California conducts a tremendous amount of commerce through its port facilities. It is estimated that California transports 184 million tons of cargo and over three million passengers by vessel each year, representing one of the world's largest volumes of ocean trade and passenger transport (U.S. Army Corps of Engineers, 1993). With its numerous ports and intermodal links, California serves as a critical thoroughfare for the nation's increasing role in Pacific Rim trade. Trade with Pacific Rim nations accounted for 25% of the Nation's imports and exports in 1980; by 1993, that share of trade was almost 35% of the national total and rising (U.S. Department of Commerce, 1994). An economic analysis conducted by the California Research Bureau has found that, in 1992, ports and port-related activities contributed approximately $6 billion to the California economy (California Research Bureau, 1993).

The waters within California's ports also provide critical sheltered water habitat for a wide variety of ocean and coastal species that are ecologically important, as well as being important to commercial and recreational fishery interests. For example, the waters within the Ports of Los Angeles and Long Beach include some of the last sheltered subtidal habitat in Southern California, providing nursery habitat for some species and year-round habitat for others. San Francisco Bay ports provide critical habitat for commercial Dungeness crab, Chinook salmon, and Pacific herring.

Ocean and coastal resources are affected by port maintenance and development activities because dredge, fill, and other operations within the ports can adversely impact or eliminate habitat. In addition, dredge materials are sometimes proposed for disposal at ocean sites which also can adversely impact a wide variety of ocean and coastal resources.

BACKGROUND

Port development in California (such as dredging to maintain ship channels or filling water areas to increase land for port terminals) is generally subject to the regulatory, planning, or technical consultation authorities of the:

• National Marine Fisheries Service (Fish and Wildlife Coordination Act; Endangered Species Act),

• U.S. Army Corps of Engineers (Clean Water Act; Rivers and Harbors Act),

• U.S. Environmental Protection Agency (Clean Water Act; Marine Protection, Research, and Preservation Act),

• U.S. Fish and Wildlife Service (Fish and Wildlife Coordination Act; Endangered Species Act),

California's Ocean Resources:  An Agenda for the Future					 Chapter 5D:  Ports and Harbors
The Resources Agency of California						 		    July  1995  (Draft)

• California Coastal Commission (California Coastal Act; Coastal Zone Management Act),

• California Department of Fish and Game (California Fish and Game Code; several other State and federal statutes),

• San Francisco Bay Conservation and Development Commission (McAteer-Petris Act; Suisun Marsh Preservation Act; Coastal Zone Management Act) for projects located in San Francisco Bay,

• State Coastal Conservancy (Public Resources Code, Division 21; Coastal Zone Management Act),

• State Water Resources Control Board and Regional Water Quality Control Boards (Clean Water Act; Porter-Cologne Water Quality Control Act), and

• State Lands Commission (Public Resources Code; several State and federal statutes).

The Coastal Zone Management Act (CZMA) establishes a unique relationship between federal and state governments to carry out ocean and coastal management objectives. The California Coastal Commission (Coastal Commission), San Francisco Bay Conservation and Development Commission (BCDC), and the State Coastal Conservancy (Coastal Conservancy) implement important segments of California's Coastal Management Program (CCMP), approved pursuant to CZMA. The Coastal Commission and BCDC require permits for port development activities and must determine if applications for federal permits are consistent with the CCMP. The Coastal Conservancy is designated as the State's coordinator for urban waterfront development. In this role, and through its resource enhancement and public access programs, the Coastal Conservancy has been involved in port affairs including mitigating the impacts of dredging on fish and wildlife, developing facilities for commercial fishing, and working to obtain public access to coastal waters through port properties.

ISSUE ANALYSIS

For the purposes of this discussion, California's ports are divided into three groups:

1. San Francisco Bay ports with developments reviewed by the BCDC (predominant issues: dredging to maintain shipping channels and disposal of dredged materials);

2. Major commercial ports required to produce port master plans under Chapter 8 of the California Coastal Act (predominant issues: expansion of port facilities which usually requires filling or dredging); and

3. Over 25 ports not identified in Chapter 8 of the California Coastal Act, but subject to the Act's standard resource protection policies (predominant issues: port maintenance, small improvement projects, and recreational conflict).

California's Ocean Resources:  An Agenda for the Future					 Chapter 5D:  Ports and Harbors
The Resources Agency of California						 		    July  1995  (Draft)

San Francisco Bay (Bay) includes the ports of San Francisco, Oakland, Richmond, Benicia, Redwood City, and the Encinal Terminals in Alameda. State development permits for these ports, and any other port facility within the Bay, such as proprietary terminals, are issued by the BCDC. Federal permits for projects that "affect" the Bay must be consistent with the BCDC's management program for the San Francisco Bay segment of the CCMP.

