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Port Comes Back After Hurricane Sandy: Part One

On the morning of November 4, 2010, the first of five cargo ships slid toward its berth at the Elizabeth Port Authority Marine Terminal.

On any other day, such an event would be business as usual. But this vessel was the first one cleared to dock after Hurricane Sandy ripped up the northeast coastline, causing unprecedented damages and altering long held paradigms for storm preparedness.

"No one believed there could be a 13-foot storm surge ever in this port, and there was," said Richard Larrabee, director of the Port Authority's Port Commerce department. "I talked to people who have worked here for 30 years who said they never feared for their lives but they did that night."

David Brady concurs. The Vice President of Administration for Global Terminals, Mr. Brady has worked at the port for 31 years.

"I’ve never seen an event close to this," he said. "We’ve never flooded before but this time we found ourselves between one and four feet underwater depending on which part of our facility you were at."

The storm surge spared few port assets. On the Jersey side of the Hudson, up to 14,000 new cars were devoured by rising water as they waited on the docks. Forty percent of the port's cargo cranes were temporarily disabled. Some 2,500 trucks critical to transporting freight throughout the region were effectively destroyed due to salt-water contamination.

The weather damaged shipping containers. One floated across the Arthur Kill from Staten Island. Seven more drifted across the Buttermilk Channel to pile like so many Lincoln Logs on the seawall at Governor's Island. High winds and thundering waves snapped a barge at Greenville Yards in half.

And so on.Hundreds of motorbikes scattered like toys in the wake of Hurricane Sandy

IMF trucking is a third generation family-run firm and a port tenant since 1975. Sandy totaled 110 of the 130 trucks in its fleet. Salt water savaged the engines, corroding computer chips, making them worthless.

"It's a new reality," remarked James Simpson, Commissioner of New Jersey's Department of Transportation.

Turning a corner: praise for federal agencies, labor, port community

It's natural to expect a long and arduous recovery following such extensive damage. Yet six days after Sandy struck, the Port of New York and New Jersey was back up and running.

"We did a great job," said Ann Strauss-Weider of A. Strauss-Weider, Inc., a transportation consulting firm. "We are still compiling the data to define the supply chain impact, but the immediate recovery was quick."

Cleanup began the moment conditions were declared safe, and continued round the clock at most locations.

Dennis Lombardi serves as the Port Authority's Deputy Director of Port Commerce. He commended the entire maritime community for its unprecedented cooperation during the crisis.

"I saw terminal operators reaching out to their competitors, offering assistance," he said. "They were horse-trading equipment, sharing leads on repair techniques and services. It was stirring. A rousing response."

Bethann Rooney coordinated the efforts of several entities from the Port Authority's Incident & Command station. The agency's Security Manager and emergency planning chief, Rooney had nothing but praise for the swift, professional work of the U.S. Coast Guard, the National Oceanic and Atmospheric Administration, and the Army Corps of Engineers.

"In a word?" she said. "Outstanding. Remember, when it comes to the port, everything starts with the channels. You’re talking about a huge geographic area. After the storm, every inch had to be checked for underwater obstacles that could hamper a vessel's progress. It turns out more than 20 TEUs had blown into the water. Each one needed to be marked, its identity and contents confirmed, and the box retrieved. Meanwhile, we had to get the ASA navigation system back up and running. But all this happened in three and half days, at which point we were just waiting for the power to come back on. You couldn’t ask for a better response."

Mr. Brady offered similar praise for CBP.

"The port grapevine was saying that our radiation portals had been knocked out of commission. So Tuesday after the storm [October 30], I called a Deputy Chief Inspector I know to check on their status. I was pleased to hear that CBP was already on top of things. They were flying spare parts up from Washington, they met with us to see what our needs were, they were amazing. Sometimes government gets criticized for being slow. Not in this case. Not at all."

Labor played another key role in the recovery's swift success.

"We had a lot of people come in Wednesday, Thursday, Friday after the storm," said Mr. Brady. "They were very cooperative, got right to work rearranging containers that had been moved, clearing debris. A very impressive response."

Within days of losing 85 percent of its fleet, IMF Trucking was back on its feet. Many port insiders call IMF's recovery nothing short of miraculous.

"Nothing like this has ever happened in all the years we’ve been here," says Chris Grato of IMF. "How did we come back so fast? A lot of help from our vendors, lots of deals extended on a handshake. Rental agencies came to our aid. It was a very generous show of support, and not just for us. It was everywhere you looked."

"There were so many pieces of the puzzle, but everyone worked their line and suddenly everything started to work," Ms. Rooney said.

Even so, the scars Sandy left will be visible for some time.

Port Comes Back After Hurricane Sandy: Part Two

A Superstorm and the damage done

On November 23, Governor Chris Christie said that Sandy had inflicted $29.4 billion in overall damages on New Jersey. Less than a week later, his office adjusted this figure to $36.9 billion.

