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Joe Nathanson: Region’s original anchor — the Port of Baltimore

As we consider the regional economy, attention is rightly focused on the anchor institutions that play a growing role in providing employment and generating income: the area’s research universities and medical/ health sciences complexes. But it is also timely to give renewed attention to the region’s original economic anchor, our primary link to global commerce — the Port of Baltimore.

After all, even as we have seen a transformation to the new knowledge-based economy, the port remains a vital component of area’s business landscape. According to a 2010 study of the port’s economic impact, some 40,000 jobs were generated by port activity; another 63,000 jobs were found to be port-related. The combined activity accounted for $3 billion in personal wage and salary income.

In a recent telephone interview with James White, the administrator of the Maryland Port Administration, it became clear that he heads a complex system with many moving parts. This is particularly true as the port is moving into a new phase of development, occasioned in part by the emergence of ever-larger ocean-going cargo vessels.

One of the key drivers of the port’s current investment is the prospect of providing the facilities for the newest class of container cargo vessels that will pass through the Panama Canal. Anticipation of the arrival of the so-called Post-Panamax vessels has been in the works for years.

In fact, it was one of the motivations for the MPA entering into a 50-year public-private partnership with PortsAmerica. This private entity has been preparing the Seagirt terminal with a new berth providing a 50-foot draft. Four new cranes, each weighing 1,550 tons, to accommodate container cargo 22 units wide, arrived last June and have been successfully tested.

This new capability will make Baltimore and Norfolk, Va., the only East Coast ports able to welcome the largest Panama Canal transiting vessels when the newest canal improvements have been completed, now expected in the first quarter of 2015. Other competing ports must overcome major infrastructure investments.

For example, in the case of the port of New York and New Jersey, that involves either raising the roadbed of or replacing the Bayonne Bridge at projected costs ranging from $ 1.3 billion to $3 billion. At the earliest, the work could not be completed until 2019.

But Baltimore has not completed its preparations for the increased flows of cargo across the region and from Baltimore to markets all across the country. There is still the major constraint represented by the Howard Street tunnel, the height of which prevents trains with double-stacked containers from passing through.

A solution has been identified, but not without additional major investments of capital and the passage of time. After reviewing many alternative sites and responding to negative community feedback regarding earlier preferred sites, CSX Corp. and the state have agreed on a site for an intermodal transfer facility, accommodating the transfer of cargo from rail to truck. The site, in Baltimore at the Mount Clare rail yard, will cost upward of $60 million, with the state having budgeted $30 million for its development and CSX having committed to pay for the balance. Completion is expected by the end of 2015.

Even with these major developments, the port is still not poised to meet all its future challenges. There is the ever-present need to find locations for depositing dredging spoils resulting from channel maintenance and deepening. In this regard, the 3,000 acres of land in Baltimore County formerly occupied by Bethlehem Steel (and a succession of companies with failed attempts at reviving steel-making) can play a role in the port’s future. Port administrator White indicated that the MPA is in continuing consultation with the current owner of the land, Environmental Liability Transfer, for acquiring a 300-acre portion of the site, Coke Point, for future spoils disposal.

With those infrastructure issues on the table, there is still the matter of achieving amicable labor-management relations in the port. At the beginning of February, port interests were cheered by the forging of a Master Labor Agreement between shipping interests and the International Longshoremen’s Association, covering 14 ports along the Atlantic and Gulf coasts. This allows for local agreements, including one for the Port of Baltimore, to move to resolution.

Only when all of these myriad components are in alignment can we expect the flow of waterborne commerce to and through Baltimore’s port to encounter smooth sailing.

Joe Nathanson heads Urban Information Associates Inc., a Baltimore-based economic and community development consulting firm. He contributes a monthly column to The Daily Record. He can be contacted at urbaninfo@comcast.net.