By Jock OíConnell
Judging from recent reports in this newspaper, public officials in Sacramento and Yolo Counties are now more inclined than ever to write off the Port of Sacramento as a port and treat it instead as a strategically located parcel of real estate ripe for mixed-use development by a fast-growing City of West Sacramento.
One key proposal now under consideration would transfer a greater say over the portís future to authorities in Yolo County. In words of a report that has been the catalyst for the current review of the portís fate: ďThere is a disconnect between the geographic region served by the Port and the Portís governance structure (in particular, the City and County of Sacramento should have a reduced role, and the City of West Sacramento should have a greater role.Ē
Considering how assiduously West Sacramento community leaders have been coveting the port's real estate holdings, residential and commercial development on property that has long served as a peacekeeping buffer between the port and its closest neighbors would almost certainly ensue. Yet, such development would inevitably breed the sort of vocal constituency that could in time be counted upon to hector local politicians into restricting maritime operations or closing the port entirely.
Alluring as it may be, mixed-use development on property bordering the port would likely have the same impact on regional transportation planning as constructing even more subdivisions, schools and playing fields under the flight-path air freighters take when landing or departing Mather Field.
Whether a future generation will come to regard the portís scuppering in the face of development pressure as a monumental blunder is, of course, impossible to know. But what is equally unfathomable is how a public debate over the future of a key transportation asset can be conducted Ė as this one is -- in the absence of any concrete appreciation of the Sacramento regionís long-term transportation needs.
Driving this latest round of civic wrestling with the portís fate is a report submitted in August by an advisory panel convened by the portís Commissioners and chaired by McGeorge School of Law professor Clark Kelso. Over the years, Kelso has earned a reputation as all-purpose fixer of conspicuous failures in public administration, having been pressed into service as the stateís acting Insurance Commissioner and as its chief information officer. In the fall of 2002, the Port Commission asked this bureaucratic version of a Swiss Army knife to form a committee to advise on what ďsteps the Port could take better to fulfill its mission within the context of the changing face of the City of West Sacramento and the changing nature of the Portís immediate neighborhood.Ē
The Kelso Committee reported back in late August with a document that lays out what appears to be a compelling case for summary action. As with several previous analyses of the portís plight, this one features a muted but unmistakable rebuke of the portís management, which is indicted for its failure to broaden the portís client base beyond its traditional customers in agriculture and forestry.
Not surprisingly, the report emphasizes the portís precarious financial condition, observing that its 2.6 percent average net profit margin over the past decade is ďa much lower figure than would ordinarily be tolerated in a private business environment.Ē It further warns that the portís customers are in danger of being wooed away by the Port of Stockton, a terminus that is able to offer more attractive shipping schedules and rates.
(While at least implicitly critical of the portís management, the Kelso report fails to observe that its chief competitor -- the Port of Stockton -- might not be much better off had it not been the site of a major u.s. navy logistics center for most of the last sixty years.)
Turning the portís fortunes around will require much more than completing dredging of the deep water channel linking the port to Sacramento River. Although that would permit bigger vessels to call at the port, the port must find ways of expanding customer base while developing added sources of revenue. Unspecifically, the Kelso report urges the port to ďreinventĒ itself or at least adopt a ďbroader visionĒ of its future.
In marked contrast to its thoroughly lugubrious portrayal of the portís prospects, the reportís rendering of the surrounding city is downright salubrious. In language regrettably reminiscent of treatises on mice and their misplaced cheese, the report describes West Sacramento as, a municipality ďengaged in a process of re-discovery and re-invention, where its self-identity is undergoing a substantial transformation.Ē More to the point, itís also one of the fastest growing communities in the region.
Obviously, new houses, schools, parks, stores, places of employment and a host of other civic amenities must be constructed over the next few years to accommodate the needs of a surging population, not to mention the grand vision harbored by West Sacramentoís leaders to build an elegant cityscape on the West Bank of the Sacramento River.
So with the port being both literally and figuratively in medias res, it would seem logical to conclude that the interests of an evidently moribund maritime facility should give way to the higher and better needs of a resurgent city.
To that end, the Kelso report recommends a shift in the membership of the portís governing commission to reflect both the portís location in Yolo County and the fact that itís the City of West Sacramento that has to live with the hubbub of a working port that is all but invisible to outsiders. (Of the seven members of the Port Commission, five are from the Sacramento side of the river while just two hail from Yolo County.)
Why should anyone seriously object to a reconstituted Port Commission, especially if, as the Kelso report alleges, the port ďproduces no significant direct economic benefits to the City or County of Sacramento.Ē The current distribution of seats on the Commission is a merely an artifact of the portís original bonding scheme. But since those bonds have been long since retired, why not now graciously cede effective control of the port to the Yoloites? Both the Bee and the Sacramento Business Journal have lately editorialized in favor of just such a move.
