Port of Long Beach Prepares for More Traffic – With or Without Bond Funds

Last month the Legislature to put a measure to fund goods movement, transportation, and levees on the June ballot. What was the significance of that failure from your perspective as a Long Beach port commissioner?

It increases our burden. We already have tremendous infrastructure responsibilities, and foremost among those is a replacement for the Gerald Desmond Bridge. We received only $100 million out of the T-21 federal legislation, and we have to sort out how we're going to come up with another $750 million. We also have the huge burden of our electrical service for cold ironing, which amounts to multiple hundreds of millions of dollars. We have to have contingent planning because we have to provide for this cargo. Whether we'll be able to do that or not, I'm not sure. We were looking to that infrastructure bond issue as a major source of support for us.

As someone who has served long in county and city government, why is it so difficult for the Capitol to address these trade infrastructure and transportation funding issues? Why the failure on March 15?

By and large, our Legislature has too many people on the ideological fringes-on both sides of the aisle. We don't have enough folks in the middle, and the solutions are always in the middle.

The press covered that series of negotiations as if it was a political debate on how the governor could resurrect his poll standing. How do you get the media and the public to focus on what's lost if these bonds are not given a chance to be voted on by the public?

I regret that I've come to the conclusion that the Legislature can only deal with a crisis that is hitting them in the face at the moment. It's very difficult for them to look to the future, even a future that is just over the horizon. As we all know, the future has no vote. As a consequence, we're always pandering to today's politics. We're always paying attention to the story that is in our face, and it's usually a story about some sort of crisis. And that's what the public and media are responding to.

In early March the Port of Long Beach announced its strategic plan that will guide the port for the next ten years. Can you tell us what's involved in that plan and what its priorities are?

The number-one priority is environmentally smart growth and sustainability. Those are the themes and watch-words. I think every single commissioner realizes that the two ports create significant environmental problems for our neighbors and, indeed, the region. And we believe that we have to take the lion's share of the load for correcting those problems. The ten-year plan reflects that philosophy and commitment.

When we last interviewed you in September of 2004 you spoke of the limited ability of the ports to grapple with the bottlenecks that have come from expanding trade. Can you talk a little bit about the impending bottleneck and what ability the ports themselves have to respond to the challenges?

In terms of dealing with the bottleneck we experienced in 2004, I think all the components of the logistics chain have responded well. I don't think that we're going to see those kinds of problems again in the near future. But our ability to handle the increase in volume of cargo that we're going to see in the next decade is severely impacted by the environmental requirements of CEQUA and NEPA. Even when we're doing a project that is extraordinarily beneficial for the environment, we have a long, long environmental review process, and chances are that we will be challenged at some level by an environmental group that basically wants to hold the project hostage – not because it's not a good project, but just because they can. And however good the project is, they always want to see it better. As a consequence, we have a number of projects that would significantly improve on-dock rail-which everyone says they want-but the process is taking us a long time. I think at some point the state needs to consider relaxing those environmental impact review requirements for projects that offer manifest environmental improvements. Also, maybe they should consider developing an EIR process for a system and a series of projects that, when taken together, improve the environment. I think the time may have come for that.

Can you elaborate on the nature of the challenge? What are the growth trends, and why is this a crisis that deserves state and regional attention?

By the projections of certain economists, these two ports handled just over 14 million containers last year. Projects call for that number to triple between now and 2020, or thereabouts. I'm not sure that that's exactly what's going to happen, but I think it's a reasonable estimate to plan for. That being the case, clearly we do not have enough land down here if we continue to practice the various components of goods movement the way we do now. We have to make the land area that we have more efficient and more productive. To do that, we need all the partners in the logistics chain – including the terminal operators, the ILWU, the trucking interests, and the railroads – to all be hitched to the same wagon and all making improvements to their various systems. Ultimately, we're going to have to have a lot better use of on-dock rail. We're probably going to have to have an inland port, and those are just for starters. There are other technological improvements that a lot of folks are looking at now, like a maglev system, all of which will require careful consideration.

Then at the end of the day, all of the various improvements are going to have to be paid for. And a certain amount of that capital is going to have to come from the public, and a certain amount is going to have to come from the private partners. And the debate as to how much and who will benefit is going to be a very intense debate, and hopefully it will come to a positive outcome. It has to, frankly, or we will be generating a new and vital industry in Mexico!

The Southern California Leadership Council and Los Angeles Economic Development Corporation have been working on a regional solution involving the rail lines, the shippers, the ports, the transportation agencies, and others, including environmental and labor groups. What is the promise of that effort in light of the challenge you've just described?

I don't think that it's far enough along to assess its viability. I think it establishes a dialog that has to take place. Clearly a certain portion of the infrastructure investment is going to have to be paid for by those companies that benefit from goods movement. And in many cases, that means the tennis shoes are going to have to cost a dollar more. A certain debate is going to have to take place-just like it did with PierPass, which has proven to be valuable, important, and successful-and I think we're going to see the same kind of dialog with what the SCLC is proposing with respect to all elements of the goods movement chain.

Last month the obscure topic of port management dominated the national media because of the Dubai fiasco. What's the significance of this issue of port ownership and management for the ports of Long Beach and Los Angeles?

I think "fiasco" is a good word. Most of our terminal operators are foreign-owned companies, and we believe that the controversy was a tempest in a teapot that was largely media-created by reporters calling people and asking, "Well, aren't you concerned? Aren't you upset?" and a lot of knee-jerk politicians saying, "Oh my gosh, yes we are!" Frankly, I think that transaction would have had not one whit of negative impact on the security of the ports of the United States.

Regarding port security, you told MIR in 2004 that the federal government's contribution to port security had been "woefully lacking"? A year and a half later, has anything improved?

You could say not just that it hasn't improved but, based on the potential threats, that it's gotten worse. I still don't think the federal government has stepped up in any way, shape, or form with regard to security at our ports. The radiation portal monitors are nice, but if you look at what's being spent on airport security, there's a huge imbalance compared to ports. It's starting to get polite conversation and some folks in the Senate are getting interested; Dan Lungren is leading a charge in the House. So I think we're starting to see the germination of a reasonable dialog about port security, and I think, regrettably, much of that was generated by the Dubai situation.

The Los Angeles Harbor Commission recently hired away your managing director, Geraldine Knatz, to be its executive director. What does that say about the relationship between the two ports, and what will you do to fill that void in Long Beach?

Let me start by saying that I'm delighted that the Port of Los Angeles picked, in my estimation, the very best person for the job. I also believe that it will improve communication and cooperation between the two ports, particularly in the area of environmental impact. From our standpoint, they picked the best person, and that person is someone whom we know and respect and who communicates well with us.

Having said that, it will be a hard position to fill. Geraldine started out with the Port of Los Angeles, but she had been with us for a long time. You don't back-fill a position like Geraldine's, because so much of the position is intertwined with personality. Nevertheless, we have a good track record. People want to work here, and if you consider the people who have worked at the Port of Long Beach and gone on to successes in other ports, you can be sure that we're not going to lack for candidates. We'll have to choose wisely.