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Friday, January 10, 2014

Port of Seattle CEO to Retire

By Mark Edward Nero

Tay Yoshitani, who has served as the Port of Seattle’s CEO for nearly seven years, is stepping down from the position when his current contract expires at the end of June, he confirmed during the port commission’s Jan. 7 meeting.

“I’m not going to give my exit speech yet because I’m going to be here for another six months and I look forward to using those six months to work closely with the Commission,” he said.

Yoshitani has been chief executive officer of the Port of Seattle since March 2007. He’s the former chief executive of both the Maryland Port Administration and the Port of Oakland and was also previously the deputy executive director with the Port of Los Angeles.

Born in Japan, Yoshitani is a graduate of the US Military Academy at West Point, a Vietnam veteran and holds a master’s in business administration from Harvard University.

The Port Commission announced during the meeting that an international search would be conducted for Yoshitani’s replacement.

“Tay continues to be a leader on issues central to the success of ports across North America,” Commissioner Tom Albro said. “We thank him for his years of valuable service in Seattle, as well as his work to promote international trade and advance the success of maritime and aviation industries.”

Yoshitani is expected to continue to serve as chairman of the board of the American Association of Port Authorities, an unpaid position to which he was elected in March 2013 and assumed last fall. The AAPA, headquartered outside Washington, DC, is a trade group representing about 160 ports in the Western Hemisphere. It advances its members’ interests through public advocacy and professional development.

Yoshitani’s relations with the harbor board were strained in the fall of 2012, when he was the subject of an ethics probe by Port of Seattle commissioners after he joined the board of a for-profit logistics company, Expeditors Intl.

In the role, he stood to earn more than $230,000 in annual compensation – consisting of $30,000 in cash and up to $200,000 in restricted stock options – on top of the nearly $367,000 a year he was earning at the port.

An investigation found no conflict of interest or violations of law because the logistics company doesn’t compete with, or conduct business directly with, the port.

Port of Portland Halts Terminal Development Plans

By Mark Edward Nero

A lengthy and complex process by the Port of Portland to annex West Hayden Island for a future marine terminal has come to an end. The port announced Jan. 8 that it is formally withdrawing its consent to annex the property into the City of Portland.

“The terms under which annexation has been proposed by the city would simply render a future development on the property impossible,” Port of Portland Executive Director Bill Wyatt explained. “We cannot justify the investment of more time and money into the process.”

The port owns more than 800 acres of property on the island, which is currently part of unincorporated Multnomah County and lacks the appropriate zoning and city services needed for marine terminal development.

In 2009, the port began a process at the request of then-City Commissioner Sam Adams to pursue annexation. Eventually, a proposal was formulated that would have preserved 500 acres as open space and 300 acres for future marine industrial development.

However, an annexation recommendation released by the city’s Planning and Sustainability Commission in July 2013 included new forms of mitigation that would have added an estimated $30 - $40 million in costs. The city indicated it was not willing to amend these terms, which led the port declaring that the annexation was impractical to proceed with.

“This is a disappointing and unfortunate outcome on several levels including lost economic opportunity for our region,” Wyatt said.

The port says it’s currently “reassessing short and long term future plans” for West Hayden Island, and that it has not counted out future annexation and development prospects for the island and its 300 developable acres.

EPA to Conduct Webinar on Port Goods Movement

By Mark Edward Nero

The United States Environmental Protection Agency plans to conduct a two-hour “National Conversation on Ports with Port Stakeholders” webinar Tues., Jan. 14, 2014, beginning at 9:30 am Pacific Standard Time.

This event is the second of three virtual meetings facilitated by the US EPA to bring together port stakeholders to explore options to improve the environmental profile of ports while protecting community health and supporting economic growth.

The latest webinar’s theme is “Goods Movement and Ports: Community Impacts and Collaborative Solutions.” During the event, Andrea Hricko of the University of Southern California’s Keck School of Medicine is expected to describe community health impacts and present current research findings.

