It started at 10AM in Dover and it doesn’t look like it is being live streamed anywhere — which is a pity. I’m hoping to hear from those of you who did go in the comments below. But in the meantime, I want to repeat what I think is one of the two most compelling reasons why the port shouldn’t be privatized — having over a monopoly for the running for the ONLY port shipping terminal that Delaware has to a private entity is not a business decision that is in the best interests of taxpayers.
You’d also think that the Governor and DEDO wouldn’t want to hand over this asset to a private firm, either. I can’t imagine that you could still run around the world telling people about how great it is to do business in Delaware, when you have to tell them that your only Port facility is in the hands of Kinder Morgan and you need to make sure it would be OK with them before making an new import or export deals. And given what we know about this deal — which admittedly isn’t much — people who have been at briefings note that the state is planning to do this lease deal with minimal oversight of Kinder Morgan. The Port will be pretty much theirs to do what they need to do to make money — and the only protections businesses and workers may have are limited by the length of current contracts. And handing over a port monopoly without getting an iron-clad commitment to extend out into the Delaware ought to be considered malpractice of some kind.
A monopoly interest at the Port lets one firm extract a great many taxpayer resources, while reducing the competitive environment the Port, its clients and stakeholders live in. And this monopoly interest doesn’t even compensate taxpayers for their significant interest in this asset, much less commit to the kind of big improvements that would fundamentally change the competitive stance of this port. I’ll also remind you of our current experience with casinos — where the State is apparently enough of a “partner” in these operations that casinos can improve their profitability by getting the State to reduce its cut when the going gets rough, rather than figure out a better way to compete. Even though the money is paltry, I don’t imagine it would take much of a downturn for KM to come back looking for the State to reduce its lease payments.
So what to do? If I were in charge, I’d send KM packing, since they can’t get to the real change the Port needs. I would also convene a working group of Port customers and businesses led by an outside group to work through a structured planning process — one focused on short term, medium term and long term improvements and initiatives that would help current operations be more competitive. Make a commitment to implement these changes. I would also revisit the DSPC’s Board. The current board is clearly political appointees, with Alan Levin as the only one that I can ID as actually running a significant operation and one emeritus member who has maritime experience. I’d try to professionalize this board, by bringing in better expertise in logistics and/or transportation and give this board the charge to make sure that the results of the planning process got implemented. A more professional board probably won’t be so quick to throw away this asset, either.
Are you hearing anything about the hearing yet? Let us know in the comments or email me if you prefer to send info that way.