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ACR 140 (O'Donnell) — Assembly Committee on Jobs, Economic Development, and the Economy (June 21, 2022)

Summary

This is an Assembly Committee on Jobs, Economic Development, and the Economy analysis of ACR 140 (O'Donnell), as introduced February 15, 2022, for a hearing on June 21, 2022 before Chair Sabrina Cervantes. The resolution declares that the state is suffering a supply chain crisis and urges public agencies and local governments to assist carriers, cargo owners, seaports, terminals, and workers in delivering goods to Californians. The analysis says California's 11 major commercial seaports move more than 40% of the containerized cargo entering the US, and describes the backup of vessels that peaked in January 2022 at over 100 vessels. It reviews federal and state actions on supply chain disruptions, including Executive Order N-19-21. It lists the California Association of Port Authorities and the Pacific Merchant Shipping Association in support, with no opposition on file.

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“ACR 140 (O'Donnell) — Assembly Committee on Jobs, Economic Development, and the Economy (June 21, 2022).” Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2022-06-21-acr-140-jede-analysis-e7eadf0599/, SHA-256 c30efea0ba811152476b08ffb5334e30ec19c0894804ddaa140f96e7e318a53f.

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                                                                                                    ACR 140
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Date of Hearing: June 21, 2022

   ASSEMBLY COMMITTEE ON JOBS, ECONOMIC DEVELOPMENT, AND THE ECONOMY
                            Sabrina Cervantes, Chair
               ACR 140 (O'Donnell) – As Introduced February 15, 2022

SUBJECT: Freight transportation: supply chain

POLICY FRAME: California’s 11 major commercial seaports move more than 40% of the
containerized cargo entering the US, representing nearly 30% of all US exports. This cargo is responsible
for more than 1 million California jobs and 3 million jobs nationally. Collectively, the California seaports
are the most significant system of ports in the nation.

Seaports are, however, only one component of the state’s freight system. The production and delivery of
products is a multifaceted and highly integrated logistical network of specialized supply chains
comprising businesses, skilled workers, and transportation facilities and infrastructure.

While some conditions that led to the disruption of global supply chains in 2021 have dissipated, others
remain, and new issues have arisen. ACR 140 calls on state and local governments to do all they can to
facilitate the movement of goods to Californians.

The policy committee analysis includes information on California’s trade-based economy and state and
federal actions to address the most recent supply chain disruptions. There is no known opposition to this
bill.

SUMMARY: Memorializes the Legislature’s declaration that the state is currently suffering a supply
chain crisis and therefore urges the state’s public agencies, departments, and local governments to provide
all due and proper assistance to carriers, cargo owners, public seaports, terminals, workers, and facilities
to facilitate the essential service of delivering goods to Californians. Specifically, this bill:

