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Give port stability, not new operator

The Virginia Port Authority's governing board is set to announce this month whether to restructure its arrangement with Virginia International Terminals Inc., the port's private, nonprofit operator, or pursue a new relationship with a for-profit company.

Board members already should have concluded that the better option is to retain VIT. The company was formed about 30 years ago to take control of Virginia's fledgling port and promote economic development, and by nearly every measure it has been successful.

VIT has built the port into the third busiest on the East Coast, upgraded its facilities and prepared it to handle the next generation of massive ships expected to pass through the widened Panama Canal in 2015. And it supports close to 340,000 jobs while posting an annual economic impact of about $41 billion.

Equally important to the board's decision, however, is the process that has led to this point. That process was so flawed, and led to so much turmoil around a critical economic engine, that lawmakers recently took steps to ensure it never happens again.

The Public-Private Transportation Act of 1995, the law that allows the governor's administration to bypass the legislature on major transportation-related deals, underwent several changes in the past legislative session, including approval of a measure prohibiting any future unsolicited bids for the port. The Joint Legislative Audit and Review Commission also has been directed to conduct an extensive study of port operations.

One reason the bid-evaluation process has been so flawed is that Gov. Bob McDonnell's administration has struggled to commit to a clear strategic vision for the Port of Virginia.

In 2010, state officials signed a lease that let VIT operate APM's state-of-the-art terminal in Portsmouth for 20 years. A year later, McDonnell overhauled the port authority's board by replacing 10 of 11 members. He and Secretary of Transportation Sean Connaughton prepared to strengthen the state's commitment to VIT in late 2011 when they tried to negotiate the outright-purchase of APM's terminal in Portsmouth.

APM declined the offer and, a few months later, came back with its own proposal: up to $3.9 billion to the state in exchange for rights to replace VIT as the operator at the publicly owned terminals in Norfolk, Newport News and Portsmouth, and at APM's own terminal in Portsmouth, for 48 years.

The offer caught state officials flat-footed. They established an unnecessarily short period - less than 60 days - to solicit bids to compete with the most lucrative unsolicited proposal for a public asset. The move suggested the governor's administration had already decided to favor APM's bid and wouldn't give the scrutiny necessary to ensure a good deal. Worse, state officials never established the value of the asset for which they were thinking about giving up control.

Public outcry, including from shipping lines, persuaded state officials to revise the timeline. An analysis of the deal by Old Dominion University economist James Koch suggested the APM offer undervalued the port. An opinion from Attorney General Ken Cuccinelli, who said the fate of operations at the port should be determined by the port authority's board, rather than Connaughton, led to further delays.

In the meantime, a recent preliminary report on the port's operations concluded that claims of VIT having an unsustainable business model were overstated. The report highlighted areas where VIT could be more efficient, and the company is undertaking efforts to reorganize.

Port authority board members would do well to support that effort, and to finally provide the stability the port has been missing for too long.

Posted to: Editorials Opinion

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a thought

--these ports were and still are a economical developing tool for the economy of this state and this locality.--It was turned over to VIT to stimulate the job market as well as the economy,--which it has done for the past 20 years with great success.

--then along comes a foreign company that sees a profit to be make for it's investers in other countries.--they just wave some money in the face of our governor and the drool just burst out of his mouth,and before you know it he wants to turn it over to them for a half a century.--he changes the Virginia Port Authority members into a group of hand picked personnel that seems to want to do his bidding instead of what good for the state.--get rid of the DUCK and keep the ports.

--If the ports need to be changed from a economical developing company,--give the people that have been doing their jobs as directed a chance to make that change.--keep the profits from our ports in this country,--and not in the pockets of some foreign investers that don't care about us for any reason except for the chance of making millions in profit ,--that you know has to come out of our pockets.

--I just don't understand why a leader in this country is so interested in giving foreign investers part of our economy,--for any reason.we deserve what we have.--don't give it away!--QUACK

--and you people need to be heard,--before it's too late.

Virginia is for Virginians

Good Job Frank. Thanks for your citizen voice in support of the Port of Virginia. Many of us in the Port of Virginia have stood steadfast behind VIT.

As a port community and stakeholders in the success of the Port of Virginia I believe in the past and present leaders of Virginia International Terminals. When I think of Virginia I think of The Port of Virginia. That makes me think of the origins of the solid commitment to commerce made when the first commercial venture in the New World was started in Jamestown. Virginia, as the region later became known, was a gateway to adventure and international commerce. Today, tomorrow and into the future Virginia is the “Gateway” for success, growth and most promising location for increased international commerce on the US East Coast.

Virginia is for Virginians. The Port of Virginia belongs to Virginia and therefore belongs to Virginians. It is only right to "Let Virginians operate The Port of Virginia."

Public good

Thanks for the well thought LTE! I have become increasingly alarmed at the rate that our public assets have been being sold to private concerns. The entire concept of public assets.. our roads, our ports, our parks is to provide for needs and benefits of the public who own them. They are ours and should not be sold to the highest bidder without our explicit understanding of what we are giving up and our consent to do so. There are also overarching issues that need to be fleshed out. In the case of the ports there are questions regarding public safety in terms of terrorism through which a foreign-owned port could act as an entry. Another column has already mentioned the problem with an owner who has competing ports, ceding freight to the other from the Ports of Virginia. In my opinion, we are giving away far more than we are getting for our tax dollars when we sell our collective assets. The tunnel deal recently pushed sold the people of this region to the highest bidder for a guaranteed profit that will be wrought from our tax dollars... including a future of being gouged by excessively high tolls. What could have been done by the state through smart tax policy has thus become using our taxes to fund the profit of a private enterprise.

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