Newsom signs order to help tackle supply chain issues
OCTOBER 24, 2021
As global supply chain issues continue to affect California, Gov. Gavin Newsom signed an executive order directing state agencies to identify additional ways to alleviate congestion at the state’s ports.
“California’s ports are critical to our local, state and national economies and the state is taking action to support goods movement in the face of global disruptions,” Newsom said in a prepared statement. “My administration will continue to work with federal, state, labor and industry partners on innovative solutions to tackle immediate challenges while also bringing our distribution processes into the 21st century.”
Record demand for imported goods combined with capacity issues across the supply chain worldwide have slowed distribution at ports. Delays caused, in part, by the pandemic, as well as a recent massive oil spill off the coast, have led to a large backlog of ships waiting to enter two of the most prominent ports in the nation: the Ports of Los Angeles and Long Beach.
Additionally, a shortage of truck drivers and railway workers that typically help deliver goods to their final destinations once they get off the ships has increased delay.
The order directs state agencies to determine state-owned properties and other locations that could help alleviate short-term storage needs once goods are taken off of ships, identify priority freight routes that could be temporarily exempted from vehicle weight limits to allow them to carry more goods, and create workforce training and education programs.
The order also calls for agencies to coordinate with the Biden-Harris Administration Supply Chain Disruptions Task Force to address current challenges, along with the Department of Finance to develop longer-term solutions, such as port and transportation infrastructure improvements, including electrification and workforce development, with those plans set to be considered in the governor’s budget in January.
California business and industry groups representing each of the various parts of the supply chain — all of which are being affected — released a statement in response to Newsom’s order, noting that while they support the governor’s response, it’s the first of many steps needed in addressing the crisis.
“There are additional real, tangible actions the governor could take to meet the moment and tackle this crisis head-on, but convening taskforces in 2022, delaying urgent actions for at least a month, and pushing funding discussions to the January budget proposal do not provide the sense of urgency needed to address this crisis now,” a statement released by the agencies read. “Medical supplies, component parts for manufacturing, diapers and basic household necessities are sitting off the coast or in containers at the ports, while California-grown agricultural products are waiting to be exported around the world.”
The statewide coalition, which includes the California Business Roundtable, California Retailers Association, California Grocers Association and California Trucking Association, among others, also sent a letter to the governor, outlining specific action items that could be taken now to help alleviate the issues now and into the future, such as declaring a state of emergency at the ports, as well as suspending Assembly Bill 5 to allow independent truckers to operate in the state.
Writer: Emily Alvarenga