1) Makes legislative findings and declarations:
   a) The national supply chain, national economy, and international standing of the US benefit from
      and depend on the airport, land port of entry, and seaport infrastructure that facilitates interstate
      and international trade by the state, its local governments, and its residents.
   b) The state is experiencing an unprecedented global supply chain crisis, with disruptions to goods
      movement caused and exacerbated by the COVID-19 pandemic and surges in product demand,
      which outstrip equipment supply and availability.
   c) The state’s goods movement system and supply chain have facilitated the lion’s share of the
      growth of United States trade, which in 2021 resulted in a 27% growth in the trade deficit to
      approximately $860 billion, including a 14.5% increase in China trade of an additional $355
      billion over the same period.
   d) The effects of the global supply chain crisis and the resulting disruptions to goods movement
      caused and exacerbated by the COVID-19 pandemic in the state are complex, pervasive, and
      acute.
   e) These effects have resulted in numerous impacts on all modes of freight transportation and goods
      movement in the state.
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f) Impacts of the supply chain crisis have caused unprecedented and unexpected congestion in ocean
   going vessel traffic at seaports, with the backup of vessels off the state’s coast or in transit to the
   state’s ports, which peaked in January 2022 at over 100 vessels, resulting in hundreds of thousands
   of containers delayed and off schedule for arrival at the state’s marine terminals.
g) The state’s marine terminals are processing more cargo than ever before, maintaining expanded
   gate hours, and processing more empty containers than ever before, but with constrained acreage
   and space and a lack of intermodal equipment available for customers. As a result, the state’s
   marine terminals are congested, lack space for regular transactions, suffer from a dramatic climb
   in excessive dwell times, and deal with a delayed and variable vessel sailing windows.
h) While experiencing the impacts of the COVID-19 pandemic amongst its membership, the state’s
   workforce of longshore workers continues to add shifts, hours, and registrants to keep up with the
   unprecedented strain on marine terminal services.
i) Motor carriers and the trucking community continue to maintain their roles as frontline and
   essential service providers throughout the COVID-19 pandemic, see unprecedented demand for
   drayage and local delivery during the supply chain crisis and respond by adding as many new
   vehicles and drivers into the supply chain system as possible. However, they are limited in their
   business by the lack of access to chassis and other intermodal equipment, excessive empty
   intermodal container storage on trucking terminals and occupying chassis, and full facilities or
   limited windows for transactions both at marine terminals and at warehouses and distribution
   centers.
j) The state’s warehouses and distribution centers continue to experience record levels of low
   vacancy and higher than expected inventory turnover. They suffer from secondary congestion
   impacts through other components of the supply chain, uncertainty in delivery schedules, and
   capacity constraints, which limit their ability to continue receiving or distributing cargo as
   effectively or efficiently as usual.
k) The impacts of the supply chain crisis have created unprecedented and unexpected strains on the
   railroads serving the state. These railroads have to manage the same backups and congestion, and
   intermodal equipment availability challenges facing motor carriers and marine terminals, and
   being the victim and target of organized and extensive cargo theft.
l) The COVID-19 pandemic demonstrates that access to the global supply chain in times of
   excessive demand is limited by extenuating factors beyond the control of Californians. The
   impact of a lack of access to equipment, vessels, and foreign markets on the state’s cargo owners,
   importers, exporters, and economy, which relies on these cargo owners, is significant.
m) It is in the state’s interest to assist the state’s importers and exporters in weathering increased costs
   of access to and from foreign and interstate markets, reduce the impacts of congestion, improve
   the efficiency of the supply chain, and minimize other negative externalities associated with the
   supply chain crisis, including increased emissions and degradations in air quality.
n) The state’s importers and exporters and the international trade that they facilitate are critical
   components of the state and national economy, directly or indirectly employing millions of
   Californians, contributing billions of dollars in economic activity, and generating significant local
   and state tax revenues as a result.
o) The development, improvement, expansion, and maintenance of the state’s importing and
   exporting of cargoes to and from farming, distribution, manufacturing, fabrication, assembly,
   processing, and warehousing sites in the state are essential to the growth of the state’s economic
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       well-being and the ability of those businesses and workers associated with trade-related industries
       to continue to compete cost-effectively on a regional, national, and global scale.
   p) The impacts of the global supply chain crisis are driving costs and threatening access of the state’s
      importers and exporters to foreign markets, which threatens the sustainable economic growth of
      the state.
   q) It is in the state’s and nation’s best interests to encourage the development and growth of
      California-originated and California-destined international and interstate cargoes, improve access
      to foreign markets for California’s goods by reducing the real costs of transportation, and create
      and support jobs provided by the state’s employers who can grow their import and export
      businesses and maintain their global competitiveness.

2) Declares that the Legislature recognizes that the state is currently suffering a supply chain crisis and
   urges the state’s public agencies, departments, and local governments to provide all due and proper
   assistance to carriers, cargo owners, public seaports, terminals, workers, and facilities to facilitate the
   essential service of delivering goods to Californians.

