NORFOLK, Va. — The Virginia Port Authority on Tuesday rejected two offers worth billions of dollars to privatize the operations of the state’s coastal terminals, choosing to keep and restructure the port’s current operator instead.
The authority’s board of commissioners voted unanimously to discontinue negotiations with two companies that were seeking to lease and operate most of the state’s terminals for the next several decades.
The proposal to privatize operations ran into widespread opposition by many with port-related jobs who worried that a company would look out for its own interests above those of the people of Virginia, and that a private operator would unfairly discriminate against competitors.
The Norfolk board room where the vote was held was so packed with those in shipping-related industries that tickets had to be issued to gain admittance hours in advance, and chairman William Fralin urged nobody to applaud and cheer after the board rendered its decision.
In explaining the decision, Fralin said the private offers were competitive, but not compelling, and didn’t fully recognize the port’s value.
It’s an issue that resonates in South Carolina. In 2005 and again in 2009, some state officials, including then-Gov. Mark Sanford, floated the idea of privatizing some State Ports Authority operations. The SPA’s board has adopted a policy forbidding private companies taking over the operations of its port facilities.
The Charleston maritime agency had no comment Tuesday about Virginia’s decision, said spokeswmoan Allison Skipper.
It’s the second time in five years that Virginia has opted not to privatize its port operations, rejecting three offers in 2009.
The renewed possibility of privatizing operations started last spring when the authority received an unsolicited bid from APM Terminals. A group headed by JP Morgan Chase was also a contender.
The companies said they could provide better growth opportunities than Virginia International Terminals, which was created by the state to operate its ports and has done so for 30 years.