Mississipppi report released on challenges to expanding Gulfport

Biloxi Sun HeraldAugust 7, 2012 

GULFPORT -- A report the state port delivered to Gov. Phil Bryant outlines challenges the port faces if it is to compete for import and export business expected when an expanded Panama Canal opens in 2015.

In addition to a relatively shallow ship channel, the report says, the port is not near a population base large enough to generate significant imports, lacks area warehouse space tied to rails and railways directly linked to inland markets, has no refrigerated warehouse space and suffers from a perception of high labor costs.

Gov. Phil Bryant, who met privately Monday with port officials, said his first priorities are to hold onto the port's current four tenants, and create the 1,200 jobs promised when the state received $570 million in post-Katrina federal funds for West Pier restoration and expansion.

"Any big project has challenges, so this is not unusual," Bryant said, as he surveyed West Pier work after the port meeting broke up.

The port does have its strengths, the report concludes, including nearby forestry, agriculture and seafood businesses with export markets; an upgraded rail line to Hattiesburg that can carry double-stacked containers; state tax incentives; skilled laborand the junction of three railways in Hattiesburg.

Bryant has been mulling whether the port should stick with its current expansion and restoration plans, which the state conceived under Gov. Haley Barbour, or modify them. He thinks the current port work could be finished two years ahead of schedule -- in 2015 -- and $140 million to $160 million could be saved if plans to elevate the West Pier are scrapped.

Plans are to raise the pier from 10 feet to 25 feet above sea level for storm-surge protection. Bryant said that money could go instead to deepening the ship channel from 36 feet to 45 feet. The port, he said, would need a "robust evacuation plan" if the West Pier is not elevated.

However, some port experts believe Gulfport is unlikely to land permission for a deeper channel from the U.S. Army Corps of Engineers, or additional federal funding for the work, now that earmarks are no longer possible. Also, competing ports already are ahead of Gulfport with channel-deepening requests, funding and construction.

Barbour envisioned a "port of the future" that would generate thousands of jobs by serving the larger post-Panamax ships that will be able to navigate a widened Panama Canal in 2015. Port officials in Gulfport recently conceded to the public that no permit is pending with the Corps for channel deepening that would allow the smallest class of post-Panamax ships to sail into Gulfport.

The Corps must first determine whether channel expansion is feasible, economically and environmentally. The initial studies take years, with no guarantee construction would be approved. Congress also would need to provide funding at each step in the process.

Bryant said he is working with Mississippi's congressional delegation to add the state port to the list of ports being considered for funding.He does not believe Mississippi's congressional delegation dropped the ball on channel deepening, but that Congress has been otherwise preoccupied with the economic woes at home and globally.

"I think it did get lost to some extent on a national level," Bryant said.

Bryant wants to see the current improvements moving faster so the port's tenants can settle on the West Pier, freeing up space on the port's northern property for non-maritime development such as shopping, restaurants, hotels or even a minor-league baseball stadium. Those developments, he said, would create additional jobs.

The governor also wants the port to look at rebuilding a freezer on the East Pier for chicken exports, business the port lost after Hurricane Katrina. Poultry is currently shipping from New Orleans and Mobile, with no guarantees that it will return to Gulfport, the port report says. However, poultry producers have said they would consider any proposals from Gulfport's port.

The report also says the port will work with the Mississippi Development Authority to identify and recruit Mississippi businesses for the port.

Bryant said his office has not made any final decisions about the direction the port should take and has no timetable for doing so.

"I believe we have great opportunities," the governor said. "So much of it depends on the global economy, the competitors, even the weather."

The port's executive director, Don Allee, said he is flexible on port elevation. Allee said, "I could make the port work at either elevation."

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