July proved to be busy month for the Port of Oakland, but August will bring unexpected media attention to the Port of San Francisco.
By Patrick Burnson
Published: August, 2013
July proved to be busy month for the Port of Oakland, but August will bring unexpected media attention to the Port of San Francisco.
In July, the Oakland Board of Port Commissioners approved a resolution officially ratifying the election of new board officers. The board selected Commissioner Cestra "Ces" Butner to serve as president, Commissioner Alan S. Yee as first vice president, and Commissioner Earl S. Hamlin as second vice president. The board elects new officers at the beginning of every fiscal year; the port’s fiscal year 2013-2014 began on July 1, 2013.
By city charter, the Oakland Board of Port Commissioners consists of seven members who are nominated by the Oakland mayor and appointed by the Oakland City Council to staggered four-year terms. All three new officers were nominated by Oakland Mayor Jean Quan and appointed by the Oakland City Council in 2011 or 2012. With the departure of immediate past president Gilda Gonzales, the board now consists of all commissioners nominated by current Oakland Mayor Jean Quan. President Butner’s current term expires on July 10, 2015; First Vice President Yee’s current term expires on July 10, 2014; and Second Vice President Hamlin’s current term expired on July 10, 2013, but he remains on indefinite holdover status until he is reappointed or replaced.
Oakland Port Board Approves Terminal Settlement
After the dust settled on appointments, the Oakland Board of Port Commissioners unanimously approved a litigation settlement agreement with SSA Terminals, one of the port’s major long-term seaport tenants. The settlement involves four of the Port’s seven marine terminals, and will create operationally the third-largest terminal on the U.S. West Coast. In terms of size and operational efficiencies, this new "mega-terminal" will be more in line with competing terminals, allowing the port to sustain and attract more maritime cargo, which currently supports approximately 40 percent of the 73,000 jobs the port generates annually in the region.
"We reached this litigation settlement to protect the port’s long-term viability as a job-creating economic engine for this region," said Butner. Under the settlement, SSA will lease two terminals through 2022 at current rates and conditions; terminate its lease for Howard Terminal effective September 30, 2013; and dismiss its lawsuits against the port.
The settlement involves short-term revenue loss in exchange for longer term revenue growth and stability. Prior to this agreement, the port was facing the expiration of all four terminal leases along its middle and inner harbors in 2016-2017. Further, those leases all had very short renewal notification periods, leaving the port vulnerable in the event one of the operators decided not to renew its lease.
The board carefully considered over many months how to move forward relative to a potential settlement with SSA and a reconfiguration of the marine terminals. Given the realities of the port’s current market position and growing competition in the maritime industry, this agreement provides the port with important competitive benefits and future opportunities that will facilitate the efficient flow of cargo through these terminals.
New Oakland Port Executive Director Assumes Post
In other Port of Oakland news, the port’s new executive director had his first day on the job in July. Chris Lytle is the former executive director of the Port of Long Beach, the second busiest container port in North America. Under Lytle’s leadership, the Port of Long Beach experienced major growth and expansion, while implementing numerous successful environmental initiatives and community-focused programs.
Hamburg Sud to Christen Cargo Carrier in S.F.
The global German ocean cargo carrier Hamburg Sud will be christening its new container vessel at the Port of San Francisco on August 23.
Port cargo manager Jim Maloney notes that this is remarkable for two reasons. First, the carrier calls the Port of Oakland to load and discharge cargo. Second, the event will take place at Pier 35, a destination otherwise served by the cruise industry.
Hamburg Sud did call the Port of San Francisco with a feeder service late in the last century, but why it’s paying this honor to the City now is anyone’s guess.
