The Los Angeles City Council on Tuesday decided not to overturn the Harbor Commissioners’ denial of a Long Beach company’s bid to build a shipyard at the Port of Los Angeles.

At the same time, however, the City Council urged commissioners to find another more acceptable shipyard site.

The unanimous vote upholds the harbor commissioner’s rejection of the request by Gambol Industry Inc. to build a repair and construction facility at the former Southwest Marine site.

In an unusual move, the council had decided to reconsider the commission’s December decision regarding Gambol Industry Inc.’s proposal to construct the $50 million shipbuilding and repair facility at the now-abandoned Terminal Island site.

Port officials had argued that it could not be built without seriously delaying an ongoing main channel-deepening project critical to the port’s future success. The problem, they said, was that much of the sludge from the project – designed to enable larger ships to enter the port – was slated to be deposited in two slips alongside the Southwest site.

“I would never do anything to slow down the channel deepening project,” Councilwoman Janice Hahn, who led a panel that had considered resurrecting Gambol’s plan, said after Tuesday’s vote. “I understand why the Harbor Commission felt it was impossible to build a shipyard at this site.”

The council also asked the commission to find another site, and to report back on plans for preserving the historic buildings at the Southwest site.

The operation of a shipyard at another location would be open to bids from any interested parties including Gambol, port officials said.

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