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TIA and the Port: One Proactive and One, Who Knows?

September 9, 2011

Tampasphere has been quite clear that we believe that those in charge of public assets, like the port and airport, should provide information on their plan/vision for how to make their public asset an engine for the local economy.  Thankfully, the Airport Director did just that this last weekend.  In this piece for the Tribune, the Director laid out a proactive vision.  We applaud him for doing so and, given how close it is to what we asked for, wonder if he has been reading Tampasphere (full disclosure – we have no idea if he has).

Tampasphere is aware that it is just a vision and various factors can influence its speed and success, but at least it is a publicly stated vision.  Moreover, one thing you do not find in the vision is anything about how the economy is the main factor.   It is a proactive vision to drive business not wait for others to create it.  We also like that the Director is upfront that you have to invest some money to get a return.  In a competitive, global environment, you cannot sit back and expect everyone to come knocking at your door.  Tampa Bay has to compete, and that takes some spending.

Now, it is the Port Director’s turn.  We urge him to provide a vision.  We note positively that he is working to get a rail connection to the container facility.  We also think it is a good sign that some of the port’s business is up.  However, we note a continuing theme in his comments:

“Ports tend to be indicators of economic performance — in fact leading indicators — of when businesses start to spend money,” Tampa port director Richard Wainio said.

Once again, this is a reactive, not proactive, attitude.  The logic seems to be the port will do well when the other business picks up (certainly to some degree true), not the port will actively work to create new markets and new business.  An economic engine drives the economy, it does not just ride the economy.

Giving credit where it is due – the Port Director is discussing a few issues, but, at least as reported, not how the plan to deal with them:

Speaking to the Hillsborough County Metropolitan Planning Organization Tuesday morning, Wainio admitted that the Sunshine Skyway Bridge’s size (182 feet above the water) is definitely a factor that will limit expansion of that part [cruise ship] of the Authority’s revenues in the years to come.

That’s because new “mega-ships” don’t and won’t be able to fit under the bridge in the years to come. Wainio says that there are two sizes that luxury ships come in these days – small, mid-range ships that hold between 2,000-3,000 passengers, which are not the ascendant type of design that exists these days, and the much larger ships that hold as many as 6,000 passengers, which Wainio says Tampa’s cruise terminals can’t handle.

When asked directly by Commissioner Kevin Beckner if that meant a diminishing number of tourists coming through cruise ships in the long term, Wainio said “Longer term, yes.”

Ok, We understand the problem.  What is he planning to do about it?  Is the plan just to have the business wither?

And this:

But when asked by Beckner if there were any new export opportunities out there, Wainio admitted that the fact is, most of the things exported from the Port are not manufactured in Florida, but instead come by truck from other ports of call.

“I told (Governor) Scott face to face, you can pour money into Ports, but the umbrella that drives the need for that is economic development. They need to spend a great more effort on encouraging economic development…if you don’t bring in right firms that manufacturing, you’re not going to create export opportunities…they need cargo to take out, otherwise they’ll go to Savannah and Charleston (in South Carolina), they’ll truck down to Florida like they do now,” he said. He also mentioned that recently that the Port loaded up a ship recently with railroad ties to Panama – but those rail ties were made in Pittsburgh.

Well, in a way, good.  We should be drawing goods from elsewhere to export from the port.  Also, if is works to export things made in Pennsylvania, what about serving their imports, especially with the swell new rail connection they are adding at the port?  And what is the port doing to help land manufacturing locally to add to its customer base and to export more items from far afield?

And about the Panama Canal:

Tampa City Council and MPO member Lisa Montelione remarked to Wainio that “the perception is you need a 50 foot deep port to be competitive,” but had said previously that’s not necessary, adding that perhaps deepening to 45 feet would be sufficient.

The Port Authority Director replied that the Tampa Port currently is as deep as “any port out there,” and said that competitive ports like Houston and New Orleans have no plans at this time to deepen their ports, but said Miami is doing so. “I’d love (to go to) 48 feet, but that’s very expensive,” he added.

