• House and Senate lawmakers forward port restructuring bill to governor
• Gov. Mark Sanford likely to veto the measure
• Lawmakers close session without transferring rail ownership, punting to the court
• Norfolk Southern says Promenade property in Charleston a no-go

By Molly Parker
mparker@scbiznews.com
Published May 22, 2009

House and Senate lawmakers signed off on a port restructuring bill on Thursday that sets resume qualifications for members of the S.C. State Ports Authority board and that imposes new requirements on the agency.

But the bill, before its eleventh-hour passage, was stripped of controversial language that would have transferred a rail line running onto the former Navy base in North Charleston to S.C. Public Railways. Lawmakers have instead punted that issue to the courts.

Sanford is expected to veto the bill, but it passed overwhelmingly — with veto-proof majorities — in both chambers.

Among its tenets, the bill mandates the sale of the SPA’s Daniel Island property by 2013 and the Port of Port Royal property by 2009.

Under the measure, if sales are not finalized by these deadlines, the properties revert to the state Budget and Control Board, which would take over responsibilities for selling them.

As to the SPA board, the bill says the nine members appointed at large by the governor must have experience in one or more of a list of fields, such as international commerce and shipping, finance and economics, engineering or law. It also establishes that the Commerce Department secretary and Department of Transportation chairman, or their representatives, are to sit on the board as nonvoting members.

“We were trying to force communication between DOT and Commerce with the State Ports Authority board,” said State Sen. Larry Grooms, R-Bonneau. “Had we had that in the first place, we would not have the issues we now have with rail in North Charleston.”

Grooms was referencing a memorandum of understanding the S.C. State Ports Authority entered into with the city of North Charleston in 2002, in which the SPA agreed that any rail access to its terminal under construction on the former Navy base would remain exclusively to the south end.

North Charleston Mayor Keith Summey is adamant that the promise be upheld and has threatened a legal fight if attempts are made to operate intermodal trains through the Noisette Co.’s property.

The SPA put the state in a tough spot, Grooms said, because railroad executives and state officials now believe that adding railroad access through the northern end of the property is the only way to provide equal access for both of the region’s Class 1 railroads to the Port of Charleston’s customers.

CSX has near-dock access to the terminal from the south end and is considering building a new intermodal facility on the Macalloy property. But it has no plans to share its line with Norfolk Southern — nor can it be forced to do so. Both railroads currently operate intermodal facilities in North Charleston, in the vicinity of Meeting Street and Goer Drive.

Recently, leading Senate lawmakers, including Grooms, asked Norfolk Southern officials to study a plan that local developer Robert Clement put forward. It called for the creation of an intermodal facility on the Promenade property in Charleston, near the Columbus Street and Union Pier terminals.

Grooms said Norfolk Southern responded in a letter this week that the railroad company does not view the Promenade property as a viable option for an intermodal facility.

“Norfolk says it will not work no matter how you twist and turn it,” Grooms said.

The bill calls for the Budget and Control Board to approve any transfer of ownership of the rail line that currently runs onto the base. The Charleston Naval Complex Redevelopment Authority and the Noisette Co. are currently involved in a legal dispute about who owns it. Grooms said the outcome of that case will establish the Legislature’s next steps.

“There was a perception the state was trying to roll over the city of North Charleston and take something from them, but that’s not the case,” Grooms said. “If the city has title to those rail lines and sold those to Noisette, than that’s what happened. On the other hand, if those rail lines belong to the state, we need to sit down and negotiate how we are going to handle the situation moving forward.”

The portion of the bill that drew Gov. Mark Sanford’s ire strips the governor of his ability to remove any member from the board at will.

“We’re still reviewing the bill, but we’re almost certainly going to veto it,” Sanford spokesman Joel Sawyer said. “This bill is about putting the Senate in control of the ports, and, as a result, is going to make our ports less responsive to the needs of our state, and ultimately less competitive.”

The bill, S.351, also would require the authority to create a searchable transaction database of all expenditures of more than $100, and establishes a 10-member oversight committee charged with reviewing the annual performance of the SPA’s executive director, and the agency as a whole.

SPA spokesman Byron Miller said the authority has “closely monitored” the progress of the bill and will implement any changes “thoroughly and aggressively.”

Lawmakers handed the governor this measure on the last day of session after months of legislative wrangling. It was prompted by Maersk Line’s announcement late last year that the shipping company planned to pull out of Charleston in 2010.

Pat Barber, the owner of the Superior Transportation trucking company and an activist in the local maritime industry, said it seems the General Assembly missed the point by adding “ridiculous amendments” that have nothing to do with creation of a viable port.

“They’ve used the port as an example of the power struggle that exists in Columbia and the egomania that exists in Columbia, and they’ve done nothing to enhance our port’s ability to compete in the international marketplace with this bill,” he said.

Reach Molly Parker at 843-849-3144.