Port Says it’s O.K.

Everyone is filled with trepidation about what al Qaeda’s next move will be and reports that less than 2 percent of containers moving through the nation’s seaports are checked are hardly reassuring. We sat down with Ray Boyle, General Manager of Maritime Operations for the Port of Oakland, and the man in charge of coordinating the Port’s maritime security plan, to find out what’s up.

BC: Lots of news reports these days about dirty bombs and how easy it would be to slip one through a container ship with only 2 percent of the containers being searched. Are folks right to be worried?

Well, I think that there is a concern. It is a potential risk, but the focus needs to be on securing the supply chain at the earliest point and then having contingency plans in place for the rare possibility that it could actually ship through that chain.

The Coast Guard is charged with the waterside security in the Bay and the Captain of the Port, a Coast Guard Officer, has the authority to close down the Bay and keep vessels from coming in if necessary. The 11th Coast Guard District basically developed a plan for all of the ports on the West Coast to come up with a set of consistent security standards so that everybody was sort of playing from the same sheet of music.

Just after the events of 9-11, we at the Port of Oakland organized a local security committee. We asked the U.S. Coast Guard, U.S. Customs, some law enforcement people, and the terminal operators to all meet and discuss security issues and we’ve been meeting ever since on an ongoing basis. This group, with the Port serving as the facilitator basically, has worked with the Coast Guard to develop certain guidelines for security standards while we wait for the U.S. Congress to pass the Seaport Security Act. That legislation is in conference now; both the House and the Senate have passed their own version of the bill but the conference has to reconcile the two.

Once the bill is passed, regulations have to be written, and then published in a federal register. So you are looking at from 9 to 12 months after Congress finally passes the law before regulations start hitting the street. I think the Coast Guard here on the West Coast wanted to be more proactive.

BC: The economy is tanking and the Port of Oakland is having to make budget cuts. Do you have the resources you need to respond to these extraordinary new security challenges?

We don’t have the money resources that we would like so we have aggressively sought grants. $92.3 million was designated for seaport security in a Department of Defense emergency bill that’s already passed. The Transportation Security Administration and the Maritime Administration established a grant program which we applied for in March. The awards were announced in late June by Transportation Secretary Mineta and the Port of Oakland got almost $5 million. The Port early on had estimated that to make all the security improvements we would need would run in the neighborhood of $68-70 million and here we have landed only $4.8 million so far in grants. That’s enough to get a start on the projects that we have identified. We can significantly improve the security of our terminals, not to the highest level, but at some level in between. But we have enough to secure the physical plant and yet retain the ability to have a speedy and efficient movement of cargo.

BC: The San Francisco Examiner reported last week that the theft of crew uniforms from the Alameda Oakland Ferry had aroused security concerns. The Port of Oakland is a partner in running the Alameda Oakland Ferry. Does your security plan extend to the ferries?

My security efforts are focused primarily on the marine terminal facilities of the Port of Oakland. The ferries are handled through our commercial real estate department. But the U.S. Coast Guard has implemented something similar to the Sea Marshall Program, where Coast Guard people are on board the ferries monitoring the activities, some in uniform, some not.

BC: Describe the extent of your challenge, i.e., how many ships in the Port of Oakland every year and so on.

About 1,850 ships visit the Port of Oakland each year. As for the total number of containers, last year we had 959,300 loaded and empty containers. The Port Authority itself has roughly 640 employees, with many more working for the 10 independent terminal operators renting space from us. We have about 700 acres of container facilities and altogether the waterfront that is in the Port area of jurisdiction is about 19 miles long, all the way from the other side of the Oakland Airport around through the estuary, all the way to the north side to Emeryville.

BC: Where do all these containers come from and where are they going?

Because we have more outbound than inbound traffic, there is a certain imbalance. See, generally ships coming from Asia either go north to Seattle first, or go south to Los Angeles/Long Beach first. They’ll go to Los Angeles/Long Beach because it’s a huge consumption market. Fifty percent of the containers that come into L.A. generally stay within the area. And then 50 percent move onto the inland points. The shipping lines want to go there first and they want to dump as many containers as possible at the first port they call on because that gets them onto the rail faster. It moves them inland faster, cuts down the transportation time, which is a big thing in the shipping industry.

Now the northwest doesn’t have a very large consumption market, but they have good rail service into the inland. The reason the Port of Oakland has worked so hard to build new facilities, including the new cranes you’ve read so much about, is because we need to match their rail facilities, also known as intermodal facilities, to remain competitive.

BC: So Los Angeles/Long Beach Port is the powerhouse port of the West Coast?

Well, in terms of container volume they are sort of the 800 pound gorilla on the West Coast, handling probably 65 percent of the container cargo moving inland. California handles about 39 percent of the overall trade coming into the U.S. from overseas. Oakland has about 12 percent.

BC: How did you get to be responsible for Port of Oakland security issues?

