L.A. budget projects 13% drop in shipping revenues
The Los Angeles Harbor Commission Thursday adopted a budget of $1.1 billion for the fiscal year beginning July 1, a 1.8 percent increase over the current year's budget.
'Our approved budget reflects the harsh realities of the global economic recession and the financial challenges facing the Port of Los Angeles and our tenants,' said Geraldine Knatz, the port's executive director. 'With container volumes expected to fall again in the next fiscal year, we are continuing to advance projects that will produce economic and environmental benefits while preparing us for the eventual economic recovery and the return of higher trade volumes.'
Knatz said the port cut spending by 7 percent or over $20 million during the current fiscal year and adopted additional reductions in expenses for the coming fiscal year that will help make possible increased spending on capital projects.
The fiscal year 2009-2010 budget anticipates total receipts of $435 million. Shipping revenues, which represent the largest share of the port's revenues, are projected to be $311 million, a decrease of 12.9 percent from the current fiscal year's adopted budget as a result of declines in import and export volumes.
For the first 10 months of the current fiscal year, the port has handled 6.1 million containers, about 9 percent less than in the prior fiscal year. In the first four months of this calendar year, Los Angeles handled about 2.06 million TEU, 16 percent less than in the same period last year.
Operating costs are expected to be $260 million, $15.6 million less than in the current year while capital spending is set at $377 million for capital expenditures ' a 22 percent increase over the current fiscal year.
Much of the capital funding will be devoted to the 'green' expansion of the TraPac ($64.3 million) and China Shipping ($17.5 million) container terminals, as well as the World Cruise Center ($15.9 million), security projects that include a new port police headquarters ($21.9 million) and transportation projects ($27.7 million). The budget also includes $105 million for the continuation of previously approved projects to develop the L.A. waterfront.
The port's environmental initiatives will receive $62.7 million, three-quarters of which will fund the continued implementation of the Clean Truck Program.