Seaport development in the Bay is guided by the San Francisco Bay Area Seaport Plan (Seaport Plan), jointly prepared and administered by the BCDC and the Metropolitan Transportation Commission (MTC). The Seaport Plan was prepared with the assistance of the Seaport Plan Advisory Committee, consisting of representatives from the BCDC, MTC, Bay Area ports, California Department of Transportation (CalTrans), federal Maritime Administration, Association of Bay Area Governments, and Save San Francisco Bay Association. The Seaport Plan planning process seeks to balance the need for port development and operations with the minimum impact to the Bay's natural resources, upland uses, or transportation systems. The Seaport Plan is incorporated into the BCDC's Bay Plan and MTC's Regional Transportation Plan.

Dredging and the Decision-Making Process. Dredging of the Bay for maritime trade, recreational boating, and other public trust uses annually creates approximately 7 million cubic yards (mcy) of dredged material that must be disposed. In addition, there are proposals to deepen existing channels that would result in another 19 mcy of dredged material from the Oakland Harbor, Richmond Harbor, John F. Baldwin ship channel, and two Navy projects. Dredging and the disposal of dredged material can damage the natural systems of the Bay, an estuary of international importance. The dilemma facing Bay ports, maritime shipping, and environmental protection interests is how best to balance the needs of maritime commerce with the protection and management of the Bay's significant aquatic and wildlife resources.

In 1989, concerns about overburdening disposal sites for dredged material and potentially harming local fisheries and ecosystems put a halt to certain major projects for channel deepening. The competing needs of industry, ports, fishermen, and the environment caused a debate over where and how to dispose of dredged material. In response to these concerns, representatives from the U.S. Army Corps of Engineers (Corps), U.S. Environmental Protection Agency (USEPA), San Francisco Bay Regional Water Quality Control Board, and BCDC embarked on a Long-Term Management Strategy (LTMS) to establish solutions to these issues. The LTMS also included the active participation of over 40 other concerned public agencies and private interest groups.

Consensus Approach To Bay Dredging Challenges. The LTMS is a consensus-based problem solving process designed to formulate a long-range management plan and implementation program to guide the disposal of dredged materials from San Francisco Bay in an environmentally and economically sound manner. The draft LTMS management plan was released in August 1994 and a draft Environmental Impact Statement is scheduled to be completed by July 1995. The final Environmental Impact Statement is due to be released in July 1996. The final adopted plan is intended to form a template for development within the San Francisco Bay for the next 50 years. Any policy or regulatory changes developed during the LTMS process will be brought before the appropriate regulatory agencies for their consideration and approval. Technical studies conducted

California's Ocean Resources:  An Agenda for the Future					 Chapter 5D:  Ports and Harbors
The Resources Agency of California						 		    July  1995  (Draft)

In particular, the upland studies address ways to use dredged material as a resource to restore wetlands, maintain levees, or cap landfills. For example, the Coastal Conservancy and other participants worked for two years to develop an innovative approach to disposing of dredged materials which would otherwise be dumped in the ocean. An upland disposal project, known as the Sonoma Baylands Project, is being constructed in North San Pablo Bay using diked low-lying property acquired by the Sonoma Land Trust through a grant from the Coastal Conservancy. The Coastal Conservancy was responsible for the design and engineering work, as well as providing 25% of the financing. The Corps has completed all site preparation, such as work on levees and moving utilities out of the area to be filled. In the next phase, several million cubic yards of uncontaminated dredge materials will be placed on the site, bringing its level up to that of a tidal wetland (it is now below sea level). The Coastal Conservancy has been working with a unique group called the Bay Dredging Action Coalition, comprised of business, labor and port representatives, to help develop this disposal option.

Ocean study processes conducted as part of the LTMS process have provided valuable information about the impacts of ocean disposal which has contributed to the designation of a deep ocean disposal site by the EPA. This site will be limited to the disposal of clean materials and testing requirements for these materials will be stricter than those currently applied to in-Bay disposal. The Coastal Commission concurred with the USEPA's consistency determination for the site designation in April 1994 pursuant to provisions of the CZMA. In September 1994, the Coastal Commission concurred with a negative determination by the Corps for the first major disposal at this site of dredged material from the Port of Oakland.

Major Commercial Ports

Chapter 8 of the California Coastal Act (Coastal Act) establishes specific planning and regulatory procedures for California's "commercial ports" (defined as the ports of San Diego, Los Angeles, Long Beach, and Hueneme). The Coastal Act requires that a coastal development permit be obtained from the Coastal Commission for any development within these ports. However, a commercial port is granted the authority to issue its own coastal development permits once it completes a master plan certified by the Coastal Commission.

