Transmittal 1 MARKETING INCENTIVE PROGRAM WHEREAS, for the purpose of this Marketing lncentive Program, the lands and waters, and interests under the possession, management and control of the Board of Harbor Commissioners shall be known as the Port of Los Angeles; and WHEREAS, the Board of Harbor Commissioners recognizes that container volumes moving through the Port of Los Angeles have declined in recent years; and WHEREAS, the Board of Harbor Commissioners recognizes the more recent impact to nationwide imported container volumes caused by the collapse of the housing market and subsequent crisis in the financial markets; and WHEREAS, the Board of Harbor Commissioners recognizes that shipping lines and beneficial cargo owners are facing increased operational costs because of rising oil prices, inland rail and new container cargo fees for the benefit of the environment, security and infrastructure needs; and WHEREAS, the Audit Committee of Board of Harbor Commissioners requested staff to develop a Marketing lncentive Program that would provide an incentive to container terminal tenants when they have secured new container volumes through the Port of Los Angeles; NOW, THEREFORE, the Board of Harbor Commissioners hereby authorizes a marketing incentive program for attracting new container volumes by providing an appropriate incentive to container terminal tenants of the Port of Los Angeles whose customers' vessels regularly call at the Port. I. ELIGIBLE ENTITIES City of Los Angeles Harbor Department container terminal tenants. II. TERM The new container volumes (as defined in Section Ill below) must begin calling at a Port of Los Angeles terminal commencing between the period beginning upon date this program is approved by the Board of Harbor Commissioners and ending on December 31, 2009. The new container volumes must call on a regular basis for a period of one year from the date of commencement.
Ill. ELIGIBLE CONTAINER VOLUMES 1. NEW CONTAINER VOLUMES DEFINITION i. A shipping line using Port facilities initiating a new container service during the term of this Marketing Incentive Program. A service is a group of vessels either exclusively operated by one shipping line or operated in an alliance with other shipping lines that are assigned to a particular route involving multiple port calls. ii. A shipping line that moves container volumes through the Port but diverts an existing service thereby making the Port of Los Angeles the first port of call instead of another U.S. West Coast Port, and thereby increasing the percentage of intermodal rail container volumes handled through the Port. iii. New container volumes include imports and exports of full and empty containers. 2. CONTAINER VOLUME EXCLUSIONS i. Seasonal shipping line service deployments that are launched from July 1 through November 30,2009. ii. Shipping lines that increase vessel sizes of existing container services calling at the Port of Los Angeles. iii. Container volumes a container tenant secured from another Port of Los Angeles container terminal tenant. IV. INCENTIVE AMOUNT 1. The incentive will be in the amount of $10.00 per twenty-foot equivalent unit on container volumes which moved through the container terminal tenants' facilities at the Port during the term of this program and which has been approved by the Executive Director pursuant to Section V.2 below. V. METHODOLOGY During the effective term of the program, and prior to the start of the proposed service, the container terminal tenant is to inform the Los Angeles Harbor Department in writing of their intent to participate in the Marketing lncentive Program. The container terminal tenant shall demonstrate in writing that the proposed additional container volumes are new business as defined by this program and not a consolidation of other existing services previously calling at the Port of Los Angeles The container terminal tenant shall provide the following information: - Title: Marketing lncentive Program. - Container terminal tenant name, address and contact party. - New container service description. - The number and sizes in twenty-foot equivalent unit capacity of vessels deployed in the new service.