FISCAL EFFECT: Unknown

COMMENTS & CONTEXT:

1) COVID-19 and Supply Chain Disruptions Explained: At the beginning of the pandemic,
   businesses across the US held billions in unsold goods as consumers abruptly reduced purchasing of
   new products. This caused the inventory-to-sales ratios to spike for nonperishable goods. Over time,
   these businesses could liquidate inventories, and many elected not to maintain pre-pandemic inventory
   levels. Pandemic-related worker shortages globally also resulted in disruption and inefficiencies
   within the production and distribution sectors.

   As the most significant economic restrictions due to the COVID-19 pandemic began to lift in mid-
   2021, consumers in the US started making historical levels of purchases. Low inventories, workforce
   shortages, and rapidly rising wholesale and retail demands created cascading issues all along supply
   chains.

   Figure 1 (following page) shows that the retail sector’s inventory-to-sales ratio was especially short.
   According to a Small Business Pulse Survey (May 31 to June 6, 2021) administered by the US Census
   Bureau, 36% of small business respondents reported delays with domestic suppliers, with delays
   concentrated in the manufacturing, construction, and trade sectors.
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Another impact of the shortages, as reported by the White House, has been abrupt price increases.
Between May 2020 and May 2021, prices of commodities tracked within the Producer Price Index
rose by 19%, the largest year-over-year increase since 1974. In May 2022, the unadjusted Producer
Price Index for goods and services rose 0.8% from the prior month and 10.8% year-over (see sidebar
for more details).

In addition to the direct impacts on retail and lack of component parts for manufacturers, supply chain
disruptions also limited business activity in other sectors. For example, the National Association of
Homebuilders reported that shortages of key materials such as framing lumber, wallboard, and roofing
impacted many homebuilders, which resulted, in part, by homebuilders delaying new construction.

The production and delivery of products is an integrated system – disruptions at any point in the
system impact the overall system’s capacity. According to data compiled by Sea-Intelligence, an
international research firm, nearly 13% of the world’s cargo shipping capacity was tied up by delays
during the fall of 2021. Below is a list of key features to supply chain disruptions that impacted
California:
   COVID-19 shut down manufacturing and port operations in key trading partners, including
    Southeast Asia.
   Even as the Ports of Los Angeles and Long Beach processed record levels of cargo (throughput),
    dozens of ships remained waiting to be offloaded.
   There was a shortage of truckers to pick up the unloaded containers at the ports. In September
    2021, the LA Port estimated that 30% of truck appointments were not filled.
   Warehouses in Southern California were full, resulting in containers on truck chassis sitting for up
    to a week waiting to be unloaded. It was reported that warehouse capacity for offloading goods
    was down to 2% in Los Angeles and 4% in the Inland Empire.
   The lack of warehouse space resulted in:
       o Trucks entering and parking/idling in residential or other nonindustrial areas of cities.
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           o A shortage of truck chassis on which to place new containers for distribution.
      While alternative temporary sites to offload products were pursued, some cities in Southern
       California refused to permit temporary offloading sites.

   Six months into 2022, some of these factors are resolving, while others like the lack of chasses and
   trailers continue. Another example of a continuing challenge is work stoppages attributed to China’s
   continued reliance on a “Zero COVID” policy, resulting in strict lockdowns across a growing number
   of economic regions, disrupting manufacturing and the delivery of parts, components, and finished
   products to foreign markets. New supply chain issues have also arisen including the escalation of the
   Ukraine-Russia war and failures in the domestic production of baby formula. Sanctions on Russia in
   response to its unprovoked attack on Ukraine are driving energy costs higher globally, including in the
   US.

