The Port of San Diego's Tenth Avenue Marine Terminal downtown has long been a developer's dream. But each new idea — most with a football stadium attached — has been beaten back by those who believe a rare, deep water port should remain — just that.
Much of the debate consistently focuses on the "highest and best use" argument for a public asset. Are we getting the biggest bang for our considerable bucks?
I-Newsource looked at all the leases on the terminal, talked with port supporters and opponents, as well as maritime experts. We interviewed dozens of employees and small business owners affected by what happens on those 96 acres that jut out into the bay in order to better understand this debate.
What follows is a look at the terminal from all angles — who's there, what they pay, what they do, who they affect, and where prominent people in the city stand on the debate.
The Tenth Avenue Terminal is the one causing all the debate. Click on the blue and red blocks on the terminal below to see which companies call it home.
The tenants at Tenth Avenue aren't the only ones affected by maritime commerce. Other companies in San Diego rely in one way or another on the port's activities. Here are local company owners and operators talking with us about their relationship with the port and the terminals.
We've attempted to include all relevant companies. These are presented in no particular order.
Mark Jennings, Bill Bartsch and Lyle Donovan, all captains, board any ship coming to the Port of San Diego weighing more than 300 tons — that's about 150 cars — to bring them into and out of the bay.
"We're it for the pilots," said Jennings. "We're a small group — just three guys ... there isn't a huge opportunity for [outside workers] to get in."
Source: Mark Jennings
"We have about nine people that work on our two boats," said Capt. Josh Ellis. "On the shore-side, we have about 100 people that support [the operation]."
"When the ships come in, we assist them to the berth," Ellis said. "When they're done, we pull them off the dock. We're there to assist the pilots and the captain of the ship."
Crowley Marine, a worldwide multi-service company, handles about 70 percent of all the commercial ship-assists in the Port of San Diego.
Source: Josh Ellis
The Army Corps of Engineers puts out bids for dredging contracts to the public, and is advertising a contract right now for maintaining the San Diego Bay entrance channel.
One main contractor is awarded the contract, "but they'll have subcontractors who do surveying, environmental monitoring, and other kinds of support," said Scott John of the Corps.
Source: Scott John
The president of Marathon Construction, Mike Furby, says 90 percent of his company's work over the years has been in San Diego county.
"We build piers, marinas, seawalls," he said. "We do mitigation projects too, like re-vegetation and wetland construction."
Notwithstanding the past two years of economic turmoil, Marathon generally operates in the annual range of $25-30 million, with six to eight projects undertaken each year, and currently employs about 30 people.
Furby says that his company handles half of the water-based construction projects, while his competitor, R.E. Staite Engineering, handles the other half.
Source: Mike Furby
Jankovich provides fuel for commercial vessels, like cruise ships and Dole carriers, and employs five people.
Source: Jankovich spokesperson
From cruise ship security to monitoring the closed-circuit televisions, Universal Protective Services is the port's contracted security company for all operations.
The company has had the contract with the port since before 9/11, and continuously wins the bidding process year after year.
"It's very competitive," said David Hoffman, the general manager of Universal Protective Services for San Diego.
The company is national, and has "hundreds of employees" in San Diego, according to Hoffman, who declined to give precise numbers for security reasons.
Source: David Hoffman
NASSCO, a division of General Dynamics, is the largest industrial manufacturer on the San Diego working waterfront and employs around 3,000 people.
The company is also the largest shipbuilder on the West Coast.
"We've got a staff of approximately 350 engineers that actually designs the ships we build here, and they're located here," said Mary Montgomery, the manager of public and governmental relations for the company.
Source: Mary Montgomery
Divers in the San Diego bay perform underwater cleaning and upkeep operations for both private and commercial vessels.
"There are 7,000-plus vessels in San Diego Bay and they need regular maintenance and upkeep," said Alex Halston, the owner of San Diego Diving Services.
Source: Alex Halston
"If there's a product being moved," said West Coast Manager Thomas Tice, "we're the independent inspection company that goes in to make sure that cargo is what it says it is."
Marine Inspection employs one full time person in San Diego. The company has locations throughout the U.S. and the world.
Source: Thomas Tice
There are thousands of carriers in California and hundreds of thousands nationally, according to the American Trucking Associations annual trends report.
There were nearly 2.3 million tractor-trailers operating in the U.S. in 2010, employing 3 million truck drivers.
