all non-rail import containers at the TTI operated
Long Beach Container Terminal were picked up using PAS services.

Also MTC statistics showed that in June 2004, about 52 per cent of truckers make
an appointment for transactions at participating terminals. MTC also argued that
truckers with appointments had turnaround times 15 to 18 minutes faster than
those without appointments.

76
At the port of Los Angeles, the TraPac terminal uses the eModal appointment
system. The terminal reported that though the system was good in principle, in
practice truckers were often unable to use the system efficiently and miss
scheduled appointments (Roche Ltee and Levelton Consultants. 2006).

Hence the appointment system is not being effectively utilized. Instead, using a
combination of labor cost reduction and increasing productivity through use of
innovative technology, the terminal gate idling time has been cut to 10 minutes, a
drastic change from the past when the delays could go up to 6 hours.

It was felt that the terminal has managed to address the problem of gate queuing
without relying on the appointment system.

Similarly, the SSA terminal at the port of Los Angeles has also implemented the
appointment system in compliance with AB 2650. However, only about 10-20 per
cent of the truckers using the terminal scheduled appointments (Roche Ltee and
Levelton Consultants. 2006).

As the usage rate is low, SSA has not changed its operational practices to
77
accommodate fixed appointment slots. They feel that low usage and numerous
cancellations do not merit pre-mounting of containers, and also state that gate
queuing has been eliminated mostly through the use of technology such as RFID,
OCR, EDI at the terminal gates.

The most comprehensive study on the appointment system to date was conducted
by METRANS, collecting data from multiple terminals at POLA/LB (Giuliano et
al. 2006).

Their conclusions reflect the findings from the TraPac and SSA terminals
regarding the role of technology in bringing about efficiency gains in truck moves
at terminal gates.

The METRANS study found that the use of the system depends considerably on
the operational practices of the terminals, different stakeholders perceive the
effectiveness of the system differently, the system had no effect on truck queuing
at gates and the impetus for implementing the system was to choose a cost
effective alternative to full-service extended gate hours.

The responses from truckers in the study indicated that truckers honored 63 per
cent of their appointments; however, this did not have a significant impact on their
turn times. As reported by SSA, a majority of terminals did not make any changes
78
within the terminal premises to comply with fixed appointment slots, thus
hindering the effectiveness of the appointment system.

It was felt that the appointment system was not an industry-generated solution, but
rather a measure imposed by public agencies through legislation. Also, as
compared to the appointment system, a greater impact on terminal gate efficiency
was due to the adoption of advanced technology such as OCRs, which greatly
reduced the processing time for truckers at terminal gates.

However, the biggest challenge to the appointment system has been the
widespread adoption of extended gate hours by terminals due to participation in
the PierPass program (Journal of Commerce. September 27, 2004e).

Under the AB2650 legislation, terminals are provided with an exception to the
$250 per truck fine if they implement either an appointment system for truckers or
operate full-service gate hours for more than 70 hours in a week.

The AB2650 states that the fines specified in the bill do not apply “to any marine
79
terminal that provides, as determined by the district, two continuous hours of
uninterrupted, fully staffed receiving and delivery gates two hours prior to and
after, peak commuter hours each day, at least five days per week”. (Assembly Bill
2650: p. 4)

Further the bill states that the provisions of the bill will not apply “to any marine
terminal that operates fully staffed receiving and delivery gates for 70 hours, five
days per week, if that marine terminal is located at a port that processes more than
3 million containers (20-foot equivalent units (TEUs)) annually”. (Assembly Bill
2650: p.4)

It can be seen from the list of terminals using eModal services that their number
has declined from 2004-06. This has occurred as terminals have taken up extended
hours of operation, and the appointment system has become redundant for the
purposes of meeting legislative requirements.

Regarding PierPass, at present there are almost no independent studies evaluating
the performance of PierPass that have not been supported by any industry
advocacy group. An independent study currently in progress is the METRANS
evaluation study for PierPass.

However, there are two prominent evaluation studies, one commissioned by
80
PierPass, and the other by California Trucking Association, a truckers’ advocacy
group that provide us valuable data on the performance of the PierPass program
and the challenges so far.

Other information regarding PierPass performance comes from qualitative data
provided by respondents to my in-depth stakeholder interviews, which are
incorporated in this analysis.

Some of the initial reports prior to the implementation of PierPass had indicated
that the rate of non-peak hour terminal gate usage was about 17 per cent. One of
the first studies evaluating the impact of the PierPass program on truckers was
commissioned by the California Trucking Association and presented in September
2005.

The study concluded that the PierPass program of extended hours of terminal gate
operation had little impact on wait time for truckers at the terminal gates, and there
is little difference in processing times between night and day time operations
(Rozsa 2005).

According to this survey 43 per cent of drivers had a negative opinion of PierPass,
and many of them felt that the benefits that PierPass promised of shorter wait
times at terminal gates had not been realized through the measures. Also, the
drivers were unhappy at being unable to spend time with families and put
81
themselves at risk by working long and night time hours.

The respondents also reported that the amount of work available to truckers had
not increased; rather, the same amount of work had become distributed over longer
hours as the drivers face long wait times during night shifts a well.

The drivers surveyed in the study felt that additional compensation for truckers
would be a key incentive for working off-peak hours. Also improvement in turn
times at terminal gates, by using improved technology and more labor was also
key to improving working conditions for truckers.

This survey was followed by a second survey commissioned by CTA which was
completed in March 2006, essentially surveying the same set of questions covered
in the first survey (Rozsa 2006). The responses to the second survey were similar
to those in the first survey; however, there was a slight improvement in driver
attitudes towards PierPass and their working conditions in off-peak hours.

As in the first survey, the second survey also showed that drivers working during
off-peak and night hours were not making any additional turns overall. Thus the
night gates were not operating any faster than the gates during day time, thus not
resulting in any significant time savings for the drivers.

82
Among the drivers surveyed 40 per cent stated that they did not wish to work in
night shifts, and 41 per cent did not work on Saturdays. Many of the drivers who
worked night and Saturday shifts only did so as the loads were made available by
terminals at those times. Inability to spend time with families was again cited as a
major objection to working during night shifts and Saturdays.

However, as compared to the first survey, there was an improvement in truckers’
attitudes to PierPass, helped by the fact that a percentage of the drivers were being
given additional compensation for night-time and Saturday moves.

Among drivers who worked during night hours, 21 per cent were paid additional
compensation. Among drivers working Saturday shifts, the figure was 17 per cent.
This additional cost is being borne by shippers who are the beneficial owners of
the freight.

The poor turn times for both day and night time gate operations remains a key
concern with the truckers. Safety and night time visibility on freeways also
remains a salient issue, especially given the constraints within which the trucking
industry operates, which I shall discuss in the next section.

After these two surveys by CTA, the PierPass organization commissioned its own
evaluation study of the perceptions of the PierPass program among intermodal
83
truckers serving the POLA/LB complex (Fairbank, Mauslin, Maullin and
Associates. 2006). According to the survey, among those familiar with the
PierPass extended hours program (8 out of 10 respondents), overall two-thirds had
a positive opinion of it.

About 40 per cent of the respondents stated that they were able to make more trips
due to the efficiencies generated by the PierPass program, and 60 per cent among
this group also reported higher earnings.

Also, the truckers perceived less congestion both inside and outside the terminal
gates after the PierPass program was implemented. About two-thirds of those
familiar with PierPass also stated that the daytime traffic on the 110 and 710
freeways had improved (Wargo 2006a; 2006b).

Since all three of these surveys have been commissioned by organizations with a
specific position and stake in outcomes of the implementation of efficiency
measures, it is essential to have an evaluation of the program by an independent
research organization.

The performance of PierPass was discussed extensively by many of my
84
interviewees, and a composite analysis of their qualitative impressions regarding
the performance of PierPass is presented in my discussion of stakeholder
interviews (Chapter 5).

Besides the evaluation of the appointment system and PierPass programs and the
perceptions of truckers regarding PierPass, several other issues regarding the
implementation of these two measures have been highlighted in the last 3-4 years
during which these measures have been debated, adopted and implemented.

The issues that are most relevant to my analysis pertain to the specific institutional
characteristics of the freight movement network and the industries associated with
it.

In my final section, I discuss the most salient issues regarding the institutional
environment of freight movement and stakeholder collaboration. I discuss the
specific characteristics of key stakeholder groups that are involved with the
implementation of efficiency measures at the POLA/LB complex.

I also discuss some of the characteristics and expected changes within the freight
movement network that would crucially impact efforts to collaborate between
freight movement actors.

Issues in the Institutional Environment of Freight Movement
85

Some of the most important factors affecting the incentives, barriers and
governance mechanism of collaboration over freight efficiency measures are the
characteristics of specific industry groups and the changes in the economic and
legislative environment within which the freight distribution network operates.

Here, I discuss some of the key issues and characteristics of selected stakeholder
groups that are expected to have a significant impact on the implementation and
stability of the appointment system and PierPass at the POLA/LB complex.

Trucking Industry Characteristics

According to some reliable estimates, there are approximately 10-12,000
commercial truck drivers licensed to haul containers to and from the POLA/LB
complex. Studies have shown that a majority of truckers work an average of 7
hours per day and get paid an average of $100 per container-load transported
(Dowall 2000).

The amount though varies significantly. According to one of my interviewees, for
distribution centers closer to the ports, the truck drivers are paid $50 per trip.
However, for longer trips to San Bernardino or Chino, the drivers may be paid up
to $200.

Some truckers are forced to work during congested day time hours due to the fact
86
that night-time ordinances and curfew regulations in residential neighborhoods
prevent them from making night-time deliveries (Journal of Commerce. December
11, 2003).

At present the trucking industry is facing significant challenges, that many fear
will be exacerbated in future leading to impact on the productivity of the industry,
affecting the most vital link in the distribution network (Journal of Commerce.
June 30, 2004).

Most truckers in the industry are small owner-operators, hauling freight on their
own or working on contract basis with other larger trucking companies. The
average trucking company size is a fleet of 25 trucks or less.

Low rates for deliveries means inability for most small-scale truckers to replace
their outdated equipment in a timely manner. A new retrofitting program has been
initiated by the state of California recently; however, trucks from the year 1993 or
older are not eligible for retrofitting.

By 2010, trucks 1993 or older are to be phased out and replaced by newer trucks.
This would present challenges for truckers operating with very old rigs, and it
would require a substantial capital investment to replace them.

Additionally, unlike terminal operators who enjoy anti-trust immunity in
87
discussing rates and also measures to address congestion under WCMTOA,
truckers are unable to collaborate under existing legislation to discuss rates and
working condition. Currently the trucking industry is seeking anti-trust immunity
like the terminal operators to be able to discuss rates.

One of the most significant issues affecting the trucking industry is the very high
turnover rate in the industry. At present the average age of active truckers is 54
years.

The industry is facing difficulties in attracting younger truckers to the profession
due to the low rates, limited benefits, long difficult hours, and work hazards. Thus
the ageing trucker population is poised to become a very serious challenge to the
distribution network in future.

Generally speaking, the trucking industry, more than any other stakeholder group
besides the terminal operators has been actively involved in the discussions and
debates regarding the appointment system and PierPass (CALMITSAC. 2006).

However, the trucking industry has also alleged that they were not fully involved
88
in the process of creation of the two systems. The trucking industry also feels that
there has been greater attention to changing the practices of the trucking industry
rather than any other freight group.

Warehousing Industry Challenges

The warehousing industry is very diverse, fragmented and has a mix of large and
small players. Most of the larger players tend to be specialized and are associated
with specific manufacturers or industries. A few are into dry and cold storage.
Most of the warehouses are located in industrial zones and hence those warehouses
have little impact on residential areas.

Warehouses are divided into public and dedicated private warehouses, with the
latter housing freight for only one shipper. With the increasing integration of
distribution within the logistics of large shippers/retailers, the private warehouses
have become more common as compared to public warehouses that lease facilities
to multiple shippers.

Given the structure of the industry, the logistics practices of large shippers have a
tremendous impact on the institutional characteristics of the industry and its
practices (North Jersey Transportation Planning Authority Inc. N.Da).

Specifically, Wal-Mart, the single largest importer at the POLA/LB influences the
89
industry tremendously through the organization of its distribution network
(Freeman 2004). Most shippers in the network generally prefer to send their
freight from the port complex to local warehouses and distribution centers by
truck, and later send them by truck to destinations within a 500-mile radius.

The warehousing industry is increasingly facing space constraints in the Southern
California region (North Jersey Transportation Planning Authority Inc. N.Db).
Most of the warehouses in the region are located within the areas of Long beach,
Carson, Wilmington, Torrance and the South Bay

Within the city of Carson, there are only about 34 plots of warehousing property
left that are 70,000 sq.ft. or above (SS, personal communication). Compare this
fact with the industry standard of a minimum of 50,000 sq.ft. of space for
warehouses. Most industrial property in the area is off the market and has been
leased.

This has led to a tremendous increase in warehousing operations in San
Bernardino (Kirshner 2002). The rent for warehouses in San Bernardino have
increased to be in the range of 30-40 cents for ¼ ft. from an initial rate of 27 cents
for ¼ ft about two years ago (SS, personal communication).

This has made it difficult to find space in San Bernardino as well, and newer
90
warehouses are locating further and further away.

There is a trade off involved in warehouses moving to San Bernardino and the
Inland Empire. There is more space and cost reductions; however, the distance
from the ports increases, thus increasing the delays in moving freight from the
ports (LAEDC. 2002).

There are additional warehouse spaces in Chino but those are filling up fast as well
(LAEDC. 2004b). The land for warehouses is becoming scarce and expensive,
because warehouses are also fighting with residential uses. This has led to further
increase in congestion on the freeways I-710, 91, 605, CA-60 and 71.

Some studies on freight movement and warehousing in the POLA/LB region assert
that the move to the Inland Empire represents a migration by warehouses already
operating in the vicinity of the POLA/LB complex (LAEDC. 2004a).

I would like to argue, however, that the growth in Inland Empire is due to the
creation of new warehouses that located in the area due to industrial land shortage
near the POLA/LB complex.

Thus depending on the traffic it might take up to 3 hours to get from the ports to
the facilities in Inland Empire. With tight deadlines, it becomes even more difficult
to make timely deliveries. Most freight is sent off to their final destinations from
91
distribution facilities before 2:00 p.m. This requires complex logistical planning
and the companies have to calculate the cost of getting the freight to its
destination. This is made more difficult for warehouses with specific rigid
contractual obligations with their larger customers.

Organization of Terminal Operators

Within the freight distribution network, the most well-organized stakeholders are
terminal operators, who have collaborated on a regular basis over the last two
decades in determination of rates.

All the terminal operators at the ports of Los Angeles and Long Beach lease their
facilities from the authorities overseeing the respective ports. Many of the
operators are also integrated into ocean carrier companies, thus providing a
comprehensive ship and terminal facilities to shippers.

One of the most prominent issues with regard to terminal operations that affects
the implementation of appointment system and PierPass are the labor issues
associated with them (Finlay 1987).

It has been reported that one of the major reasons for the congestions and delays
experienced dockside and at terminal gates is that there is inadequate labor to
service the container flows at the terminals.

92
A large part of the current mismatch between shipments and labor available to
service them can be attributed to the very rapid increase in container flows over
the last few years that are expected to continue to rise steadily for the next two
decades (Journal of Commerce. September 27, 2004a).

Despite initiating the hiring of nearly 5000 temporary workers as well promoting
nearly 1000 casual workers to regular status, the terminal operators still experience
labor shortages (Journal of Commerce. October 5, 2004).

Though work at the West Coast port terminals provides some of the highest paid
blue-collar jobs in the world, contracts negotiated between the ILWU and the
PMA and specific rules for hiring ensure that there are significant barriers to entry
in the labor pool (Journal of Commerce. September 30, 2004).

The ILWU negotiates a master contract nearly every 5 years with the Pacific
Maritime Association, which represents the terminal operators, the last contract
being implemented in 2002 and expected to be binding till 2006 (Pacific Maritime
Association. 2002).

After years of resisting technological innovation at the terminals due to fear of loss
93
of jobs, in the 2002 labor contract several significant provisions were made for the
introduction of technologies leading to faster processing of containers (Business
Wire. December 10, 2003).

These include technologies such as Optical Character Recognition (OCR) and
Radio Frequency Identification (RFID) tags that help process paperwork faster
thus improving terminal gate productivity (Jula, Liu, and Ioannou. N.D).

Despite the introduction of technological innovations, labor continues to play a
crucial role in terminal operations and the growing freight flows require further
addition to the labor pool in the coming years.

Given that labor costs at the POLA/LB complex are considerably higher compared
to some other ports, a less than optimum use of additional gate hours would make
terminal operators extremely reluctant to offer additional off-peak hours for
truckers.

Chapter 4
94

RESEARCH DESIGN
My theoretical analysis supports the argument that it is essential to uncover the
specific incentives and barriers associated with collaboration between actors in
POLA/LB freight movement to design an appropriate governance mechanism to
support the arrangement.

