(The following story by Max Marbut appeared on the Jacksonville Daily Record website on October 25.)
JACKSONVILLE, Fla. — With one exception, it was all great news and optimistic attitude at the 2nd Annual Global Trade & Transportation Symposium Wednesday morning at the Hyatt.
Freight traffic on land and sea and in the air is poised to grow exponentially in the next 10 years according to most of the local administrators and executives, but the representative from the Florida Department of Transportation (FDOT) said the state is now and may remain behind the power curve in terms of meeting future infrastructure needs.
Rick Ferrin, executive director of the Jacksonville Port Authority, recently returned from a trade mission to South Korea where the Port inked a Memorandum of Understanding to add Hanjin Shipping Co. Ltd. to the list of major port users. He said one of the first things he did was assemble the team that will supervise the construction of the new terminal.
“I told them, ‘Guys, we’re pregnant.’ Now the hard part begins,” said Ferrin, adding he expects the final agreement — including a 30-year lease — will be signed within 120 days.
Hanjin’s facility will be located northeast of the Mitsui O.S.K. facility currently under construction, which Ferrin said is “on budget and on time.”
When both terminals are completed and functional, the increase in port business will add 6,000 new jobs and $1 billion of local economic impact, Ferrin predicted.
“Jacksonville will be a center of transportation and logistics” and “one of the true shipping hubs in America,” he said.
As for the long-term forecast, two things will take place in the next 10 years that will position Jacksonville as an even more important international maritime shipping destination.
New locks are under construction at the Panama Canal that will allow vessels as large as 1,500 feet in length to transit the canal and Jacksonville’s harbor will be deepened from the current 39 feet to 45 feet to accommodate the larger ships preferred by Asian shipping companies. Both changes will be in place by 2014, with the deepening of the port to begin in 2012. Ferrin said it will be a $400 million project with $180 million appropriated from the federal government.
Ferrin said he’s confident the Port can supply its share and Florida’s senators and representatives in Washington will secure the balance of the funding.
Jacksonville’s rail lines are also preparing for the increase in freight traffic.
Adam Bridges, director of marketing & strategy for CSX Intermodal, said his company predicts that within 15 years, the population of north Florida and south Georgia will exceed the population of the New York City/New Jersey port region. To prepare for that day, in the last five years CSX has invested $250 million in the company’s rail lines in Florida. CSX also is doubling the size of its yard on the Westside from 250 to 500 acres.
“For us, this is a hub. We can provide access to the world through Jacksonville,” said Bridges.
Norfolk Southern is taking a more conservative approach to its intermodal rail capacity growth, said International Marketing Manager Randy Bayles.
The recent downturns in the automobile and housing markets have adversely affected the company’s containerized freight business, but he said more traffic through the Panama and Suez canals could lead to half of America’s imports arriving at East Coast ports.
Bayles also said while railroads provide the link between maritime interests and consumers, “The industry has a low return on investment compared to other business. It will take public/private partnerships to make system improvements to handle the projected growth.”
The Jacksonville Transportation Authority (JTA) is also predicting a change in the way its operations are funded. Executive Director Michael Blaylock said there will be a tremendous need for money in order for the region to remain competitive in transportation and it’s time to look beyond the Better Jacksonville Plan and develop a different financing plan.
“The days of depending on the federal and state governments for transportation funding are over,” he said. “We have to rethink how we’re going to finance our transportation future.”
Blaylock said plans are under way to improve the mass transit system and therefore attract more riders. He also suggested the day may come when public/private partnerships could mean the return of toll roads in Jacksonville, possibly in the form of lanes designated exclusively for buses and people who drive their own cars but would be willing to pay a fee to use the bus lanes.
The JTA sees the St. Johns River as having the potential to play a more important role in regional transportation.
“I see the river as free right-of-way and an opportunity to open a gateway from Jacksonville to Orlando and Sanford for both passengers and freight,” said Blaylock.
The Jacksonville Aviation Authority (JAA) is planning for the future growth of international trade. Director of External Affairs Michael Stewart said although Jacksonville currently ranks 67th in the nation in air cargo landing rate, the amount of freight passing through the airports has been “growing by double digits since 9/11.”
He also described Cecil Field as the JAA’s “crown jewel” in terms of air freight growth since the runway is “long enough to land anything that flies – now and into the future.”
“My news is not as good. Things are a little gloomy now,” said FDOT District Secretary Charles Baldwin.
He said he’s “not sure FDOT will be able to even keep pace with North Florida’s growth” because “the Federal (Transportation) Trust Fund will be broke in 2009” and the state’s budget is getting tighter.
Baldwin said it makes him anxious “any time I hear someone from Jacksonville is going to the Far East to talk about trade.”
He also said FDOT is trying to encourage rail companies to handle more port traffic and he believes getting freight off the state’s roadways will become more important in the future based on projected growth in cargo traffic. More than half of FDOT’s annual budget – currently $8 billion annually – goes to maintaining existing roads and bridges, leaving $3.5 billion for new roads and improvements, he said.
“Revenue is declining while we’re confronted with growth,” said Baldwin. “The competition for dollars is getting intense. Waiting until the bag of money is empty is not the solution.
“In my observation, there is some lag in commitment to address transportation issues. We’re not like the private sector. It takes government a long time to get the ball rolling.”
The symposium was presented by the First Coast Metropolitan Planning Organization and the Jacksonville Business Journal. It was sponsored by Holland & Knight and supported by the Jacksonville Port Authority.