Ports like San Diego do business with hundreds of companies annually, with each tenant, importer, exporter, and broker arranging the transportation of their goods.
Source: ATA American Trucking Trends 2012
A ship's agent serves as the liaison between the ship's owner/operator and the port and government officials. An agent will arrange for a ship's refueling, crew changes, paperwork, compliance with environmental regulations, and anything else necessary for docking.
"There's no way a ship can come to the port nowadays and do [all of this] themselves," said Transmarine's San Diego District Manager Marc Shouwe. "Especially in the state of California"
Source: Marc Shouwe
Customs brokers prepare documents, calculate taxes, duties and fees, and serve as a liaison between the importer or exporter and the government.
They work to clear customs barriers on behalf of their clients.
Stevedoring services provide longshoremen for all types of operations taking place on a terminal.
Burlington Northern Santa Fe Railway runs cargo trains out of the Port of San Diego to the rest of the country through Orange County.
Source: BNSF spokesperson
According to spokeswoman Jackie Wasiluk, Customs and Border Protection "is the unified border agency within the Department of Homeland Security charged with the management, control and protection of our nation's borders at and between official ports of entry. CBP is charged with keeping terrorists and terrorist weapons out of the country while enforcing hundreds of U.S. laws."
While the numbers fluctuate, Wasiluk says that the San Diego Field Office — which includes airport and seaport activities in San Diego and Imperial Counties, as well as the land border crossings along the California/Mexico border — includes almost 2,000 front-line CBP officers, agriculture specialists, and support staff.
Source: Jackie Wasiluk
There were 132 registered longshoremen in San Diego in 2011.
Nationally, there were 13,785 registered longshoremen last year operating throughout the West Coast.
In 2011, the average wage for a longshoreman in San Diego was $41.88/hour, with the Pacific Maritime Association paying a total of $15.6 million in wages to those registered to work.
Source: Pacific Maritime Association website
More than 30 ship owners and operators utilized the Port of San Diego last year, bringing in everything from automobiles and lumber to wind turbines and fresh fruit.
As the worldwide shipping market grows, so too do the ships. A forecast published by Alphaliner, a company that monitors shipping data, predicts "post-Panamax ships" will transport more than half of the world's containers by the end of 2015.
Post-Panamax ships are extremely large vessels that can enter only a few ports throughout the country — San Diego is not one of them.
Current ships coming into the bay are much smaller, requiring less depth and less space to dock and maneuver.
Source: POSD Public Records Act request, Alphaliner data
Dole is considered an "anchor tenant" and with the recent signing of the 24.5-year lease, the company plans on being a staple in San Diego for the foreseeable future.
The lease signing has drawn the ire of developers in town who see it as a major roadblock to discussions of redeveloping the terminal for a more commercial purpose.
The port staff see the lease as guaranteed income from a multi-billion dollar corporation. The company imports billions of bananas and other fruit from South and Central America each year, and distributes the fruit throughout the west coast and up into Canada.
Source: Dole lease, Dole website
A few months ago, we blogged during a road trip where we followed one car shipped from Germany bound for an eager Volkswagen technician in Henderson, Nev. This is the full story of that shipment, along with all the industries and employees it touched along the way.
The port has its share of supporters and critics. Here are some of the most prominent voices and what they have to say about the port and the terminal.
"The facility's commercial operations need to be preserved in the short and medium term. Ultimately, however, in the long term, we find it unlikely that anyone would argue the Marine Terminal is the best possible use of a big chunk of San Diego's spectacular downtown waterfront. That's why we think that eventually, it needs to move south, with the jobs and cargo transfers shifted either to an expanded port at National City or elsewhere."
"... Integrating the Convention Center's expansion with a new football stadium with a retractable roof built at the 10th Avenue Marine Terminal in tandem with a new sports arena in a sports-entertainment-resort district, as well as a new public park and public beach."
"I don't think the city of San Diego should lose its maritime presence. I've been a very big promoter of making the best use of the waterfront that we can, and the highest yield on the waterfront, generally speaking, is hotels. But I don't think all hotels (on the waterfront) defines who we are or should be. I think it's important — and the Coastal Commission seems to agree — that we maintain a maritime presence."
"If you have a port facility, it needs to remain a port facility because it's the law of California. In the sense that you can put a stadium anywhere, you can only put a port at a port. Once you turn it into a hotel or a stadium, you lose that capacity forever. So you have to be very, very careful if you're going to draw down."