The stability and success of stakeholder collaboration is essential for reconciling
the operational practices of actors to facilitate the implementation of appointment
system and PierPass.

To address the questions raised by issues identified by my analysis of the
institutional environment affecting freight movement at POLA/LB, I develop a
survey instrument and interview schedule to gather data on stakeholder
collaboration.

Defining the Problem

95
The objective of my study is to examine the incentives and barriers that determine
the governance mechanisms required to administer stakeholder collaboration at the
POLA/LB.

Analysis of these categories would provide guidelines for devising effective
governance mechanisms for regulating partnerships, as well as yield generalizable
principles for policy on governing private stakeholder collaboration in other
institutional environments as well.

The growth of freight movement at the POLA/LB has lead to an increase in
congestion and pollution in the region around the port complex, requiring
measures to be undertaken to reduce peak-hour truck movement in the region.

Given the paucity of infrastructure funds for the freeway network used by the
intermodal trucks, I argue that in the short run, efficiency gains in freight
movement will be derived from changes in operational practices of stakeholders.

The measures devised to effect these operational changes, the appointment system
for truckers and the PierPass system for off-peak movement of trucks, have been
96
demonstrated to have problems and challenges related to their implementation.

The implementation of the measures involved changes in operational practices
incurring additional costs (or collaboration-specific investments), requiring
stakeholder-specific incentives or benefits to attract them to the collaboration.

Early reports also indicated that mismatch in operational practices, trust issues
between actors in different industries, anticipation of the free rider problem etc.,
all of which had the potential to become significant barriers in the implementation
of the measures.

The voluntary nature of the arrangement, unsupported by any state regulation
posed unique challenges and risks, requiring contractual measures and targeted
governance mechanism to ensure the stability and viability of the arrangement.

The analysis of the issues required a theoretical framework synthesized from
discussions on public private partnerships, new institutional theory, specifically
hybrid organizations and multi-actor governance.

My literature review yields a comprehensive discussion on the importance of
tailoring specific governance mechanisms to address the characteristics, incentive
97
structure, and risks associated with the collaboration being analyzed. Hence,
creation of the appropriate governance mechanism requires an understanding of
the incentives and barriers related to the collaborative arrangement between actors
in freight movement.

Research Questions

Using my theoretical framework, I argue that the success of these efficiency
measures depends on the creation of a governance mechanism that addresses the
issues of participation incentives, transaction costs of information and monitoring,
and the problem of free riders and trust.

I argue that voluntary governance mechanisms suited to the characteristics of the
particular collaborative arrangement they govern will lead to greater efficiency
gains in freight movement compared to top down regulation by public agencies.

Having identified the key research issues in freight movement at POLA/LB, I can
now formulate the research questions that I seek to answer through my study:

a) What are the transaction costs that pose a barrier to collaborative
arrangements to increase operational efficiency between stakeholders in
the intermodal network?
98
b) What are some incentives that can further collaboration and alignment
of practices between stakeholders?

c) What sort of governance mechanisms should be created to ensure stable
collaborative arrangements, minimize risk in collaboration and lead to
effective arbitration between stakeholders in the freight movement
network?

Having outlined the questions being addressed by my research, I may state my
hypothesis as the following:

Collaboration between stakeholders on operational efficiency measures such as
appointment system for truckers and PierPass extended hour system is prevented
by transaction costs over and above increased operation costs of implementing
efficiency measures.

These transaction costs are reduced by the creation of a governance mechanism
that performs the following tasks: reducing information costs, reducing risk in
collaboration by addressing trust and free rider issues, and providing a forum for
arbitration between stakeholders.

99
Selection of Methodology

To address my core hypothesis I rely on a combination methodology that includes
examining existing data sources, primary data gathered through a comprehensive
stakeholder survey, and supplementing it all with in-depth personal interviews.

In using a combination of research methods, I hoped to acquire information that
would comprehensively address a set of aims that arise from my definition of the
research questions of my study.

The information necessary for addressing my hypothesis could be categorized as
pertaining to stakeholder incentives, transaction costs and barriers to collaboration,
and the existing governance mechanisms and institutional environment supporting
collaboration within the freight community.

The incentives to collaboration for stakeholders depend on many different factors,
including nature of collaboration and the extent of investment of resources and
practices by the actors in the collaboration.

The incentives also differ depending on the characteristics of the stakeholders,
whether it is a public or private agency, a large or small firm, or the type of
100
industry within which the private stakeholder is located.

Information about the transaction costs or barriers to collaboration may be
ascertained in both direct and indirect ways. Through the survey I aim to gather
data on stakeholder perceptions regarding the existence of free riders, the level of
trust between stakeholders, information exchange and the ease of information
gathering regarding the measures and changes by other stakeholders, etc.

Besides these two crucial categories, I also hope to obtain data on existing
contractual arrangements and governance mechanism pertaining to the
appointment system and PierPass, as well as the informal arrangements between
stakeholders at intra-industry and inter-industry levels, and for the freight
movement network as a whole.

Given the aims of the study as outlined, it was concluded that the most appropriate
way to collect data for the study was to use a combination of methods targeting the
key stakeholder groups involved within the most crucial steps in implemented the
measures of appointment system and PierPass.

The methodology developed included the tasks of identifying the relevant
stakeholder groups to be studied and selecting sample sets for data collection,
developing a survey instrument incorporating the relevant research aims,
administering the survey, developing a semi-structured interview schedule based
101
on survey responses, and administering interviews to a small set of selected
stakeholders.

Identifying Survey and Interview Respondents

Support from a wide variety of entities is crucial for the success of the operational
efficiency measures at the POLA/LB to address congestion and pollution issues
associated with freight movement.

Though the responsibility for primary implementation of these measures is with
marine terminal operators, many other stakeholder groups within intermodal
freight movement would need to bring their operations in alignment with the
changes effected by the measures.

Important among these groups are truckers, warehouse operators and shippers,
whose decision-making directly affects the hours during which the freight moves
through the freeway network.

Besides these key stakeholder groups, there are also other private stakeholder
groups who are affected by the initiatives and contribute to the public debate on
102
freight movement. Some of the most important private stakeholders within the
freight movement network are discussed below.

Shippers – These are the beneficial owners of freight, and usually the suppliers or
owners of the freight being shipped. Shippers place an order with overseas
producers for their goods and then arrange to have them shipped to the US,
making the choice of port that the freight is to be brought in.

In this endeavor, increasingly shippers use the services of third party logistics
providers like freight forwarders or consolidators (mostly for shippers of smaller
consignments). The operations of shippers may range in size from large retail
chains such as Wal-mart and Target to smaller entities shipping one container at a
time.

Marine Terminal Operators – A marine terminal operator is an entity that is
responsible for providing a number of services to an ocean carrier at a maritime
terminal.

These services include wharfage, docking, temporary storage and stocking of
freight at the terminal, on site warehousing facilities (now rare) and facilitating
transport of freight through on-dock rail. With the consolidation of the maritime
business that has taken place in the last two decades, it has become increasingly
common for a common business entity to operate ocean carriers as well as
103
dedicated terminals servicing only ships belonging to the specific ocean carrier.

Ocean carriers – It refers to an entity which is contractually engaged to transport
freight by sea. These are firms that operate ships that are usually leased, and
undertake fixed schedule voyages. Usually a consolidated intermodal
transportation package is offered by third party logistics firms to shippers that
include the sea journey aspect of transportation.

Truckers – With the Motor Carrier Act of 1980, the deregulation of the trucking
industry began and led to a substantial decrease in trucking charges, as well as
leading to relative ease of entry and exit in the industry as well as the entry of non-
union drivers.

The deregulation of the trucking industry had a significant impact on intermodal
trucking, making logistics decision-making a crucial aspect of product cost
calculations.

Warehouse Operators – The warehousing industry has also seen tremendous
changes over the last two decades. From small mostly public warehouses, I now
have large distribution centers dedicated to freight belonging to a single retail
entity. Many of the distribution centers also provide additional services.

Third Party Logistics Providers – These are firms that provide supportive services
104
for various logistical needs of shippers, covering different aspects of intermodal
freight movement. Included in these services are customs brokerage, freight
forwarding, freight consolidation, information technology support for shipments,
etc.

Depending on the shipper, the third party logistics providers may perform a crucial
role in determining the time of container pick-up by truckers.

They also include public and voluntary groups with a stake in goods movement
debates in the region:

Port of Los Angeles (Los Angeles Harbor Department or Department of the City
of Los Angeles) and Port of Long Beach (managed by the Harbor Department of
the City of Long Beach and headed by the Long Beach Board of Harbor
Commissioners) – Both ports are landlord ports, leasing out facilities to terminal
operators for leasing fees and other charges.

The ports have used their substantial revenues from leasing fees for investing in
the Alameda Corridor Project, as well as other street and bridge improvement
projects. The ports do not directly influence

Local and regional transportation planning authorities (MTA, SCAG, and
Caltrans) – These agencies are responsible for planning and implementation and
105
maintenance responsibilities for a number of transportation projects within the
greater Los Angeles region.

The agencies also conduct research on intermodal freight movement in the region,
and also take on advocacy for specific transportation projects. Like the port
authorities though, the transportation agencies do not have any direct influence on
the movement of truck traffic in off-peak hours or the appointment system.

Environmental Agencies and Citizens Groups (AQMD, ERB, NRDC and
neighborhood councils) – These agencies, in various capacities are responsible for
advocacy and awareness raising regarding the externalities and impact of growing
port traffic on the local population.

The local AQMD also has the additional responsibility of overseeing the
implementation of AB2650 regulation regarding the fining of trucks for idling at
terminal gates.

As is evident, the number of stakeholders involved with intermodal freight
movement at POLA/LB is very large. Given the national scope of the container
movements through POLA/LB, a number of the stakeholders are not locally based,
rather they are based in a number of locations nationally as well as internationally.

Also given the widely varying character of industries involved in freight
106
movement, it is difficult to obtain a representative sample where equal weights
could be apportioned to the responses by the industry affiliations of respondents.

Hence, in my survey, I primarily concentrate on obtaining responses to issues in
freight movement from three key industries associated with the implementation of
efficiency measures at the POLA/LB. All industries show similar characteristics of
an industry dominated by many small players and a few large players, and
requiring the implementation of changes in industry operational practices for the
successful implementation of appointment system and PierPass.

In the following section, I describe the creation of my survey instrument, the
selection of sample set and the implementation of the survey in innovative ways
and the challenges associated with the choice of method.

Stakeholder Survey

To obtain empirical data on the types of barriers and incentives to collaboration as
well as how stakeholders perceive them I have used a survey of the different
stakeholder groups, focusing on four key stakeholder groups.

These groups belong to the industries of trucking, retail and wholesale,
warehousing and third party logistics providers. I would supplement the survey
107
data with interviews with stakeholders that would allow us to obtain more detailed
information on issues raised through the survey.

The survey questionnaire was developed based on the relevant literature on the
operational measures of appointment system and Pier Pass and the debates and
discussions around alternative measures for alleviating pollution and congestion in
freight movement at the Ports of Los Angeles and Long Beach.

The study aimed to cover a wide range of stakeholders in the survey; however, the
focus was on getting responses from four groups of private stakeholders namely,
shippers, truckers, warehouse operators and third party logistics providers.

Previous work in this area has emphasized surveys (Regan and Golob 2000),
including a METRANS study that gathered data on truckers to establish goods
movement performance measures (Barber and Grobar 2001).

As well some recent work has used interviews (Giuliano et al. 2005). I use a
combination of these instruments. My survey questionnaire was developed from
the categories of analysis already identified through my theoretical framework.
These document the incentives for and barriers to cooperation between actors in
freight movement.

The aim of the survey was to elicit responses on a wide range of questions that
108
covered issues related to the implementation of PierPass and appointment system.
Broadly speaking, the questions in the survey can be divided into the following
groups.

Incentives to Adoption of PierPass and Appointment System

A substantial number of questions covered issues related to the incentives to
cooperate on Pier Pass and the appointment system for stakeholders. Specifically, I
explored differences in incentives between public and private stakeholders, as well
as different types of private stakeholders.

I also seek responses related to the mutuality of stakeholders in the collaboration,
and how benefits from resource investment are equalized across different
stakeholders.

Barriers to Collaboration – Trust, Free Riders, and Information Costs

The second set of questions addressed the potential barriers to the successful
implementation of partnerships between actors in freight movement. The key
barriers to collaboration as identified through my theoretical analysis are trust, free
rider problem and information costs, all combining to produce potential risk of
109
moral hazard and dissolution of collaboration.

Questions address both directly as well as indirectly the cost-benefit imbalance for
stakeholders, gauging a shortfall of resource contribution by some actors who fully
avail of the benefits from the operational efficiency measures.

The question of information cost as a key transaction cost is also explored, as
respondents are asked to ascertain the extent to which information costs affect the
cooperation between stakeholders.

Governance Mechanism and the Performance of PierPass

The final set of questions gathered information on the efficacy of PierPass as a
governance mechanism for partnership on freight movement, as well as the
feasibility of other measures for governance of collaborative arrangements. I also
cover a few other issues related to freight movement at the POLA/LB.

These questions elicit responses on the respondents’ perception of congestion
related to freight movement, environmental pollution and the likelihood of success
for voluntary methods to deal with congestion and pollution.

I decided to administer my survey through a web-based survey tool. The decision
to use a web-based survey tool was arrived after deliberating the pros and cons of
110
using the method and the limitations or advantages it might confer my data
collection.

The advantages of using a web-based survey tool includes the ease of survey
design, as the survey can be developing using the easy interface provided by a
web-based survey tool. Additionally there is considerable saving of costs
associated with a printed or telephonic survey, as there are no printing or special
equipment expenses with a web based survey. The survey is sent electronically
through email so it can reach respondents instantly.

Additionally, it allows respondents the flexibility of taking the survey at their own
pace, and to return to it to change responses any time before sending it off.

The biggest disadvantage of a web-based survey is the fact that it limits itself to
only respondents with valid email addresses. Additionally, many respondents
change email addresses frequently, and hence a database of email addresses can
become outdated soon.

Also, there is reluctance on the part of respondents to take surveys online because
there is considerable apprehension about providing personal and professional
opinion online that can be traced back to them. To allay this fear I offered the
option of a completely anonymous survey where the respondents didn’t have to
111
identify themselves by name.

Another major disadvantage of a web-based survey is the lack of interaction
between the surveyor and respondent, which would have allowed the surveyor to
gauge more nuanced responses out of the respondent.

However, this is a disadvantage even printed surveys present and hence have no
additional advantages over a web-based survey.

Since most of my respondents work in industries that require the possession of an
email address for interaction with clients, I felt that a web-based survey would not
be limiting itself to a small set of stakeholders.

I also felt that the flexibility of a web-based survey would appeal to my
stakeholders. Additionally, I felt that a web-based survey would be the most
optimum use of my resources for the quickest and most resource-efficient way to
reach the most stakeholders.

After developing the survey, I pre-tested the survey with a few chosen volunteers
to address any inconsistencies and errors in the survey. These volunteers attempted
112
the survey as my stakeholders would, and provided feedback regarding the design,
user-friendliness, and difficulty level of questions as well as the time taken to
complete the survey.

Based on this feedback, I refined the survey and developed it further. After this
round of pre-testing I opened the survey to my stakeholders and alerted them to it.

The survey was administered through a web based survey tool provided by the
website www.surveymonkey.com. It was completed by participants online in an
easy interface. All the questions were optional and the participants could skip any
questions in the survey.

Participants for the survey were recruited through emails that were sent to various
stakeholders. Email addresses for stakeholders had been collected using different
sources, such as trade organization databases, reports, conference proceedings, and
organization websites.

In total approximately 2000 emails were sent to various stakeholders soliciting
their participation in the survey. Out of these 2000 emails, nearly 1000 emails
113
could not be delivered as the email addresses had been either suspended or
abandoned. Based on this information I kept revising my sample set of
respondents.

A final tally of 132 respondents eventually took the survey. Different stakeholders
from among the four targeted groups were well represented within my
respondents, with the largest group drawn from trucking, and the second highest
group being from the third party logistics industry.

The third largest respondent group was from the warehousing industry. About 40.9
per cent (54 persons) were from the trucking industry, 25.7 per cent (34 persons)
were from the third party logistics industry, and 19.7 per cent (26 persons) were
from the warehousing industry.

After administering the survey, I collected the results and analyzed them with
simple quantitative and qualitative analyses. The responses were cross tabulated
with responses to other questions within the survey and compared with existing
data as well as my analysis of institutional environment of freight movement at
POLA/LB.

The analysis of the survey results indicated some gaps in information, which
formed the basis for the categories of questions and analytical framework for
114
interviews with key stakeholders. In the following section I describe how
interviews with key stakeholders were administered.

Administering Key Stakeholder Interviews

The data obtained from the survey questionnaire was supplemented with
qualitative data gathered from in-depth interviews conducted with key
representatives of selected firms and industries.