2) Federal and State Actions to Address Supply Chain Disruptions: The earliest actions by the
   federal and state governments focused on addressing healthcare-related shortages, which later
   expanded to component parts to manufacturing, including semiconductors. As noted in the earlier
   comments, eventually, supply chain disruptions impacted the delivery of domestic goods to
   consumers. Below is a timeline of selected actions by the federal and state governments to assess and
   address these disruptions.
      February 2021 – President Biden signs E.O. 14017, directing a “whole-of-government approach”
       to assessing vulnerabilities in and strengthening the resilience of critical supply chains.
      June 2021 – The Supply Chain Disruptions Task Force releases 100 day reviews and
       recommendations to address the short-term disruption of the delivery of goods.
       o The review included four key industrial products: semiconductor manufacturing and advanced
         packaging; large capacity batteries, like those for electric vehicles; critical minerals and
         materials; and pharmaceuticals and active pharmaceutical ingredients.
       o The review found that COVID-19 amplified the impacts of decades of underinvestment and
         public policy choices, which have resulted in fragile supply chains across a range of sectors
         and products.
       o The supply chain review reinforced the need for transformative investments to rebuild US
         manufacturing capacity in key sectors and value-chains. Among other recommendations, the
         review called for establishing a new $50 billion Supply Chain Resilience Program at the US
         Department of Commerce to “monitor, analyze, and forecast supply chain vulnerabilities and
         partner with industry, labor, and other stakeholders to strengthen resilience.”
       o The second part of E.O. 14017 is due in February 2022, which included the review of six
         “critical industrial base sectors that underpin America’s economic and national security,”
         which includes the defense industrial base, public health and biological preparedness industrial
         base, information and communications technology industrial base, energy sector industrial
         base, transportation industrial base, and supply chains for production of agricultural
         commodities and food products.
      August 2021 – Whitehouse names a senior –level “Port Envoy” to the Supply Chain Disruptions
       Task Force
      September 2021 – The Center for International Trade and Transportation at California State
       University at Long Beach partners with GO-Biz, CalSTA, and the Port of Long Beach to launch
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    the California Supply Chain SUCCESS Initiative (Initiative). The Initiative used a solutions-
    based approach to re-engage a broad set of stakeholders with historical differences. According to
    a summary of the Initiative’s outcomes: “Not only was the Initiative meant to provide a broader
    framework for dialogue, but also to emphasize the need for individual stakeholders to identify
    what they could do as independent actors to add value to the supply chain with or without
    government facilitation.
   October 13, 2021 – The White House announces actions aimed at relieving congestion in the
    supply chain.
    o This included a plan for the Port of Los Angeles to operate 24/7 and major US retailers to
      expand working hours. In addition, a virtual roundtable was held between the federal and state
      governments, the LA/LB Ports, labor, and the business community to discuss current logistic
      challenges.
    o In addition, the Whitehouse reported working with major retailers and domestic shippers,
      including UPS and Walmart, to increase hours of operation.
   October 20, 2021 - Governor Newsom issues Executive Order N-19-21 (EO N-19-21), which was
    the culmination of the state’s extended dialogue with businesses, freight operators, labor, and the
    White House and its federal Supply Chain Disruptions Task Force. According to the
    announcement, the Governor particularly singles out GO-Biz and its work of engaging with
    stakeholders on key challenges and identification of short-term and long-term solutions to supply
    chain disruptions. Among other directives, the EO stated:
    o The Governor's Office of Business and Economic Development shall identify non-state sites,
      including private, locally owned, and federally owned parcels, that could be available to
      address short-term storage needs to address the supply and distribution chain crisis.
    o The Department of General Services shall complete its review of state-owned property in
      proximity to impacted ports that may be made available to address short-term storage needs to
      address the supply and distribution chain crisis by no later than December 15, 2021.
    o The Department of General Services shall collaborate with other state agencies to expedite
      leasing to store cargo containers on state-owned parcels.
    o By December 31, 2021, the California Labor and Workforce Development Agency shall take
      all necessary actions to constitute and announce the membership of the industry panel required
      by AB 639 (Cervantes). The Secretary of Labor shall convene the panel for its first meeting
      by March 1, 2022.
    o The Department of Finance shall work with state agencies and departments to develop longer-
      term proposals that support port operations and goods movement for consideration in the
      January 10 Governor's Budget. Proposals may include port and transportation infrastructure
      improvements, electrification of the goods movement system from port to delivery, workforce
      development, and other actions to support goods movement.
   October 28, 2021 – US Department of Transportation announces a strategic partnership with
    California to help facilitate innovative projects and financing opportunities for multi-billion
    infrastructure improvements. The agreement intends to facilitate the movement of imports and
    exports, upgrade supply chain processes, and “create resilience throughout the critical trade
    corridors of California and the US, including around San Pedro Bay and the Inland Empire.”
    Projects that could receive support through this agreement, according to Governor Newsom’s
    announcement, include:
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       o Port-specific upgrades;
       o Expanding capacity for freight rail;
       o Developing inland port facilities for increased warehouse storage;
       o Railyard and truck electrification;
       o Highway upgrades to improve truck travel times;
       o Grade-separated crossings to reduce the number of rail-street intersections and improve safety
         and efficiency; and,
       o Land ports of entry to expand trade capacity and cross-border commerce.
      November 10, 2021 – The California Department of Motor Vehicles announces it will be doubling
       its capacity to conduct commercial driving licenses to address the national commercial truck
       driver shortage and support the efficient movement of goods between California’s largest ports
       and major distribution centers.
      November 17, 2021 – Governor Newsom toured the Ports of Los Angeles and Long Beach and
       announced that Caltrans would begin issuing temporary permits to allow trucks to carry
       overweight loads of up to 88,000 on state highways and interstate routes between the Ports of
       Long Beach and Los Angeles, other ports, and key distribution centers. Other participants in the
       tour included Port Envoy to the Biden-⁠Harris Administration Supply Chain Disruptions Task
       Force John D. Porcari, ILWU International President Willie Adams, port leadership, local
       legislators, and elected officials.

