Senators hear of fallout from port slowdown

By Walker Orenstein, January 15, 2015, Seattle Times

The labor contract dispute between dockworkers and their employer at major West Coast ports could affect Washington state revenue, and lawmakers are grappling with ways they can help.

 

Sen. Michael Baumgartner, R-Spokane, held a work session in Olympia on Wednesday that included representatives from businesses, agriculture, truckers, the Seattle and Tacoma ports, and the International Longshore and Warehouse Union (ILWU). No one represented the Pacific Maritime Association (PMA), whose members include terminal operators and shipping lines.

 

The ILWU and the maritime association have been in contract negotiations since May to replace a six-year agreement that expired July 1. They brought in a federal mediator this month.

 

“If the mediator is really good and both parties are fully committed to this,” said Eric Schinfeld, of the Washington Council on International Trade on mediation, “I think we could see some progress by the end of the month.”

 

Most at the work session weren’t interested in blaming any one party for the cargo- shipping slowdown. But Baumgartner and others pressed panelists on ways they could help.

 

The dispute reverberates throughout the state’s economy.

 

Clare Gallagher, of the Port of Seattle, said Port-related activity generates $138.1 billion annually, a figure that is over one-third of the state’s total gross domestic product. The state collects fewer taxes when the port makes less money.

 

“I don’t want a special session because of a drop in [state] revenue because of a labor dispute that I can’t control,” Baumgartner said.

 

Testimony from business representatives pointed to huge numbers in lost revenue and wasted product. Dan Coyne, of Darigold, said that the company has lost $30 million and has not made any additional sales due to the shipping backlog at the ports.

 

“The longer that the slowdown continues, the longer Washington dairy farmers are put at risk,” he told the committee.

 

Not only are current sales being lost, but businesses and port representatives said overseas companies are looking to other ports to get their fruit, potatoes and other products in the future.

 

“There’s a lot of other places in the world that do produce potatoes, and process potatoes, and they’re after our business in a big way,” said Mike Dodds, of Basic American Foods. He said normal shipments to the Pacific Rim took about six weeks, and now it’s taking 10 weeks. “Believe me, they see this going on and we’re seeing extreme competition.”

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