The interviews allowed for a more rigorous and comprehensive analysis of the
issues associated with incentives, barriers and transaction costs in freight
movement and supplemented the data already obtained through the survey.

Within the interviews, I attempted to obtain more in-depth and nuanced
information on issues on which there was considerable ambivalence within the
responses to survey questions.

The responses that I were interested in were the ones that provided information
that had not appeared in the literature review or secondary data that was analyzed
prior to the survey.

The aim of the interview was to obtain information that was not readily available
115
or missing from the survey responses. I were also aiming for responses that
required a detailed clarification from certain key stakeholders, thus providing a
more multifaceted analysis of the issues surrounding the particular response.

Also, the interview process allowed us the opportunity to input an emotive content
into the study, as I could capture the undertext to the responses provided by my
stakeholders.

I had the opportunity to interact with a few key stakeholders, and it gave us a
contextually situated analysis of the issues that were brought up in the survey.

While the survey responses were brief, when the same issues were addressed in
interviews, they were given an historical, social and political perspective,
compared to other similar initiatives in the past and seen as part of trends that were
unique to the region due to the policy matrix that exists here.
The interviews specifically focused on a few key players within the freight
movement community associated with POLA/LB.

These interviewees were affiliated with public agencies, private organizations as
well as non-profit entities playing a leading role in shaping policy and practice in
freight movement.

Within public agencies, I concentrated on respondents affiliated with port
116
authorities, as they are the most closely connected with the general operations of
intermodal freight movement at POLA/LB.

In private organizations I covered primarily terminal operators, as they were
underrepresented within my survey respondent groups. I covered a wide range of
non-profit entities responsible for the implementation of operational efficiency
measures and facilitating information exchange between freight movement
stakeholders.

A wide range of stakeholders allowed us to access a number of perspectives that
differed from each other due to the different institutional structure of the
organizations and industries they were affiliated with.

Interviews were semi structured, with a set of predetermined questions
supplemented with extensive discussions of specific issues associated with
institutional collaboration, transaction costs and freight movement.

Table 4-1: Coded List of Interviewees
Respondent Industry Data of Interview
117
KC Port Authority March 20, 2005
LC Port Authority March 20, 2005
RC Trucking October 12, 2005
SM Terminal Operations February 11, 2006
TC Labor Union February 11, 2006
GC Railroad Industry February 11, 2006
MA Information Agency for Maritime
and Logistics Information
May 12, 2006
JC Appointment System
Administration
June 5, 2006
SS Warehousing June 10, 2006
SM Trucking June 15, 2006
AB Terminal Operations July 10, 2006
BC Terminal Operations July 10, 2006
CD Terminal Operations July 10, 2006
DE 24-hour Operation Administration July 11, 2006

The stakeholder interviews were unstructured, in-depth discussions lasting from 1-
2 hours each. The discussion focused on the appointment system for truckers and
118
the PierPass system, the developments related to freight growth at POLA/LB, the
performance of the two measures and the barriers that stakeholders are faced with
in changing their operational practices in response to these measures.

The interviews were semi-structured, and the interviewees were encouraged to
dwell at length on the different issues surrounding Pier Pass and the appointment
system. The discussion was structured, however, with some critical questions that
were developed on the basis of the responses to the stakeholder survey.

From the stakeholder survey a few key factors were identified that pointed to gaps
in available information regarding stakeholder interaction. These key questions
include: perceptions of trust; the problem of free riders, impact of institutional
environment on stakeholder collaboration, and the efficacy of PierPass as a
governance mechanism and coordinating body for bringing stakeholder operations
in alignment.

In the following chapter I present the data collected from the responses to my
stakeholder survey, as well as the insights from my interviews with key
representatives of stakeholder organizations.

119
I analyze my responses based on an analytical framework derived from the
incentives, barriers and governance mechanism that determine the character of
cooperation between stakeholders.

The responses to the survey provide us with an overview of the perceptions of
stakeholders from the four key private stakeholder groups of truckers, warehouse
operators, shippers and third party logistics providers. The survey presents their
responses on the key factors of collaboration incentives and differences between
public and private actors, free rider problem, information gaps in collaboration,
and the performance of PierPass.

The analysis of responses identifies certain aspects of freight movement
collaboration that required to be probed further through my in-depth interviews
with stakeholders. These gaps on the questions of trust issues, free rider, and
institutional environment impact on collaboration formed the basis for the
questions for my interviews.

120
Chapter 5

SURVEY ON INTERMODAL FREIGHT MOVEMENT AND
STAKEHOLDER INTERVIEWS

The survey on freight movement was designed to collect information on the
perceptions of the intermodal freight community at POLA/LB regarding the
incentives and barriers to the implementation of appointment system and Pier Pass.

Many of the issues identified and opinions expressed are in concordance with
previous studies and existing information on freight movement at POLA/LB.
However, other responses provide alternative perspectives on the issues in
stakeholder collaboration, meriting further investigation through interviews with
key actors in intermodal freight movement at POLA/LB.

The factors identified as affecting partnership formation within my broad
categories, incentives, barriers and governance mechanism were the basis for the
questions in my survey instrument. These three categories, as well as background
information obtained from secondary sources, formed the basis for creating the
analytical framework for examining the results obtained from the freight
121
movement survey.

My theoretical framework and study of the institutional environment of freight
movement yielded variables organized within my three basic categories. I explore
the question of incentive differences between different organizational structures.

Thus, I analyze how public and private stakeholders have distinct incentives and
how different private actors derive varying benefits from resource investments in
collaborations.

The barriers to collaboration examined in my survey can be broadly summarized
as trust perceptions between stakeholders, free rider problem and information costs
of implementation of appointment system and PierPass. Finally my questions on
governance mechanism investigated stakeholder opinions regarding public
regulation vs. industry self-regulation.

To cross-analyze survey responses, I use existing data on freight movement at
POLA/LB, and findings from previous studies. The analysis of the survey
responses identifies gaps in information on specific issues, requiring further
information collected from key stakeholders in the intermodal freight network.
These gaps in available information form the basis for questions in my interviews
with key stakeholders, where a more qualitative and nuanced understanding of the
issues in efficiency measure emerges.
122

This chapter is divided in three sections. The first section analyzes data obtained
from questions on incentives, covering differences based on organizational
structures of stakeholders.

The second section contains data on barriers to collaboration, including trust, free
rider and information costs. In the final section I briefly examine responses on
self-regulation vs. regulation by the state. In conclusion I summarize my findings
and identify the issues on which information gap persists, to be covered within my
stakeholder interviews.

Incentives – Differences Between Public-Private and Intra-Private
Stakeholders

In my literature review, I discussed the different aspects of incentives for
stakeholders to collaborate on efficiency measures. Within the analysis, the
discussion of the literature on public-private partnerships demonstrated the impact
of public and private organization and ownership on reasons and incentives for
collaboration.

I explore the incentive question within my survey, focusing on organizational
differences as the implementation of the appointment system and PierPass require
operational support from both public and private stakeholders.
123

Incentive Differences Between Public And Private Stakeholders

In response to question 10 in my survey (Appendix I), about 48.6 per cent agreed
and 24.1 per cent somewhat agreed that regarding intermodal freight movement,
there are significant differences in strategies, motivations and decision-making
between private sector and public agencies.

To explore the hierarchy of beneficiaries within both sectors I asked respondents
in questions 1&2 (ibid.) to identify two entities most crucial to the success of the
appointment system and PierPass.

Within private stakeholders, 64.4 per cent identified truckers and 33.3 per cent
identified carriers as the most crucial to the success of the operational efficiency
measures.

These figures, however, are not in concordance with the position of the trucking
industry advocacy groups, whose studies have shown that truckers have not
benefited as expected from the PierPass system. Also, an early opponent of the
West Coast Terminal Operators Agreement was the Teamster union of truckers.

The responses to the question regarding the public agency most influential in
freight movement throws up some interesting outcomes. An overwhelming 82.9
124
per cent of the respondents identified the port authorities as the most influential in
freight improvements.

The ports of Los Angeles and Long Beach as landlord ports influence freight
movement through terms of contracts with terminal operators where they can
specify certain provisions in operating the terminals at the ports. They also provide
financial support for infrastructure improvement projects such as Alameda
Corridor and street improvements around the port complex.

However, given that the port authorities are landlord port operators, their influence
on operations is only indirect. Also, they benefit only indirectly from operational
efficiency at terminals, though they were identified by nearly 24.4 per cent of the
respondents to question 3 (Appendix I) as benefiting the most from the
appointment system.

This indicates that the port authorities despite their actual sphere of authority have
a very high visibility within the freight movement community, much more than
other transportation agencies and city governments.

TABLE 5-1: Ranking of Public Stakeholders based on Cost-bearers and
Beneficiaries from Pier Pass and Appointment System
Stakeholder Pier Pass System Appointment System
Cost-Beneficiaries Cost-Beneficiaries
125
bearer bearer
City
Governments
1.2 14.3 0 14.9
Port Authorities 15.5 21.4 8.4 24.4
Transportation
Agencies
2.4 11.9 4.8 9.2
Environmental
Protection
Agencies
0 8.3 0 0
Other 23.8 19 22.9 17.2
(Based on responses to questions 3, 4, 5 and 6 – refer to Appendix I)

In Table I I see a very significant difference in the perception of private
stakeholders and public stakeholders in their sharing of costs for appointment
system and PierPass.

Only 15.5 per cent of the respondents felt that port authorities bear the costs for
PierPass. Only 2.4 per cent felt that local, state and federal agencies were bearing a
greater share of the costs of the operational efficiency measure.

It seems that there is definitely a failure on the part of public agencies to
communicate the steps taken by them to bring about the PierPass of terminal gates.
I would argue that public agencies need to engage at a more intensive level with
representatives of private stakeholders and be able to communicate and explain
their work in bringing about operational efficiency measures at the ports.

Incentive Differences Between Private Stakeholders
126

A number of survey questions addressed issues related to differences in incentives
to collaborate between different private stakeholders. The responses reflect the
institutionally conditioned perceptions of the stakeholders, as well as the greater
visibility of the issues related to specific industries.

The differences between different groups of stakeholders were manifested in terms
of the way the interests of specific groups were articulated, specifically in terms of
which groups were identified as the strongest advocates of the two systems.

As responses to questions 3,4,5 and 6 (Appendix I) illustrate, clearly truckers, port
authorities and local city governments are perceived as having the most significant
stake in the two measures, while warehouse operators and logistics providers do
not figure quite so prominently.

The response to question 5 regarding the greatest beneficiaries of the PierPass is
quite similar to the response to the question regarding the appointment system.
Truckers are considered to be the top beneficiaries by 43.4 per cent of the
respondents.

A fairly significant number of the respondents (28.9 per cent ) also consider
shippers to benefit the most from the PierPass. Interestingly, the ocean carriers are
127
considered to benefit the most by 22.9 per cent of the respondents, despite the fact
that they remain unaffected by PierPass at terminal gates.

It appears that within the debates on freight movement, the role of truckers and
shippers has been highlighted extensively. For truckers, this can be attributed to
the fairly persistent awareness campaigns conducted by trade organizations
through various measures.

Also truckers are more numerous and the most crucial link between the ports and
the distribution centers and ultimately consumers. The shippers, despite their very
limited public role within the debates on congestion and pollution at the ports,
have also registered a strong presence, which shows that their influence within
freight movement is fairly pervasive.

Again, in data that mirrors the numbers for the appointment system, the three
groups considered by the largest proportion of respondents as bearing the greatest
costs for the PierPass are truckers, warehouse operators and shippers.

However, unlike for the appointment system, here warehouse operators are
considered by 36.1 per cent of respondents as sharing a greater portion of the cost
of PierPass. This can perhaps be attributed to the fact that many smaller
warehouses that did not operate nighttime hours would have to consider keeping
128
their warehouses open during nighttime to accommodate deliveries from the ports
made during those hours.

This confirms my analysis of institutional environment of freight movement
regarding a vital link in the success of the PierPass being changes in the
operational practices at warehouses. As my information regarding the warehouse
industry indicated, it seems that larger warehousing operations were either already
operating on a 24-hour basis, or had no difficulty in changing to a PierPass.

However, it seems that smaller warehouses would have trouble following up with
similar measures, since a lot of them seem to be located close to residential areas
with regulation of noise levels and nighttime truck movement.

I see that my responses demonstrates the differences between public and private
stakeholders in their incentives, and benefits available to them. In the next section
I analyze the responses to my questions pertaining to the barriers to collaboration,
focusing on the issues of trust and free rider problem.

Barriers to Collaboration – Trust and Free Rider Problem

129
A number of barriers to collaboration are indicated through my theoretical review
as well as examination of issues around implementation of appointment system
and PierPass. Among them, the two most prominent factors, trust perceptions and
free rider problem were framed within survey questions. My responses indicate
that these two issues figure prominently within the perceptions of the respondents,
and the differences are primarily framed in terms organizational structure of the
stakeholder (large or small, homogenous industry with fewer player or fragmented
industry with large number of players).

Trust Perceptions Between Stakeholders

As highlighted by my discussion of the new institutional literature, an important
condition for the stability of collaborative arrangements between partners is the
presence of trust and avoidance of moral hazard. Aggregating the responses to my
survey, I find that the responses to many of the questions raise very strongly the
problems associated with trust between stakeholders.

TABLE 5-2: Two Strongest Advocates of the Pier Pass and Appointment
System (in percentage of respondents)
Stakeholders PierPass System Appointment
130
System
Truckers 26.2 44.7
Carriers 27.8 18.2
Shippers 10 15.6
Warehouse Operators 6.2 7.8
Third Party Logistics
Providers
7.5 9.1
City Governments 26.6 23.7
Port Authorities 30.4 31.6
Transportation Agencies 10 14.3
Environmental Protection
Agencies
20 15.6
Other 20 14.3
(Based on responses to questions 7 and 8 – refer to Appendix I)

I can see that truckers and carriers among the private stakeholders and the port
authorities and environmental protection agencies among the public stakeholders
are considered to be the greatest advocates of the two efficiency measures.

This produces a discordance with the requirement of mutuality for the creation of a
stable collaborative arrangement, as certain parties are perceived to be less
committed to the changes than others. This is despite the fact that the gains from
the measures would be throughout the freight movement network.

Additionally, cross-tabulating the perceptions of the advocacy of environmental
protection agency (20 per cent for PierPass and 15.6 for appointment system) with
no stakeholders perceiving that these agencies undertake costs for the
implementation of the measures (Table 1 – 0 per cent for PierPass, 0 per cent for
appointment system), I see that certain stakeholders are perceived to promote the
131
measures without incurring any costs from them.

The Free Rider Problem

There is a considerable difference in the list of respondents expected to benefit the
most from the appointment system and the ones who are expected to incur the
most cost from the system. Thus there is a perception that the costs and benefits of
the appointment system are being disproportionately borne.

Thus for example while 50 per cent of the respondents indicated that truckers get
the benefits of the appointment system, nearly 61 per cent indicated that they bear
the costs of the appointment system. Thus more respondents believe that truckers
bear the costs of the appointment system than get their benefits.

TABLE 5-3: Ranking of Private Stakeholders based on Cost-bearers and
132
Beneficiaries from Pier Pass and Appointment System
Stakeholder Pier Pass System Appointment System
Cost-
bearers
Beneficiaries Cost-
bearers
Beneficiaries
Truckers 48.2 43.4 61 50
Carriers 23.8 22.9 14.5 24.1
Shippers 33.7 28.9 29.3 18.4
Warehouse
Operators
36.1 13.1 26.8 16.1
Third Party
Logistics
Providers
14.3 13.1 21.7 10.3
(Based on responses to questions 3,4,5 and 6 – refer to Appendix I)

About 36.1 of respondents felt that warehouse operators incur the greatest costs
from the PierPass, only 13.1 per cent feel that they are the greatest beneficiaries
and a mere 7.8 per cent feel that they advocated strongly for the measure.

Thus it seems that warehouse operators are reluctant participants in the PierPass
measure, as they have to make significant changes in their own operations to bring
them in alignment with the PierPass measure. In new institutional terms, I can
state that the warehouse operators are perceived to have the greatest transaction
costs in complying with the operational change of PierPass.

Again, in data that mirrors the numbers for the appointment system, the three
groups considered by the largest proportion of respondents as bearing the greatest
costs for the PierPass are truckers, warehouse operators and shippers.

133
Again, as with the appointment system, I see a very significant difference in the
perception of private stakeholders and public stakeholders in their sharing of costs
for PierPass.

Only 15.5 per cent of the respondents felt that port authorities bear the costs for
PierPass. Only 2.4 per cent felt that local, state and federal agencies were bearing a
greater share of the costs of the operational efficiency measure. It seems that there
is definitely a failure on the part of public agencies to communicate the steps taken
by them to bring about the PierPass of terminal gates.

I would argue that public agencies need to engage at a more intensive level with
representatives of private stakeholders and be able to communicate and explain
their work in bringing about operational efficiency measures at the ports.

