Wider funding options for California ports
SB 63 will provide a new tax increment financing mechanism for US seaport infrastructure
The state of California’s largest container ports are now in line for wider funding after Governor Jerry Brown signed a new Bill.
The Senate Bill 63 will promote the continued competitiveness of California ports, especially Los Angeles, Long Beach and Oakland – three of the six largest US container ports – by providing a new tax increment financing mechanism for seaport infrastructure.
A Seaport Infrastructure Financing District will have the authority to fund both traditional transportation as well as environmental improvement infrastructure at seaports.
Mike Jacob, vice president and general counsel of the Pacific Merchant Shipping Association (PMSA), which supported the bill, said: “Now, our Ports must pay for new investments in the next generation of infrastructure and environmental quality improvements. With SB 63, the state is providing new financing options to our ports and looking towards adding new cargo capacity and pursuing the next generation of air quality improvement projects.”
Under the provisions of SB 63, seaports may now work with local cities and counties to create local Seaport Infrastructure Financing Districts, which can underwrite revenue bonds in anticipation of future tax revenues generated from growth in the flow of cargo through California’s seaports. SB 63 now also gives seaports a specific enhanced infrastructure financing district category – recognised as being vital for restoring local tax increment financing opportunities lost by the elimination of redevelopment.
“Financing new investments in California’s seaports is crucial not just to the overall economic health of the state but also to the bottom lines of local cities and counties,” added Mr Jacob. “Seaport infrastructure districts should create win-win investments in our seaports, where we can improve our competitiveness, grow cargo volumes, while also investing in the environment.”