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State-ownership Not the Solution for Portland

by Staff
Port Strategy, May 24, 2016

The Port of Portland's executive director has rejected a recent proposal
from president of Common Sense for Oregon for the port's Terminal 6.

Many Oregon shippers have been taking longer routes to get goods to ports Seattle and Tacoma in Washington since two bigger shipping lines, Hapag-Lloyd and Hanjin, pulled out more than a year ago. (Leah Nash photo) Bill Wyatt believes that creating a state-owned authority, Oregon Shipping Authority (OSA), does not solve the problems which currently face the terminal.

In a letter to Port Strategy, Mr Wyatt said: "While we are open to new ideas, his proposal doesn't fix what's broken here or globally."

"We understand the desire to seek a solution to the lack of direct container service from Portland and the frustrations by affected Oregon shippers created by the on-going problems at Terminal 6."

It was reassured that restoring full container service is the port's top priority and the Port of Portland believes that demand for direct container service in the region remains strong.

Mr Wyatt accepted that restoring service at Terminal 6 still remains a challenge: "We are seeing a carrier industry that is struggling from overcapacity, low freight rates and a significant reshuffling of alliances affecting vessel deployments and routing decisions."

Despite the challenges, the Port of Portland is positive that there is a strong market proposition for direct carrier services in Portland. But carriers will need assurances that they will not experience further disruptions and receive a reasonable level of productivity.

These challenges of local and global dynamics will not change by creating a new authority, which is presented in the Common Sense of Oregon proposal.

The proposed project is headed up by president of Common Sense for Oregon, Kevin Mannix. It is in its fourth month and aims to present a draft bill for consideration by the Oregon Legislature in January 2017.

Mr Wyatt continued: "Among issues with creating a new authority is the concept that would create a redundant government entity that offers the same function as the Port of Portland at a higher cost."

"It would seek state finding to duplicate activities and services the port currently provides to the terminal operator, ICTSI, including police coverage and security, terminal and crane maintenance and berth dredging."

Following the lease of the terminal by the Port of Portland to a private operator in 2010, disputes between the terminal operator and the longshoreman's union resulted in problems at the terminal.

The proposal from Mr Mannix suggests making longshoreman public employees, but the Port of Portland executive director argued that this would likely not be acceptable to the unions or shipping lines who collectively bargain with the ILWU under the West Coast agreement.

"It is worth noting that there is not a single public operated container terminal on the west coast," explained Mr Wyatt.

"Public entities like that Port of Portland have not been considered for membership in the Pacific Maritime Association and it is highly unlikely that they ever would be, which means the new entity could not employ longshoremen directly or as state employees."

The Port remains confident that it will provide access to global markets for companies and producers through container service.

Mr Wyatt's letter concluded: "We know that trade cannot wait on a solution and that solutions aren't simple."

The state governor called has called for the port, along with Oregon Department of Transportation, the Oregon Department of Agriculture and Business Oregon, to participate in the Trade and Logistics initiative.

Related Pages:
Here's Why Portland Won't Get New Shipping Container Service Anytime Soon by James Cronin, Portland Business Journal, 5/9/16

State-ownership Not the Solution for Portland
Port Strategy, May 24, 2016

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