Port of Tacoma

Ports may need up to $1 billion to update terminals

Port commissioners from Tacoma and Seattle on Tuesday adopted their first budget for a new cargo alliance while warning they’ll have to spend hundreds of millions more to make the port facilities competitive with rivals.

The $174.5 million included in the Northwest Seaport Alliance’s 5-year capital budget is “woefully inadequate to our needs,” asserted Tacoma Port Commissioner Don Meyer as the two commissions were preparing to accept the budget.

Meyer predicted the alliance and the two ports will have to spend $800 million to $1 billion over the near future to equip the two ports to handle the new generation of mega-sized container ships.

The Northwest Seaport Alliance combines the cargo terminals of both ports under a single operating entity. The recently formed partnership between the two rival ports is designed to halt the erosion of container shipping market share in the Puget Sound. New competitors such as Prince Rupert, B.C. and East Coast ports such as Savannah and Charleston are mounting strong campaigns that could divert additional containerized shipments from Tacoma and Seattle.

Meyers’ warning met with agreement from commissioners from both ports who now govern the alliance. The two commissions were meeting jointly at Sea-Tac Airport to consider the alliance’s operating and capital budgets.

Meyer said some rival ports are already equipped to handle the new giant-sized ships, some 1,300 feet long with a capacity of 18,000 container units.

While agreeing with Meyer that the two ports face major infrastructure expenses, Tacoma Commissioner Connie Bacon said the huge expenditures needed to update port terminals will have to be raised in partnership with the port customers who will use those expanded terminals.

“I’m not a kind of ‘we-will-build-it-and-they-will-come’ kind of person,” she said.

Tacoma Port Commission President Don Johnson said discussions of larger capital expenditures are probably best handled when the two ports get together to ponder long-term strategies.

The relatively modest initial alliance budget projects that the two ports’ operations will turn a profit, and that maintenance for port terminals and long-range planning and environmental preparation for major expansions moves forward.

John Gillie: 253-597-8663