Rendell Announces Investment in Southport
Governor Edward G. Rendell announced the investment of up to $25 million dollars in commonwealth capital funds to advance the Southport Marine Terminal project at the Port of Philadelphia. The investment will fund pre-construction activities critical to the project's success. Teams qualified to bid for the right to develop and operate the Southport terminal were notified earlier today that the competitive bid process has been temporarily suspended to allow capital and financial market conditions to improve.
Initial development proposals from qualified teams, received on May 15 after a months-long competitive process, reflected the detrimental impact of the global recession and international credit crisis on the shipping lines, terminal operators, and infrastructure investors that make up the bidding teams.
"We want Southport to be a resounding success for the selected bidder and also for the citizens of Pennsylvania and the Delaware Valley region," said Governor Rendell. "Giving the financial markets time to recover will lead to stronger proposals and a better return to the commonwealth. By investing state capital dollars, we will increase the attractiveness of the project to a broader spectrum of investors and we believe those capital dollars will be recouped when the competitive bid process resumes."
Despite the current economic downturn, long-term projections for the maritime shipping industry remain positive. Capacity constraints at existing ports, combined with the Panama Canal expansion and shifting trade routes, create demand for new terminals -- such as Southport -- on the East Coast.
The Governor announced that the capital funds released will be used for a variety of pre-construction activities on the site, which tentatively include design work, permitting, site preparation and utility infrastructure.
"As the largest infrastructure project in the state offering the potential for creating thousands of new family-sustaining jobs, the Southport Marine Terminal remains a top priority for my administration and the leadership of the Philadelphia Regional Port Authority," said Governor Rendell. "My commitment is to see it through and to ultimately award the project to a development team that is as dedicated to increasing jobs and cargo in this region as I am."
Within 10 years, studies show that development of the Southport marine terminal is projected to create thousands of new jobs and inject an estimated $359 million dollars annually in new business revenue into the Philadelphia regional economy.
The Southport site boasts three class-one railroads, access to two interstate highways, an "air draft" or height limit of 188 feet, and significant quantities of contiguous, undeveloped waterfront property. The Port of Philadelphia offers many assets as well, including more labor start times than any other seaport in the mid-Atlantic region, a convenient inland location with access to many major consumer markets -- including New York -- and a lower throughput cost for shipping lines.
The Rendell administration is committed to creating a first-rate public education system, protecting our most vulnerable citizens and continuing economic investment to support our communities and businesses.