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Public Private Partnerships Are a Win-Win for Ports

Scott Keillor (center) with Chester Manaea and Falenaoti Loi-On, of American Samoa Department of Port Administration, at the APP 2017 Winter Conference in Maui.

The Association of Pacific Ports (APP) 2017 Winter Conference was held 11 to 13 January at the Ritz-Carlton Kapalua in Maui, Hawaii. The conference provided seminars and open forum discussions on current port industry topics, such as port litigation, media perception, technological advancements, economic trade forecasts, and more.

BergerABAM joined more than 50 other APP members at the conference, including familiar west coast port managers and commissioners, such as the ports of Alberni, Skagit, Longview, St. Helens, Stockton, Hueneme, Long Beach, and San Diego, as well as Pacific island representatives from Hawaii, American Samoa, Marshall Islands, and Guam. The conference provided valuable one-on-one interaction with port representatives to discuss how public and private enterprise collaborates to create economic opportunity while adding local and Pacific port jobs.

Scott Keillor, senior planner with BergerABAM, and Todd Chase, principal and economist with FCS Group, were guest speakers at the conference. Together, they presented examples of how public private partnerships (P3) can leverage both port and private investments in marine and land side development to enhance job growth. Scott and Todd focused their presentation on successful P3 port projects in the Pacific Northwest, including the Port of Seattle Terminal 18, Port of Longview Terminal 9, Port of Newport redevelopment, Vancouver waterfront redevelopment, and Port of Portland AirMAX and Cascade Light Rail Transit Station projects.

For most ports, the hallmark of a successful P3 project is a private entity investing in waterfront facilities, such as upland ship loading, staging, and storage systems, while the port invests or assists in funding terminal or related in-water facilities to make projects happen. The port will typically assist with the financing at a low rate and pays off its investment through tenant lease agreements, thereby accommodating economic growth and achieving long-term asset ownership. The private developers of such terminals provide capital to establish and enhance their operations, assisted by ports, which can often structure return on investment over a longer period.

One major benefit of a P3 is additional property tax revenue. A property with no development or public investment will yield very modest property tax gains over a 10-year period, while urban development with vertical housing tax exemptions can allow a project to be built that provides significantly more tax revenue to the city, port, and other service providers for years to come. Planning professionals can assist ports and investors through the process of collaborating on a P3 project. The process includes determining P3 options, evaluating risk, analyzing potential benefits, determining return on investment, budgeting and scheduling, and developing communication strategies.

The “P3—Partnerships and Ports” presentation was very well received, and Scott and Todd have already been invited to provide BergerABAM and FCS planning and economic team resources for several related opportunities, that may also include engineering work.

The APP is a trade and information association that promotes increased efficiency and effectiveness of the ports of the Pacific.