Additional participants are expected to provide examples of engagement between port facilities and nearby communities.

The EPA says it has convened the series of webinars to hear directly from the organizations and stakeholders with the greatest interest in ports about the challenges, concerns and opportunities within the ports sector. The insights and lessons gleaned from these meetings are expected to help the EPA develop a comprehensive and valuable agenda for a National Ports Stakeholder Summit, scheduled for April 8, 2014 in Baltimore, Maryland.

Those wishing to secure a spot in the webinar can register at https://www2.gotomeeting.com/register/351694914. Since space in the online meeting is limited, the EPA’s asking that registration be completed as soon as possible.

Port of Tacoma Accepting Summit Award Nominations

By Mark Edward Nero

The Port of Tacoma has opened nominations for its 2014 Summit Awards, which recognize customers and tenants for excellence and achievement.

The awards, which will be presented at an April 9 breakfast, recognize three categories of leadership:
Business Magnet: a port customer or member of the supply chain – shipper, transportation or logistics service provider, developer – recognized for business development efforts and investments that led to a recognizable increase in business volume or new business opportunities for the port and have a positive economic effect for the citizens of Pierce County.

Livable Community: a port customer or tenant recognized for a project, program or initiative that demonstrated the business community’s positive contribution to Pierce County through social responsibility. Criteria include philanthropy and charitable giving, community service and employee volunteering, community engagement and outreach and employee development.

Environmental Stewardship: a port customer or tenant recognized for a project, program or initiative that supported Pierce County’s sustainability and honors biodiversity and the interconnected nature of industry, people, wildlife and natural systems.

Recipients will be chosen by a panel of community and business leaders led by a Tacoma port commissioner.

Nomination forms and information are available at www.portoftacoma.com/summits.

Nominations are due by 5 p.m. Feb. 13. Completed forms can be emailed to lkvidera@portoftacoma.com, faxed to (253) 593-4534 or mailed to: Port of Tacoma Summit Awards, P.O. Box 1837, Tacoma, WA 98401-1837.

Updates about the awards and the annual breakfast can be received by subscribing to the port’s Summit Awards email list at https://public.govdelivery.com/accounts/WAPT/subscriber/new?topic_id=WAPT_55.

Tuesday, January 7, 2014

Strengthening the US Marine Transportation System: A National Maritime Strategy

by Darrell Conner and Nikolas Milonas

The US Marine Transportation System (“MTS”) is a key pillar of our national, economic, and homeland security. The MTS consists of ocean, coastal, and inland waterways, ports, intermodal connections, vessels, as well as commercial, military, and recreational users. According to the Maritime Administration (“MARAD”), the MTS includes 25,000 miles of navigable channels, over 3,700 marine terminals, 238 locks at 192 locations. The MTS also supports critical military operations, tens of thousands of commercial fishing vessels, and millions of recreational boaters.

Given those numbers, it is not surprising that 99 percent of the volume of overseas trade (62 percent by value) enters or leaves the US by ship – at a fraction of the costs associated with other modes of transportation. With so much riding on the viability of the MTS, there has been increased chatter in Washington, DC about a national strategy to strengthen the US Merchant Marine and explore additional opportunities to develop cargo and sealift capacity.

On October 28, MARAD announced plans to facilitate a public discussion among MTS stakeholders intended to develop a robust national maritime strategy. According to MARAD, the purpose of this public meeting, a National Maritime Strategy Symposium, is to gather ideas for improving the nation’s cargo opportunities and sealift capacity, while ensuring their future sustainability. The two-day symposium is scheduled to take place on January 14-16 at MARAD in Washington, DC.

