Md. on verge of financing car terminal State would build port facility for Florida company

Vote expected today

Hobelmann upset that public money would bring in rival

On the waterfront

September 23, 1998|By C. Fraser Smith | C. Fraser Smith,SUN STAFF

Moving aggressively to gain more cargo for the port of Baltimore, the Board of Public Works appears ready to approve a project under which the state would build an $18.6 million auto shipping terminal for a private company -- despite strenuous objections from a competitor.

At least two members of the three-member board apparently will vote to approve a 20-year lease under which the state would build the new facility for ATC Logistics Inc., a Jacksonville, Fla.-based company that distributes cars in Mexico.

Gov. Parris N. Glendening, who has often balked at contracts with out-of-state firms, said through a spokesman that he would withhold comment until today's meeting. But the proposal comes from his administration.

"To grow the auto business, we needed to add some capacity to the port," said M. Kathleen Broadwater, the port administration's director of planning and business development.

She said potential new processors have turned to other ports when Baltimore could not accommodate them.

Officers of the auto processor already in place at the port, Hobelmann Port Services, Inc., say they believe that there is little new cargo to be had. Auto processors take cars on and off ships and distribute them.

"We're fighting like hell for the business," said Hobelmann's president, Tim Chadwick.

"They're determined to spend the taxpayers' money. The money is being thrown away," Chadwick said.

But state Treasurer Richard N. Dixon, a member of the Board of Public Works, agreed with Broadwater: "This will definitely enhance our port's ability to increase productivity. It will allow the port to take us to the next level."

Dixon said he believes that there is significant new business to be gained by the port -- with a specific new prospect on the horizon.

State Comptroller Bobby Swann, the board's third member, said he is leaning toward approval of the lease -- but finds Hobelmann's concern a troubling one.

"This is something I've studied closer than anything else since the buck stopped here," said Swann, who recently took over from the late Louis L. Goldstein.

"We should not be in competition with private industry if private industry can provide the service. So, it's not a done deal with me, but I'm leaning toward the state's position."

Hobelmann's Chadwick hopes that Swann will decide to oppose the deal. Chadwick's fear is that ATC's cost of doing business will be lower because the state is building its plant and granting other financial concessions, principally a lower payment in lieu of taxes (called a PILOT).

Hobelmann has 230 employees. "It's going to destabilize an existing, healthy company," Chadwick said.

Broadwater says ATC's $82,213 PILOT is based on usable acres and has been accepted by Baltimore City; Hobelmann contends that the payment should be in the neighborhood of $500,000 a year. In addition, ATC will pay the state more than $146,000 a year for the lease on the state-built facility.

Today's vote comes after many months of strenuous opposition by Hobelmann, which says it built the automobile import-export business in Baltimore.

Last July, Hobelmann won a new contract with General Motors Corp., which had not used the port of Baltimore for a decade.

It expects to handle 7,000 to 10,000 GM units a year to start and more later, company officials say.

Hobelmann's primary contract is with Chrysler, which has sent as many as 120,000 cars per year, since 1989.

Under the contract up for consideration today, ATC would move 125,000 cars a year -- some of which, Hobelmann worries, could come from its current business.

The Masonville site is located on the south side of the Patapsco River across from Fort McHenry. It was first purchased by the state in 1974 as disposal site for dredge spoil.

Hobelmann is expected to tell the board today that the proposed new facility would be resting on a pool of toxic sludge that could be hazardous to nearby communities.

But the state says it plans to cap these deposits, making them more secure than they are now.

Pub Date: 9/23/98

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