The logic of the Kelso report is impeccable, as far as it goes. The problem is that the report does not go far enough. Because its authors were evidently intent on regarding the port primarily in the context of West Sacramentoís development priorities, their report wholly overlooks the fact that the port is a potentially vital transportation asset, one that Caltrans has identified as one of the stateís ďtop priority global gateways.Ē
Unfortunately, discussions of the regionís transportation needs seldom move beyond the issue of how best to move people between points in this ever-sprawling conurbation. Apart from periodic flashes of debate about whether disgruntled neighbors will permit Mather Airport to flourish as a regional air freight hub, the efficient and economical movement of goods receives scant attention from the regionís political leadership.
But as the regionís economy continues to expand, so too will the need to attend more systematically to the question of how products are transported from farms to groceries stores, from warehouses to consumers, and from factories here to markets abroad.
The mix of businesses and industries that will characterize the Sacramento Region in the next twenty years will probably bear a strong resemblance to the current blend of industries in the East Bay. There will be a substantial presence of manufacturing, warehousing and distribution centers along with a generous ladling of service companies together with firms in a steadily widening range of high-technology sectors. To thrive, an economy so constituted requires an efficient system for moving goods as well as people into, around, and out of the region.
The unpleasant reality is that development of the regionís freight transportation infrastructure has not kept pace with population growth, economic expansion, or steadily increasing volumes of foreign trade. Nor has this infrastructure kept up with the exceedingly intricate ways in which modern corporations integrate the flow of goods from initial sourcing all the way through to delivery to the end user. The rise of global supply chains, just-in-time delivery schedules and the increasingly widespread practice of managing inventory not in warehouses but in transit all serve to place an unparalleled burden on the nationís transportation systems. So, too, does the steady rise in e-commerce with its extensive reliance on overnight mail and package delivery services. Just ask your FedEx delivery driver.
The U.S. Department of Transportation estimates that value of cargo hauled across the nation's transportation system will more than triple by 2020. The strain will be particularly acute here in California, where road and rail systems handle not only the cargoes generated by the worldís fifth largest economy but also the vast majority of the two-way trade the rest of the nation conducts with the Pacific Rim.
Failure to address the consequences of the spiraling volume of goods moving over the Sacramento regionís transportation network will assuredly undermine the regionís ability to remain economically competitive. It will also severely hamper its ability to create new jobs and retain existing businesses.
Conversely, insuring the Sacramento regionís continued competitiveness Ė especially in the context of a global economy Ė requires that the areaís civic leaders grasp the importance of a diversified transportation system that maximizes the options available for moving people and shipping goods into, around, and out of the region.
That means gaining a firmer awareness of the vital role that key transportation assets such as Sacramento International Airport, Mather Field and the Port of Sacramento are apt to play in the regionís economic future.
A modern economy, for example, moves increasingly by air. Indeed, most of Californiaís merchandise export trade already goes by plane. Yet that commercial reality is seldom recognized by public officials deluged by citizensí complaints about rush-hour gridlock. Nor is there much appreciation of the potential role a maritime terminus like the Port of Sacramento could play in alleviating a sizeable share of the growing burden on the I-80 transportation corridor.
In recent years, more and more communities throughout the country have been exploring waterborne alternatives to highways and surface streets. In the Bay Area, frequently exasperating traffic conditions have prompted transportation officials to increase the use of ferries to move people and barges to transfer freight.
There is a certain irony in this, of course, because it represents a return to a mode of transportation modes that once dominated the bay. There is also a lesson here: As pitiable as the Port of Sacramento may appear today, replacing it would likely be a financial and political impossibility.
Like the regionís airports, the Port of Sacramento is fundamentally not a local business whose balance sheet should be evaluated as though it were a hardware store or an automobile dealership. It is instead a transportation asset that serves an entire region. Itís potential for playing an even more vital role should not, therefore, be left to the whims of any single municipality. Far from ceding majority control of the Portís Commission to the Yoloites, the Commissionís membership might usefully be expanded to include representatives of other counties in the region. Its membership should also include people who appreciate the importance of nurturing the regionís transportation assets, not regarding them merely as sites for future development.
It is axiomatic that the Sacramento regionís surging population together with a swelling volume of freight will severely strain its existing transportation network. Before sealing the fate of the Port of Sacramento, policymakers need much more hard information about the movement of goods as well as people.
As public consideration of the portís future continues, the regionís political leaders should bear in mind that sensible, long-term policy choices do not always require inspired vision. In many cases, the mere absence of shortsightedness would do.
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