In response to Charles Crumpley’s Comment column in the May 24th issue (“L.A. Port Awash in Mystery”), I want to offer some background and feedback about why the Port of Los Angeles is appropriately scrutinizing designs and ideas to create a shipbuilding and vessel-repair facility proposed by Gambol Industries Inc.

For starters, I suggest a careful review of the staff report presented at the May 18 special board meeting of the Los Angeles Harbor Commission. The report and accompanying transmittals describe in detail the port’s efforts under a Memorandum of Understanding established with Gambol Industries in June 2009. Under this MOU, port staff and consultants have spent countless hours working in good faith with the Gambol team to explore design configuration ideas that would preserve for possible shipyard use two former dry-dock slips that supported shipbuilding operations here in the mid- to late 1900s.

Expansions under way

Today, the port has two major container terminal expansion projects under way. Those projects and the final phase of a 10-year, $300 million Main Channel Deepening Project required the port to create a solution for the disposal of clean and contaminated dredge sediment. That solution was a landfill in the highly contaminated dry-dock slips that Gambol wants to preserve for its proposed shipyard.

Ironically, Business Journal articles from five to seven years ago talk about the competitive disadvantage the port would face in the future if it did not deepen its navigational channels to accommodate the world’s largest cargo ships. The Business Journal raised a valid concern because containerized cargo accounts for roughly 74 percent of the port’s revenues and generates hundreds of thousands of jobs throughout Southern California. Fast-forward to 2010, and the competition that the Business Journal reported on five years ago is now emerging and gunning for L.A.’s market share.

Contrary to Crumpley’s column, there is an existing vessel repair facility at the port – a tenant for more than 100 years that, by all appearances, Gambol will directly compete against. The business plan that Gambol has yet to deliver must demonstrate the viability of its proposed shipyard in light of this operation and other ship repair services in San Pedro Bay. As San Diego’s well-established shipbuilding industry faces 900 or more job cuts in the coming months, Gambol’s plan must clearly demonstrate a market growth opportunity for Los Angeles.

Gambol’s vision for a shipbuilding revival and 1,000 shipyard jobs in Los Angeles certainly deserves thorough exploration in line with the city’s obligation to study the best long-term uses of port property. At the same time, it’s clear that Gambol’s team likes to blame the port for the regulatory process it faces with the company’s 11th-hour change to a project already approved. Blaming the port, however, does not change the fact that it took five years for the regulatory agencies to approve the dredge material disposal sites now designated for the completion of the Main Channel Deepening Project.  

Approval process

The approval process for dredging projects and shipyard developments in San Pedro Bay includes a number of permits, sign-offs and environmental analyses from regulatory authorities that include the California Coastal Commission, U.S. Army Corps of Engineers, U.S. Environmental Protection Agency, Los Angeles Regional Water Quality Control Board and, in this case, the Department of Toxic Substances Control. Meanwhile, any schedule delays inflicted on the final phase of the port’s decadelong Main Channel Deepening Project pose a material threat to our current terminal construction schedules, agreements we have with those terminal operators, our port’s long-term competitive position, and more jobs than any San Pedro Bay shipyard – past or future – could ever deliver. 

Deciding whether to put all those interests at risk in order to support one company’s dream absolutely demands a high level of scrutiny.

Geraldine Knatz is the executive director of the Port of Los Angeles.

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