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Monday, November 21    |    Upstate South Carolina News, Sports and Information

Ports Authority should work with private sector

Posted Thursday, November 17, 2005 - 6:00 am


By Richard Stewart

As South Carolina begins the process of steering its economy into the 21st century, maximizing our state's competitive advantages must become more of a priority to those in government. Too often, "politics as usual" trumps the fundamental value of ideas -- preventing our state from moving forward and realizing its potential. As a result, South Carolina's unemployment is high, our income levels are low and an increasingly fragmented and inefficient state government remains part of the problem, not the solution.

The global, Web-based economy is advancing at lightning speed, but the South Carolina State Ports Authority (SPA) and the political establishment that controls it is limping along like an old Charles Towne carriage horse with its blinders on.

Despite huge increases in port traffic and an influx of new Asian shipping business, the SPA has spent the past decade fumbling over various expansion plans in Charleston, all while ignoring the best remaining port site on the Eastern Seaboard -- Jasper County.

Recently, the SPA further disconnected itself from working families and taxpayers by forbidding public-private partnerships in the form of landlord-tenant agreements -- effectively eliminating a critical source of private investment utilized at 45 of the world's 50 largest ports, including 13 of the 15 largest U.S. ports. Essentially, landlord-tenant models enable private companies to build and operate terminals with private money, paying a lease to the government until the facility is turned over to the state.

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Yet while states like Alabama, Florida, Texas and Virginia are using these win-win agreements to boost port capacity and create jobs, the SPA is telling private investors to take their money someplace else.

Unfortunately for our state, that's exactly what's happening.

For example, Maersk Sealand, the world's largest shipping company, recently entered into a $450 million landlord-tenant agreement to build a new terminal in Portsmouth, Va. States like Virginia understand that taxpayer dollars are limited, the private sector moves faster than government and competition for business is brutal.

The SPA's defense of its "our way or the highway" approach has been to raise the specter of unions -- an argument referred to as "nonsense" by University of Chicago economist Sam Peltzman. Forgetting that 1,400 unionized employees already work at the Port of Charleston (compared with just 400 state employees), the SPA board warned ominously that a public-private Jasper port would "pave the way for further unionization in South Carolina."

This is simply a scare tactic to distract you from the real issue of accepting some private control in exchange for private investment. More importantly, it differs from the statesmen-like actions pursued in other states. Listen to Joe Dorto, president of Virginia International Terminals, commenting on the $450 million agreement his state reached with Maersk Sealand: "It's capacity we need. We don't have the money to buy additional property or expand beyond where we are now, but this is all being done with private money."

The next decade and beyond promises significant growth in the shipping business, and South Carolina is either going to get in the game or sit by and watch other ports willing to engage public-private partnerships generate jobs and prosperity for their citizens. Our state needs real jobs for working families right now, and our leaders should be looking for ways to make that happen.


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GUEST COLUMN
Richard H. "Dick" Stewart, a Beaufort businessman, is co-founder of South Carolina Citizens for Free Market Ports. He also is a board member of the Greater Beaufort-Hilton Head Economic Partnership, past chairman of the Greater Beaufort Chamber of Commerce, chair of the United Way of Beaufort County and a member of the Beaufort County Council. His e-mail address is dstewart@303associates.com.

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