Port may be losing political power Legislators propose cost cuts, new uses of some maritime land.

August 22, 1991|By Jon Morgan and Liz Atwood | Jon Morgan and Liz Atwood,Evening Sun Staff

For centuries, the Port of Baltimore occupied an important position in the hearts and wallets of Marylanders. It was called the "engine" of the state's economy, and the "port that built a city and a state."

Hundreds of millions of dollars were spent on its development, from dredging shipping channels to building the latest in high-technology marine terminals.

But business has faltered badly at the port, and political leaders are now using a word once considered anathema along the waterfront: downsizing.

Has the once-mighty port -- which was founded in 1706, 23 years before Baltimore -- lost its support?

A joint panel of the state Senate and House of Delegates this week issued a series of recommendations to cut costs and provide guidelines for future port operations.

The suggestions, some of which are backed by the Schaefer administration, call for cutting the budget of the Maryland Port Administration by $2.5 million by, in part, ending its funding of

the Pride of Baltimore and closing its out-of-state marketing offices.

The panel also calls for cuts in the port administration staff, more selective spending on development, and exploring new uses for land previously set aside for maritime uses.

Perhaps most dramatic on a symbolic level, the panel also suggests moving much of the port administration hierarchy out of its posh offices at the World Trade Center, which the agency developed.

"The party is over," says state Transportation Secretary James O. Lighthizer.

"The facts are the port is running a huge deficit. We have to bring expenditures in line with revenues and that means cost cutting," Lighthizer says. "That means making it leaner."

The port administration is projecting a $5.5 million operating deficit for the current fiscal year, which began July 1, a cost that will ultimately be borne by Maryland taxpayers. That is up from a loss of $3.34 million last year on an operating budget of $47.4 million.

Before 1989, the agency was self-supporting, generating more money in fees from users than it paid out. But a drop in cargo tonnage, and discounts offered to keep the remaining business, have eaten into port finances.

Lighthizer says he is not prepared to endorse some of the legislators' proposals, such as stopping funds to the Pride and closing out-of-state offices, but he says the state has changed its attitude toward the port and will be calling upon the private sector to take over an increasing share of the port costs.

"The state of Maryland has done all it should or it could to help that port. It's time for it to stand on its own two legs."

He says the discussions about increased privatization have been general so far, but says the new port administration would be exploring specific ways on how to cut the state's obligations.

Lighthizer says he doesn't believe a decrease in state support spells doom for the port. He says he thinks the worst days are over for the port and it will start to rebound.

Gov. William Donald Schaefer's spokesman, Ray Feldmann, says the downsizing does not mean that the port has become a lower priority for the state, but rather reflects Maryland's fiscal difficulties.

"There is no change in the philosophy of looking at the port as a major, major part of the economy," Feldmann says. "But there are times when we have to do things to keep in line with the fiscal situation."

But M. Sigmund Shapiro, president of Samuel Shapiro & Co., a port service firm, says the state is giving up on the port too early.

"I think the state is being short-sighted," he says. Shapiro says the port has shown signs of revitalization and the state should not cut back on the integral operations of the port. He says he is not opposed to cutting funding of the Pride or selling unused real estate. But he says it would be a mistake for the state to close its overseas marketing offices.

Shapiro says some members of the legislature "lack knowledge on the port" in turning to the port as a place to cut money. "The port is just as good a scapegoat as any," he says.

Del. Timothy F. Maloney, D-Prince George's, says the state is not ending its support for the port, but is trying to keep its importance in the proper perspective. The port is only one of many economic priorities for the state.

"We're still going to actively recruit business for the port, but we're not going to be investing for investment's sake," says Maloney, chairman of the House subcommittee overseeing the port and co-chairman of the legislative study group that is making the recommendations.

"Continued investment in the port is important, but there is a threshold point beyond which you stop writing checks. I think everyone realizes we are pretty close to that point," Maloney says.

With many of the port's major capital expenditures already complete, future developments will have to be linked directly to new business, he says.

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