   As the state’s lead on economic development activities, GO-Biz Director and the Governor’s Senior
   Economic Advisor, Dee Dee Myers, played a pivotal role in the state’s supply chain mitigation
   activities. She participated in the federal Supply Chain Disruptions Task Force and represented
   California in other national, state, and regional meetings.

   ACR 140 calls on the state and all local governments to provide all due and proper assistance to
   carriers, cargo owners, public seaports, terminals, workers, and facilities to facilitate the essential
   service of delivering goods to Californians.

3) California Goods Movement Investments: Additional funding has been provided through the 2021-
   22 budget, with $250 million awarded for ports, $280 million for infrastructure projects in and around
   the Port of Long Beach, and $1.3 billion over three years for zero-emission trucks and buses,
   including funding for more than 1,000 zero-emission port drayage trucks. Governor Newsom
   proposed an additional $2.3 billion for supply chain investments in his 2022-23 January budget.
   According to the Governor’s Budget Summary, these funds help address congestion and bottlenecks
   across the West Coast. The proposed supply chain investments in the January release of the 2022-23
   budget include:
      Port Infrastructure and Goods Movement: $1.2 billion for port-related high-priority projects that
       increase goods movement capacity on rail and roadways serving ports and at port terminals,
       including railyard expansions, new bridges, and zero-emission modernization projects.
      Zero-Emission Equipment and Infrastructure: $875 million for zero-emission port equipment,
       short-haul (drayage) trucks, and infrastructure.
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      Workforce Training: $110 million for a training campus to support workforce resilience in the
       face of supply chain disruption and accelerate the deployment of zero-emission equipment and
       technologies.
      Commercial Driver’s Licenses: $40 million to enhance California’s capacity to issue Commercial
       Driver’s Licenses.
      Operational and Process Improvements: $30 million for the GO-Biz to provide funding for
       operational and process improvements at the ports. This could include enhancing the movement of
       goods and improving data interconnectivity between the ports to enable efficient cargo movement,
       reduce congestion, and create opportunities to increase cargo volume by promoting and building
       supply chain efficiency.
      Supply Chain Policy Unit: $1.15 million ongoing and three positions to the California
       Transportation Agency to establish a freight policy team to oversee and coordinate freight policy
       across the state, including freight transportation research projects.

