Friday, January 28, 2011

Los Angeles Chamber Urges City Hall to End Shipyard Plan

The Los Angeles Chamber of Commerce has asked the Los Angeles City Council to formally turn down a Long Beach firm's proposal to renovate and reopen a shuttered shipyard at the Port of Los Angeles.

Contained within a letter to Councilmember Janice Hahn sent Monday, the Chamber request comes as a council committee prepared to debate whether or not to revisit the shipyard proposal by Long Beach-based Gambol Industries on Thursday.

Gambol has been trying for over a year to move forward with a $50 million plan to re-develop the shuttered South West Marine shipyard along the port's main channel into a modern ship repair facility. The firm, which claims it has a solid business plan that would create hundreds of union trade jobs at the proposed facility, has garnered support from some trade unions, local officials and residents desirous of the promised jobs. However, the plan has also faced stiff criticism from the port, shipping industry, and longshore unions who fear the plan will delay ongoing port development.

Under pressure from Los Angeles City Hall, the port's governing board signed a memorandum of understanding with Gambol in 2009 to consider the development of the ship repair facility. After nearly a year of consideration, the port's five-member governing board voted to end negotiations with Gambol over the project in December 2010.

Port officials have maintained that the Gambol plan is unrealistic and could seriously delay an Army Corps of Engineers dredging project in the port's main channel and ongoing terminal development at the port. Port staff has spent more than five years planning and permitting the dredging project, including the use of the former shipyard's two slips as a location to deposit the main channel dredge material.

Finding another location for the dredge material, according to port officials, could take years and delay the Army Corps work, which in turn would delay terminal development that is dependent on the deeper main channel.

"For more than a year and a half now, we have been hopeful that a win-win solution could be developed that would allow for the deepening of the Main Channel and the location of the new ship building facility proposed by Gambol Industries," the Chamber's Toebben said in the letter to Hahn, who heads the committee revisiting the Gambol plan.

"While we thank Gambol for their dedication to bringing jobs to the harbor, it does not appear to be possible to achieve this win-win scenario and still meet the competitive timeline that the port will face from the widening of the Panama Canal and modernized East Coast ports," Toebben said.

"Thus, we have determined that it is in the best interest of the regional economy to move forward immediately on the channel deepening project. Too many jobs and too much of our economy is at stake to make any other recommendation."

Nearly a decade ago, the neighboring Port of Long Beach faced a similar situation when the federal government turned over the shuttered Long Beach Naval Shipyard, including several large drydocks, to the port.

Port officials, spurred by calls from city officials and residents, spent several years trying to identify a firm that could present a viable plan to redevelop the abandoned navy yard into a commercial shipyard.
While several firms stepped forward, each proposal eventually fell through, most related to financing.

The drydocks, including one of the largest on the West Coast, were eventually filled with dredge material from the port and paved over to add additional acreage to a massive container terminal under development at the time.