Port anticipates growth in 2001

LOOKING AHEAD: Officials say strong cash flow, rates for containerized cargo put port in good position for future

10/27/2000

Al Gibbs; The News Tribune

Most of the arrows point upward for the Port of Tacoma next year.

Operating revenue will top $65 million, up over this year's record $62 million, according to the port's most recent budget documents.

The number of containers will rise to more than 1.3 million, an 8.1 percent increase over this year's record 1.2 million.

And cash flow will remain above $30 million for the second year in a row.

"We're flush," said Greg Nelson, the port's senior director of finance and administration. "We've got a strong cash position, and we want to maintain a strong position."

"We've got a strong base to build for the future," added port controller Jeff Smith.

But not everything's going up.

Log exports are expected to decline a bit, but they've been in a swoon for nearly all of the past decade. Similarly, alumina imports will drop because Kaiser Aluminum has shut down much of its production at plants in Tacoma and Spokane to avoid the region's higher energy prices.

But logs and alumina never have been big parts of the port's revenue.

Growth rates for containerized cargo, the port's major business, will continue to soar, according

to Doug Ljungren, the port's business planning manager.

Container handling is expected to increase by 41 percent by 2005, according to Ljungren's projections.

In part, that's because Asian economies are recovering strongly from the economic chaos of 1997. Economic growth for South Korea, China and Taiwan is expected to be in the 6 percent to 7 percent range next year.

Japan, after a decade of recession, probably will grow less than 2 percent, Ljungren said.

There are other signs of a strong port business getting stronger.

Three of the four container shipping lines that call at the port will get larger ships in the next few years. The fourth already sails with the biggest container vessels afloat.

And Totem Ocean Trailer Express, which serves Alaska with roll-on, roll-off vessels, will get two larger ships beginning in about two years.

Ljungren's forecast assumes that another container line will call at a new facility at Pierce County Terminal by mid-2003. So far, however, no deal has been struck.

Officials are expected to leave the port's property tax levy, which has been declining for years, at 18 cents per $1,000 of assessed valuation. For the owner of a $150,000 house, that amounts to $27.

The tax will raise $7.7 million next year, most of which goes to pay off bonds the port has sold to finance new or improved port facilities.

The port commission is scheduled to have a public hearing on its 2001 budget Nov. 2 and to vote on the measure Nov. 16.