Tuesday, June 29, 2010

Long Beach Port Approves $716 Million FY2011 Budget

On Monday the City of Long Beach Board of Harbor Commissioners approved a $716 million budget for the Port of Long Beach 2011 fiscal year that includes $474 million in development projects and $71 million in environmental programs.

“Despite the global recession, the Port of Long Beach is in a strong financial position,” said Port Executive Director Richard Steinke. “But to remain competitive, we must look into the future. We must continue to invest in projects to modernize and ‘green’ our operations.”

The 2011 fiscal year budget represents a 19 percent reduction from the current budget. The budget projects that while container terminal revenues are expected to increase 4 percent in the 2011 fiscal year, other income streams such as interest and revenue from oil operations are expected to decline. A projected net decline in overall revenues will require the port to draw down $343 million from reserve funds. The budget also cuts 12 percent in operating expenses from the previous fiscal year by maintaining current staff levels and reducing non-personnel expenses.

In approving the budget, which begins Oct. 1, the port board also gave tentative approval to a scheduling change in the way 10 percent of the port's annual profits are transferred each year to Long Beach City Hall. The city had requested the change, which will require the port to make two transfers in one year--one for $12.4 million and another for $11.5 million--to come in line with the new schedule. The port, while expressing concern about the one-time hit, said it would likely pull the additional transfer funds from the port's capital projects budget.

The board will make a final decision on the city transfer-related items in the next several months.