Volume up, revenue lags

Exports and new routes continue to grow State Ports Authority volume, but the agency said its revenue remains below projections.

The state agency reported $90.3 million in revenue for the first eight months of the current fiscal year, or 5% more than a year ago. It was 6.4% below expectations, in part because of lower rates the Port of Charleston and its competitors are offering shippers.

Container volume was up almost 11% last month compared to February 2012, with the equivalent of 131,634 20-foot-long boxes handled in Charleston. Volume for the first eight months of the fiscal year also was up by about 11% to 1.024 million 20-foot units.

The SPA also said noncontainerized cargo continues to grow.

“We are going into the strong part of our year,” said CEO Jim Newsome. “All of the lines are making their service-deployment decisions that come into effect in May, and we expect to see additional big ships in our harbor from more carriers.”

Tyrone Richardson

The preliminary work for the Charleston Harbor deepening project remains on track, but it’s up to federal government to make sure that doesn’t change.

That was the message from Army Corps of Engineers Lt. Col. Ed Chamberlayne to the State Ports Authority board of directors Monday.

Chamberlayne was at SPA’s offices to give an update on the $300 million dredging project, which the maritime industry has said is critical to maintaining the Port of Charleston’s competitiveness.

He was joined by U.S. Sen. Lindsey Graham, R-S.C., who announced plans to introduce a merit-based system for funding port improvement projects from coast to coast.

Chamberlayne told the board that the Army Corps could face some hiccups if federal budget cuts force agency workers to slice their workweeks to four days from five starting the week of April 22 under the so-called sequestration budget cutbacks.

“Although they are concerned about a 20 percent pay cut, they’re more concerned about getting the job done,” Chamberlayne said. “They want to get it done and keep with the schedule because it is so important.”

The Army Corps’ feasibility report is one of the first steps in the lengthy process of dredging the local shipping channel to 50 feet from 45.

The draft of the report should be completed by the summer of 2014, and a final version is expected to be submitted in summer 2015, Chamberlayne added. The deepening is scheduled to be completed by 2020 and cost an estimated $300 million, which will be shared by the state and federal governments.

Several ports along the East and Gulf coasts are jockeying for federal dollars to deepen their shipping channels to accommodate larger ships once the Panama Canal is expanded in 2015.

The S.C. General Assembly already set aside $300 million for the project, in case the federal government doesn’t add its share.

Graham said moving the dredging project along depends on Congress approving the money without federal earmarks.

Graham’s is looking to push a legislation that would create a fund of as much as $20 billion to dredge ports to 50 feet within five years. That money also would help improve land-side access at West Coast ports and dredge the Mississippi River for inland ports.

The merit-based system for dredging ports on the East Coast would be based on certain criteria, such as economic impact and the population of area served, said Graham. He first floated a merit-based funding proposal about two years ago.

“For us to grow our economy, we’ve got to do the big deal,” Graham said Monday. “The economic engine of South Carolina is the Port of Charleston. I am confident that the Port of Charleston will fare very well in that merit-based system.”

Graham reiterated on Monday that dredging Charleston remains on the minds of many federal lawmakers as well as President Barack Obama.

“Should we start in Charleston?” Graham said, referring to a recent discussion he had with the president about dredging. Last summer, the Obama administration included Charleston, Savannah, Jacksonville and Miami as part of a “We Can’t Wait” initiative to help speed up dredging projects.

Last week, Senate Budget Chairwoman Patty Murray, D-Wash., singled out Charleston in a proposed federal budget that called for $100 billion in transportation funding to fuel job growth. “This budget also increases funding for the construction program of the Army Corps of Engineers, which will allow them to construct deeper harbors in places like Charleston, South Carolina, to strengthen our export economy,” according to the 114-page proposal.

Reach Tyrone Richardson at 843-937-5550 and follow him on Twitter @tyrichardsonPC.