"It's unfortunate that the Port isn't looking at this opportunity like a private entity would — as it is phenomenal land with a much higher and best use than container storage. There are minimal jobs being preserved — and even less being created — versus that of a new development. And a new development could open up the land for all of citizens of San Diego to enjoy. Not just Dole truckers and container workers."
"While we should be concerned about 150 longshoremen jobs, we must not forget that the Barrio Logan community has children's asthma rates higher than anywhere else in the state of California. A great public use for the Tenth Avenue Marine Terminal could be a park for all the people, in Barrio Logan, in downtown, and in our region."
Councilman and mayoral candidate Carl DeMaio told the Investigations Desk of KPBS and I-Newsource that he is not in favor of using the Tenth Avenue Terminal for any use other than trade and maritime. This despite his connections with UT San Diego owner Doug Manchester and and his CEO John Lynch, who are advocating prominently for an entertainment complex, including a football stadium, on the terminal.
In his "Pathway to Prosperity" plan, DeMaio outlines eight reform measures concerning the port and the terminal:
Here is an interview with Demaio on KPBS Evening Edition:
The City of San Diego should establish a special Task Force of business leaders and financial experts to conduct a full-scale performance audit on the Port of San Diego operations. This performance audit would provide a detailed analysis of operations and efficiencies across business lines to ensure each is financially self-sufficient and producing acceptable returns on the taxpayers' investment. Although a public entity, the Port needs to be run as a business. Like its clients, the Port should focus on maximizing value from current business lines while identifying and investing in new areas for growth and development. Inefficiencies and poor management at the Port lead to a diminished return on taxpayers dollars while stifling overall investment, economic growth, and employment opportunities for the region.
Building and maintaining modern facilities throughout the Port requires a large and ongoing financial investment. The Port needs to explore and develop public-private partnership opportunities with companies that use or are interested in using the facility. Strategic partnerships will help save the Port money in infrastructure improvements. In addition, partners will have a greater say in developing facilities to meet their specific needs while helping to ensure their long-term use of San Diego as their Port of choice. Asian governments have indicated their desire to invest in west coast port operations. The Port needs to look beyond the border for clients' and work with officials from Asia-Pacific countries to see if partnerships can be forged to expand San Diego's port facilities.
The Port's cruise ship facilities bring a different demographic of tourist to San Diego who spend money in our restaurants and shops, thereby adding to the local economy. At a time when cruise ship companies are Re-orienting away from Mexican ports of call, the Port needs to work with these companies to ensure that San Diego remains a stop along all travel routes. For example, the Port and City of San Diego need to work with other US cities along the West Coast in order to remove regulatory barriers to promote cruising along the West Coast.
Under the current system, higher costs on Port projects are ultimately passed along to customers who have choices on which facilities to access. With large capacity ports within two hours of San Diego, the Port needs to ensure that future projects are done without unnecessary and expensive restrictions or preferences for certain bidders. Promoting competition across prospective contractors ensures market-based bids and promotes efficiencies and costs savings. The Port of San Diego must remain competitive to ensure a successful future.
Streamlining permit requirements will provide for quicker project approval and completion — while generating cost-savings to permit applicants, the City and the Port.
As previously mentioned, the Port needs to be run like a business — with an eye on achieving its mission in a cost efficient and effective manner. A bloated bureaucratic organization leads to a stagnation and limits economic opportunities for the region.
As outlined in other reforms in the Pathway to Prosperity, the Port of San Diego should be held accountable for providing additional support for these two important projects. There projects have been shown to produce an immediate financial return on investment to the Port itself, and will act as an economic catalyst for the region.
The City of San Diego appoints three out of the seven commissioners to the Port. As individuals are considered for appointment, we must require they are committed to economic growth policies as a condition of nomination and appointment of The Mayor and City. Any current appointees who do not support economic growth policies should be replaced by the City.
Congressman and mayoral candidate Bob Filner does not have a published plan for the port, but he did speak with us recently to state that he does not support the stadium proposal.
Filner has advocated for modernizing Tenth Avenue and bringing in new business from overseas. Here are a few of his quotes from our interview.
(on Manchester's stadium plan): "He's looking at the old San Diego, where a few people build a few hotels, pay a lot of people minimum wage, and get all of the benefits of the port. Meanwhile thousands of working people are denied that kind of job."