ToddnotieBy Todd Coleman, CEO, Port of Vancouver USA

I’m often asked to speak about the Port of Vancouver and our role in economic development. I share that on the port’s 800 acres of developed property; more than 2,300 people come to work each day. More than 50 businesses operate on port property and offer the region’s residents a tremendous diversity in job opportunities. And those businesses pay more than $200 million annually in employee salaries, purchase local supplies totaling more than $120 million in value, pay annual taxes of more than $90 million that support local services vital to our community, and contribute more than $1.6 billion in economic activity. That’s a significant amount of economic benefit.

For the port to be a strong economic driver in our community, it is critical that we continue to be a leader in industrial and marine development. This means that we must have state-of-the-industry facilities with efficient transportation connections. It means that we must compete in the global market place by providing a competitive advantage to our customers. It means that we must be constantly identifying opportunities – and finding solutions to evermore complex logistical challenges.

I’ve been at the port now for almost 14 years. During that time, I’ve heard many leaders dream big for our community. We’ve identified projects that could one day be called “game changers.” For example, the three ports located in Clark County have discussed aggregating properties for industrial development. This concept was identified in Clark County’s Economic Development Plan as a way to address the extreme shortage of large industrial tracts in the greater Portland-Vancouver region.

At the Port of Vancouver, we’ve looked at the possibility of redeveloping Section 30 in east Clark County for industrial use. There have been discussions around the development of a large section of land known as the Lagler property on SR 503. In addition, there is a unique opportunity to establish a thriving industrial corridor along the Clark County rail line. These are only a few examples – but think of the potential these initiatives present our community. Yet, whenever we dream big – there seems to be one reality that wakes us up with a jolt. To bring these game changers to fruition, we need leadership – and we need money to invest.

The Port of Vancouver, like other ports in the state of Washington, creates economic development through the utilization of its assets. Today, the port has approximately $450 million in assets. These assets provide the infrastructure needed for cargo to flow across our docks and for businesses to operate in our buildings. Although a public agency, the port is a profit generating enterprise. However, the key difference between the port and a private-sector business is that 100 percent of our profits are reinvested into publically owned assets – so that more cargo flows through our community, more businesses locate here, and more jobs are created.

Today, the port operates with between 25 and 30 percent profit on its operations. In addition, the port also invests the property taxes it receives in port assets. For the average household in the city of Vancouver, this is approximately three percent of their overall annual property tax bill. In 2013, the Port of Vancouver had approximately $32 million in operating revenues and profited about $9 million. Adding approximately $9 million in property tax levied, the port invested around $18 million in additional infrastructure assets in 2013.

Simplified greatly, the port has two ways of increasing its operating revenues. Revenues can be increased through incremental business and through what I will call “game changers.” Incremental business increases typically are a result of relatively small growth in cargo tonnage and through new leases on port buildings. Incremental increases are great, creating jobs and slight increases in profit. Game changers tend to be large scale projects – like unit train export facilities – or energy distribution terminals. These types of projects are complex, involve world-class companies, are driven by the global marketplace and are subject to widespread political influences.

Recently, we experienced firsthand how these complexities can affect our community with the loss of a planned potash export facility at the port. That project alone would have nearly doubled the operating revenues at the Port of Vancouver after a 10-year period. Unfortunately, due to changes in the global economy and other political pressures, this project failed to move forward as planned. Fortunately, the port had taken this possibility into account and put safeguards into the contracts to protect our long term interests – a practice common in our operations.

Vancouver Energy also has the potential to double the revenues at the Port of Vancouver. Is revenue the only consideration? Absolutely not. But we believe strongly that between the safeguards in the port’s lease and the comprehensive review and operations oversight of the Energy Facilities Site Evaluation Council, this project will either be able to operate safely in our community or it will not be approved.

So, if U.S. crude oil is already being transported through downtown Vancouver by the railroad under federal mandate, and if we put in place an operation that can safely handle the product at the port – then why wouldn’t we consider bringing $10 million a year in additional profit to our community – and then reinvest it in game changing projects?

These game changing projects turn our dreams into reality. They’re how we make sure this community thrives for the long term. Game changers make this a community where our children can go to college, where they’ll want to build their own business, and where they’ll want to raise their families.

And we can’t just assume that there’s another large project right around the corner. Already, we have a shortage of industrial land and jobs in our region. Let’s find a way to capture these opportunities, develop projects of which we can be proud – and make a lasting positive impact on our community.