The West Coast has a couple of worries
All eyes are on the potential East Coast strike, but ports on the West Coast are suffering in a different fashion. First, Seattle.
Its low sulfur incentive scheme, similar to those of Southern California, is in trouble because a state audit says the rewards are an illegal gift of public money. The audit’s gripe is that the port is paying the Puget Sound Clean Air Agency to administer the scheme.
“The port concluded that certain aspects of air-pollution reduction programs were outside of its authority and entered into an agreement with the Agency to operate the program. The port may not pay another party to perform the activities it is not authorized to do.”
The state also takes the port to task for not having a mechanism to refuse payment if the agency spends the money for some other purpose. But, as the port says, it would have made the phone lines to the lawyers red hot if the money was spent wrongly.
The audit’s recommendation? That “internal controls” be set up to make sure the port is acting legally.
Which leads to groans of despair all round. Officials went to great lengths to make sure they were acting legally, which is why the Clean Air Agency was brought in. The audit smacks of zealous officials combing through records to find some error to justify their jobs. And we can be sure that in the years to come there will be more of these officials eager to smother daily life with bureaucracy. More interference in daily life can be expected.
But that’s a minor issue. More serious is the port’s new deal to keep Total Terminals (Hanjin Shipping) busy. According to the harbor commission agenda the port is paying Hanjin $4 million, changing the terminal fee to a minimum annual guarantee and almost giving away a number of cranes. The terminal handles about one-fourth of the port’s container business.
Competition from Tacoma is obviously taking its toll. A port commissioner, Rob Holland, told the Puget Sound Business Journal: “We are in a very tough situation; I’m kind of likening it to Baltimore. We’re going to have to do the best we can, and keeping this terminal active is one of those examples of helping us move forward.”
And then there is the furor over the new sports stadium, which is seen as a serious threat to traffic movements and, ultimately, the port as an attractive investment.
Moving further up the ladder, Seattle has labor problems of its own. A possible lockout looms at the grain terminal (and a couple of others), where the ILWU is considering a “last, best and final contract proposal” from the grain companies.
Judging by industry press reports, the terminal owners (Dutch and Japanese) are ready to set up contracts with non-union workers. No ships have called at Seattle since August – an indication that the owners do have stand by arrangements ready to go. That’s also a probable reason for the port almost begging Hanjin to stay.
Going into the New Year, Seattle has food for thought on its plate.