The standards for master plans, contained in Chapter 8 of the Coastal Act, require environmental protection while expressing a preference for port-dependent projects. The logic behind this process is that it is environmentally and economically preferable to locate major shipping terminals and other maritime facilities in the major ports instead of siting these major industrial facilities up and down the coastline. Each commercial port in California has a certified port master plan which identifies acceptable development uses. If a port desires to conduct or permit developments that are not included in the approved port master plan, the port must apply to the Coastal Commission for an amendment to the master plan.

Dredging. Dredge and fill operations cannot move forward under these master plans without establishing:

California's Ocean Resources:  An Agenda for the Future					 Chapter 5D:  Ports and Harbors
The Resources Agency of California						 		    July  1995  (Draft)

• a demonstrated need for the dredge or fill operation,

• the severity of impacts from dredge or fill on marine life and other activities within the port, and

• a consensus between State and federal regulatory agencies regarding the adequacy of potential mitigation options.

Ports and various regulatory agencies are attempting to determine acceptable mitigation measures for future expansion. The difficulty centers around the appropriate type and quantity of mitigation, responsibility for land acquisition, management, and remedial actions, and limitations on the use of port funds outside the port vicinity. With the difficulties and costs presented by subtidal or wetland rehabilitation, the ports have been pursuing alternative measures to fulfill mitigation requirements. Regulatory and resource management agencies remain open to considering the use of such alternative mitigation measures as "upland cuts" (already in use at Anaheim Bay, Upper Newport Bay, and Batiquitos Lagoon), "in-bay terracing," or even artificial reefs, if these measures can be scientifically proven to provide an appropriate level of mitigation.

Continuing concern about the potential for problems with fish and wildlife mitigation to delay port development led to the enactment of Assembly Bill 2356 (Chapter 751, Stats.1989). This bill directed the Coastal Conservancy to prepare a report regarding port development and problems associated with implementing appropriate mitigation processes. A final draft of that report, which has been prepared in cooperation with other State and federal regulatory agencies and the ports, is expected to be submitted to the Secretary for Resources in 1995.

In 1992, Senate Bill 1677 (Chapter 575, Stats.1992) was enacted, requiring the analysis of new mitigation processes for port development. This bill authorized the California Association of Port Authorities to prepare a report that "identifies and describes deep-water habitats that could be enhanced, restored, or created as potential mitigation associated with the construction of port facilities in deep-water areas located within a port." The bill required the Coastal Conservancy, California Department of Fish and Game (DFG), and Coastal Commission to review the report, which has been submitted to the three agencies. The legislation required the reviewing agencies to:

"...verify the information and scientific methodology in the report, including, but not limited to, the geographic location, size, type and value of habitat, public benefit, biological costs and benefits, and financial analysis."

California's Ocean Resources:  An Agenda for the Future					 Chapter 5D:  Ports and Harbors
The Resources Agency of California						 		    July  1995  (Draft)

Processes to Facilitate Mitigation Solutions. One process used to coordinate upcoming port developments in Southern California, and possible regulatory approaches, is the Bio-Mitigation Team. This team includes representatives from the ports of Los Angeles and Long Beach, Coastal Commission, Coastal Conservancy, DFG, National Marine Fishery Service, U.S. Fish and Wildlife Service, Corps, and USEPA. The team was established as a cooperative problem solving group in the mid-1980's to facilitate discussions between the ports and regulatory agencies. Although the process has been helpful by providing a discussion format between the ports and the agencies that regulate them, it has been difficult to gain consensus on major issues as there is no mandatory process or deadlines for decision making.

Developing regional mitigation banks is a strategy that may help facilitate mitigation projects to offset fish and wildlife impacts. Regional mitigation banks would involve the acquisition and enhancement of upland or degraded wetland areas or subtidal habitats by public or private organizations. Habitat values created on these properties could be used by ports as compensation for values lost in port development activities. Once properties were enhanced and regulatory agencies assigned values to them, habitat credits could be sold to ports, enabling them to move ahead with development projects.

The Coastal Conservancy has developed a regional mitigation bank along Humboldt Bay to offset the impacts from an industrial area, and has completed other mitigation projects, most notably at Huntington Beach. The Coastal Conservancy has also been working with a private landowner in Orange County to develop a joint public/private mitigation bank. The Coastal Conservancy may be the appropriate lead agency to work with ports and regulatory agencies to develop a larger regional bank network in Southern California. However, additional funding and the ability to acquire private property would be needed for such a program. Governor Wilson's wetlands conservation policy specifically calls for the development of mitigation banking guidelines to facilitate this type of approach. On April 7, 1995, the Resources Agency released a document titled "Official Policy on Conservation Banks" which addresses mitigation banking procedures for a variety of resources, including wetlands.

