NEW ORLEANS (AP) Gov. Bobby Jindal’s proposal to provide $25 million to the Port of New Orleans is only the start of what the port needs from government to take advantage of an expanding number of trade partners and a wider Panama Canal, officials said March 6.
However, the port’s director said the port is not looking to government alone to fund its new $1 billion expansion plan. Private investment likely will be counted on to provide a third to half of the money for the 12-year plan to boost the port’s container cargo capacity and its ability to handle traditional cargoes and expand cruise facilities.
Under the plan, the port would spend $574.4 million through 2012, followed by another set of projects from 2013 to 2020 that would total $465.1 million.
During a news conference, port director Gary LaGrange said the state, which does not now provide a regular appropriation for the port’s operation, will have to invest in expansions in order for the state to take advantage of larger trade opportunities.
For example, LaGrange said a $237.6 million plan to expand the Napoleon Avenue container terminal — one of the first priorities on the list — would return six times the investment to the state’s economy, provide 1,940 jobs and generate $14 million in annual taxes.
“Not financing and not investing in the port is not an option,” LaGrange said.
In addition to expanded trade from Asia and South America, the port must be in a position to handle an expected explosion of shipments coming through the Panama Canal, which is expected to open a third lane in 2014, LaGrange said.
At the same time, competing ports, such as in Houston; Mobile, Ala.; and Gulfport, Miss., are investing billions of dollars in improvements, he said.
“We need to keep up with our competition,” LaGrange said.
Jindal has proposed $25 million for the port from the state’s surplus, which LaGrange said would be used to start the container terminal expansion. LaGrange said he hopes the Legislature will provide more money later in the year.
State Rep. Austin Badon, D-New Orleans, said the $25 million is “pretty much a drop in the bucket” and pledged to push for more state support.
“We have to take this port into the next decade and get this port state financing,” Badon said.
LaGrange said he expected private investment, probably from the investment banking community, to provide 33 to 50 percent of the total plan’s cost. LaGrange said that in return for capital, investors would share in port revenue.
The port has considered the idea before. When the port was considering about $250 million in pre-storm improvements, officials had narrowed private investors to about three groups, “then Katrina hit,” LaGrange said.
Of the total plan, approximately $477.6 million would involve a two-phase expansion of the Napoleon Avenue terminal that can now handle about 366,000 containers annually. The first expansion now being pushed would boost the capacity by 194,000 containers. The second expansion, set for 2013 and later, would cost $240 million and bring capacity to 1.3 million containers.
For the cruise ship business, the port wants to spend $22.5 million to redevelop a wharf as a third cruise terminal and provide enclosed gangways. After 2012, the plan includes $40 million for another terminal.
The plan also calls for $25 million to build an intermodal rail facility by 2013 — one that can handle ocean freight containers transferred directly to rail cars.
Up the Mississippi River at the Port of South Louisiana, a 54-mi. (87 km) port district between New Orleans and Baton Rouge, officials are pushing the state for $55.2 million in improvements — $41 million involving the Globalplex facility at Reserve, an intermodal terminal that can handle bulk, breakbulk and containerized cargoes.
Jindal has proposed spending another $515 million for transportation projects, including $249 million for roads, bridges and ports in all 64 parishes.