MARAD has actively solicited from the public and interested stakeholders potential agenda items for the January symposium. Proposed agenda items may focus on any of the following topics: fostering and improving the US-flag fleet; improving transportation efficiency, speed, availability and cost-effectiveness; methods to improve overall US economic competitiveness though MTS improvements; improving transportation efficiency through interoperability with existing infrastructure systems and other modes of transportation; reduction of marine transportation pollution and adverse environmental impact; expansion of the pool of skilled and available US mariners; developing strategically valuable capacity; increasing economical waterborne carriage for US businesses; improving US port operations and related businesses; improvement of global business and employment opportunities for the Nation; and fostering the construction and repair of vessels in US shipyards.

More than 50 suggestions for potential agenda items were submitted from trade associations, commercial operators, ports, research institutions, and concerned individuals, among others. The comments from these entities and individuals offer ideas to promote a technically skilled pool of US mariners; the construction and modernization of vessels in US shipyards, as supported by competitive grants and loan financing; the transport and use of natural gas as a marine fuel; the preservation of US laws that support the merchant marine base and create stability in the marketplace; ways to foster continued support for cargo preference requirements and the Maritime Security Program; and the importance of inland waterways and the Great Lakes; among other topics.

Acting Maritime Administrator, Paul Jaenichen, has been enthusiastically promoting the January symposium and laying the necessary groundwork for a successful meeting between private stakeholders and the government. Mr. Jaenichen stated earlier this year before the Maritime Trades Department of the AFL-CIO that “the nation needs a maritime policy. It needs a strategy [and] the Maritime Administration is going to take a leading role.” The National Maritime Strategy Symposium aims to put a regime in place that will “reinvigorate the US Merchant Marine . . . [and] ensure that we create a process and develop a maritime strategy that actually works, is inclusive, is far-reaching and long-lasting.” Additionally, as part of his recent confirmation hearing before the Senate Commerce Committee, Mr. Jaenichen also stated, “we need a strategy that will result in a significantly higher portion of the US overseas trade being carried on US flag vessels.”

MARAD was finalizing its agenda for the January symposium in mid-December, and following participant registration, making decisions on speakers for the program at the January symposium.

The MTS supports millions of American jobs by facilitating the movement of people and goods, supports national security efforts by providing critical sealift capacity in times of war and emergency, and acts as the eyes and ears of our coastal and inland waterways. Through its National Maritime Strategy Symposium, MARAD is seeking to foster a public/private relationship and cooperation between interested stakeholders to ensure that the MTS and the US Merchant Marine continue to be a key pillar of our national identity.

Darrell Conner, Government Affairs Counselor, is the co-chair of the Public Policy & Law Practice Group at the law and lobbying firm of K&L Gates, which for 40 years has represented maritime clients on legal, legislative, regulatory, and policy matters. Darrell can be reached at darrell.conner@klgates.com. Nikolas Milonas is an associate at K&L Gates whose practice focuses on transportation policy, with an emphasis on issues affecting the U.S. domestic maritime industry.

BC Ferries to Institute Fuel Surcharge

By Mark Edward Nero

British Columbia-based BC Ferries says that due to current world fuel market conditions that affect the prices that BC Ferries must pay its diesel fuel suppliers, it will institute a 3.5 percent surcharge on the vast majority of its routes starting Jan. 17.

Two routes are being exempted from the surcharge increase: the Port Hardy-Prince Rupert and Prince Rupert–Haida Gwaii routes.

BC Ferries’ President and CEO Mike Corrigan said market pricing indicates that the price differential will continue throughout 2014.

“We are well aware that implementing a fuel surcharge is unpopular with our customers, and we are doing everything we can to keep our fuel costs as low as possible, including building new ships with LNG capability,” Corrigan said. “We have waited as long as we can to implement a surcharge, however we must act now as it is clear that fuel prices are unlikely to decline in the foreseeable future.”
In November 2013, BC Ferries’ monthly fuel prices reached a new high for the year; $1.09 per liter. The company says it has reduced its fuel consumption by 5.8 million liters since 2004, the cost of fuel in fiscal 2013 was $121 million, up from $50 million in fiscal 2004.

