News / Ports and supply chain operators weigh in on funding for CPB

Photo: © Danielfela

Legislators and port operators have teamed up to push through a law that would hinder US Customs and Border Protection’s (CBP) capacity to bill ports for their activities, amid expectations of a major ramp up under the present administration.

Florida Republican representative Laurel Lee and Washington Democrat Marie Gluesenkamp Perez reintroduced the CBP Securing Ports and America’s Commerce and Economy (Space) Act yesterday, aimed at establishing “a fair, transparent, sustainable funding source” for CBP.

Cary Davis, CEO of the American Association of Port Authorities (AAPA), said: “CBP officers’ work is crucial, however, the costs of government inspection operations are historically and constitutionally, a federal government responsibility.

“Ports generate hundreds of millions in public tax revenue – taxpayers benefit when those funds are reinvested in activities that generate future revenues. The [act] will ensure ports can focus on and invest wisely in the assets necessary for our main mission: moving cargo.”

Operational costs for the CBP, including staffing and facilities, were historically funded by the federal government in line with national security needs, but recent years have seen a CBP practice of billing local port authorities.

An AAPA spokesperson said costs of up to $1m stretched beyond core inspection activities and were threatening the budgets and infrastructure investment of port authorities run by local or state governments in a precarious position.

A letter from a coalition of 27 supply chain operators noted: “The demands are also accompanied by coercive language, with CBP implying that failure to pay could result in throttled inspection capacity, or even suspension of port operations.”

The spokesperson told The Loadstar that while the legislation would not “stop CBP from billing ports”, they believed it would ensure that the costs of CBP’s operational needs were met by the federal government.

They added ports in the US south-east had been particularly hard hit by CBP practices and while they would not be drawn on the reason for this, one suggestion is that the region has seen a recent spike in transhipment of Chinese goods coming through Latin America.

And there appear expectations that those gateways will come under even more pressure after the White House brought an end to the de minimis exemption for goods from China and Hong Kong this year, with a global ban due in 2027.

Asked if the AAPA was expecting this to prompt a spike in port volumes, the spokesperson said “ports will almost certainly be affected”, but it seems that they like others remain uncertain just what form that effect will take.

They added: “It’s unclear how shippers and carriers in the supply chain will adjust as a result. We are watching this because as the volume of cargo needing inspection increases with policy updates, we could also see increased wait times for cargo inspection by CBP.”