In an unusually frank airing of the State Ports Authority's strengths and weaknesses Thursday, Gov. Mark Sanford called on port officials to scuttle one of the state's three ports, act as a real estate developer on Daniel Island and share more profits with taxpayers.

"Don't take anything personal in this process," Sanford said before launching into a revealing discussion with ports authority staff and board members about how to transform the state agency into a lean quasi-corporation that gets along with its neighbors.

The lively talks, which painted a picture of a bloated, overstaffed agency that clings to an unprofitable facility and hundreds of acres of prime waterfront land, hit on several actions the authority could take, including:

-- Close its Port Royal break bulk cargo terminal in Beaufort County, which lost about $58,000 last year.

The terminal serves only about 20 ships per year and handles mostly cement, fertilizer and other bulk cargo. The niche business in Port Royal makes up just a fraction of the SPA's operation, which focuses mostly on containerized cargo.

Sanford said Port Royal's annual cargo is an amount that Charleston terminals can move in a matter of days. Port officials said they did not know the terminal's value but agreed that its land in booming Beaufort County is worth more than the facility.

"Bottom line, that's a facility that's at best underutilized," Sanford said. "I would ask that, given where it is, we look at how quickly we can close it."

Because the terminal is required in the state legislation that created the ports authority, the General Assembly would need to act before its customers could be transferred to other SPA terminals, SPA President and CEO Bernard Groseclose Jr. said.

The SPA took over operation of the 12-acre terminal from a private company in 1995. It and the SPA's Port of Georgetown are the only state-run shipping terminals outside the Charleston area.

-- Work with a private company to begin developing the port's 1,300-acre tract on Daniel Island, using the proceeds to finance port expansion at the former Charleston Naval Base.

"We will come out much better if we form a subsidiary that develops it rather than sell it," said SPA board member and real estate developer Harry J. Butler Jr. of Georgetown.

In the year since its Global Gateway port expansion plan for the island succumbed to public and legislative opposition, the port has been using parts of the undeveloped land for dredge disposal.

-- Open local container terminal gates 24 hours a day, spreading out the concentration of mostly day-time truck traffic on roads and highways. On a typical day, some 11,000 vehicles pass through the port's terminals.

While the port's downtown, North Charleston and Mount Pleasant container terminals operate night and day, the trucks that haul the containers are allowed access only during gate hours, largely in the day and early evening.

Such a move would be tricky. While port employees operate some gates, others are run by shipping lines that lease space from the SPA, said Maritime Association of Charleston president John Hassell.

Expanding gate hours could hinge on the local longshoreman's union renegotiating its contracts with shipping lines, Hassell said.

State Sen. John Kuhn, R-Charleston, who attended the meeting along with other members of the Charleston County legislative delegation, also brought up traffic concerns, calling on state leaders to begin planning road infrastructure for the port's planned base terminal. "We've got to make sure we don't have a complete crisis down here on Interstate 26," Kuhn said.

-- Kick in to state coffers an annual payment based on a percentage of the port's profit.

Noting that its past payments to state government were voluntary, such as a $45 million commitment to help fund a new Cooper River Bridge, Sanford said he wants to consider requiring the SPA to make an annual payment to the state.

Groseclose cautioned that a large percentage of the port's earnings already are pumped back into equipment maintenance and purchases.

The port also is considering issuing tax-exempt bonds to help finance its expansion plans. But Hassell said bonds alone won't build a $400 million to $500 million container terminal. He and SPA board chairman Whit Smith said the port is pushing shipping lines to help bear the new terminal's construction costs.

-- Trim its 600-employee workforce by eliminating redundant jobs.

Butler, who was recently appointed to the port board by Sanford, said the agency's administrative costs are out of line.

"Maybe we've got more staff than we need," Butler said, noting that direct and contract salaries, wages and benefits account for more than 40 percent of the port's annual budget.

Last year, the port paid nearly $1.5 million in legal fees alone to 16 different law firms.

-- Encourage development of a privately operated port that's been proposed for Jasper County. State lawmakers said the port should do everything in its power to stand behind a facility that could siphon business away from the Port of Savannah, which has been growing rapidly in recent years to rival Charleston.

Overall, Sanford said he was pleased that the port is meeting its mission but that it is missing some cost-saving opportunities.

Frank Heindel of SPA watchdog group Contain the Port applauded the suggestions, which he said were "just plain common sense. Gov. Sanford is just discovering the tip of the iceberg in potential taxpayer savings."