Tom Davis secures his contract with Jasper Port, but the South Carolina securities bill faces an uncertain future

South Carolina State Senator Tom Davis it is giving up its obstruction on account of a huge loan that aims to benefit the SC Port Authority (SCPA), administered by the government – although the future of this proposed debt burden remains in the air.

Davis was blocking the loan account – which will delay taxpayers by $ 645 million over the next decade and a half to finance rail and terminal improvements around Charleston Harbor – hoping to win concessions for a proposed deepwater port in Jasper County, SC, the last suitable location for such a port on the coast East.

Well, he won a big concession on that front earlier this week …

On Tuesday, SCPA officials accepted Davis’s requirement to pass on his 50 percent stake in the Jasper project to the county government – as specified in a deal struck years ago to develop the facility. The other 50% of the project is maintained by the Georgia Port Authority (GPA), which has been circulating in South Carolina for the past decade.

Georgia secured its advantage by expanding its own port in Savannah (thanks to competent help from the former governor of South Carolina Nikki Haley) – overtaking the port of Charleston as the main Southeast destination for container traffic.

Will GPA staff work with Jasper County to develop the new port location?

This remains to be seen … but the answer will likely depend on the extent to which global demand for container shipping will recover after the Covid-19 recession.

Obviously, South Carolina should have developed the Jasper website on its own years ago … Back when SCPA officials vowed to devote “all state faith and credit” to its conclusion. They failed to do that, however … just as they failed to allow investors and private sector managers to chart a competitive future for the port of Charleston.

Just over a decade ago, Charleston was America’s fourth busiest port. Today, it is not even in the top ten in terms of container traffic.

South Carolina port authorities have invested hundreds of millions of dollars in taxes to deepen Charleston’s port, but that focus – which is of dubious benefit – has caused them to fall manner behind Savannah in terms of port infrastructure. In addition, Charleston is ill-equipped to handle this infrastructure, due to its poor road and rail access – and congestion in and around its port terminals.

For years, Davis has asked lawmakers to explore the Jasper County site as an alternative, instead of trying to “chock” more capacity in Charleston. Davis also struggled to make Jasper’s site a “free market” port – one in which private investment supports infrastructure development and private managers (not government bureaucrats) oversee the facility’s management.

Port officials hope to resolve their capacity and rail problems through the new Hugh K. Leatherman terminal, which happened to be named after a liberal politician who admittedly exerts more influence over state finances than any other legislator.

Unfortunately, the Leatherman project is (surprise) over budget – and is likely to face additional cost overruns after our waterfront sources have reported problems with the “structural integrity” of the new Leatherman pier.

Another seaside source confirmed these reports this week, citing “dire resolution problems” – especially after the recent arrival of their new ship-to-shore cranes earlier this month.

“Instead of fixing (structural problems), they are adding more asphalt,” warned the source.

Oh oh …

SCPA employees want to use $ 400 million of the title value for a railway yard and $ 150 million for a barge system – both would serve the Leatherman terminal. Other $ 95 million would go to debt financing.

Are these good investments? State lawmakers are not so sure. SCPA has already sunk $ 1.7 billion at the Leatherman terminal – depleting his connection capacity and forcing him to come to the state for a rescue. Other $ 220 million was spent by the SC Department of Transportation (SCDOT) on a connecting road that links the facility to Interstate 26.

According to our sources, SCPA “has no funding” to complete the terminal and is facing tremendous pressure from Leatherman, 89, who “wants it to be opened before he dies”.

Our founding editor Will Folks for years it has argued that South Carolina should not be in the port business – and that the management and development of these competitive assets should be left to the private sector alone.

“Allowing private sector companies to manage our state’s port assets would potentially free up hundreds of millions of dollars in public money for necessary infrastructure improvements (including the Leatherman terminal and the proposed Jasper port),” Folks wrote recently.

Unfortunately, South Carolina leaders continue to believe that running a port (and running an energy company) are central government functions. And so they continue to perform these two functions … bad.

-FITSNews

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