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Port Stresses Channel Deepening in Draft Strategic Plan by Mike O'Bryant Columbia Basin Bulletin - January 24, 2003

As it publicly considers its strategic plan, the Port of Portland puts high on its list of needed projects deepening the Columbia River navigation channel by three feet to accommodate newer deep draft steamships.

The quasi-governmental agency is the lead port in a regional effort to push through the $156 million channel deepening project, which also involves the U.S. Army Corps of Engineers and the states of Oregon and Washington.

Also on the port's list of objectives is cleaning up the lower Willamette River port area listed by the Environmental Protection Agency in 2001 as a Super Fund site.

The Columbia River basin's largest port released its draft strategic plan this month and is taking it to the public for comment before the Port Commission adopts the plan in March, Bill Wyatt, the port's executive director, said at a public meeting attended by about 50 people Thursday night in Portland. The port is also taking its message to other stakeholders, including river and bar pilots, shippers, unions and it even has scheduled a meeting in Astoria, an area where some of the channel deepening project's strongest critics reside.

The number of issues facing the port is larger, but Wyatt said the plan identifies six of the port's most significant challenges. Those issues include the port's financial viability, its environmental performance, relations with stakeholders, competitive maritime access, air service to key markets and trade-related infrastructure.

"Deepening the channel to 43 feet is an important metric to accommodate the largest grain and bulk vessels coming up the river," Wyatt said. That is also the depth that would accommodate the deepest draft ship that could traverse the Panama Canal.

He added in response to a question that the Port of Astoria isn't appropriate for a large deepwater port, as some have suggested, because it lacks the infrastructure, such as rail and highways needed to support the port. In addition, it lacks the land to be a major port. Terminal 6 at the Port of Portland, for example, is larger than all of downtown Astoria, according to Wyatt.

There is a deepwater site a little further downriver at Warrenton, he said, but that and Astoria occupy one of Oregon's most sensitive environments, the lower Columbia River estuary.

While two-thirds of the port's business is from air traffic and is self-supporting, its maritime business continues to be subsidized. Three percent of the port's day to day $360 million marine and administration budget is paid by taxpayers, according to Wyatt. The remainder is paid by revenues from shipping activity. But that doesn't worry Wyatt, who said other Northwest ports are subsidized at a higher rate. Seattle receives about 35 percent of its operating expenses from taxes; Tacoma about 20 percent; and Vancouver about 12 percent.

"We're unable to generate sufficient revenue to cover all our costs plus the infrastructure investments plus the capital investments," Wyatt said. "If we could generate enough dollars through this activity, we should probably sell it." Wyatt quipped.

A difficulty of getting the port to a self-supporting level is that it exports more than it imports and a better balance would result in more balanced revenues. One problem is the container business, which requires shippers to sometimes import empty containers to carry home full containers from the Northwest. Anytime a shipper carries empty containers, he is losing money, according to Wyatt, and so does the port.

"What goes out full needs to come back full, too," Wyatt said. "If it is empty, the exporter pays both ways."

Obtaining that balance, however, could be difficult because it would require the region to increase imports and it's difficult to attract more imports to an area of only about one million people, he said.

Consequently, the port's direct revenues do not support such large infrastructure projects as deepening the channel without help from local governments and states. Each state has earmarked $17 million to pay for a portion of the $156 million channel deepening project, with Oregon's share coming from lottery bonds. "Without those commitments, we would be unable to meet the capital needs of our mission," Wyatt said

Also on the port's list of issues is the environment. "Everything we do intersects with the sensitive environments of the lower Columbia River," Wyatt said. "Being an environmental steward is quite challenging."

He said that the Portland Harbor Super Fund site is partly due to activities during World War II and the following few decades before environmental regulations existed. "Wouldn't it have been nice if back then we could have imagined the balance and tradeoff with the environment?" he asked.

He said hundreds of businesses are responsible for cleaning up the harbor and that eight of the major players, including the port and the city of Portland, have signed an agreement with EPA outlining how the cleanup will proceed. "It's our front yard and it's an assault on our community," Wyatt said. "We feel as a public agency that it needs to be cleaned up as early as possible, even if that's faster than other parties."

Related Sites:
Port of Portland: www.portofportland.com