Only about 8.4 per cent of the respondents, in answering question 4 (Appendix I)
stated that the port authorities incur the greatest costs in the implementation of the
appointment system. There seems to be a perception that shippers seem to bear a
greater proportion of costs and do not enjoy corresponding benefits.

In terms of the division of costs incurred between private stakeholders and public
stakeholders, the responses neatly stack all private stakeholders within the top half
of the responses and public stakeholders in the bottom half. Thus it is felt that
private stakeholders incur more costs than public stakeholders in the
134
implementation of the appointment system.

Most of the respondents in my survey are private stakeholders, and it seems that
there is an entrenched perception that in such operational efficiency measures it is
the private sector, which disproportionately bears the burden of any operational
improvements.

There is a perception that public agencies are more wasteful and that they impose
policies on private sector without taking into account the problems faced by the
private sector in implementing these policies.

Information Costs for Inter-Stakeholder Collaboration

Given the numbers, diversity and variety of operational practices prevailing within
different stakeholders in the intermodal freight network, it is to be expected that
streamlining operations and homogenizing practices across the network entails
significant information costs.

These information costs are related to both the costs of procuring information
about the practices of other firms and industries, but also the cost of negotiation
and reconciling opinion and finding common solutions across the network.

135
The issue of information costs is also highlighted by the different sets of responses
related to specific stakeholder groups based on their institutional structure. The
perception of public stakeholders by the respondents would indicate a gap in
communication on the part of public agencies to communicate the steps taken by
them to bring about the Pier Pass and appointment system into existence.

This would indicate the need for greater engagement by public agencies level with
representatives of private stakeholders and be able to communicate and explain
their work in bringing about operational efficiency measures at the ports.

Additionally, the respondents directly indicated the information cost issues related
to the measures. In response to question 13 (Appendix I), 56.3 per cent of my
respondents agreed that lack of cooperation between private stakeholders is due to
difference in opinion regarding benefits and losses from appointment system and
PierPass system.

This difference in opinion can be attributed to both the institutional environment
within which the firm or the industry operates, but it might also indicate a gap in
information regarding the operations of other firms and industries leading to
unwillingness to collaborate with them.

136
Of all respondents, 49.3 agree and 30.4 percent somewhat agree in question 15
(Appendix I) that the success of operational changes introduced by one set of
stakeholders in response to appointment system and PierPass depends changes
made by all other stakeholders.

This indicates the importance of information about the operations of all
stakeholder industries and its availability to all members of the freight movement
network. Regarding information costs, in question 16 (ibid.) 24.3 percent of
respondents agree and 30 percent of respondents somewhat agreed that there are
significant costs in obtaining information about other stakeholders within the
freight network.

These information costs are a barrier to cooperation between stakeholders.
Reflecting the difference between stakeholders, in question 17 (Appendix I) 49.3
percent of respondents and 15.9 percent somewhat agreed that information costs
are significantly greater for groups with many stakeholders (such as truckers) as
compared to groups with a few large entities (such as terminal operators).

Thus I see that the issue of information costs operates in different aspects of
freight movement, including differences in ownership structure (public or private),
nature of the firm (large or small), and nature of the industry (concentrated with
few players or fragmented).

137
In my final section I present the responses from the survey that present the
perceptions of stakeholder regarding the appropriate governance mechanism for
maintaining the stability of the collaborative arrangement required for the
implementation of the appointment system and PierPass.

Governance Mechanism for Collaboration

In the case of off-peak hour truck movements and 24 hour operation of terminal
gates, the PierPass entity functions as a governance mechanism with limited
powers of arbitration and contractual negotiation between stakeholders. For
appointment systems for truckers, eModal acts as a coordinating body between
terminal operators and truckers.

Thus my questions explored both the perceptions of the respondents regarding the
effectiveness of PierPass and eModal, as well as soliciting opinion on alternative
governance mechanisms for implementing the efficiency measures.

In response to question 14 (Appendix I), 50.7 per cent of the respondents agreed
and 12.7 per cent of the respondents somewhat agreed that a coordinating body is
essential for coordination among private stakeholders on appointment system for
truckers and 24-hour operation of terminal gates.

138
This is also in concordance with the response to question 36 (Appendix I) which
asks respondents to select from a list of alternatives to answer if voluntary
compliance by private sector on measures to reduce congestion and pollution
related to freight movement feasible. Nearly 61.9 per cent of the respondents
stated that voluntary compliance was somewhat feasible, if supported by public
sector initiative.

Thus, I see that a majority of my respondents feel that a coordinating and
arbitrating body is essential for the successful implementation of the efficiency
measures. The respondents to question 36 also feel that the coordination and
arbitration between stakeholders should come from a public sector initiative.

However, at present the efforts of stakeholders are being coordinated through self-
regulatory private initiatives like PierPass. It can be argued that my respondents
desire a more proactive role for public agencies within the freight movement
initiatives of appointment system and PierPass.

In answering question 35 (Appendix I) which asked respondents to rate the current
level of cooperation between public agencies on pollution and congestion issues,
62.1 per cent of my respondents felt that they cooperated somewhat, while 28.8
per cent felt that there was no cooperation between public agencies.

139

For a similar question regarding the level of cooperation between private
stakeholders (question 34 – Appendix I), 51. 6 per cent felt that they cooperate
somewhat, while 37.5 per cent felt that there was no cooperation between them.

It is evident that the respondents feel that the inter-stakeholder cooperation exists,
however it is not at an optimum level and there needs to be greater interaction
between stakeholders. More ambivalence can be seen in the responses to the
question 35 on the role of the PierPass arrangement.

Table 5-4: PierPass system has been effective in balancing the interests of all
groups of stakeholders in intermodal freight movement.
Agree 21.1
Somewhat Agree 22.5
Neutral 14.1
Somewhat Disagree 11.3
Disagree 31
(Based on question 19 – refer to Appendix I)

It is evident that there is no unanimity regarding the role of PierPass in
maintaining mutuality between different partners within the freight movement
network. To obtain more information on whether the interests of different
stakeholders are reconciled within the PierPass arrangement, I need to rely on
information obtained from my interviews with key stakeholders in freight
movement.

140

Identifying Issues for In-Depth Stakeholder Interviews

My survey responses provide us with many valuable insights regarding issues
surrounding implementation of freight movement efficiency measures. Many of
these responses, such as the difference between incentives to collaborate for public
and private entities and the differences between private entities were predicted
through my literature review and analysis of institutional environment of freight
movement.

However, many of the responses did not provide us with clarifications on aspects
of stakeholder collaboration, thus requiring further probing through my
discussions with key stakeholders.

Some of the salient issues that need further exploration are trust issues between
stakeholders, free rider problem, and the role of PierPass as an effective
governance mechanism for stakeholder collaboration. My questions for key
stakeholder interviewees dwell on these issues, providing us with a more nuanced
understanding of freight movement and implementation of efficiency measures.

141

SECTION II

Discussion of Interview Results

My analysis of results from my intermodal freight movement survey provides us
with information and insight on several key questions related to stakeholder
collaboration. However, I also encounter ambivalent responses, and gaps in
information that I seek to address through my interviews with key stakeholders.

These interviews not only provide us with more nuanced, historically grounded
perceptions of freight movement, but also allow us to gauge the emotive
undertones of responses from interviewees, adding another dimension to my
multilayered analysis of issues.

Within my survey, I find significant differences between public and private
stakeholders in terms of motivation and incentives for adopting efficiency
measures. There are also important differences between different private
stakeholders in their ability to adopt and adapt to operational changes.

I also find that the scale of the stakeholder’s operations and scale of the industry
142
within which it operates affects the incentives and barriers it faces in collaborating
on freight movement. I also gauge respondents’ perceptions regarding the presence
of free rider problem and trust issues within the freight network, as well the
importance of information costs in determining the level of collaboration between
stakeholders.

However, the survey also raises several important questions that need to be
addressed in detail. I need to explore the perception of the performance of PierPass
as a governance mechanism in greater detail in discussions with stakeholders, as
well as the pros and cons of alternatives involving greater or lesser participation by
public agencies. I also need to explore in detail the questions of trust, free rider
problem and information costs, all contributing to significant risks in
collaboration.

My interviews with key stakeholder representatives are organized in two primary
categories. These are the barriers to collaboration and governance mechanism
situated within the institutional environment of freight movement.

Within the category of barriers to collaboration, I explore the variables of
143
stakeholder trust, free rider problem and information costs of cooperation. In the
latter category, I examine the performance of PierPass and the appointment system
as a governance mechanism and the impact of various factors within the
institutional environment of freight movement on the choice of governance.

In the following sections I utilize these components of my analytical framework to
organize information obtained from my stakeholder interviewees. I combine
information obtained from my interviewees with my theoretical framework
derived from new institutional theory and partnerships, data on freight movement,
Pier Pass and appointment system and insights from my stakeholder survey.

Trust Issues between Stakeholders

Collaboration between stakeholders who are in competition with each other is
always fraught with the risk of non-compliance, reluctance to share information
and mutual suspicion regarding the motives of other actors. This is highlighted by
the way in which transportation costs are negotiated between different entities,
with no stakeholders willing to bear the extra cost burden that comes with the
implementation of appointment system and PierPass.

My interviewee SS, a senior executive in the warehousing industry informed us
that when shippers discuss contract rates with trucking companies, very tough
negotiations are driven, and there is a reluctance to accept any increase in rates
144
passed on to shippers. Thus shippers are reluctant to bear the burden for increased
costs due to night time truck movements enabled by PierPass.

This puts truckers as well as warehouse operators in an adversarial position vis-à-
vis the shippers and hence, it becomes difficult to forge collaborations between the
two due to the presence of mutual distrust.

SS also stated that the initial response to PierPass within the warehousing industry
was one of skepticism, as it was felt that it would be difficult to convince
competitive entities to voluntarily cooperate with each other and modify their
operational practices accordingly.

However, SS felt that it was surprising how quickly intermodal truckers adapted
themselves to it, reposing their trust in the PierPass organization. Thus Pier Pass
has been a very good success and SS suggested anecdotal evidence that nearly 70
per cent of the truckers have already managed to shift their cargo to the night time
hours. There was also noticeably less congestion on the 710.

The trust issues and the distrust between stakeholders is also highlighted in the
distinct responses to PierPass and the appointment system. According to SS,
PierPass has been a tremendous success.

However, as SS stated, “at some terminals the appointment system is a bit of a
145
joke” (SS, personal communication). In other terminals such as Hanjin, Maersk,
APL, the appointment system gets high marks from the truckers, and the system
operates based on an honor system where a relationship of trust is established
between truckers and terminal operators.

According to SS, there is also the matter of a disconnect of incentives and
priorities between the private and the public sector. According to my interviewee,
the private sector respects agencies such as MARAD and US-DOT.

However, private stakeholders are disillusioned by the political intrigue that
permeates the decision-making process in public agencies. For example, according
to SS, the AB2650 Bill that fined terminal operators $250 per truck idling beyond
30 minutes did not take enough relevant variables into account. It seemed as if
public agencies did not understand the maritime industry correctly.

According to AB, a senior executive in a terminal at POLA/LB, most private
stakeholders would prefer the option of self-policing and self-correction. They
resent being forced to adopt certain measures due to regulation.

However, SS felt that the role of the federal government in this matter has been
146
changing in recent times and it has been trying to develop a policy on a marine
transportation system that is infused with greater awareness of the
interconnectedness of issues in different regions.

SS stated that a few legislators have a greater understanding of the issues
associated with freight. However, many of them tend to have no understanding at
all of the maritime industry and some are reflexively anti-free trade and tend to see
all growth as evil. There is also a lot of media hysteria about the lack of adequate
infrastructure and congestion in the region.

He also felt that most environmental and community activists have taken up a
strident anti-port stance, reflected by the controversy over the EIR of the Pier J
project and the rejection of the report. This also occurred in the case of China
Shipping terminal visual blight case at the port of Los Angeles.

My interviewee RC, a member of the trucking industry stated that there is a lack of
trust on the part of the communities and environmental activists regarding the
commitment of private stakeholders towards cleaning up the environment.

The ports have seen a dramatic increase of environmental concern by
neighborhood councils and environmental agencies after a few highly publicized
cases in which the ports had to accommodate growing environmental concerns,
such as coke piles at the port of Long Beach, environmental mitigation for
147
dredging and the China Shipping case.

Also, MA stated that many private stakeholder groups feel that there needs to be a
balance between growth and environment. However, they feel that the
environmental groups have been raising objections over issues such as noise and
sight blight, and want to put controls on growth at the ports.

With regard to the perception of public agencies by private stakeholders, according
to SS and RC, a lot of businesses feel that they can do better than public agencies.
Most businesses are conservative in fiscal matters. They feel that every public
expense must be justified with tangible returns.

The businesses feel that they can come up with better solutions to problems than
public agencies. There is also a lot of suspicion regarding the agenda of public
agencies in the minds of private stakeholders. There is the feeling that public
agencies, by virtue of their access to policy and legislative powers are able to force
measures on private entities that may not be feasible or optimal.

Cost-Benefit Imbalance: Free Rider Problem at Multiple Levels
148

The free rider problem has been reflected within my theoretical analysis,
background information on institutional environment and responses to stakeholder
survey. It has been noted that a few stakeholders, draw greater benefits than the
resources they contribute to the implementation of appointment system and
PierPass.

Parallel to this are concerns about the health impact of the increase in freight
movements and the resulting pollution affecting the local communities
surrounding the POLA/LB complex. KC and LC, officials with one of the port
authorities being studied, argued that while the benefits of increasing trade are
available nationwide, the negative externalities of the trade are born by the local
communities surrounding POLA/LB.

This creates the situation where the regions receiving freight imported through the
POLA/LB complex, but receiving none of the negative externalities of pollution
and congestion can be said to be free riders who take advantage of cheaper
imported goods, but do not bear the costs associated with them.

As nearly 50 per cent of the imports through the POLA/LB complex leave the
Southern California region, it is important to see this as not a local but a national
issue. Hence there are calls from many stakeholders in freight movement for a
national freight policy that would address the problems in Southern California
149
with solutions that are implemented at the national level with greater participation
by the federal government.

Both BC and CD, executives with a terminal operator at the POLA/LB complex
agree that labor availability is a major barrier to dealing with congestion at the
terminal gates.

They feel that due to the very high cost of unionized labor at the port complex, the
cost of operating night-time terminal gates is excessively high, providing a
disincentive to terminal operators from operating full service gates. They felt that
the port labor derive benefits from extra income from nighttime gate operation,
however the costs for maintaining the gates are fully passed on to the terminal
operators. Another great challenge to the operation of full service 24-hour terminal
gates is to ensure the steady availability of labor, as the union operations limits the
availability of labor at terminals.

Reflecting the responses to my survey highlighting the cost-benefit discrepancy for
truckers, a number of my interviewees including SS, RC, KC and LC highlighted
the problems faced by the trucking industry which suffers the free rider behavior
of other stakeholders in freight partnerships.

It has been pointed out by both the Teamsters Union and the California Trucking
150
Association that though terminal operators are assured a realization of additional
costs of gate operation through PierPass revenues, truckers receive no such assured
revenues and have to depend on individual negotiations with shippers to realize
extra night-time charges.

My respondent RC highlighted that the lack of anti-trust immunity for the trucking
industry prevents them from collectively negotiating rates to cover the additional
expenses of night-time trucking operations, thus making it difficult for truckers to
comply with off-peak movement promoted by PierPass.

Additionally, the poor conditions of truck fleets, uncertain traffic conditions and
unresponsive terminal operators make it difficult for truckers to comply with
appointment times; however, they are not compensated for delays and lose
additional income.

It can be argued then that shippers and terminal operators are free riders within the
freight movement network, passing on additional costs to the fragmented trucking
industry, which is less well organized and less effective at lobbying for better
benefits accruing from the efficiency measures than either of the other
stakeholders.

It was also stated by SS, BC and CD that the warehousing industry also absorbs
151
the cost of additional hours of operation, without being able to pass them on to
shippers, who can exercise the threat of taking business elsewhere, taking
advantage of better rates.

The competitiveness within the warehousing and trucking industries makes it
difficult for them to operate on a level of mutuality and parity with other
stakeholders, making the collaboration lopsided in the cost-benefit distribution.

Information Dissemination and Exchange Issues of PierPass and
Appointment System Implementation

The information costs associated with implementing the appointment system and
PierPass operate at multiple levels. At one level, the information costs refer to the
costs of obtaining information regarding the operational practices of other
stakeholders within the network.

However, the costs of information also refer to the transaction costs of informing
stakeholders at large about appointment system and PierPass and their features.

My respondent SS felt that there was a lack of understanding among different
152
private stakeholders regarding each others’ orientation towards freight movement
and institutional framework within which decisions are taken.

To illustrate, he stated most steamship lines and terminal operators have a
traditional mindset, where they take the path of least resistance and defer changes
until a fundamental change occurs within the institutional environment.