   In the May Revise, the Governor proposed additional actions to address rising fuels prices and utility
   bills:
      Energy Mitigation: $9.5 billion from various fund sources over four years, which brings the total
       proposed funding by the Governor for climate actions to $32 billion, including climate solutions
       and support energy reliability.
      Inflation Relief: $18.1 billion in direct payments to help address inflation, help people pay their
       utility bills and rent, and reduce costs like health care and child care.

   The LAO has completed an analysis of the Governor’s budget proposals on supply chain and the $4.1
   billion Transportation Infrastructure Package, which provide additional details on his strategy for
   integrating state and federal funds to meet important California needs. This includes: $3.4 billion that
   was agreed to in concept in the 2021-22 budget package but reverted to the General Fund when
   subsequent legislation was not enacted; and $1.5 billion that would be allocated between programs
   from last year’s package and a new set of proposed programs.

4) California’s Trade Dominated Global Economy: International trade and foreign investment are
   important components of California’s $3.0 trillion economy (2020 most recent data), supporting
   nearly 5 million California jobs. The importance of trade to the state economy increased as a
   growing number of California businesses accessed new global markets. In the last three decades, the
   percentage of California jobs tied to trade more than tripled, moving from 10.6% in 1992 to nearly
   30.3% in 2020.

   In 2020, the state’s diverse group of business owners and workers produced and/or exported $155.8
   billion in goods, representing 10.9% of total U.S. exports, and imported $396 billion, representing
   16.9% of total US imports. In 2021, California exported $175.1 billion in goods, representing 9.9% of
   all US exports.

   Many of the jobs associated with these major industry sectors are also associated with high wages.
   Research by the U.S. International Trade Commission undertaken in 2010 and updated in 2015 found
   a significant earnings premium in jobs within export-intensive manufacturing industries – a 19%
   premium for blue-collar workers and a 9.9% premium for white-collar workers.
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Manufacturing has many economic advantages and is often considered the “gold standard” for jobs
because of its high wages, the inclusion of small businesses within its global supply chains, and
having a high multiplier effect on related jobs. The Milken Institute estimates that for every job
created in manufacturing, 2.5 jobs are created in other sectors. In some industry sectors, such as
electronic computer manufacturing, the multiplier effect is 16:1.

As noted earlier in the analysis, California’s largest industry sector by employment is Trade,
Transportation, and Utilities, which encompasses everything from major retail outlets, to import-
export businesses, to transportation and warehousing. These industry sectors support the flow of
goods across the US, as well as globally. For their part, California manufacturers have reaped the
short-term benefits of global supply chains and just-in-time delivery models.

Advances in transportation and communication technologies encourage development of previously
undeveloped markets and expand multinational business opportunities for California firms. With
more than 95% of consumers located outside the US and emerging economies experiencing a
growing middle class, accessing global markets has been key to California’s continued economic
growth. Manufacturers have also reaped benefits from global supply chains and just-in-time delivery
models. Today, four of California’s top five exports include component parts, which leave the state to
be combined and assembled into final products in foreign countries.

Chart 3 shows data on the export of goods to the state’s top six trade partners, based on the origin of
movement. [Please note that federal reporting separates data from China and Hong Kong.]
California’s largest export market in 2021 was Mexico, which received over $27.3 billion in
California products. Top-ranking export destinations not shown on the chart include Germany, the
Netherlands, and the United Kingdom.
              Chart 3 - California Exports of Goods 2013-2021 (billions of dollars)
    Partner      2013     2014      2015     2016       2017           2018           2019          2020          2021
   World        $168.1    $173.8   $165.3    $163.2    $171.9         $178.1         $173.7        $155.8        $175.1
1 Mexico         $23.9    $25.4    $26.7     $25.2     $26.7           $30.7          $27.8        $24.0          $27.3
2 Canada         $18.8    $18.3    $17.2     $16.2     $16.8           $17.6          $16.6        $16.0          $17.8
3 China          $16.2    $16.0    $14.3     $14.3     $16.4           $16.3          $15.8        $15.0          $16.7
4 Japan          $12.7    $12.2    $11.7     $11.7     $12.8           $13.0          $11.8        $10.5          $11.8
  South                                                 $9.5            $9.9          $9.1          $9.7          $11.6
5                 $8.3     $8.6     $8.6      $8.2
  Korea
6 Taiwan          $7.5     $7.4     $7.7      $6.9      $6.3            $6.8           $7.2         $7.3          $8.9
                                                                Source: International Trade Administration, accessed 3/26/22


