THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Tuesday, December 19, 1995 TAG: 9512190301
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY CHRISTOPHER DINSMORE, STAFF WRITER
LENGTH: Medium: 62 lines
With the rapidly growing port of Hampton Roads ready to stand on its own, Gov. George F. Allen wants to cut the port's hold on the state's apron strings.
The end of state support isn't likely to harm the port, which can sustain itself on its own revenue.
The Republican governor's budget proposal for the next two years calls for an end to state contributions to the Virginia Port Authority's budget.
Allen released the budget Monday to the General Assembly. The governor's budget outlines his spending proposals for the two years starting July 1. The budget still must be approved, and likely rewritten, by the Democrat-run General Assembly.
The governor also asked the General Assembly to approve the port authority's plan to expand its huge terminal in Norfolk. The plan would nearly double Norfolk International Terminals by building wharfs to the north of the existing facility and adding cranes and container staging and storage space there.
The port authority oversees the three state-owned port terminals in Norfolk, Portsmouth and Newport News.
Allen's proposal essentially calls for the state's annual contribution to the port's budget to be replaced by revenues from terminal operation. The port will need to make up about $9.3 million a year.
The port authority suggested the move during the budget planning process last summer, said Robert Baratta, a deputy director of the Virginia department of planning and budget.
``It is so profitable that it can run itself,'' said Baratta, who called the port one of the state's best run operations.
Port officials deferred comment on the budget proposal to Virginia Secretary of Transportation Robert Martinez, who could not be reached Monday. Oversight of the port authority was transferred recently to the state transportation department from the department of commerce and trade.
Money from the state's general fund now helps pay for the port's marketing, administration and planning, its security force, and its debt service.
The port authority expects to be able to make up the loss of state funding without too much difficulty, Baratta said.
The port is growing rapidly and growing cargo volume means greater revenue for the port. The port's terminals have handled 1 million more tons of general cargo through October than they did at that point last year. Consultants estimate the port's cargo volume will at least double by the year 2010.
The company that operates the port's terminals, Virginia International Terminals Inc., already takes in more money than it spends and that surplus or profit is only expected to grow.
The port will continue to get a share of the Commonwealth Transportation Fund, which is funded by state fuels taxes.
The budget proposal does contain a clause that allows the state to help the port cover its debt service if terminal revenues can't. Baratta said he didn't expect that would be necessary. ILLUSTRATION: Gov. Allen's 2-year state budget plan
by CNB