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California is slated to receive $5B in loan funds to be used for improvements to the state’s ports, which have been clogged as a result of pandemic disruptions and record consumer demand.
California Gov. Gavin Newsom and U.S. Secretary of Transportation Pete Buttigieg announced a partnership Thursday that would help update port infrastructure to prevent issues like the current congestion in the future.
According to the Los Angeles Times, the improvements would likely be forward-looking and their benefits might not be apparent for years.
“Today’s announcement marks an innovative partnership with California that will help modernize our infrastructure, confront climate change, speed the movement of goods and grow our economy,” Buttigieg said in a statement.
The spotlight on port congestion turned on during the coronavirus pandemic as e-commerce demand soared, but experts have said that the problem was caused by many factors, a number of which predate the pandemic, and that it will be complex to eliminate the snarls.
The agreement “allows California to expedite work on a network of related projects — rather than using a piecemeal approach — that collectively will help grow the economy, protect the environment, facilitate the movement of imports and exports, and bring supply chain processes into the 21st century to create resilience,” in the state and country's critical trade corridors, including the San Pedro Bay ports and the Inland Empire, a release from the governor said.
The money would come from existing U.S. Department of Transportation programs, but it would also include some state funds and public-private financing, the LA Times said.
It’s unclear exactly how the money would be spent, the LA Times notes, though releases from both the governor’s office and the Department of Transportation list a number of projects that could receive money, including upgrades at the ports, developing increased warehouse storage space inland, upgrading highways to improve truck travel, and the electrification of rail yards and trucks.
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