Thus they are late adapters to cutting-edge technology, and also less empathetic to
the conditions of truckers struggling to make a living wage. This lack of
understanding has led to animosity, where terminal operators and truckers do not
appreciate the industry constraints within which the other entity makes operational
decisions.

Another issue highlighted by the interviewees was the information gaps in public
agency decision-making regarding issues affecting private stakeholders. My
interviewees AB and DE, who is associated with an organization involved with
24-hour terminal operations, felt that due to lack of transparent information
exchange, there are reliability issues that private stakeholders feel towards public
stakeholders.

There is fear that because public agencies do not fully communicate their
functioning and intentions with private stakeholders, there is limited accountability
by public agencies towards private stakeholders and that any public agency
153
imposed container fees would not be used optimally towards infrastructure
improvements.

My informants AB and DE felt that there was a need for both private and public
stakeholders to obtain more information about each other. My respondent SS
maintained that it was felt by private stakeholders that agencies like AQMD (Air
Quality Management District) act in a very one-sided manner to the detriment of
the interests of private stakeholders.

Public executives who go after private entities tend to see that as notches on the
belt, and it figures prominently in their evaluation. This is especially true within
the state of California which as a very restrictive climate for businesses. There is
definitely a difference in the way of thinking of public and private entities fueled
by lack of understanding regarding the institutional constraints of each other.

SS argued that there is generally a trade off involved in greater environmental
measures resulting in greater costs of production. However environmental
organizations like AQMD do not care about the increased costs associated with
environmental protection and asks for absolute measures by private stakeholders.

My interview with MA, who heads an organization facilitating information
exchange between stakeholders, yielded an excellent example of the role of
information sharing in facilitating collaboration between stakeholders. MA
154
provided the example of past crises in freight movement at the POLA/LB complex
that had been solved by the regulated flow of information through the intermodal
freight network.

The events of September 11 led to a crisis in container flows at the POLA/LB
complex .The commander of coast guards at the Port of Los Angeles, Captain John
Holmes had taken the initiative to meet with labor, terminal operators and port
authorities on personal initiative.

He had also been in constant communication with 3 admirals in the US navy, and
had their complete confidence in his ability to be able to manage the crisis.

As a result of the initiative and the flow of communication between different
actors, the ports kept functioning normally and there was no disruption in the
movement of freight.

Also, during the 2002 lockout at the port, the complex had effectively shut down
for 12 days in the month of October. According to MA, “during the lockout, there
were 130 ships calling at the harbor, there was a 10 day wait period and 70 of
these ships were anchored outside the port” (MA personal communication).

155
In this period the Marine Exchange of Southern California acted as facilitators of
information for various stakeholders and ship queue lines were regularly posted
and updated on their website. This enabled truckers, shippers, third party logistics
providers and warehouse operators to keep track of the movement of containers at
the port.

Another important information cost related issue is that of having accurate
information on predicted changes in institutional environment, so that stakeholders
are able to tailor changes in their operations accordingly. My interviewees BC and
CD informed that due to more accurate labor projections, more labor were hired to
handle increasing freight there were fewer delays at dockside and terminal gates.
This had a great impact on reduction in congestion in freeways and street
networks. Nearly 3000 additional workers were hired in 2004 to ease the labor
shortages and congestion dockside.

Additionally, BC and CD also informed us that a substantial percentage of
shippers redirected their discretionary cargo in anticipation of growing freight and
delays in 2005.

Also the use of more advanced technology facilitating greater ease in sharing
information between terminal operators, shippers and truckers have also helped in
speeding up the processing of paperwork and information for truckers at terminal
gates. In recent years such technological innovations have been adopted by most
156
terminals as a response to concerns about congestion and productivity losses due
to dockside and terminal gate delays.

Performance of PierPass and Appointment System

Most of my interviewees dwelt at length on the performance of the PierPass and
appointment system, and their efficacy as coordinating mechanisms reconciling
diverse stakeholder interests and practices to implement efficiency measures.

According to SM, executive for a terminal operator, shippers have managed to
incorporate the PierPass fees into their shipping. This is due to the fact that there is
no feasible alternative to the POLA/LB complex and they are the best choices for
shippers for bringing in cargo from the Pacific Rim.

According to TC, an employee at a terminal and a labor union member, PierPass
has shown substantial and promising growth since it began in July 2005. At the
time it was implemented the rate of non-peak hour moves was 12 per cent of total
cargo. Quickly this figure increased to 33 per cent of total cargo in November
2005.

My informant GC, a former port executive involved with intermodal freight
157
network and rail informed us there has been substantial impact of PierPass on the
truck traffic in the area. Within the first month of implementation of the Pier Pass
system, there was a noticeable lack of truck traffic on the I-710. A lot more of the
traffic was being moved to nighttime.

According to SS, the PierPass program affects company drivers and independent
contractors similarly. According to the drivers associated with SS’ warehousing
operation, their moves through terminal gates had become faster after the
implementation of PierPass.

Also, the drivers were able to put in more turns than they did before PierPass.
They also reported that the freeways connecting to the port complex were less
crowded than they had been previously.

When Pier Pass was first implemented, the company spoke to its drivers regarding
driving during night shifts. Most truck drivers were reluctant to spend time way
from families for long periods, and were not eager to do night shifts. However,
additional compensation for night moves was a crucial incentive for truckers, and
the drivers were paid premium rates for doing night-time moves.

This cost was passed on to customers. My respondent SS stated that when freight
158
is picked up at night, the shipper has to pay a warehouse to store it if it is not
directly taken to their distribution center. If the truck does a night-time pick up and
the distribution center of the shipper is closed then the container is kept at a
reposition yard to be delivered later. There is a stop-off charge that is applied if the
freight is dropped at a reposition yard.

However, what also helped ease the situation with respect to congestion was that
nearly 200 ships were diverted during 2004 to other ports. There might have been
other diversions as well that are not fully known.

Many of these ships may not be coming back. During the 1
st
and 2
nd
quarters of
2005 there was a decline in the cargo moving through the port complex, which
may have had a significant impact on the processing of trucks at terminal gates,
thus leading to the success of appointment system and PierPass.

My respondent MA informed us that many terminal operators have now opted out
of having an appointment system, as the new extended hours of operation make an
appointment system redundant.

One of the biggest challenges of the appointment system is the limited number of
lanes at terminal gates that prevents the terminals from sorting the truck arrivals
into appointment and non-appointment as originally planned. There are
infrastructural limitations that prevent the full implementation of the appointment
159
system. Also the problem is many truckers showing up without an appointment
altogether cause considerable delays for terminal operators.

Institutional Environment and Implementation of PierPass and Appointment
System

A number of factors within the institutional environment of freight movement at
the POLA/LB complex have contributed to shaping the debates around the
creation of PierPass and the appointment system.

Contrary to popular perception, the current initiatives in stakeholder collaboration
follow a number of past initiatives that laid the groundwork for the dialogue
around greater cooperation between stakeholders.

My interviewee MA provided an instance of collaborative voluntary regulation
between stakeholders in the past, which incrementally contributed to the
development of present information sharing arrangements.

The Marine Exchange of Southern California was created during an oil spill crisis
in 1990 and the debate on prevention and response to the spill at the time. This
occurred when the tanker vessel American Trader was grounded off Huntington
Beach, causing a spill that affected a large part of the Orange County coastline.

160

There was a lot of discussion on the need for policy that was aimed at regulating
the movement of tankers. There were calls for a formal mandatory regulated traffic
system that would help prevent such accidents in future. In other ports around the
country, these responsibilities are taken over by the Coast Guard.

However, in 1991 the first Vessel Tracking System in a US port was initiated by
the MESC as a non-public agency initiative. The MESC had an advisory service
for shippers and ocean carriers, and the system was begun on a completely
voluntary basis, with cooperation from shippers, carriers, terminal operators and
truckers.

It was a huge success during the trial period and was very user friendly. The
system was conceived as a partnership and was the first such service of its kind in
the nation. It became a national model, and now a similar system is in place in
Tampa Bay, Florida. The system is run on the basis of a user fee charged to the
ocean carriers. The system is very efficient, and has the best equipment of its kind
as compared to similar organizations.

This was also the case with initiation of appointment system for truckers, as I were
161
informed by interviewee JC, a member of appointment system administration at a
private organization. The eModal organization, begun in 1999 was posting
information about container availability provided by terminals at the outset.

These efforts were initiated before the Lowenthal Bill AB2650 was being
conceived. According to JC, the terminals were already looking for a system that
would allow them to have advance information about truck pick-ups and deliveries
at the ports.

Thus the terminals were looking for an appointment system to regulate the arrival
of trucks. They wished to improve turn times at the terminal gates, and the
appointment system would aid them in doing so. Within the freight movement
network, the movement of a container is very predictable and runs according to a
well-established schedule.

The carriers run fixed schedules and the terminals unload cargo according to
schedules. However, there might be delays in the pick up and transport of cargo by
trucks from the terminals. The appointment system would make the pick-up of
cargo at terminal gates more predictable.

When eModal was created, to convince the terminal operators and truckers to join
162
the online port community a conference was held on the premises of the Port of
Long Beach. The morning session had members of the marine terminals. Initially
there was much resistance to the idea of an appointment system at the terminals.
After initial discussion, the terminal operators were asked to think less as
representatives of their specific terminals and more as experienced professionals
within the field.

The major reason for opposing the measure was that terminal operators felt that
selective implementation of the appointment system would make the terminals
uncompetitive as shippers would be likely to shift to terminals without the
appointment system.

Larger shippers would be more likely to do so as they wouldn’t be given
preference in any such appointment system. The advantages for an appointment
system would be the following:

The terminals would have adequate information about which truckers would be
coming the next day for pick-up and hence be better prepared for the pick-up.
They would be able to more accurately predict their labor requirements and be
able to adjust their labor needs accordingly.

They would load the right number of containers on chassis and not have to
163
reposition cargo needlessly. In the afternoon sessions the trucking industry
professionals were brought in and were asked for their input.

They felt that the incentive for appointment system for them would be a reduction
in delays and increase in number of turns. The information that emerged out of
each session was shared with the others and the effort was a collaborative one.

The information generated through the conference was used extensively to
influence the design of the eModal website and services.

A major concern for trucking companies was that if they were not able to make it
to an appointment on time, they should have the ability to cancel the appointment.
Thus the eModal service provided the feature to cancel the appointment if it
couldn’t be reasonably completed. Similarly, the terminal operators could also
cancel appointments if the containers were not ready for any reason.

Information about containers were obtained from terminal operators and
downloaded onto the eModal system through data feeds. Also each container has a
specific yard spot on which it is placed in the terminal yard. Thus while truckers
are making appointments this information is also made available to them and they
can decide when exactly to go and pick up the cargo.

164
This system allows the terminal operators to regulate the number of truckers inside
terminal gates at any given time. This allows both terminal operators and truck
drivers not to be bound within very specific time frames.

However, JC did acknowledge, that despite eModal’s pre-existing appointment
system, the adoption of appointments for truckers did receive a great deal of
impetus from the AB2650 legislation introduced by Alan Lowenthal.

As my informant JC stated, the eModal website underwent many evolutions based
on feedback from different stakeholders who are users of the service. Currently
eModal is undertaking a feasibility study by an outside firm that is analyzing the
website. The firm is trying to study the experience of first time users of the website
and also surveying stakeholder feedback. Most of the changes to eModal were the
result of industry feedback.

Taking collaborative arrangements a step further, now the eModal website works
on a contract basis with PierPass. It was felt that more cooperation with PierPass
would be very desirable for the transportation industry as a whole. However, there
are organizational differences between the two entities. While eModal is a for-
profit venture, the PierPass is a non-profit organization.

Many of my interviewees were concerned about the stability of the PierPass
165
arrangement and the impact of several factors on its operation. Some felt that if
PierPass is too successful, then it’s revenue model encounters several significant
problems.

According to MA, the PierPass program is well on target and has exceeded
expectations with a very large number of off-peak hour moves within the first few
months of its implementation.

However, the problem with fewer day time moves is that there would not be
enough revenue generated to subsidize the night time operations at the terminal
gates. This would mean that it would no longer be profitable for terminal operators
to keep offering night-time and off-peak hour gates. Thus, in a hypothetical
scenario with only night-time moves by truckers, no revenue would be generated
by PierPass for funding the additional gate hours.

As both MA and SM informed us, the performance of the PierPass program has
been so impressive so far that the Pier Pass is making less money than anticipated.
This might lead to discontent and dissent by terminal operators, who might feel
that they are bearing more costs than benefits in implementing the program. This
also ties in to my discussion of free rider problem, where the shippers and
neighboring communities who reap the benefits of the PierPass program do not
contribute adequately to its implementation.

166
A significant change within the institutional environment is that the sheer
exponential growth numbers and the limitations of infrastructure is forcing
shippers to re-think their distribution and logistics strategies and set-ups.
According to MA, realization is dawning on shippers that the freight distribution
network cannot be taken for granted in determining optimum cost calculations and
using just-in-time inventory methods.

The industry would have to get used to delays and problems with just-in-time
inventory practices. Most companies have operated in a fashion so far that
provides no warehousing cushions and ships and trucks and trains act as mobile
warehouses.

The stores plan their inventory a mere 6 months in advance, hoping that logistics
providers would be able to deliver on very tight time margins and delivery
schedules. The problems with congestion on freight movement networks has made
it difficult to stick to such delivery schedules.

Summarizing Interview Discussions
167

In summary, my interviewees touched on a number of issues related to freight
movement, dwelling on a few key matters that affect the implementation of
partnerships in freight movement.

They discussed trust issues between stakeholders, stressing on the suspicion of the
motives and actions of public agencies by private stakeholders, who feel that
public agencies have an imperfect understanding of freight issues.

As in the survey, the issue of free rider problem was raised in the interviews as
well, with interviewees contending that truckers contribute more to the
implementation of the measures, while deriving proportionately less benefits from
them.

Concomitantly, port labor enjoy the benefits of added earnings through extra hours
of work at the terminals, but do not bear any of the delays and night-time driving
hazards that truckers face.

Overall, it was felt that shippers and terminal operators have succeeded in passing
on the extra costs of the measures on to the fragmented trucking industry, which is
not able to negotiate for better rates and increased compensation for the night-time
hours.

168
Another issue raised by interviewees was that of information exchange issues
between stakeholders. This included the lack of adequate information about other
stakeholders, leading to partially informed decision-making and mutual distrust.

It also covered the importance of educating civic society and stakeholders at large
about the aims and process of PierPass and appointment system, leading to a more
inclusive and participatory decision-making and implementation of the measures.

My respondents also discussed their qualitative assessments of the appointment
system and PierPass, and on the whole their assessment of PierPass was positive.
However, for the appointment system, some interviewees felt that the system
wasn’t being implemented in an efficient manner by terminals and truckers had
difficulty following the system.

Finally, respondents discussed many of the features of the institutional
environment within which stakeholder collaboration takes place at POLA/LB. This
included a discussion of the history and particular instances of stakeholder
collaboration in the past, laying the groundwork for the present cooperative
measures.

169
Chapter 6

CONCLUSIONS

My analysis of the implementation of appointment system for truckers and the
PierPass system for off-peak movement of freight provides many valuable insights
regarding the features, process and stability of cooperation between stakeholders.
Through my research I are able to identify the key factors that affect the creation
of partnerships, especially of the self-regulatory kind among private stakeholders.

My findings not only produce an assessment of the process of creation and
implementation of the appointment system and PierPass, but also provide direction
for policy discourses and responses to managing container growth at ports, self-
regulation through private stakeholder collaboration and local planning to
accommodate the impact of global institutional changes.

In my concluding chapter, I provide a summary of my research process and
discuss my salient research outcomes, elaborating on the research tasks and
170
questions I set for the study.

Additionally, I also discuss the broader policy issues implicated in my discussion
of stakeholder collaboration, namely the impact of changes in institutional
environment, such as new legislation, global trade and maritime practices, on
stakeholder collaboration and the POLA/LB complex.

Institutional Analysis of Stakeholder Collaboration in Freight Movement

The primary focus of my study has been the identification of the incentives and
barriers to collaboration between stakeholders in freight movement at the Ports of
Los Angeles and Long Beach (POLA/LB). Additionally, I also discuss how these
incentives and barriers influence the specific governance mechanism required for
the management of such partnerships.

The characteristics and conditions for the success of collaboration between
stakeholders in freight movement has become crucial due to the implementation of
efficiency measures to deal with the congestion and pollution around the
POLA/LB complex caused due to rapid increase in container flows.

The measures adopted to address these issues, appointment system for truckers and
PierPass system of extended gate hours require the alignment of operational
practices and information sharing between stakeholders in freight movement.
171

In my study, I attempt to identify characteristics of the collaboration necessary for
the alignment of institutionalized practices and information sharing between
stakeholders. Employing a theoretical framework that combines new institutional
economics and partnerships, I synthesize a theoretical framework that incorporates
factors affecting partnerships.

