Tuesday, August 10, 2010

Los Angeles Port Email Warns Against Proposed Shipyard

The Port of Los Angeles, concerned about a proposed plan to build a ship repair facility at the port, sent out an email Monday to roughly 250 local, state and federal government officials criticizing the plan and making the argument that any further consideration of the proposal could seriously delay an Army Corps of Engineers channel deepening project and ongoing terminal development at the port.

Gambol Industries, Inc. has been working for more than a year to move forward with the $50 million plan to re-develop the shuttered South West Marine shipyard along the main channel of the port into a modern ship repair facility. The Long Beach-based firm, which claims it has a solid business plan that would create hundreds of jobs at the proposed facility, has faced stiff criticism from the port, shipping industry, and longshore unions.

The port email warned that the Gambol plan threatens to delay the port's Main Channel Deepening Project, a major navigation project by the port which would provide access for the largest of modern container vessel to areas deep within the port's channels. The MCDP is also key, according to the email, to an ongoing $350 million expansion and redevelopment of two port container terminals.

The main conflict with the MCDP is that the port has already identified the area of the abandoned South West Marine facility as the dumping area for the material to be dredged by the Army Corps.

"In the face of Gambol's proposal, the Army Corps has said they would shut down our project while a 24 to 36 month supplemental EIR/EIS is done," said the port email. "Staff of the California Coastal Commission has advised Gambol that the changes it has proposed to date to our contaminated sediment fill are not feasible or environmentally optimal. The Los Angeles Area Chamber of Commerce and ILWU also oppose Gambol's plan because it would delay our channel deepening project."

For it's part, Gambol has received the support of at least one key area politician – Los Angeles City Councilmember Janice Hahn. Daughter of famous City Councilmember Kenneth Hahn and brother of former Los Angeles Mayor James Hahn, Janice Hahn currently represents the port area. She also chairs the City Council's Trade, Commerce and Tourism Committee, which oversees the Port of Los Angeles, the Los Angeles International Airport and the city's Convention & Visitors Bureau.

Earlier this month, Hahn wrote an op-ed piece for the port-area Torrance Daily Breeze newspaper in which she supported the Gambol Industries proposal, citing the $50 million investment in the hard-hit port-area economy and the creation of hundreds of union jobs as main reasons for her support.

Another supporter of the Gambol plan is the Los Angeles County Economic Development Corp. (LAEDC), a local economic think-tank who was commissioned by Gambol to study their shipyard proposal. LAEDC found that the Gambol facility would be "a welcome addition to a city that has struggled to create employment opportunities for its growing population."

The LAEDC estimated that "When the [Gambol] shipyard reaches full capacity, it [could] generate total annual economic activity of over $219 million and sustain 2,040 full-time jobs in Los Angeles County with [payroll] earnings of $79 million."
The port argues in Monday's email that Gambol's business plan is "highly speculative" and in a play on the firm's name, a "gamble."

Port officials point to the fact that major shipyard employment in the United States has fallen precipitously in the past 30 years and that there is simply not enough work to support the Gambol facility.

"Nationwide, over 70 percent of shipbuilding revenue and over 75 percent of ship repair revenue comes from the U.S. Navy," the port wrote. "There is no such patron to fuel a rebirth of shipbuilding in the San Pedro Bay. In fact, other shipyards have announced layoffs and eliminations, including 560 jobs eliminated recently at NASSCO in San Diego."

The port's five-member governing board is expected to officially reject the Gambol plan at their Aug. 19 board meeting.