The company maintains that each one-cent per liter increase in the cost of diesel translates into a $1.2 million increase in company expenses.

Since 2004, BC Ferries has had fuel surcharges, fuel rebates and periods of time with neither, all based on the market price of diesel fuel.

BC Ferries is one of the largest ferry operators in the world, providing year-round vehicle and passenger service on 25 routes to 47 terminals, with a fleet of 35 vessels.

Port of Stockton Biorefinery Awarded Expansion Funding

By Mark Edward Nero

Community Fuels, a biofuel producer operating a biorefinery at the Port of Stockton, has been awarded a nearly $5 million grant from the California Energy Commission to support the facility’s expansion.

“Our initial construction was completed in 2008, and it is gratifying to win this sizable grant to contribute to the next phase of expansion, which was contemplated from the early days of the business,” Community Fuels corporate controller William Crooks said.

The biorefinery was specifically designed to allow for multiple phases of expansion, according to Community Fuels co-founder and CEO Lisa Mortenson.

“This important grant will enable our team to expand our production capabilities to meet the anticipated demand for low carbon fuels,” Mortenson said.

Community Fuels’ Port of Stockton biorefinery is one of the largest continuously operating advanced biorefineries in the Western US. Its customers include major oil companies, petroleum refiners and some of the nation’s largest bulk fuel distributors.

Its renewable fuel is used as a lubricity additive for diesel fuel. It also reduces emissions relative to petroleum diesel.

Port of Hueneme Gets $3 Million in Federal Funds

By Mark Edward Nero 

The Port of Hueneme will receive more than $3 million in federal grant funding for the purpose of infrastructure improvements and air emission reductions, the port revealed Dec. 26.

“This program will bring nearly $3 million of added funding, underscoring our significant role within our community and California’s economy,” Board of Harbor Commissioners President Jason Hodge said.

Most of the funding, which comes from a branch of the US Community Development Financial Institutions (CDFI) Fund, is expected to go toward the port’s development of state mandated shoreside power at terminals.

The shoreside power project, which would allow ships to cut their engines while at dock, is expected to cut diesel particulate matter by 92 percent, nitrous oxide by 98 percent, and carbon dioxide by 55 percent, according to the port.

The Port of Hueneme, which is run by the Oxnard Harbor District, is located in Ventura County, California, about 80 miles north of Los Angeles. It moves about $7 billion in goods annually.

In addition to the shoreside power project, funding from the grant is earmarked for support of a nonprofit project called FOOD Share, which has a goal of bringing millions of pounds of fresh, healthy and affordable food to underserved areas in Ventura County.

Keynote Speaker Named for LNG As Fuel Conference

By Mark Edward Nero

Anthony Chiarello, President and CEO of TOTE, is scheduled to provide luncheon remarks at the inaugural Pacific Maritime Magazine/USCG LNG As Fuel Conference, set for Jan. 29, at the Renaissance Seattle Hotel in downtown Seattle.

Chiarello is expected to discuss TOTE's LNG conversion project, and new LNG vessels destined for their Puerto Rican trade.

The event is an opportunity for the maritime industry to hear from the regulatory and policy making community on the anticipated national and local regulatory environment for LNG fueled vessels, LNG fuel bunkering operations and LNG maritime fueling facilities.

Those considering LNG as a fuel source, considering entering the market as a supplier, or are curious about LNG regulatory, policy and technical developments are invited to attend the conference.

The event, which begins with a 7:30 am breakfast, also includes sessions on vessel design, terminal design & operations and LNG operational aspects. In addition to Chiarello, other scheduled speakers include US Coast Guard Capt. Joe Raymond, who’ll give the opening remarks, and closing remarks from John Dwyer, Officer in Charge, Marine Inspection (OCMI) for the Puget Sound sector.

More information about the conference including the full agenda and registration information, can be found at http://seattlelngconf.com/index.php.