These factors, organized within the categories of incentives and barriers, include
difference between public and private stakeholders in incentives to collaborate,
trust issues in collaboration, free rider problem and information costs.

I also discuss the literature on governance mechanisms, highlighting the three
primary requirements of a governance mechanism as formal contractual
negotiations, arbitration organization and informal regulation through reputation
effect.

The literature demonstrates how the specific incentives and barriers in
collaboration between freight stakeholders at POLA/LB determine the type of
governance mechanism required to ensure the stability of the collaboration.

Thus I see that the more the risk from stakeholder mistrust and free rider problem
is, the more well-specified contracts and arbitration body with greater monitoring
172
powers is required.

Additionally, the presence of a large number of stakeholders, as well as the long
term nature of the appointment system and PierPass make it necessary for the
contracts determining the partnership to be more specific and cover a large number
of potential risks.

The research questions in the study can be stated as: what are the areas of
convergence and divergence between the preferences and practices of actors in the
intermodal freight network; what are some barriers that might prevent greater
convergence between the different groups; and, how might these barriers be
addressed to reduce conflicts and engender cooperation?

To address these questions, I utilized a combination of a survey of freight
movement and interviews with key representatives of selected stakeholder
organizations.

The analysis of survey data from my respondents confirms the presence of three
major barriers highlighted through my literature review; namely, trust issues
173
between stakeholders, free rider problem and information costs in collaboration. A
majority of respondents were members of private stakeholders and indicated that
public agencies had not contributed proportionately to the implementation of the
measures.

Further, the respondents also identified truckers and warehouse operators as
stakeholder groups that bore more costs than benefits in the implementation
process of appointment system and PierPass.

A majority of my respondents also held that the information cost posed a barrier
to effective cooperation between different stakeholder groups. The survey further
explored the performance of PierPass and stakeholder responses on governance
mechanism, noting that a majority of respondents felt that the implementation of
the measures requires support from public agencies.

There were also gaps in information on freight movement identified in responses
to the survey. The questions that needed to be probed further included differences
in incentives between public and private stakeholders, trust issues, free rider
problem, performance of appointment system and PierPass and institutional factors
affecting collaboration.

These questions were explored through in-depth interviews with respondents
working in key positions with stakeholder organizations involved in implementing
174
appointment system and PierPass.

My interviews provided us with a nuanced understanding of the incentives and
barriers identified through my theoretical framework and survey results. Thus, I
find further confirmation for my findings regarding the impediment of mutual
distrust and difference in motives and operations in public and private
stakeholders.

I also find that the free rider problem is reflected not just in the relative differences
in benefits and costs borne by some stakeholders, but also in the difference in costs
and benefits borne by the Southern California region vis-à-vis the final freight
destinations.

Regarding free rider problem, my respondents identified truckers as the group that
bore more costs than received benefits from the appointment system and PierPass.
They also identified terminal labor, shippers and terminal operators as groups that
received more benefits from the measures.

Discussing the information issues in implementing the measures, my respondents
felt that information gaps in the understanding of each others’ operations by
stakeholders needs to be addressed. Additionally, it is essential that the process
and outcomes of the appointment system and PierPass need to be communicated to
every relevant stakeholder group and civic society at large.
175

Finally, the stakeholders discussed the institutional environment of freight
movement, discussing how the problems in freight movement have led to a re-
think in logistics strategies among shippers.

Also, my respondents highlighted the importance of considering the historical
context of cooperation between stakeholders, and pointed to instances in the past
when stakeholder had collaborated to implement changes in operational practices.

Using my theoretical framework, review of institutional context and data from
survey and interviews, I argue that for the successful implementation of
stakeholder collaboration in freight movement at POLA/LB, the following are
necessary but not sufficient conditions.

The incentives and barriers to collaboration, specifically, differences between
private and public entities, the risk of mistrust and free riders and information gaps
should determine the governance mechanism to monitor the partnership.

The presence of a large number and types of stakeholders, free riders, and mutual
distrust between stakeholders means that the governance mechanisms should , a)
be determined by contracts that try to cover substantially the risk from future
uncertainties due to mistrust and free riders; b) have an independent arbitration
176
body that maintains the mutuality and parity between partners; and c) relies on the
pre-existing informal arrangements between stakeholders and industries to
reinforce the collaboration.

My results show the importance of understanding the institutional environment
within which freight movement and efforts to fight congestion are shaped. A key
finding, for instance, is of significance of pre-existing negotiations, agreements
and informal reputation effect in determining the incentive for stakeholders to
collaborate with each other.

The changes within the institutional environment in the form of new legislation,
introduction of new technology, restructuring of supply chains by shippers and the
supply of labor all play a major role in determining the success and stability of
stakeholder collaboration and the measures they support.

I also notice that there is considerable diversity both among stakeholders’ interests
and their perceptions of problems.

While the diversity of interests suggests the need for streamlining incentives so
that the public interest of efficient transportation is aligned with the private
interests of port operators, truckers, shippers, and other key stakeholders, the
perceptual issues suggest that information asymmetries increase the transaction
costs in communication and exchange between stakeholders thus making projects
177
inefficient.
Often interests and perceptual issues are conflated. For instance, I find evidence
of the problem of free riders, where certain stakeholders bear disproportionately
less costs relative to benefits, thus affecting the incentives for other participants.
But, I also find perceptual variation regarding who is a free rider, depending on the
industry the evaluator is affiliated to.

I argue that a governance mechanism is essential for reducing the barriers to
collaboration so as to resolve the problems due to differences in perception. Only
when this happens might it be possible to go to the next problem of reconciling
interests.

For instance, without resolving problems of trust, free rider, information and moral
hazard issues in partnerships between stakeholders it is unlikely that stakeholders
will feel sufficiently vested to respond to incentives aimed reconciling public and
private interests. Resolving the perceptual issues becomes a pre-requisite for
reconciling interests.

Overall, a key basis of this study is that future gains in freight movement
efficiency through the Pier Pass system and appointment scheduling are likely to
come from better collaborative arrangements between key stakeholders, better
information sharing, and joint streamlining of logistics and supply chains, rather
than by regulatory efforts.
178

In my concluding section, I provide a broad overview of the interaction between
the operational practices in freight movement network with the broad institutional
environment within which it operates. I focus on the questions of changes in
logistics practices, legislation and maritime networks on freight movement,
highlighting how local development and planning are affected by changes at a
global scale.

Institutional Environment Impact on Freight Movement.

According to one of my key interviewees MA, “Most consumers have a very poor
understanding of how goods get to the US.” (MA, personal communication). The
freight movement network’s challenges and limitations have been poorly
understood not only by end consumers but also by their primary clients, the
shippers.

After the crisis in freight movement during 2002 and 2004, there has been more
interest from shippers to get involved in debate on the issues (Hall 2004a).
Initially, the response of shippers had been that if the congestion at the ports
worsens, freight can be automatically diverted from the POLA/LB complex.

However, given the capacity constraints at most alternative ports, the ready
diversion of freight to other ports has become a difficult proposition. Proposed
179
developments within the maritime network such as a new port in Ensenada,
Mexico, the widening of gates at Panama Canal, increasing capacity at other West
Coast ports such as Seattle/Tacoma are all long term plans that cannot address
short run congestion.

This has led to significant changes within the logistics and transportation practices
of retailers, altering established paradigms within global trade (Hall 2004c). The
peak season for moving freight is getting more and more elongated, as a lot more
freight is being moved during the February March period.

Greater provisions are being made for warehousing, and the delivery schedules are
becoming less tight as the predictability of deliveries becomes unstable (Journal of
Commerce. June 9, 2003).

The retail giant Wal-Mart, whose practices set the standard for the industry, is
attempting to systematically diversify its freight by apportioning small portions of
it to different ports. This is a major change from the previous practice of
consolidating all incoming freight for availing returns to scale.

The retailer is also creating new distribution centers to diversify freight, including
one in Houston. The precision of just-in-time inventory has become difficult to
180
maintain in the face of growing uncertainty of delivery times affected by
congestion.

Another major concern is the urgent need for new infrastructure and expansion of
existing infrastructure to meet growing freight needs (Haveman 2003). Many
stakeholders noted the difficulty in implementing additions to infrastructure given
the resource constraints and the lengthy process required to bring about such
improvements.

The increase in freight requires an increase in rail services as well (Goodwin 2002)
. The rail and highway infrastructure capacity are limited and are filling up fast as
delays at the ports and freight movement from the ports rise (Grenzeback, Casgar
and Vickerman. 2001). Additionally the serious environmental impacts are
affecting communities around the port basin who are increasingly unwilling to
bear such negative externalities.

Nearly $36 billion are needed for funding the infrastructure improvements for
easing congestion in the regional goods movement network (Transportation
Research Board. 2000; Wilbur Smith Associates. 2006). Existing federal funding
though, can provide only a fraction of this requirement (MARAD. 1999).

For raising the money, the local agencies need to implement bond initiatives, fees
181
and surcharges (Transportation Research Board. 2001). Certain legislators have
tried to bring about legislation to facilitate the creation of public-private
partnerships that would raise resources for infrastructure improvements.

Many of my interviewed stakeholders discussed issues related to financing
infrastructure improvements. Currently, 44 per cent of POLA/LB funds are
contributed towards infrastructure improvements surrounding the ports. However,
there have been some arguments within the freight community for a federal tax to
finance programs.

However, reflecting the mutual distrust between private and public stakeholders
highlighted within my study, there is the fear that if fees are levied federal money
would not be spent directly on Southern California projects.

The opinion of private freight stakeholders is that local money needs to be used for
local infrastructure needs. It is felt that the Southern California region can provide
leadership in this respect and the model can replicated nationwide. There is a
feeling among stakeholders that private stakeholders cannot wait for federal
agencies to intervene to bring in infrastructure improvements in the region.

As I highlighted in my analysis of institutional environment of freight movement,
the global maritime industry has been evolving very rapidly in the last decade,
182
leading to great transformation of the intermodal freight network (Notteboom and
Winkelmans. 2001).

The industry continues to evolve rapidly, leading to many new challenges for the
POLA/LB complex. The trend of large post-Panamax ships continues as ships
larger than 8000 TEUs have already called on the port of Long Beach, and bigger
ships are being built for the coming years (Schinas and Papadimitriou.2003).

Nearly a 1000 new ships are under order in the global shipping industry,
increasing the capacity of the industry by 50 per cent. A large number of these
ships are expected to call on the POLA/LB complex (Mathewson 2003). If the
current trends in global trade continue, then I will see further growth in imports
from the Pacific Rim and a greater number of empty containers to be repositioned
across the globe (US Department of Transportation. 2002).

The maritime sector could also see substantial changes if short-sea shipping is
implementing, leading to the POLA/LB complex becoming a transshipment hub
183
from where freight is transported by smaller ships to nearby. Though still at the
conceptual stage, growing congestion at the port complex may lead to serious
consideration for the project (Mallon 2000).

Finally, I highlight what is arguably the single most important institutional factor
affecting the process and characteristics of stakeholder collaboration. The
immediate impetus for both the appointment system and the PierPass were
legislations enacted to address congestion and pollution due to freight movement.
The terms of these legislations significantly shaped the nature and extent of
changes in practices undertaken by freight stakeholders.

As highlighted in Giuliano et al. (2006), the terminal operators implementing the
appointment system did so primarily to avoid being fined under the new AB 2650
legislation. As I saw through my background analysis, it was the threat of
legislation that led to the terminal operators collaborating to produce the PierPass
system. Thus the presence of a credible legislative threat has had a significant
impact on the adoption of efficiency measures and collaboration with other
stakeholders.

Also, I see that many terminals abandoned the appointment system when it was
evident that the new terms of extended gate hours would lead to compliance with
184
AB 2650 without being required to use the appointment system.

Thus the significant step of abandoning the appointment system was due to the
institutional change of extended gate hours mandated by the credible threat of
further legislation. This phenomenon begs the question: is it possible to synthesize
voluntary self-regulation through stakeholder cooperation without a credible
legislative threat?

Industry precedent seems to indicate that short term collaborative arrangements in
the past had been forged without legislative threat; however, the impetus was
provided by a radical challenge such as a major oil spill in 1993 and the events of
September 11 in 2001.

Thus I see that though the threat of legislation may not be a necessary condition in
the creation of stakeholder collaboration, a significant challenge in the institutional
environment that can be met by collaborative operation is a sufficient condition.
.

References

185
Alston, Lee J., Thrainn Eggertson and Douglas North. 1996. Empirical Studies in
Institutional Change: Cambridge: Cambridge University Press.

Andersen, Ole Johan (2004), Public–Private Partnerships: Organisational Hybrids As
Channels For Local Mobilisation And Participation?, Scandinavian Political Studies
Volume 27 Page 1 - March 2004, 1-21.

Associated Press. August 23, 2004. “Terminal Operators Announce Plan To Ease La-
Long Beach Port Jams”.

Austin, James and Arthur McCaffrey. 2002. ‘Business Leadership Coalitions and Public-
Private Partnerships in American Cities: A Business Perspective on Regime Theory’,
Journal of Urban Affairs, 24(1): 35-54.

Barber, Daniel and Lisa Grobar. 2001. Implementing A Statewide Goods Movement
Strategy and Performance Measurement of Goods
Movement in California. Los Angeles: Metrans (Unpublished Report).
Http://Www.Metrans.Org/Research/Final_Report/99-10_Final.Pdf

Booz, Allen and Hamilton Inc. 2000. California Statewide Goods Movement Its
Action Plan. Report Submitted To California Department of Transportation.
Http://Www.Caats.Org/Caits/Reports/Task1_Goodsmovemt_Its_Inventory.Pdf

Brown, Jeff. 2004. “Setting the Tone For Public-Private Partnerships: Intermodal
Goods Movement”, Presentation At Partnership in Transportation Workshop, October
20, Sacramento, USA.

Brown, Jeff, Gill V. Hicks and Jeffrey D. Holt. 2001. “California Global Gateways
Development Program”, Presented To the Foundation For Intermodal Research and
Education, October 30, Washington Dc. Http://Www.Intermodal.Org/Fire/Ff-
Global2.Pdf

Broadbent, J. and Laughlin, R. 2003. ‘Public Private Partnerships: An Introduction’
Accounting, Auditing and Accountability Journal, 16 (3):332-341

186
Brousseau, Eric. 2007. “Multi-level Governance of the Digital Space: Does a Second
Rank Institutional Framework Exist?”, in Nicolas Curien and Eric Brousseau (eds.)
Internet and Digital Economics. Cambridge: Cambridge University Press
(forthcoming).

Brousseau, Eric and Jean-Michel Galant. 2002. The Economics of Contracts:
Theories and Applications. Cambridge: Cambridge University Press.
Brousseau, Eric and Emmanuel Raynaud. 2004. “The Economics of Private Institutions:
An Introduction to the Dynamics of Institutional Frameworks and to the Analysis of
Multilevel Multi-Type Governance”, paper presented at Conference of New Institutional
Economics, Sept 30-Oct.4, Tucson, USA.

Busch, Christopher B., David L. Kirp and Daniel F. Schoenholz. 1999. “Taming
Adversarial Legalism: the Port of Oakland’s Dredging Saga Revisited”, Legislation
and Public Policy, 2: 179-216.

Business Wire. December 10, 2003. “Electronic Truck Identification To Be
Introduced At West Coast Ports; Proven Technology Is First Step in Faster Service,
Reduced Congestion and Improved Port Security”.

California Department of Transportation. 2001. California Heavy Duty Truck Travel
Survey. Http://Www.Dot.Ca.Gov/Hq/Tsip/Tsippdf/Heavy_Duty_Truck2001.Pdf

California Department of Transportation. 2002. Global Gateways Development
Program: Stakeholder Perspectives on Options To Facilitate the Movement of Goods
in California.
Http://Www.Dot.Ca.Gov/Hq/Tpp/offices/Ogm/Ggdp_Final_Report.Pdf

Caltrans. 2004. Los Angeles County Economic Forecast.
Http://Www.Dot.Ca.Gov/Hq/Tpp/offices/Ote/Los%20angeles04.Pdf

Calix, Robert and Luke Cheng. 2003. “Balancing the Mobility of Freight and People:
A Case Study on Los Angeles County – America’s Gateway To the World”, Paper
Presented At 4
th
Asia-Pacific Transportation Development Conference, April 18-20,
Oakland, USA.

187
CALMITSAC. 2006. Growth of California’s Ports: Opportunities and Challenges.
Interim Report. Los Angeles: CALMITSAC.

Cartwright, Kerry. 2004. “Port Development and Planning: Ports of La/Lb
Perspective”, Guest Lecture in Ce 589 Class, USC.

Chandler, J. A. 1998. Regenerating South Yorkshire: How The Public Sector
Dominates Business Partnerships In Britain, In Walzer, N. And Jacobs, B. D. (Eds.):
Public–Private Partnerships For Local Economic Development, Westport,
Connecticut And London: Praeger.

Coase, Ronald H.1988. The Firm, the Market and the Law. Chicago: University of
Chicago Press.