Many of California’s top exports are parts and components. Research shows that California
businesses participate in large expanded global supply chains, with components leaving and arriving
in the state assembled and/or partially assembled before becoming available for retail and wholesale
distribution.

California’s top seven exports in 2020 were: computer and electronic products ($37.5 billion);
transportation equipment ($17.3 billion); machinery, except electrical ($16.8 billion); chemicals
($14.3 billion), agricultural products ($13.3 billion); miscellaneous manufactured commodities ($11.0
billion); and food manufactures ($9.7 billion).
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   Imports into California were valued at $395.8 billion in 2020, representing 16.9% of total US
   imports and ranking the state as one of the top 20 largest importers in the world. China (including
   Hong Kong) is the largest source of imports to California, valued at 130.6 billion in 2020. Chinese
   imports totaled $130.1 billion, followed by Mexico ($47.8 billion), South Korea ($21.1 billion); and
   Canada ($26.5 billion).

   The largest amount of products imported in 2020 by dollar: computer and electronic products
   ($113.0 billion); transportation equipment ($55.9 billion); miscellaneous manufactured commodities
   ($24.0 billion); electrical equipment, appliances and components ($26.7 billion); and machinery,
   except electrical ($19.7 billion); oil and gas ($10.8 billion); and apparel manufacturing products
   ($16.9 billion).

5) Related Legislation: Below is a list of bills from the current and prior sessions.