Basically, I’m working on special projects for the new maritime director who replaced me in the job. Security issues came up just about the time that I stepped down, so I was available and able to step in and work on behalf of the Port on these issues under Jerry Bridges, Director of Maritime at the Port of Oakland.

BC: Isn’t there a kind of conflict between the security needs, which can hold things up, and the Port’s need to keep cargo moving along in order to stay in business?

You’re right that the objectives of security can be at odds with the objectives of efficient and productive cargo movement. But there are ways that you can do it so that it is almost seamless. It may still slow things occasionally, but not an unacceptable amount. And we just have to do it.

BC: Is there as much cargo coming arriving into the Port of Oakland as there is cargo being shipped out?

Oakland is predominately an outbound port. Because of California’s Central Valley, a lot of agricultural products are shipped overseas. So, surprisingly, about 60 percent of our volume is export from the United States to overseas points and about 40% of the cargo we get in is imports from overseas into the United States.

What we call captive cargo is generally cargo that is consumed within the region, in our case up as far as Reno and Sparks, and to a certain extent Salt Lake City. Interestingly, we import a lot of the same things that we export. We export fruits and vegetables and meats and things of that nature and we import a lot of the same commodities. We get some Silicon Valley type of materials. We get auto parts for NUMMI, the car assembly plant in Fremont. We get beef from Australia and New Zealand, lamb, things of that nature. And we also ship out beef and raw cotton that comes back as finished products.

BC: Terminal operators operate fairly autonomously from the Port of Oakland in the space they rent from you. Are you satisfied that all these terminal operators have made the grade in terms of these interim standards you’ve been talking about?

It’s a work in progress. I am satisfied that there is a commitment, a recognition of the need to improve the physical security, the need to identify who is on the terminal and why, and the need to increase the general security awareness of the people who work down there at the terminal. And the management of the companies are committed to that. Where they are in implementing the recommended guidelines varies from terminal to terminal.

It’s not for lack of trying. The Port submitted eight grant requests totaling $28 million. We received approval for three of them for a total grant of about $4.8 million, enough to get started with a video surveillance system at all of our terminals to monitor the perimeter security of each terminal and the water. Another project that’s a “go” is an automated access control system where we will rebuild the pedestrian gates to allow one-by- one access only, controlled by some sort of card reader and a camera which will monitor the process remotely. Oakland actually received one of the largest shares of the total awarded to Ports, which speaks to the recognition of the Port of Oakland’s position in the maritime network.

BC: Isn’t there a certain amount of fatalism that’s called for here? I mean you can tighten this place up as tight as a drum, make sure you know exactly who is on your facility, but ultimately all these containers coming in by the thousands and thousands, you can’t control what’s inside the containers, can you?

No, we can’t. The only folks who really know are the people who loaded the container and U.S. Customs if they open the container. What our terminal operators receive is documentation which says it contains, for example, television sets and what U.S. Customs sees is a manifest which says this container contains television sets. The manifests are run through a very comprehensive U.S. Customs threat assessment computer model to select which containers get physically inspected. They rely very heavily on their computerized control system where they won’t tell exactly what criteria they use, but they are only able to physically inspect about 2 percent of the total containers moving through the U.S. ports, though Customs is working very hard to increase the number of containers they inspect. For example, the Customs people at Oakland have recently deployed a mobile x-ray system which allows them to increase the number of containers checked if not physically opened. A second machine will be delivered in the fall.

Customs also has a program that they’ve just implemented that’s called Customs and Trade Partners Against Terrorism. It was started in cooperation with major just-in-time shippers who are concerned about delays in their commodities moving from overseas points into the United States and the potential impact it could have on their manufacturing and distribution system. This program is being pushed with all of the shippers, Target, Walmart, Walgreen’s, etc. It is essentially a partnership with Customs where the companies work to guarantee the security of their trade network. They work with their overseas suppliers, the people who stuff the containers at overseas points. They set up security guidelines with their trade partners, which Customs inspects and verifies.
And when they have that certification the container is likely to move more quickly.

BC: Is this enough to guarantee that someone can’t slip something through in a container?

It’s only one step. The next element related to that is how do you secure the container itself, to make sure that the container is not opened in some way in transit. We need to make sure that somebody can’t open it someplace and throw in a duffel bag which contains a dirty bomb, or weapons or something. Or even that people don’t get into the container and hide in someway during the transit. Technology type solutions are being explored, like tagging containers with global positioning system devices. Also, building a package that contains not only radiation detection, but light detection that could tell when and if a container has been opened. A lot of thought is going into securing the integrity of the seal on containers. Do you go to electronic seals, which may be $200-300 apiece instead of the $20 apiece seals that are currently used by most of the shippers?

The focus is really that our first line of defense is the overseas point. By the time it gets here, there is not a lot that can be done. The idea is to catch it before it gets into the container, make sure the container is sealed and then monitor the integrity of the container throughout the shipping process. And that is, I think, the best way to address the cargo security issue.