Finance: Milwaukee, Los Angeles

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In 2013, revenues generated by the Port of Milwaukee exceeded expenses by more than $1.4 million – money that is available to support basic city services. The Los Angeles Board of Harbor Commissioners approved a $938.8 million fiscal year annual budget for the Port of Los Angeles that includes $350 million budget allotted toward capital.

Port of Milwaukee Reports Net Income of $1.4-Million in 2013

In 2013, revenues generated by the Port of Milwaukee exceeded expenses by more than $1.4 million – money that goes to the City of Milwaukee general fund, where it will be used to support basic city services. That came in a year when cargo volumes jumped by more than 30 percent (Advisory, February 4, 2014).

In detail, the port’s annual report for 2013 shows operating revenues of $4,370,586, expenses of $2,937,975; and net income (before depreciation, debt service and interest expenses) at a six-year high of $1,432,611. Not included is $1.3 million in rent paid by Summerfest operator Milwaukee World Festivals for its use of port property.

"We have closed our books on a successful year," said acting Port Director Paul Vornholt. "By providing cost-effective transportation options and efficient sites for companies to operate, the port has supported regional business activity and employment. We have generated significant net income, and 2014 is shaping up to be another strong year."

The port is an economic entity of the city of Milwaukee governed by a seven-member Board of Harbor Commissioners appointed by the mayor with the advice and consent of the Common Council. The agency administers and promotes shipping and commercial operations on its 467-acre property and is also the grantee of Foreign Trade Zone #41.

"Our port continues to serve our community well," Mayor Tom Barrett said. "It is a valuable facility for businesses, a public resource that contributes to job creation, and a soundly managed operation that generates revenue for city government."

Los Angeles Adopts Fiscal Year 2014-2015 Budget 

The Los Angeles Board of Harbor Commissioners on June 5 approved a $938.8 million fiscal year annual budget for the Port of Los Angeles. Nearly $350 million (37 percent) of the approved budget will go toward capital.

"In the face of fierce and increasing competition from around the world, we must do whatever we can to maintain our position as the nation’s premier trade gateway," said Harbor Commission President Vilma Martinez. "This budget will allow us to continue to modernize infrastructure, upgrade terminals and build a transportation network that can continue to successfully compete globally."

The port anticipates spending approximately $1.1 billion on its capital improvement program during the next five years. The FY-2014-15 budget dedicates $281 million to specific capital improvement program (CIP) projects. Terminal development and transportation projects comprise 87 percent of the CIP budget.

About $38 million of the port’s proposed operating and capital budgets will fund projects that provide benefits to the community, such as development of the LA Waterfront. Through a combination of payments and in-kind services that support local nonprofit and youth organizations and the maritime community at large, $22 million is provided through actual cash outlay and $15.6 million is included through properties provided at a discount or gratis.

Approximately $136.3 million of the CIP budget is allotted to terminal development projects. Approximately $100.4 million will help fund the ongoing TraPac Terminal expansion, which includes backland improvements, stacking crane and automation infrastructure, an intermodal facility to provide on-dock rail capabilities, and other terminal-related construction. Another estimated $19.2 million will go toward upgrades and improvements at the Yang Ming, APL, Evergreen, YTI and China Shipping terminals.

An estimated $109 million is designated for transportation improvement projects. Funding for major projects nearing completion includes $35.5 million for the Berth 200 Rail Yard with its accompanying track connections and $27.9 million for the South Wilmington Grade Separation project. Both projects play important roles in the Port’s overall goods movement strategy. About $40 million has been allocated to improve vehicular traffic flow to and from the Interstate 110 Harbor Freeway, a critical transportation link to the port, along with the design of Sampson Way to improve access to and from the LA Waterfront.

The approved budget is based on a projected 3.8 percent increase in cargo growth over the current budget. Higher container volumes are expected to be generated by organic growth, as well as by the port’s Common Ocean Carrier Incentive Program, in which ocean carriers will earn financial incentives for each incremental container over established thresholds shipped through the port.

The port estimates that approximately 6,250 direct and indirect jobs will be created by implementation of the FY 2014-2015 budget, with nearly 74 percent of those jobs due to capital spending projects.

In addition to capital improvements, the port remains committed to its goals of sustainability and fiscal responsibility. Of the $217.3 million in proposed operating expenses, about $18 million is dedicated to environmental management operations. Of this, $3.5 million is earmarked for environmental incentives aimed at reducing emissions from port operations.