WASHINGTON—Last year’s 4 ½-day closure of the Port of New Orleans, due to a mishap on the Mississippi River, cost the regional economy $61 million and, as a senior port official noted, should have been a wake-up call for what might happen if terrorists attack port facilities on America's premier water highway, upon which an estimated 62 percent of U.S. commerce is shipped.

It would also help if the Department of Homeland Security would fund the other half of the four security gates at the main entrances to the port, a project that was initiated under DHS’s Port Security Grant program, said Gary LaGrange, president and CEO of the Port of New Orleans, and chairman of the American Association of Port Authorities.

In February 2004, the collision of a container ship and an offshore supply boat near the mouth of the Mississippi caused the U.S. Coast Guard to shut the river at Southwest Pass while it engaged in rescue operations for five members of the supply boat who went missing.

If the shutdown had lasted seven to 10 days, LaGrange said in a telephone interview, “the detrimental impact on the nation—not only on Louisiana—would have increased day-by-day exponentially, it would have skyrocketed, because cargoes would not have reached the shelves at the market.”

As it was, LaGrange added, “We had 55 or 60 ships blocked outside at anchor, trying to get in the river, and an equal number—50 to 60 ships—that couldn’t get out.”

At the center of Louisiana’s lower Mississippi River—the world’s busiest port complex—the Port of New Orleans is the only U.S. deepwater port served by six class one railroads, giving port users direct and cost-effective rail service to or from anywhere in the United States—except Hawaii—Canada and Mexico.

The significance of last year’s closure on the river should have rung a bell with policymakers concerned with homeland security back in Washington, but LaGrange said that he wasn’t so sure that was the result.

Of the $64 million the port has needed to improve security since September 11, 2001, he said, it has received only $8 million. 

[New Orleans Times-Picayune newspaper reported on Friday that LaGrange said that of the more than $50 million shortfall in federal funding, between $25-$30 million was needed for “pure hard-core brick and mortar projects,” such as detectors and fences, and the rest for security training, overtime, and additional Harbor Police personnel.

[LaGrange called a proposal contained the Bush Administration’s new budget that would roll the Department of Homeland Security’s Port Security Grant program into a $600 million public transit grant fund “unacceptable.” The ports, he told the Times-Picayune, were “once again… getting the proverbial stepchild treatment.”]

Security expenses incurred to date include putting video camera monitoring systems around the facilities, including at more than two dozen strategic points in a new up-river section that is the busiest area at the port. It was also necessary to put up lighting along the main truck thoroughfare going into the port terminals, as well as fencing and lighting around its cruise ship facilities. 

The port also created an anti-terrorism division within our harbor police department. “That was something that we did totally at our own expense.” La Grange said. 

Having to pay for the lion’s share of the kinds of port security upgrades required after 9/11 has impacted both the port’s current operations and its prospects for growth in the highly-competitive expanding global market, LaGrange pointed out.

Building projects have been delayed, maintenance is being deferred and marketing efforts have been negatively impacted by the lack of federal funding to compensate for the security mandates, LaGrange said.

“It is hurting all of our efforts,” he said. “It’s hurting our capital improvement program, its hurting our construction program. A number of the projects have been delayed; we’ve had to improvise, we’ve had to do some of them on our own.

"We've had to not only think outside the box; we've had to create a new box."

For example, the port plans to build new cruise and container terminals and transit sheds have been delayed because having to put money toward security has had a direct impact on moving forward on those needs,” he pointed out.

Port officials estimate that they need about $100 million for the transit sheds—they are running out of transit shed space--, another $200 million for the container terminals, and $60 million for a cruise terminal. 

An estimated $450-500 million will be needed in the next five years for the terminals, docks and other physical improvements, excluding the security costs, these officials say. In the last 10 years alone, the port has invested more than $400 million in new state-of-the-art facilities.

The post-9/11 security expenses have also meant significant deferrals of important port maintenance tasks, such as fixing the flood walls and various parts of the terminals, and even pot holes, LaGrange noted.

Costs in overtime and additional security guards forced the port to increase tariffs to the shippers—a phenomenon that led the Gulf Seaport Marine Terminal Group last November to establish across-the-board security fees to cover operation and maintenance (O&M) expenses, he said.

“In the case of the Port of New Orleans,” LaGrange noted, “that is not going to generate a lot of money, it will probably be $1.8 or $1.9 million, but at least that will help us cover the added personnel that we had to put on board effective July 1, 2004, to comply with the new regulations that went into effect.”

The shortage of money hurts not only the port’s ability to attract new business, he added, but to create new jobs as well. 

Then there was the issue of the four gates whose initial construction was accomplished using federal port security grant funds. The homeland security money didn’t allow for a finished project, La Grange said.

“We got basically four half gates, none of which were able to do what one gate should do completely,” he said. They’re still not finished—they’re finished enough to the point where we’ve been able to improvise until such time that we can get the funds to finish them. …”

Perhaps those monies will come in a future round of the port security grant program, Round 5 of which reportedly is being readied for announcement from Washington.

Martin Edwin Andersen can be reached at Mick_Andersen@portsecuritynews.com.

Copyright © 2005 Port Security News