Virginia reaches initial agreement for major new port lease
Gov. Bob McDonnell (R) will announce tonight that the Virginia Port Authority has reached an agreement in principle to lease the three-year old APM Terminals in Portsmouth, the only privately owned and operated port in North America.
If approved by APM's executives, based in the Netherlands, and the commissioners of the Port Authority, the agreement would mean that the new $500 million Portsmouth facility will be added to the state's three other port facilities in Norfolk, Portsmouth and Newport News. The state has been negotiating with the company for 18 months.
In a statement, McDonnell said the agreement would expand the capacity of the authority-run ports, allowing them to capture more cargo coming to the East Coast. Cargo loads will vastly increase after an expansion of the Panama Canal in 2014, and East Coast ports are in a stark competition to capture the business.
"Combining this technologically advanced facility with our existing port assets will substantially increase the marketability of this port and position Virginia to become the leading port on the U.S. East Coast faster than we anticipated," McDonnell said.
What is less clear is how the announcement might affect the state's efforts to privatize the port. The state has been weighing offers from three bidders interested in taking over operations at the Port of Authority. Those offers included the Port Authority's current facilities and did not cover the APM terminals.
Stacey Johnson, a spokeswoman for the governor, said in an emailed statement that "no determination" has been made about the bids pending under the state's Public-Private Transportation Act, or PPTA, process. "After this lease is approved by VPA and APM boards, we will made a determination on how to proceed with PPTA proposals," she said.
May 13, 2010; 4:26 PM ET
Categories: Robert F. McDonnell , Rosalind Helderman
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