The Los Angeles Board of Harbor Commissioners has recently given its approval to a $2 billion annual budget for the Port of Los Angeles for the Fiscal Year (FY) 2023/24.
The budget aims to increase investment in operational and public-access infrastructure at the port, as well as support various sustainability and decarbonisation initiatives, positioning the port as an industry leader in these areas.
The previous fiscal year witnessed a decline in cargo volumes due to inflationary pressures and a global slowdown in cargo. However, the port forecasts modest gains in the coming fiscal year, starting from 1 July.
The approved budget predicts a 5.1 per cent year-over-year increase, with an expected total of 8.9 million TEU in FY 2023/24.
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Edward Renwick, Vice President of the Los Angeles Harbor Commission, expressed satisfaction with the budget, stating: “This plan lays out a path forward that strategically balances anticipated cargo revenues with important Port priorities.”
Renwick also emphasized the port’s responsible financial management during the pandemic and the cargo slowdown, which has positioned them strongly to continue critical investments and initiatives.
Gene Seroka, the Executive Director of the Port of Los Angeles, acknowledged the prevailing economic uncertainties but emphasized the budget’s role in guiding the port through future challenges.
Seroka said: “Our strategic, long-term priorities remain the same: modernise our physical and digital infrastructure to keep us competitive, and invest in community and environmental projects important to our surrounding communities, our region, and the industry overall.”
The budget allocates a total of $652.9 million in operating revenues, marking an 8.6 per cent increase over the FY 2022/23 forecast.
Shipping services are expected to contribute the majority of operating revenues at 73.3 per cent, followed by rentals at 15.1 per cent.
To support the daily operations of the port, the budget estimates operating expenses of $372.4 million for FY 2023/24.
These expenses encompass various areas, including supply chain efficiency enhancements, infrastructure maintenance, public safety related to goods movement, property and tenant services and management, cruise center operations, and environmental and sustainability programmes.
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The budget plan also includes significant funding for environmental and decarbonisation projects.
This includes the Clean Truck Fund Rate (CTFR) programme, which aims to incentivise and support cleaner trucks serving the port. Additionally, the plan provides support for ongoing demonstration projects involving zero- and near-zero emission equipment throughout the port complex.
The budget plan also allocates $252.3 million for capital projects, representing a notable 40.6 per cent increase compared to the previous fiscal year.
The funds will primarily be directed towards container and cruise terminal modernisation, according to the Port of Los Angeles, enhancing transportation to and from the port, and improving public access infrastructure at the LA Waterfront.
It is projected that the budget plan will generate around 4,100 direct and indirect jobs, excluding port employees, with 3,100 jobs attributable to capital spending.
