The Port of Seattle’s Business With the Seattle City Council’s Sports Arena Decision
by Jim Flynn on Jan 30, 2017
The Seattle City Council voted to not Vacate Occidental Ave S. It was a decision that negated the efforts of Seattle’s Chris Hanson to create the Sports Arena. The Port of Seattle, unique in Washington State as a For Profit Municipal Corporation, led a coalition of business entities: The Seattle Mariners, the Seattle Times, and the non-profit ILWU in opposition to construction of a Sports Arena in Seattle’s SODO District. The Arena would have added significantly to Economic Development in the economically comatose area. It would have improved livability and enjoyment for the citizens of Seattle and Washington State.
The Port’s objection is that the Sports Arena will interfere with container traffic destined to the BNSF Argo Rail Yard from the Marine Container Terminals on E. Marginal Way S. The Port insisted that competition in the container shipping industry is severe. They claim Sports Arena traffic will interfere with Container movement and cause unacceptable delays in shipping, and add considerable costs to their operation.
The Port of Seattle reminds us that there is fierce competition for Marine Container Shipping business worldwide. The Journal of Commerce opines that Ports from the four corners of the US are competing for every container. The Port of Seattle fears losing customers to the Ports of Prince Rupert B.C., Canada, and the Ports of Long Beach, Los Angeles and Oakland CA because of Arena Traffic.
However, the Seattle City Council has been dazed and bamboozled by the Port.
First, in answer to the charge that Arena traffic will interfere with Seaport Marine Terminal traffic. Property owners in the Port Taxing District of Washington pay forty-five cents per thousand dollars of assessed value of their property in tax to the Port of Seattle. Those very same taxes paid over ten million dollars for an improvement project to facilitate container traffic movement from Terminal 30 and Terminal 46 to the BNSF Argo Train Yard in 2016.
The Port’s Web page explains it all: The project eliminates a dangerous traffic weave for trucks, removes the trucks from the already congested East Marginal Way and reduces the roadway blockage at the intersection of East Marginal Way and Diagnonal (sic)Avenue, where trucks queue up to turn left.
The road provides a safe, direct access for trucks from the Port seaport terminals to the Argo rail yard gates to eliminate trucks entering SR 99/EMW…
Second, as to the charge of losing customers to the four other major container ports on the West Coast, the Port is way ahead of themselves in blowing smoke. Terminal 5 has been empty for years and the Port lost its biggest customer at Terminal 46 with the bankruptcy of Hanjin.
The bankruptcy of a Hanjin is a harbinger of the status of the international container shipping industry and the reason why the Port cannot get another long term customer at Terminal 46.
Maersk who also calls at T-46 is showing some of the symptoms experienced by Hanjin prior to their business failure. The corporation is in reorganization. They expect to change to a UPS type of business structure. OOCL, facing rising volume and falling revenue, has stock trading heavily on speculation that the company is for sale. COSCO, the Chinese conglomerate, is solidifying its role in the biggest shipping alliance in Asia. The government of Taiwan is pouring a billion and a half into it national container shipping lines. They are experiencing serious cash flow problems.
Because of continuing overcapacity and low demand worldwide, you can expect a paradigm shift in international shipping. With the collapse of a Hanjin, there are only fifteen international shipping companies. Those companies are either forming alliances like COSCO, or in merger talks like Nippon Yusen, Mitsui O.S.K. and Kawasaki Kisen Kaisha.
The reason this is happening is because of a concept in the shipping business called Scale for Efficiency. The concept also applies to the construction of container ships. Using the Scale for Efficiency concept, newer container ships are double the capacity of last years. The new Post-Panamax class carry over nine thousand, forty foot containers. A typical double stacked container train could be fifty-nine miles long with that many containers. Imagine being at the foot of Broad St in Seattle, trying to get to Ivar's on E Marginal Way S , and waiting for that train to pass. Since they are not encumbered by canals, bridges and rivers the mega-ships are perfect for our part of the globe, that is, the Pacific Rim, Asia and Africa. The owners of these mega-ship alliances say they will work with the Port that offers the best customer service. That service will include: depth scaled for Post-Panamax class hull, cranes scaled for Post-Panamax container ships, Marine Terminals be completely automated and be Intermodal, meaning direct rail access.
Scaling for Efficiency through Automation also means that more than seventy percent of ILWU jobs would be lost. The remaining jobs will be of the hi-tech type. Attempting to transcend the Longshoremen Union’s opposition, the shipping conglomerates, who hold all the cards, are determined to find Port Authorities willing to work with them. The three major ports of California are investing in Automated ports. Negotiable now is Terminal Operator. The conglomerates want to do it themselves as part of efficiency scaling. Terminal 46 will not Scale for Post-Panamax.
By the time the Viaduct is removed, because of changes in the container shipping industry, the Marine Container Terminals located on East Marginal Way will be empty and the Port will be looking at a new Line of Business there. Meanwhile, the people of Seattle, King County and Washington State are losing a very valuable economic development tool by not vacating Occidental Ave S and allowing Chris Hansen’s group to build a sports Arena in Seattle’s SODO district.
Do you think the Seattle City Council should vote to vacate Occidental Ave S thereby allowing construction of a Sports Arena in the SODO district of Seattle? Your comment is welcome at the end of this article.
The Seattle City Council voted to not Vacate Occidental Ave S. It was a decision that negated the efforts of Seattle’s Chris Hanson to create the Sports Arena. The Arena would have added significantly to Economic Development in the economically comatose area. It would have improved livability and enjoyment for the citizens of Seattle and Washington State.