Gov. Newsom Proposes $2.3 Billion in Funding to Get Goods Moving, Reduce Supply Chain Bottleneck in New State Budget

Sacramento, CA – This morning, Gov. Gavin Newsom proposed allocating $2.3 billion for supply chain investments in the new state budget. The funds will help address congestion and bottlenecks across the West Coast.

California Association of Port Authorities President and Executive Director for the Port of Oakland Danny Wan thanked Gov. Newsom for his commitment to investing in California ports and addressing the global supply chain crisis. He said, “I applaud Governor Newsom for his leadership and continued support of California ports. Our state’s ports can play a critical role in fixing America’s broken supply chain. We must take a holistic approach that incorporates a reinvestment in infrastructure, technology and data-driven methods that will help get goods moving. This budget proposal reflects a historic commitment to California’s ports.”

At the start of the COVID-19 pandemic, California ports saw significant decreases in trade with record breaking impacts. But demand rose as consumers grappled with adapting to a new world that revolved around remote work and virtual learning. The surge in cargo has created unprecedented challenges across our state’s coast. California ports stepped up and took action to help address supply chain disruption.
Over the past decade, the federal government has invested roughly $11 billion in the eastern Gulf coast ports, but only $1 billion in the West Coast ports. Consequently, California ports struggled to keep up with rising demand.

The proposed investments in the supply for the 2022-23 fiscal year 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.
  • 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 Governor’s Office of Business and Economic Development 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.

The 11 major commercial ports that comprise the California Association of Port Authorities handle 40% of all containerized imports and 30% of all exports in the U.S. – reaching every corner of the country. This cargo is responsible for more than 1 million California jobs and 3 million jobs nationally. Collectively, the California ports are the most consequential system of ports in the nation.