At least that’s what port executive director Tim Farrell and most of its five commissioners are saying. Port executives announced (25 July 2007) that the port will build a $300 million shipping container terminal on the east side of the Blair Waterway. The terminal is for NYK Line, a Toyko-based shipping company that currently uses the Port of Seattle.
“I’m not going to recommend that they raise the tax levy for this,” Farrell said Thursday. “We’re not going to put anything in front of (the commission) on the tax levy.”
Port commissioners, too, aren’t counting on taxpayers to foot the bill for the new terminal.
In the past, the port has used the money it earns from leasing terminal space to shipping lines to pay for terminal expansion projects. The port earned $92 million in operating revenue last year and made an operating profit of $19 million. Those dollars go toward paying back revenue bonds the port issued to build new terminals or add on to old ones.
The same will go for the terminal the port plans to build on the East Blair Peninsula, Farrell said. In return, NYK Line will pay the port rent on a 25-year lease of about $40 million per year.
“That’s why we can afford to do big developments like this,” Farrell said. “The debt load will go up and revenue will go up.”
The port aims to keep its annual revenue at two times more than the debt it owes in any given year. Farrell said the port will be able to keep that ratio, despite the debt it will take on to build the facility.
The port now carries $450 million in debt. That number will increase to $1.1 billion by 2012, the year the new terminal is expected to open, Farrell said.
Outside of its operating revenue, the port gleaned $11.9 million from taxes in 2006. The tax will bring in an estimated $14.6 million in 2007, according to the port’s budget. The rate has remained the same for nearly a decade, but the continuing rise of property values increases how much the port collects each year.
The tax money goes toward paying off general obligation bonds and for construction projects such as road improvements and environmental projects.
By Kelly Kearsley, The News Tribune