Major Improvement Projects. In the early 1980's, the ports of Los Angeles and Long Beach (LA/LB) unveiled a major development proposal to fill approximately 2000 acres of the outer harbor by the year 2020 at a cost of up to $4.5 billion dollars. It now appears unlikely that the ports of LA/LB will pursue the massive filling envisioned in the original "2020 plan," and are working instead to implement a series of initial development phases. The Coastal Commission approved a request to amend the Port of Los Angeles (POLA) master plan to allow 390 acres of fill. The POLA began construction on a first phase of 250 acres, and will mitigate the impacts of this fill by

California's Ocean Resources:  An Agenda for the Future					 Chapter 5D:  Ports and Harbors
The Resources Agency of California						 		    July  1995  (Draft)

The Port of Long Beach (POLB) has amended their original approach. In 1988, the port received approval for a 147 acre fill at Pier J which has been completed. Instead of pursuing a substantial outer harbor fill project at this time, the POLB bought approximately 700 acres of land owned by the Union Pacific Resources Company and will re-develop these lands to serve their purposes. The POLB still desires to fill approximately 100 acres to upgrade facilities and is currently working with regulatory agencies to develop an acceptable approach for mitigating this development.

Infrastructure Challenges. Growth in port cargo movements continues to increase the need for landside facilities and transportation facilities. Over the last thirty years, containerized shipping has revolutionized maritime port services, necessitating container cranes, shoreside storage space, truck and rail transportation connections, and dredging to ensure water depth for larger ships. Activities include commercial shipment of liquid or dry bulk cargoes, containers, neo-bulk cargo such as steel, lumber, or autos, and general cargoes. In addition, maritime activities normally include passenger vessels, ship repair or construction, and related ocean vessel support services.

A major challenge for the ports of LA/LB and some Northern California ports is the lack of adequate facilities for land transportation of goods to and from the port facilities. The ports of LA/LB are working with local governments to gain approval to construct the Alameda Transportation Corridor. This corridor would create a truck and rail thoroughfare between port facilities and major facilities in downtown Los Angeles. The Port of Oakland is working to improve existing rail facilities through the Sierra Nevada mountain range to allow them to better serve markets in the Midwest and on the East Coast.

Other Ports Not Identified in Chapter 8 of the Coastal Act

The remaining ports along the coastline (over 25) come under a different standard of review than the "commercial ports" designated under Chapter 8 of the Coastal Act. These ports are not granted permitting authority and must apply for coastal permits for proposed facility developments. The Coastal Act does not require that port master plans be developed for these ports and harbors, although planning activities occur through local port planning districts. These ports are critically important to the State because they support major recreation, fisheries and industrial uses. Most of these ports are smaller than the San Francisco Bay and "commercial ports," but face many of the same management issues. The smaller ports experience competition for valuable port space, dredging is often required to maintain entrances, and recreational and commercial vessel traffic conflicts often arise. Examples of some of these ports and harbors located along the California coast include Humboldt Bay, Moss Landing, Port San Luis, Newport Bay, and Dana Point Harbor.

California's Ocean Resources:  An Agenda for the Future					 Chapter 5D:  Ports and Harbors
The Resources Agency of California						 		    July  1995  (Draft)

FINDINGS AND RECOMMENDATIONS

Finding

California's ports are vital components of the national, State, and local economies, generating over $6 billion for the California economy in 1992. Port maintenance or improvement activities, which can be achieved in an environmentally acceptable manner, are important factors in maintaining a growing port industry. State processes for evaluating proposed projects, associated mitigation measures, and monitoring procedures can be complex and time consuming. This situation is compounded by requirements of the various federal agencies that often have separate processes and standards for this development. Government agencies and ports must continue to pursue innovative planning approaches, regulatory procedures, and technical analyses that will lead to greater effectiveness and efficiency in meeting California's port development needs.

Recommendation D-1.

Improve existing processes for reviewing and acting upon port maintenance and improvement proposals. Improving the efficiency of regulatory and planning procedures is a complex undertaking due to the nature of the issues at stake, such as the type of development (dredging, filling, pier construction), degree of habitat impact (wetland, subtidal), and availability and suitability of mitigation options. An evaluation should consider new procedures, approaches, or mitigation strategies and should be based in part on a thorough review and consideration of the following documents, among others:

• The State Coastal Conservancy's report prepared pursuant to AB 2356 (Chapter 751, Stats.1989) regarding port development and problems associated with mitigation processes. The report, to be submitted to the Secretary of Resources, will provide a number of recommendations for improving the determination and implementation of appropriate mitigation for port development projects.

• The report prepared by the California Association of Port Authorities pursuant to SB 1677 (Chapter 575, Stats.1992) regarding subtidal mitigation options, and the technical analysis of that report conducted by the State Coastal Conservancy, California Coastal Commission, and California Department of Fish and Game.

• The Long-Term Management Strategy for San Francisco Bay, which is providing a consensus-based approach to dredging and dredge disposal options for the Bay.

California's Ocean Resources:  An Agenda for the Future					 Chapter 5D:  Ports and Harbors
The Resources Agency of California						 		    July  1995  (Draft)