Tampasphere is not sure that Tampa’s channel is as deep as any port out there – here is a list- but we are not going to quibble about that now.  We are also not going to quibble that dredging is very expensive – it is.  What we are concerned about is what is the plan to keep/make the port competitive so it can drive the economy (so, if there are no other ports that can handle these ships, it seems like it may be a good idea to become one of the first).  Plus there is this:

Perched on the meandering Mississippi, the Port of New Orleans is one of many facilities that has struggled to match infrastructure to its opportunities.

It is investing $650 million on new canal-linked projects, mostly on container terminals, but CEO Gary LaGrange said the port is still not at fighting weight.

We’ll be ready, but not as ready as we could be, or should be,” he told AFP.

* * *

LaGrange said New Orleans already holds much-sought-after permission to dredge its channel to 50 feet (15 meters) — enough to handle post-Panamax ships.

But bureaucracy means the project is on the back burner.

Right now it is everything we can do to get the Corp of Engineers to maintain it at its current 47 foot depth,” he said.

Similarly the Port of Beaumont, in Texas is waiting for approval of a $1.2 billion project to deepen its channel.

But even if the project is approved this year, it is likely to take 15 years to complete.

So New Orleans knows it is not ready to take advantage of the opportunity but they have at least made some provision for the 50 foot channel, as has Beaumont.

In the meantime shippers are looking to deeper ports beyond the United States; to Freeport in the Bahamas and Kingston in Jamaica.

“Unless we can get more channel capacity they are going to be the primary beneficiaries of an expanded canal,” said Sanford of the American Association of Port Authorities.

It is interesting to note that the Zim line, which is the primary container service into Tampa, has a hub in Kingston, Jamaica – just saying. (And if you read the link blurb, you’ll notice the size of the ships serving Tampa – 2 x 550-700 TEU’s vessels – seem a little small considering the multi-thousand TEU ships plying the seas)

And Houston:

These days, about 20 percent of the cargo containers that make their way to Houston come through the canal and that could increase to 35 percent once the expansion is complete, said Port of Houston Authority Chairman Jim Edmonds.

Accommodating the larger vessels that will be able to transit the canal will require dredging the Houston Ship Channel to a depth of 50 feet from 45 feet, among other projects.

“We need to be ready because Panama is ready,” said Houston City Controller Ronald Green, who was one of more than two dozen Houstonians participating in the trade mission.

So Houston knows it is not really ready either.  What about Tampa?

One other thing – recently the port pulled its funding for the streetcar.

Port authority board members who favored discontinuing funding argued the streetcar adds nothing to the maritime role of the port.

And yet a couple of weeks later, more problems were reported at the Channelside shopping complex. We are told:

“The Port is very dissatisfied, because they see this building as something that should be special in Tampa; should be a crown jewel.”

* * *

The property is owned by the Port Authority, but the complex is run by a receiver, the retail and development giant Madison Marquette, which was appointed by a state court after the bank holding loans on the complex foreclosed.

* * *

Out of more than $614,000 in capital budgeted over the last 12 months, just $150,000 has been spent, primarily because the bank involved, Anglo Irish, is selling its U.S. loan portfolio, including Channelside.

Entertainment complex – hardly a maritime role.  We are not going to get into all the Channelside details.  However, there is this regarding cutting money to the streetcar:

The port staff said it’s not possible to quantify possible impact on the port’s property values including the Channelside shopping, restaurant and entertainment land the port leases.

So the port staff has not worked out whether hurting the streetcar hurts the port’s own underperforming property, but the port went ahead and hurt the streetcar anyway, providing a justification – maritime role – that contradicts the port’s own actions in owning Channelside.

If the port were a private business, this would be fine.  The owners of a company are entitled to make whimsical decisions.  But the Port is not private.  Neither is the streetcar.  The port is also tax supported, unlike the airport.  This needs a better explanation.

The airport is doing its part (Let’s salute the flights to Cuba). The Port has many questions – let’s hear its vision and plan.

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