It seems everyone expects the Port’s container business will continue to increase as it has for the past 25 years. That may not happen. There are several ominous events that may mean the Port’s container business is destined to level off. The Port’s recent announcement about the new bigger than ever terminal does not change the possibility of a leveling off at about the 2005 level of container cargo. That year was great because we got a lot of overflow from LA’s system breakdown. That overflow was enough to strain the Port of Tacoma’s capacity.

Rail Capacity is maxed out. Only if the rail tunnels through Stampede Pass are enlarged for double stack cars can capacity be increased. Even so the rail service from the Port to mainline rails is constricted as well as access through Auburn to Stampede Pass.

Federal and State funding could help alleviate this situation but that is years away at best. If it does happen then rail traffic through Auburn will be about the same as the rail traffic that now passes by the new Chambers Bay trails and golf course. A giant train every few minutes.

Without improved rail access the Port capacity is limited to local demand and truck capacity. The future for local truck service is bleak at best. R-167 is unlikely to be funded and I-5 improvements will be lucky to stay even with present truck demand and the regional population increases.

Even more ominous are new container ships with 15,000 or more teu capacity. 5,000 teu used to be a large ship. These new ships cannot be efficiently unloaded at existing Port terminals. For shipping companies the most important port service is the ability to unload, load and send a ship away as fast as possible. Tacoma’s docks and cranes are inadequate and rail capacity is incapable of taking a container away fast enough. It is almost certain that these ships will by pass Tacoma in favor of Los Angeles, Prince Rupert, B.C., or new private ports on the Oregon coast. Once they leave they are unlikely to return unless the Pierce County residents obligate hundreds of millions more in bond financing to buy new cranes and fund railroad improvements.

So, how do I Propose to increase Port revenue, increase Longshore and other Port jobs by 50%, pay for all Tide Flat expenses, and also manage to phase out the property tax subsidy that is the required guaranty for the Port’s general obligation bonds?

Here’s how:

Federal DHS funding has so far constituted the largest pork waste in America’s history. High priority threats have been ignored in favor of low priority ones and millions more have gone for projects that clearly have nothing to do with terrorist threats. Pure Pork to the amount of $20 Billion and counting.

Port Security funds have gone to fencing, lighting, and all the other police type security that should have always been in place regardless of terrorist threats. What little funding the Port received was not enough to pay for the expenses but at least the Port was able to get some security improvements without paying the full cost.

All this time all American ports have missed out on the real opportunity to make money and provide real defense against the ultimate high priority threat….a nuclear attack.

We have been warned. The next terrorist attack will make us forget about 9/11. You may or may not believe it but I do. For this discussion it does not matter. What matters is that the American ports are the best, last and only place where a nuclear attack by a container delivery system can be thwarted. Instead of intentionally passing on this opportunity the American ports, as a unified body, should demand to participate and charge for this nuclear defensive service to America.

Double handling of the containers as they pass through a container terminal will be needed. That will increase labor demand by about 50%. Now, if the American ports cannot cooperate with each other that still leaves the American Longshore labor to take advantage of this windfall. They can do so in good conscience because they will be helping defend America just as they did in WWII.

The technology to reliably detect atomic materials inside a container is proven, tested, available for demonstration, and ready to go into service. The holdup is not technical, it is political. Tacoma has lobbied Senator Murray to lead the Port’s political opposition to participating in nuclear defense. That has been a disservice to Senator Murray, the Port itself, Pierce County taxpayers, and to America. As a group, American ports are 5 years behind and have missed out on a big chunk of that $20B of DHS funding. Tacoma cannot go alone. It must be all ports or none. Shippers will not willingly support a surcharge or a delivery delay due to double handling.

The surcharge will be on the order of $150 per import teu (20 foot equivalent). In 2006 the Port received 746,327 import teu’s. That number would have produced a for profit surcharge revenue of 120 million dollars for the Port of Tacoma in just one year. The cost to American consumers would be about 0.5% including profits for the shippers and retailers. That is $5.00 on a $1000 purchase. So what’s the big deal considering what it is paying for?

Last year the Port’s total operating revenue was $102.5 million and the taxpayer levy was $11.88 million. The net profits from additional inspection revenue of $120 million should more than cover a gradual phase out of the levy and leave enough to start reimbursing the City for Tide Flat expenses. That’s true even if the Port’s container business levels off. Nor does it include the potential revenue and Longshore labor to help defend against another Trojan Horse nuclear threat which is import autos.

A glance at the Port’s Balance sheet shows no item for retained earnings. Apparently the Port has operated a not for profit corporation for some time; maybe always. That’s not a good record for a $ billion corporation. I believe I have pointed the way to perpetual profits regardless of the likely departure of some of the Port’s shipping customers and other negative economic conditions.

New leadership is vital. We cannot rely on DHS. We must unify the American ports and pressure Congress to pass the necessary legislation to make technically correct demands of DHS or whatever agency supersedes the dysfunctional DHS.

The Port has direct access to two of the most influential members of Congress, Murray and Dicks. Norm personally told me nearly 5 years ago that he would support anything the Port wanted to do. At that time the Port was busy lobbying Murray to do nothing. Not knowing better she complied. Of course, Norm did just as he promised which was to also follow the Port’s wishes.