Daly, Fred H., Transnology Associates and Caats. 2003. California Goods Movement
and Port Security Conference, July 1-2, Long Beach.
Http://Www.Caats.Org/Caits/Papers/Fueling%20the%20engine%20white%20paper.P
df

Division of Transportation Planning. 2004. California Transportation Plan 2025.
Review Draft. office of State Planning, State of California.
Http://Www.Dot.Ca.Gov/Hq/Tpp/offices/Osp/Ctp/Ctp_Final_50304.Pdf

Dowall, David E. 2000. California’s Infrastructure Policy For the 21
st
Century: Issues
and Opportunities. San Francisco: Public Policy Institute of California.

Dwyer & Oh, 1988. F.R. Dwyer and S. Oh, A transaction cost perspective on vertical
contractual structure. Journal of Marketing 52 2 (1988), pp. 21–35

Eggertson, Thrainn. 1990. Economic Behavior and Institutions. Cambridge:
Cambridge University Press.

Eisenger, Peter K. 1988. The Rise in the Entrepreneurial State. Madison, WI: The
University of Wisconsin Press.

188
Elsner, Wolfram. 2004. “The ‘new’ economy: complexity, coordination and a hybrid
governance approach”, International Journal of Social Economics 31(11/12): 1029-
1049.

Fairbank, Mauslin, Maullin and Associates. 2006. PierPass: Los Angeles/Long Beach
Harbor Truckers Survey. Los Angeles: PierPass.

Finlay, William. 1987. “Industrial Relations and Firm Behavior: Informal Labor
Practices in the West Coast Longshore Industry”, Administrative Science Quarterly,
32(1): 49-67.

Freeman, Gregory. 2004. Wal-Mart Supercenters: What's in Store For Southern
California? Los Angeles: Laedc. Http://Laedc.Info/Pdf/Wal-Mart_Study.Pdf

Furubotn, Eirik and Rudolf Richter. 1997. Institutions and Economic Theory: The
Contribution of the New Institutional Economics. Ann Arbor: University of Michigan
Press.

Garrett, T L. 2003. “Port of Los Angeles Clean Air Program”, Presentation At
Maritime Air Quality Technical Working Group, California Air Resources Board,
Meeting, December 3, San Pedro.
Http://Www.Arb.Ca.Gov/Msprog/offroad/Marinevess/Presentations/120303/Pola.Pdf

Gauderman, James W. Et Al. 2004. “The Effect Of Air Pollution On Lung
Development From 10 To 18 Years Of Age”, The New England Journal Of
Medicine. 351(11): 1057-1067.

Getz, Kathleen A. 1997. ”Research in corporate political action: integration and
assessment.” Business and Society, 36(1): 32.

Gordon, Peter and Qisheng Pan. 2001. Assembling and Processing Freight Shipment
Data:
Developing A GIS-Based Origin-Destination Matrix For Southern
California Freight Flows. Metrans Unpublished Report. Los Angeles: Metrans.
Http://Www.Metrans.Org/Research/Final_Report/99-25_Final.Pdf

189
Goodwin, Arthur. 2002. Alameda Corridor: A Project of National Significance,
Presented At TRB Summer Conference, June 25, Pittsburgh.
Http://Gulliver.Trb.Org/Publications/Mb/2002ports/06goodwin.Pdf

Grajzl, Peter and Peter Murrell. 2007. “Allocating Law-making Powers: Self-
Regulation vs. Government Regulation”, Journal of Comparative Economics, 35(3):
520-545.

Grenzeback, Lance R., Christina S. Casgar and M. John Vickerman. 2001. White
Paper Graphics Version Presented At Conference on “Building Freight Capacity
Through Better Operations: Defining the National Agenda”, July 26-27, Long Beach,
Usa.
Http://Ops.Fhwa.Dot.Gov/Freight/Freight_Analysis/Freight_Ops_Strategies/Appendi
x/Freight%20ops%20briefing%20paper_Graphics_V062901.Pdf

Grossman, Sanford J and Oliver Hart. 1983. "Implicit Contracts under Asymmetric
Information," The Quarterly Journal of Economics, 98(3): 123-56

Giuliano, Genevieve, Sara Hayden, Paul Dell’aquila and Thomas O’Brien. 2006.
Evaluation of the Terminal Gate Appointment System at the Los Angeles/Long
Beach Ports. Los Angeles: METRANS.

Hall, Peter V. 2004b. “Mutual Specialisation, Seaports and the Geography of
Automobile Imports”, Tijdschrift Voor Economische En Sociale Geografie, 95(2):
135-146.

Hall, Tim and Phil Hubbard. 1998. ‘The Entrepreneurial City and the “New Urban
Politics”’, in Tim Hall and Phil Hubbard (eds.), The Entrepreneurial City: Geographies
of Politics, Regime and Representation, pp. 1-26. Chichester: John Wiley and Sons.

Haufler, Virginia. 2001. A public role for the private sector: industry self-regulation in a
global economy. Washington, DC: Carnegie Endowment for International Peace.

Hanh, Le Dam. 2003. The Logistics of Empty Cargo Containers in the Southern
California Region: Are Current International Logistics Practices a Barrier to
Rationalizing the Regional Movement of Empty Containers?. Los Angeles: Metrans.

190

Haveman, Jon D. and David Hummels. 2004. California’s Global Gateways: Trends
and Issues. San Francisco: Public Policy Institute of California.

Haveman, Jon D. 2003. Imports, Exports, and Shipping Services: the Balance
Between California and Other States. San Francisco: Public Policy Institute of
California.

Hendrix, Allan. 2001. “Emissions and Noise Standards”, in Global Intermodal
Freight: State of Readiness for the 21
st
Century, Report of a Conference. Washington
DC: TRB.

Hoffmann, Jan. 1998. “Concentration in Liner Shipping: Causes and Impacts”, World
Sea Trade Service Review, 1(3): 68-74.

Hodge, Graeme A.2004.The risky business of public-private partnerships
Australian Journal of Public Administration 63 (4), 37–49

Hodgson, Geoffrey M. 1998. “The Approach of Institutional Economics”, Journal of
Economic Literature 36(1): 166-192.

Holmstrom, Bengt. 1979. "Moral Hazard and Observability," Bell Journal of
Economics, The RAND Corporation, vol. 10(1), pages 74-91

Ianuzzi, Al. 2002. Industry Self-Regulation and Voluntary Environmental
Compliance. Boca Raton: Lewis Publishers.

Ioannou, Petros and Anastasios Chassiakos. 2002. Dynamic Optimization of Cargo
Movement By Trucks in
Metropolitan Areas With Adjacent Ports. Unpublished Report, Metrans.
Http://Www.Metrans.Org/Research/Final_Report/00-15_Final.Pdf

Journal of Commerce. June 9, 2003. “Shippers Have To Change To Help Ports Cope,
Execs Say”.

191
Journal of Commerce. December 11, 2003. “Extended Gates Not Panacea For So.
Cal. Congestion”.

Journal of Commerce. January 23, 2004. “Calif. Lawmaker Proposes Extended Gates
Bill”.

Journal of Commerce. April 26, 2004. “More Cargo, But Not Pollution;
California Legislation Would Cap Ports' Air Pollution, No Matter How Much Cargo
Volume Rises”

Journal of Commerce. June 30, 2004. “Truckers Want Day-Use Fee Delayed”.

Journal of Commerce. August 30, 2004. “Shipping by Day? Be Ready to Pay;
Los Angeles-Long Beach Terminal Operators to Charge $20 per TEU Extra for
Daytime Cargo Movements”.

Journal of Commerce. September 20, 2004. “Clearing the Air for Ports;
Environmental Group Recommends Ways to Reduce Air Pollution at Ports”.

Journal of Commerce. September 20, 2004. “Ports' Day-Use Fee May Be Delayed;
Terminals Discover That $20-Per-Teu Surcharge Isn't As Simple As It Looks”.

Journal of Commerce. September 22, 2004. “LA Daytime Box Fee Delayed”.

Journal of Commerce. September 27, 2004a. “Stretched to the Limit;
Surging Asian Imports Force Terminals to Seek Ways to Improve Productivity”.

Journal of Commerce. September 27, 2004b. “Shake-Up At Los Angeles;
Keller's Resignation Underscores the Balancing Act Ports Face in Increasing Cargo,
Protecting the Environment”.

Journal of Commerce. September 27, 2004d. “From Bad To Worse in LA-Long
Beach;
Truckers Remain Unhappy About Delays At Southern California Ports”.

192
Journal of Commerce. September 27, 2004e. “Break in the Backlog At LA”.

Journal of Commerce. September 29, 2004. “LA Congestion Expected To Continue”.

Journal of Commerce. September 30, 2004. “Long Beach Backs off Pier J Study”.

Journal of Commerce. September 30, 2004. “LA-Long Beach To Expand Longshore
Hiring”.

Journal of Commerce. October 5, 2004. “New Hires Fail To Ease LA Jam”.

Jula, Hossein, C.I. Liu, and Petros A. Ioannou. N.D. Design, Analysis, Simulation,
and Evaluation of Advanced Container Terminals. Los Angeles: Center For
Advanced Transportation Technologies, University of Southern California.
Http://Www.Digitalgovernment.Org/Library/Library/Pdf/Jula.Pdf

King, Andrew and Michael Lenox.2000. “Industry Self-Regulation without
Sanctions: The Chemical Industry's Responsible Care Program”, Academy of
Management Journal, 43(4): 698-716.

Kirshner, Joshua. 2002. “From the Urban Core To the Urban Fringe: Assessing the
Shift of Logistics and Trade-Related Industries From the La Port To the Inland
Empire in Terms of Job Opportunities and Workforce Development”, Paper
Presented At Institute For Labor and Employment, University of California, Graduate
Student Research Conference, January 18-19, Santa Cruz.
Http://Www.Ucop.Edu/Ile/Conferences/Grad_Conf/2002/Kirshner.Pdf

Klijn, Erik-Hans and Geert R. Teisman. 2004. “Governing public-private
partnerships: Analyzing and managing the processes and institutional characteristics
of public-private partnerships” in Stephen P. Osborne (ed.) Public-private
partnerships : theory and practice in international perspective, pp.84-102. London:
Routledge.

Los Angeles Times. September 12, 2004. “Residents Fight Port Expansion;
With Reports of Lung Problems Triggering Increased Worry Over Pollution, Long
Beach Council Agrees to Review Construction Plans”.
193

LAEDC. 2002. Los Angeles-Inland Empire Railroad Main Line Advanced Planning
Study. Http://Www.Laedc.Info/Pdf/Scag_Report_2002-12-19.Pdf

LAEDC. 2004a. Riverside-San Bernardino Area Profile. Los Angeles: Laedc.
Http://Www.Laedc.Info/Pdf/Riverside-San_Bernardino.Pdf

LAEDC. 2004b. International Trade: Trends and Impacts – the Southern California
Region (2003 Results and 2004 Outlook). Los Angeles: Laedc.
Http://Laedc.Info/Pdf/Trade-04.Pdf

Mackintosh, M.1993. Partnership: Issues Of Policy And Negotiation, Local
Economy, 7:3 210-24.

Madhok Anoop and Stephen B. Tallman. 1998. “Resources, Transactions and Rents:
Managing Value Through Interfirm Collaborative Relationships”, in Organization
Science 9(3): 326-339

Mallon, Lawrence G. 2000. High Speed Surface (HSS) Ocean Transportation and
Supply Chain Agility: A Major Customer Needs Analysis Based Upon Shipper
Supply Chain Mapping and Simulation. Long Beach: Center For the Commercial
Deployment of Transportation Technologies.
Http://Www.Ccdott.Org/Deliverables/2000/Task3.13.1/Task3.13.1.Pdf

Mallon, L.G. and Joseph P. Magaddino. 2001. An Integrated Approach To Managing
Local Container Traffic Growth In The Long Beach-Los Angeles Port Complex. Los
Angeles: Metrans.
Mantzavinos, Chris. 2001. Individuals, Institutions and Markets. Cambridge: Cambridge
University Press.

Masten, Scott and Oliver E. Williamson (ed.) 1999. The Economics of Transaction
Costs. Aldershot: Edward Elgar.

MARAD. 1999. An Assessment of the Us Marine Transportation System: A Report
To Congress. Http://Www.Marad.Dot.Gov/Publications/Mtsreport/Mtsfinal.Pdf
194

MARAD. 2002. Intermodal Access To Us Ports: Report on Survey Findings.
Http://Www.Marad.Dot.Gov/Publications/01%20iaccess%20report%20pub.Doc

Menard, Claude. 1995. “Markets as Institutions Versus Organizations as Markets?
Disentangling Some Fundamental Concepts”, Journal of Economic Behaviour and
Organization, 28: 161-182.

Menard, Claude. 2001. “Methodological Issues in New Institutional Economics”,
Journal of Economic Methodology, 8(1).

Menard, Claude 2004. “The Economics of Hybrid Organizations”, Journal of
Institutional and Theoretical Economics, 160(3): 345-376.

Menard, Claude. 2005a. “A New Institutional Approach to Organization”, in Claude
Menard and M. Shirley (eds.), Handbook of New Institutional Economics, pp. 281-
318. Boston: Kluwer Academic Press.

Menard, Claude. 2005b. “New institutions for governing the agri-food industry”,
European Review of Agricultural Economics, 32(3): 421-440.

Menard, Claude and M. Shirley (eds.).2005. Handbook of New Institutional
Economics. Boston: Kluwer Academic Press.

Meran Georg and Christian von Hirschhausen, 2004. "Corporate Self-Regulation vs.
Ex-Ante Regulation of Network Access : A Model of the German Gas Sector,"
Discussion Papers of DIW Berlin 436, DIW Berlin, German Institute for Economic
Research.

MTA and Net. 2002a. Regional Integration of Intelligent Transportation Systems
(Riits): Stakeholder Kickoff Meeting, January 17, Los Angeles.
Http://Www.Riits.Net/Pdf/Riitsstakeholderkickofffinal.Pdf

MTA and Net. 2002b. Regional Integration of Intelligent Transportation Systems
(Riits): Transit Integration Workshop, March 14, Los Angeles.
Http://Www.Riits.Net/Pdf/Riitstransitworkshopfinal.Pdf
195
North Jersey Transportation Planning Authority Inc. N.D. “Warehousing Trends,
Section 3 in Final Report of Consulting Services For Preparing Modern Intermodal
Freight Infrastructure To Support Brownfield Economic Redevelopment.
Http://Www.Njtpa.Org/Planning/Brownfields/Documents_Brownfields/3-
Warehousing.Pdf

North Jersey Transportation Planning Authority Inc. N.D. “Brownfields
Redevelopment Conditions For NJTPA Region”, Section 5 in Final Report of
Consulting Services For Preparing Modern Intermodal Freight Infrastructure To
Support Brownfield Economic Redevelopment.
Http://Www.Njtpa.Org/Planning/Brownfields/Documents_Brownfields/5-
Njtpa_Redevelopment.Pdf

Natural Resources Defence Council. 2004. Harboring Pollution: the Dirty Truth
About U.S. Ports. Http://Www.Nrdc.Org/Air/Pollution/Ports/Ports2.Pdf

North, Douglass. C. 1990. Institutions, Institutional Change and Economic
Performance. Cambridge: Cambridge University Press.

North, Douglass C. 1991. “Institutions”, The Journal of Economic Perspectives 5(1):
97-112.

Notteboom, Theo E and Willy Winkelmans. 2001. “Reassessing Public Sector
Involvement in European Seaports”, in International Journal of Maritime Economics,
3(2): 242-259.

Olson, Mancur. 1965. The Logic of Collective Action: Public Goods and the Theory
of Groups. Cambridge MA: Harvard University Press.

Osborne, Stephen P. 2004. “Understanding Public-Private Partnerships in
International Perspective: Globally Convergent or Nationally Divergent Phenomena”
in Stephen P. Osborne (ed.) Public-private partnerships : theory and practice in
international perspective, pp.1-6. London: Routledge.

Pacific Maritime Association. 2002. Pacific Coast Longshore Contract Document -
July 1, 2002 – July 1, 2008 (Between International Longshore and Warehouse Union
And Pacific Maritime Association). Los Angeles: Pacific Maritime Association.
196
Http://Www.Pmanet.Org/Pubs/Laboragreements/Pclcd_2002-2008.Pdf

PierPass. 2005. West Coast MTO Agreement: Marine Terminal Operator Schedule
No. 1. Los Angeles: PierPass.

Port of Los Angeles. 2004. No Net Increase of Air Emissions At the Port of Los
Angeles, Final Draft.
Http://Www.Portoflosangeles.Org/Doc/Nonetincreasewoappendices.Pdf

Port of Los Angeles. 2004b. Port-Wide Baseline Air Emission Inventory Executive
Summary. Final Draft.
Http://Www.Portoflosangeles.Org/Publicnotice/Portoflapublicnotice96421020_07072
004.Pdf

Regan, Amelia C. and Thomas F. Golob. 2000. “Trucking Industry Perceptions of
Congestion Problems and Potential Solutions in Maritime Intermodal Operations in
California”, Transportation Research Part A, 34: 587-605.

