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Tacoma Port to tighten belt further
2009/3/30
The global recession is hitting home at the Port of Tacoma as the organisation looks to delay staff pay raises, cut travel and even rein in cell phone use to make up for a decline in revenue more severe than the port anticipated, the News Tribune reported.
The Port of Tacoma earns money by leasing its property to shipping terminal operators, providing services such as transferring containers from ships to trains, and renting equipment.
Most of the revenue comes from those long-standing leases. But the revenue the port derives from the services it provides is directly tied to the amount of cargo coming in. And cargo volumes have been plunging.
The number of shipping containers moving through the port was down almost 17 percent as of February, intermodal lifts were down 31 percent and imports of cars and trucks were down 46 percent.
In addition, the port''s customers are asking to pay less on their leases and for services, said port executive director Tim Farrell.
A few ports around the country have already made such concessions. Farrell said the Tacoma port is considering doing the same.
"We''re in long-term relationships with these customers and they are hurting," Farrell said. "So even though it won''t make a huge difference, in long-term relationships you share the gains and share the pains."
The port expected to bring in US$103.2 million in operating revenue this year. It also receives other nonoperating revenue through grants and its tax levy. New projections put the port''s operating revenue at closer to $95 million.
"We anticipated a tough 2009 and budgeted conservatively," Farrell said. "Not conservatively enough, though, as the economy continues to slide."
The port estimated 2009 operating expenses at $84.5 million, though port spokeswoman Tara Mattina said the organization has already shaved $1.9 million in costs through cuts and delayed spending.
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2009/3/30