  a) Current Session Legislation:
       i) AB 1678 (V. Fong) Blue Ribbon Commission: This bill, an urgency measure, requires the
          Department of Food and Agriculture to establish and convene the Blue Ribbon Commission on
          Port Congestion and Supply Chain Deficiencies. Status: Held on the Suspense File of the
          Assembly Appropriations Committee, 2022.
       ii) AB 1679 (V. Fong) Supply Chain Coordinator: This bill establishes the position of the
           Supply Chain Coordinator within the California Business Investment Services Program at GO-
           Biz. Status: Held on the Suspense File in the Assembly Committee on Appropriations, 2022.
       iii) ACR 140 (O’Donnell) Freight Transport and Supply Chain: This bill memorializes the
            Legislature’s declaration that the state is currently suffering a supply chain crisis and therefore
            urges the state’s public agencies, departments, and local governments to provide all due and
            proper assistance to carriers, cargo owners, public seaports, terminals, workers, and facilities
            to facilitate the essential service of delivering goods to Californians. Status: Pending in the
            Assembly Committee on Jobs, Economic Development, and the Economy.
       iv) AJR 29 (Mathis) Ocean Shipping Reform Act: This bill memorializes the Legislature’s
           support for the Ocean Shipping Reform Act to alleviate and remedy the congestion of
           California’s ports and to ensure that the state’s importing and exporting capabilities are
           returned to pre-pandemic levels. Status: Pending in the Assembly Committee on Jobs,
           Economic Development, and the Economy.
       v) AJR 30 (Gipson) Freight Transportation Federal Funds: This bill memorializes the
          Legislature’s request to the US Congress to pass legislation and the US President to sign into
          law a statute providing for a fair allocation of federal transportation funding for freight projects
          in California, specifically, and on the Pacific Coast of the US, generally, based on the volume
          of containerized freight moved. The Legislature further calls on the US Department of
          Transportation and all federal agencies implementing any federal statute or regulation related
          to federal funding for ports or multimodal freight transportation to similarly provide a fair
          allocation of in California and other states on the Pacific Coast of the US. Status: Pending in
          the Assembly Committee on Jobs, Economic Development, and the Economy.
       vi) SB 1104 (Gonzales) GO-Biz Office of Freight: This bill establishes the Office of Freight
           within GO-Biz to serve as the coordinating entity to steer the growth, competitiveness, and
           sustainability of freight and ports across the state and to promote and assess the continued
           economic vitality and sustainability of the freight sector. The bill also requires GO-Biz, in
                                                                                                 ACR 140
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       coordination with specified state agencies, to prepare an assessment of statewide economic
       growth, competitiveness, prosperity, resiliency, and sustainability for the state’s ports and
       freight sector. Status: Pending in the Assembly Committee on Jobs, Economic Development,
       and the Economy.
b) Prior Session Legislation:
    i) AB 886 (Allen and Ian Calderon) Importer-Exporter Tax Credit: This bill would have
       authorized a five-year $500 million tax credit program for importers and exporters that
       increase cargo through in-state airports and seaports, hire additional staff, or incur capital costs
       at a California cargo facility. Status: Held on the Suspense File of the Assembly Committee
       on Appropriations, 2013.
    ii) AB 962 (Allen and Quirk-Silva) Port Infrastructure Financing: This bill would have
        established a process by which a harbor agency can monetize the future financial value of
        installing and operating a port using technology and processes that result in the reduction of
        mobile source emissions. This valuation would be used to establish the amount of a future
        state appropriation, the repayment of which occurs through the payment of state taxes and fees.
        Status: Held in the Assembly Committee on Appropriations, 2018.
    iii) AB 1561 (Quirk-Silva) Logistical Hubs and Inland Ports: This bill expands and updates the
         mandatory elements of the state's international trade and investment strategy to include the role
         of logistical hubs and inland ports and streamline reporting requirements. The bill also
         authorizes the California Infrastructure and Economic Development Bank to finance inland
         port facilities. Status: Signed by the Governor, Chapter 313, Statutes of 2018.
    iv) AB 2841 (Allen) Port Infrastructure Finance: This bill would have established a process by
        which a harbor agency can monetize the future financial value of installing and operating a
        port using technology and processes that reduce mobile source emissions. This valuation
        would be used to establish the amount of a future state appropriation, the repayment of which
        occurs through the payment of state taxes and fees. Status: Held on the Suspense File of the
        Assembly Committee on Appropriations, 2016.
    v) SB 63 (Hall) Seaport Infrastructure Districts: This bill authorizes cities and counties to
       establish Seaport Infrastructure Financing Districts and allows these districts to finance certain
       port or harbor facilities, as specified. Status: Signed by the Governor, Chapter 793, Statutes
       of 2015.
    vi) SB 308 (Seymour) Infrastructure Financing Districts: This bill authorizes cities and
        counties to create infrastructure financing districts (IFDs) and issue bonds to pay for
        community-scale public works: highways, transit, water systems, sewer projects, flood control,
        child care facilities, libraries, parks, and solid waste facilities. To repay the bonds, IFDs can
        divert property tax increment revenues, which are revenues generated from increases in
        property values within the IFD above property values in the base year when the IFD was
        formed. However, IFDs cannot divert property tax increment revenues from schools. Status:
        Signed by the Governor, Chapter 1575, Statutes of 1990.
    vii) SB 628 (Beall) Enhanced Infrastructure Financing Districts: This bill authorizes local
         officials to create Enhanced Infrastructure Financing Districts (EIFDs), which augment the tax
         increment financing powers that are available to local government under the IFD statutes. City
         or county officials can create an EIFD, governed by a public finance authority, to finance
         public capital facilities or other specified projects of communitywide significance that provide
                                                                                                ACR 140
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           significant benefits to the district or the surrounding community. Status: Signed by the
           Governor, Chapter 785, Statutes of 2014.

REGISTERED SUPPORT / OPPOSITION:

Support

California Association of Port Authorities
Pacific Merchant Shipping Association

Opposition
None on File

Analysis Prepared by: Toni Symonds / J., E.D., & E. / (916) 319-2090


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