Rozsa, John. 2005. Survey of Port Driver Attitudes on PierPASS OffPeak Program.
Los Angeles: California Trucking Association.

Rozsa, John. 2006. Second Survey of Port Driver Attitudes on PierPASS OffPeak
Program. Los Angeles: California Trucking Association.

Roche Ltee and Levelton Consultants. 2006. Terminal Appointment System Study.
Quebec: Transportation Development Centre, Transport Canada.

Rowe, Mike and Carol Devanney 2003. “Partnership And The Governance Of
Regeneration”, Critical Social Policy 23: 375-397.

Rysman, M., and T Simcoe.2007. The Performance of Standard Setting Organizations:
Using Patent Data for Evaluation. Journal of IT Standards and Standardization
Research, 5 25-40.

Sagalyn, Lynn B. 1997. “Negotiating For Public Benefits: The Bargaining Calculus
Of Public-Private Development.” Urban Studies 34 (December 1997).
197

Schinas, Orestis and Stratos Papadimitriou.2003. “the Mediterranean Ports in the Era
of Mega-Carriers: A Strategic Approach”
Http://Www.Maritime.Deslab.Naval.Ntua.Gr/Documents/2003/Ports/Ospaper_Megac
arriers.Pdf

SCAG. 2002. Goods Movement Program White Paper: A Survey Of Regional
Initiatives And A Discussion Of Program Objectives.
Http://Www.Scag.Ca.Gov/Goodsmove/Pdf/White_Paper.Pdf

Tioga Group. 2002. Empty Ocean Container Logistics Study.
Http://Www.Scag.Ca.Gov/Goodsmove/Pdf/Final_Empty_Containers_Report.Pdf

Transportation Research Board. 2001. Global Intermodal Freight: State of Readiness
For the 21
st
Century. Washington Dc: National Academy Press.
Http://Gulliver.Trb.Org/Publications/Security/Cp25.Pdf

Tier2 Community Advisory Committee. 2004. I-710 Major Corridor Study.

US Department of Transportation. 2002. Freight Shipments in America: Preliminary
Highlights From the Commodity Flow Survey. Washington Dc: Bureau of
Transportation Statistics.
Http://Www.Bts.Gov/Publications/Freight_Shipments_in_America/Pdf/Entire.Pdf

Van Ham, Hans and Joop Koppenjan. 2001. “Building Public-Private Partnerships:
Assessing and Managing Risks in Port Development”, Public Management Review,
4(1): 593-616.

Wargo, Bruce. 2004. “Off-Peak Hours Program for Southern California”,
presentation made at the Port of Long Beach, Los Angeles.

Wargo, Bruce. 2006a. “PierPASS Review & Outlook for 2006”, presentation at
Harbor Transportation Club, Los Angeles, January 12.

Wargo, Bruce 2006b. “PierPass OffPeak: Review and Update”, presentation at Port
of Los Angeles, May.
198

Williamson, Oliver. 1975. Markets and Hierarchies: Analysis and Antitrust
Implications, New York: The Free Press.

Williamson, Oliver. 1985. The Economic Institutions of Capitalism: Firms, Markets,
Relational Contracting, New York: The Free Press.

APPENDIX 1

RESPONSES TO SURVEY ON FREIGHT MOVEMENT
199

AT POLA/LB
∗

1. From this list of private stakeholders, please select the two, which are most
crucial for the success of appointment system for truckers and 24-hour terminal
operations.

Stakeholder
Response Percent
Truckers 64.4
Carriers 33.3
Warehouse
Operators
27.6
Third Party
Logistics
Providers
26.1
Other 21.6
Shippers 19.3

2. Among this list of public stakeholders, choose two that play the most influential
role in port-related freight movements.

Stakeholder Response Percent
Port Authorities 82.9
Local, Regional 48.8

∗
The results are expressed as percentage of respondents. A total of 132 respondents took the survey.
200

and Federal
Transportation
Agencies
Concerned City
Governments
20.7

Other
Environmental
Protection
Agencies

3. Please identify two groups that are expected to benefit the most from the
appointment system for truckers at terminal gates.

Stakeholder Response Percent
Truckers 50
Port Authorities 24.4
Carriers 24.1
Shippers 18.4
Other 17.2
Warehouse Operators 16.1
Concerned City Governments 14.9
Third Party Logistics Providers 10.3
Local, Regional and Federal
Transportation Agencies
9.2
Environmental Protection Agencies

4. Please identify two groups that incur additional costs due to the appointment
system for truckers at terminal gates

Stakeholder Response Percent
201
Truckers 61
Shippers 29.3
Warehouse Operators 26.8
Other 22.9
Third Party Logistics Providers 21.7
Carriers 14.5
Port Authorities 8.4
Local, Regional and Federal
Transportation Agencies
4.8

5. Please identify the two groups expected to benefit the most from the 24-hour
operation of terminal gates.

Stakeholder Response Percent
Truckers 43.4
Shippers 28.9
Carriers 22.9
Port Authorities 21.4
Other 19
Concerned City Governments 14.3
Third Party Logistics Providers 13.1
Warehouse Operators 13.1
Local, Regional and Federal
Transportation Agencies
11.9
Environmental Protection Agencies 8.3

6. Please identify the two groups that incur additional costs due to the 24-hour
operation of terminal gates.

202
Stakeholder Response Percent
Truckers 48.2
Warehouse Operators 36.1
Shippers 33.7
Carriers 23.8
Other 23.8
Port Authorities 15.5
Third Party Logistics Providers 14.3
Local, Regional and Federal
Transportation Agencies
2.4
Concerned City Governments 1.2
Environmental Protection Agencies 0

7. Please identify the two strongest advocates of appointment system for truckers
at terminal gates

Stakeholder Response Percent
Port Authorities 30.4
Carriers 27.8
City Governments 26.6
Truckers 26.2
Environmental Protection Agencies 20
Other 20
Local, Regional and Federal
Transportation Agencies
10
Shippers 10
Third Party Logistics Providers 7.5
Warehouse Operators 6.2

8. Please identify the two strongest advocates of 24-hour operations at terminal
gates.

203
Stakeholder Response Percent
Truckers 44.7
Port Authorities 31.6
City Governments 23.7
Carriers 18.2
Shippers 15.6
Environmental Protection Agencies 15.6
Other 14.3
Local, Regional and Federal
Transportation Agencies
14.3
Third Party Logistics Providers 9.1
Warehouse Operators 7.8

9. Please identify two groups that experience the greatest rise in costs and delays
due to congestion on intermodal freight networks.

Stakeholder Response Percent
Truckers 66.2
Shippers 47.5
Warehouse Operators 23.8
Carriers 21
Third Party Logistics Providers 19.8
Other 18.5

10. Regarding intermodal freight movement, there are significant differences in
strategies, motivations and decision-making between private sector and public
agencies.

Agree 48.6
Somewhat Agree 24.3
Neutral 14.3
Somewhat Disagree 8.6
204
Disagree 4.3

11. Different private stakeholders differ significantly regarding the benefits from
appointment system for truckers.

Agree 58
Somewhat Agree 23.2
Neutral 10.1
Somewhat Disagree 4.3
Disagree 4.3

12. Different private stakeholders differ significantly regarding the benefits from
24-hour operation of terminal gates.

Agree 44.3
Somewhat Agree 21.4
Neutral 11.4
Somewhat Disagree 12.9
Disagree 10

13. Lack of cooperation between private stakeholders is due to difference in
opinion regarding benefits and losses from appointment system and 24-hour
operations.

Agree 56.3
Somewhat Agree 22.5
Neutral 12.7
Somewhat Disagree 7
Disagree 1.4
205

14. A coordinating body is essential for coordination among private stakeholders
on appointment system for truckers and 24-hour operation of terminal gates.

Agree 50.7
Somewhat Agree 12.7
Neutral 19.7
Somewhat Disagree 8.5
Disagree 8.5

15. The success of operational changes introduced by one set of stakeholders in
response to appointment system and 24-hour operations depends changes made by
all other stakeholders.

Agree 49.3
Somewhat Agree 30.4
Neutral 14.5
Somewhat Disagree 5.8
Disagree 0

16. There are significant costs in obtaining information about other stakeholders
within the freight network. These information costs are a barrier to cooperation
between stakeholders

Agree 24.3
Somewhat Agree 30
Neutral 22.9
Somewhat Disagree 11.4
Disagree 11.4

206

17. These information costs are significantly greater for groups with many
stakeholders(such as truckers) as compared to groups with a few large entities
(such as terminal operators)
Agree 49.3
Somewhat Agree 15.9
Neutral 20.3
Somewhat Disagree 4.3
Disagree 11.6

18. Shifting freight movement to off-peak hours by large shippers would influence
smaller shippers to do the same

Agree 14.1
Somewhat Agree 18.3
Neutral 9.9
Somewhat Disagree 18.3
Disagree 39.4

19. The PierPass system has been effective in balancing the interests of all groups
of stakeholders in intermodal freight movement.

Agree 21.1
Somewhat Agree 22.5
Neutral 14.1
Somewhat Disagree 11.3
Disagree 31

20. The levy charged by PierPass is an effective disincentive to the peak hour
movement of goods

207
Agree 26.8
Somewhat Agree 28.2
Neutral 9.9
Somewhat Disagree 15.5
Disagree 19.7

21. Only shippers should be charged for additional terminal operating costs, as
under the current PierPass system

Agree 35.8
Somewhat Agree 14.9
Neutral 14.9
Somewhat Disagree 9
Disagree 25.4

22. Large shippers, who also operate their own distribution centers, can easily shift
operations to off-peak hours

Agree 54.4
Somewhat Agree 17.6
Neutral 8.8
Somewhat Disagree 8.8
Disagree 10.3

23. Smaller shippers are forced to move freight during peak hours as they lease
distribution centers and are unable to change hours of operation.

Agree 51.5
Somewhat Agree 25
Neutral 10.3
Somewhat Disagree 8.8
Disagree 4.4

24. Smaller shippers are disproportionately affected by the PierPass levy compared
to larger shippers.

208
Agree 55.2
Somewhat Agree 14.9
Neutral 14.9
Somewhat Disagree 9
Disagree 6

25. Changing warehouse operation practices are crucial to the success of PierPass

Agree 44.1
Somewhat Agree 25
Neutral 11.8
Somewhat Disagree 11.8
Disagree 7.4

Lengthy planning processes and scarce resources have made highway expansion
increasingly unfeasible in the Los Angeles region

Agree 55.2
Somewhat Agree 19.4
Neutral 11.9
Somewhat Disagree 7.5
Disagree 6

26. Most of the short term efficiency gains in freight transportation can only be
achieved with institutional changes by stakeholders

Agree 44.8
Somewhat Agree 34.3
Neutral 11.9
Somewhat Disagree 3
Disagree 6

27. Environmental pollution and congestion are two of the greatest challenges
facing the Ports of Los Angeles and Long Beach today

209
Agree 67.6
Somewhat Agree 13.2
Neutral 4.4
Somewhat Disagree 7.4
Disagree 8.8

28. Cargo should be diverted from truck to intermodal rail to reduce pollution and
congestion

Agree 16.2
Somewhat Agree 16.2
Neutral 26.5
Somewhat Disagree 23.5
Disagree 19.1

29. Appointment system for truckers at terminals reduces freeway congestion

Agree 19.4
Somewhat Agree 23.9
Neutral 16.4
Somewhat Disagree 10.4
Disagree 29.9

30. 24-hour operation of terminal gates reduces freeway congestion

Agree 54.4
Somewhat Agree 25
Neutral 4.4
Somewhat Disagree 8.8
Disagree 7.4

31. Some of the measures required for the success of the appointment system are
listed below. Which one is most crucial?

210

Coordination between public
agencies Synchronized signals along
freight corridors
10.6
Port labor reform 43.9
Reform in terms of service for
truckers
10.6
Improving efficiency of terminal
gates
48.5
Other 9.1

32. Some of the measures required for the success of 24-hour operations are listed
below. Which one is most crucial?
Port labor reform 58.2
Coordination between public
agencies
4.5
Synchronized signals along freight
corridors
4.5
Service reform for truckers 16.4
Change in operating hours for
warehouses
22.4
Change in city ordinances allowing
easier nighttime movement of trucks
6
Other 3

33. What is the current level of cooperation between private stakeholders on
freight movement related pollution and congestion issues?

No cooperation 37.5
Cooperate somewhat 51.6
Effective cooperation 10.9

34. What is the current level of cooperation between public agencies on pollution
and congestion issues?

No cooperation 28.8
Cooperate somewhat 62.1
Effective cooperation 9.1

211

35. Is voluntary compliance by private sector on measures to reduce congestion
and pollution related to freight movement feasible?

Not feasible 14.3
Somewhat feasible, supported with
public sector initiative
61.9
Somewhat feasible, supported with
private governing body
25.4
Not feasible 1.6

36. Appointment system and 24-hour operations increases terminal operating
costs. Please select the most likely scenario due to the increase

Stakeholders will implement
operational changes with additional
cost
46.3
Stakeholders will not respond with
operational changes due to additional
cost involved
26.9
Stakeholders will move operations to
other ports
22.4
Other 11.9

Abstract (if available)

Abstract The primary focus of this study has been the identification of the incentives and barriers to collaboration between stakeholders in freight movement at the Ports of Los Angeles and Long Beach (POLA/LB). Additionally, I also discuss how these incentives and barriers influence specific governance mechanisms required for the management of such partnerships.

Linked assets

University of Southern California Dissertations and Theses

Conceptually similar

PDF

Adaptive reuse as economic development in downtown Los Angeles: a resource guide for start-up developers, community based organizations, and stakeholder groups

PDF

Informal consent: the complexities of public participation in post-civil war Lebanon

PDF

Social entrepreneurship and urban tourism as economic development: best practices from Long Beach, California

PDF

Linking participation, program design and outcomes; voluntary air quality programs at the ports of Los Angeles and Long Beach

PDF

Nonprofit organizations and the environmental policy outcomes: a systematic inquiry into the role of different types of nonprofits to influence the processes and outcomes of the environmental policy

PDF

How does collaborative governance work? The experience of collaborative community-building practices in Korea

PDF

Foreign-related activities of the Chinese local governments and agents of globalization: a case study of 31 provinces in mainland China

PDF

The production of public spaces: design dialectics and pedagogy

PDF

Beyond the limits to planning for equity: the emergence of community benefits agreements as empowerment models in participatory processes

PDF

Information sharing, deliberation, and collective decision-making: A computational model of collaborative governance

PDF

Alternative ways, locations, and partners to meet the recreational needs of underserved communities: the case of Florence-Firestone

PDF

Structure, agency, and the Kuznets Curve: observations and implications for sustainability planning in U.S. cities

PDF

Urban conservation in the Middle Eastern historic cities: globalization and lack of identity

PDF

Essays in the study of institutions and development

PDF

Walkability as 'freedom': the ecology of school journey in inner city Los Angeles neighborhoods

PDF

Shades of conflict and conviviality: negotiating intercultural living and integration in Los Angeles's globalizing multi-ethnic spaces

PDF

The Wenchuan earthquake recovery: civil society, institutions, and planning

PDF

A site suitability analysis for an inland port to service the ports of Los Angeles and Long Beach

PDF

The crisis of potable water in Mexico City: institutional factors and water property rights as conditions for creating adequate metropolitan water governance

PDF

Transformative learning in the public sphere: the educational dimensions of a broad-based community organizing movement

Asset Metadata

Creator Chaudhuri, Swati (author)

Core Title Institutional analysis of stakeholder collaboration in freight movement at the ports of Los Angeles and Long Beach

School School of Policy, Planning, and Development

Degree Doctor of Philosophy

Degree Program Planning / Real Estate Development

Publication Date 04/01/2010

Defense Date 12/14/2007

Publisher University of Southern California (original), University of Southern California. Libraries (digital)

Tag OAI-PMH Harvest,Ports

Place Name California (states), harbors: Port of Long Beach (geographic subject), harbors: Port of Los Angeles (geographic subject), USA (countries)

Language English

Advisor Verma, Niraj (committee chair), Banerjee, Tridib (committee member), Meshkati, Najmedin (committee member)

Creator Email schaudhu@usc.edu

Permanent Link (DOI) https://doi.org/10.25549/usctheses-m1066

Unique identifier UC1206823

Identifier etd-Chaudhuri-20080401 (filename),usctheses-m40 (legacy collection record id),usctheses-c127-47389 (legacy record id),usctheses-m1066 (legacy record id)

Legacy Identifier etd-Chaudhuri-20080401.pdf

Dmrecord 47389

Document Type Dissertation

Rights Chaudhuri, Swati

Type texts

Source University of Southern California (contributing entity), University of Southern California Dissertations and Theses (collection)

Repository Name Libraries, University of Southern California

Repository Location Los Angeles, California

Repository Email cisadmin@lib.usc.edu