- Commencement date of the new service. - Vessel port call rotation. - Anticipated annual volume through the Port of Los Angeles in twenty foot equivalent units. - Mail letter by certified mail to the Los Angeles Harbor Department - 425 South Palos Verdes Street, San Pedro, California 90731 - Attn: Marketing Division 2. Upon submittal by the container terminal tenant, the proposed new container volume will be reviewed and approved in writing by the Executive Director or her designee as eligible for this Marketing lncentive Program, 3. Container terminal tenants shall continue the new service for a period of twelver (12) months commencing with the date of service inauguration,. 4. Within 3-months of completion of a 12-month period after inauguration of the new container volumes, the container terrr~inal tenant shall present an invoice to the Los Angeles Harbor Department in which the container terminal tenant shall identify the total new container volumes by service for that period as follows: - Submit invoice by certified mail to the Los Angeles Harbor Department - 425 South Palos Verdes Street, San Pedro, California 90731 - Attn: Marketing Division - Title: Marketing lncentive Program. - Container terminal tenant name and address and contact party. - New container service description. - The number and sizes in twenty-foot equivalent unit capacity of vessels deployed in the new service. - Commencement date of the new service. - Vessel port call rotation. - Actual annual volume through the Port of Los Angeles in twenty foot equivalent units. - Tenant's City of Los Angeles Business Registration Certificate W9 form. - Letter shall be signed by a corporate officer with the following statement: I certify under penalty of perjury that the above bill is just and correct according to the terms of the Marketing lncentive Program and that payment has not been received. I further certify that I have complied with the provisions of the City of Los Angeles Living Wage Ordinance. 5. Upon submittal of the invoice pursuant Section V.4, the Executive Director or her designee shall confirm the information provided therein. Upon confirmation of the invoice, the tenant shall enter into a Memorandum of Agreement ("MOA) attached as Exhibit A and incorporated herein by
reference, which shall thereafter be submitted to the Executive Director or the Board for approval as required by the City of Los Angeles Charter. 6. The incentive shall be a one-time payment after the 12-month period regardless of the length of the intent to continue the service at the Port. 7. 'The Los Angeles Harbor Department may request the container terminal tenant to provide a load and discharge container volume comparison covering a 12-month period preceding inauguration of the new service or new container volumes moved through the Port. 8. Final determination as to the acceptance of new container volumes as demonstrated by the container terminal tenant is at the sole discretion of the Executive Director or her designee. 9. Container terminal tenants are not limited to a one-time application and may apply for all proposed new container volumes throughout the term of the program.
Exhibit A MEMORANDUM OF AGREEMENT BETWEEN THE ClTY OF LOS ANGELES AND (APPLICANT) THIS MEMORANDUM OF AGREEMENT (MOA) is made and entered into by and between the ClTY OF LOS ANGELES, a municipal corporation, acting by and through its Board of Harbor Commissioners (Board), and (Name of Applicant), a (state) corporation, located at (address) (Applicant). WHEREAS, the City of Los Angeles Harbor Department (Harbor Department) initiated a Marketing lncentive Program on October 23,2008 to attract new container volumes to the Port of Los Angeles(Port); and WHEREAS, Applicant has complied with the Marketing lncentive Program requirements and now requests the incentive payment as provided for therein; NOW, THEREFORE, IT IS MUTUALLY AGREED AS FOLLOWS: 1. Applicant has met the requirements of the Marketing lncentive Program as approved by the Board on October 23, 2008 and is eligible for payment as described herein. 2. Applicant has submitted invoices and documentation, attached hereto as Exhibit A, which evidences the new container volumes brought to the Port, which totals (#) TEUs. 3. Pursuant to the terms of the Marketing lncentive Program, the parties agree that Applicant shall be paid the amount of Dollars ($ ) in full consideration of its participation in the Marketing lncentive Program as presented in Exhibit A. Said amount shall be paid as soon as, in the ordinary course of City business, the same may be approved, audited and paid. 4. This MOA shall in no way amend or modify the terms of any agreement that Applicant may otherwise have with the Department.
IN WITNESS WHEREOF, the parties hereto have executed this MOA on the date to the left of their signatures. THE C IN OF LOS ANGELES, by its Board of Harbor Commissioners Dated: BY Executive Director Attest: Secretary (APPLICANT'S NAME) Dated: (PrinVtype name and title) Attest (Printhype name and title) APPROVED AS TO FORM,2009 ROCKARD J. DELGADILLO, City Attorney