The accompanying press release estimated that "30,000 businesses and homes were destroyed or experienced structural damage [from Sandy], while [an additional] 42,000 homes were impacted in some other way."

The release also stated that 233,000 New Jersey individuals had applied for aid from FEMA.

"I’ve called this experience New Jersey's Katrina," said Christie, "because the damage to our state is nothing that we’ve experienced ever before."

Comparisons to Hurricane Katrina were echoed by Governor Andrew Cuomo who requested $42 billion in federal recovery funds for New York.

"When you look at the damage done — the economic damage, the housing damage, the damage to commercial properties — because of the density of New York, the number of people affected, the number of properties affected was much larger in Hurricane Sandy than in Hurricane Katrina," Cuomo said.

Members of the port community understand the level of damage on an intimate level. And many have begun to extrapolate what will happen in years to come.

"The paradigm for the 100 year flood has just been disproven," said David Brady. "The things we took for granted, we can’t do that anymore."

Looking forward

2011 marked an exceptional year in port trade. The dollar value for all cargo exceeded $185 billion. Facilities handled 5.5 million TEU's, a record which trumped 2010's volume by almost 4 percent. ExpressRail, the port's on-dock rail system, also set a new record by handling 422,144 containers, or 12 percent over 2010.

Before Sandy, the Port of New York and New Jersey was on track to increase its overall cargo volume yet again. However, at this point, it remains unclear how the storm hurt the year's final numbers.

"We’re trying to develop a plan [for emergency response]," said Chris Grato of IMF Trucking. "It's not easy. At the moment, we’re still hip-deep in the recovery effort. Really the question boils down to this: what do you do with 130 trucks? Where can you move them so they’re out of harm's way within just a few hours’ notice?"

Without question, Sandy has left the port community with a new set of challenges.

"We’re looking to make facility improvements that will exceed our current levels of preparedness," says David Brady of Global Terminals. "In a lot of cases that means building things higher than we used to think was necessary."

At the NAIOP seminar, many operators echoed this notion. The port, they said, should include higher vertical garages and disaster contingencies in its plans to rebuild.

Tom Adamski of Cross Port Transport proposed an early alert system to notify the transportation community of potentially disastrous weather. While such a system wouldn’t forestall any damage, it might speed recovery times. Richard Larrabee pointed to that prolonged power outages as one of the greatest threats to port functions.

"We have got to work with the utilities," Mr. Larrabee said. "We are all interdependent." Mr. Lombardi agreed with this. The Port Authority, he said, will examine best practices for boosting protections for electrical substations.

"[At] the wharves – the water came on, it rolled off," he recently told The Record. "Had the crane motors not been damaged and the substations not been damaged, those terminals, as soon as they got power back, they would have been running."

"The big takeaway," said Bethann Rooney, "is that we all need to do what we can in a risk-based manner to build more resilient infrastructure. A lot of times that's simple things like place that electrical panel higher or don’t store spare parts at ground level. Move the pumps so they’re out of harm's way. Just build things better."

Ms. Rooney pointed out how the Port Authority has always learned from adversity. As an example, she cited the ’93 World Trade Center bombing.

"Innovations prompted by that incident saved lives on 9/11. And of course the lessons learned from 9/11 have shown up in the designs for the new World Trade Center. We get better moving forward," she said. "And we’re constantly moving forward."

Above all, Mr. Larrabee wants to maintain a sense of urgency about learning lessons from Sandy.

"I have a theory about the half life of events like this," Larrabee said. "The further out it gets from when it first happened, the fuzzier it gets. We will not make that mistake. We will continue to move this ball forward for the betterment of our port."

New Survey: Port Of NY/NJ Number One In Seapoprt Real Estate Market

While the top three ports in the nation's real estate market remain unchanged, a ‘shake up’ has altered their order according to the 2012 Seaport Outlook, a white paper offered by real estate giant Jones Lang LaSalle.

For the first time in history, the Outlook scored the Port of New York and New Jersey higher than the ports of Los Angeles and Long Beach. The Outlook awarded NY/NJ a Port, Airport & Global Infrastructure (PAGI) score of 114.2 while Los Angeles earned only 112.1 and Long Beach garnered 109.1.

"This is satisfying news, but hardly unexpected," said Richard M. Larrabee, Director of Port Commerce. "The Port Authority of New York and New Jersey has worked diligently in conjunction with our entire maritime community to ensure that our facilities remain America's economic front door. A new age is dawning in global commerce. We are preparing to meet it head on."

The 2012 Outlook groups U.S. ports in three distinct tiers.

The top tier contains what many port insiders consider the nation's

"Big Three," meaning NY/NJ, Los Angeles, and Long Beach.

Savannah leads the second tier with a PAGI score of 85.8, followed by Jacksonville with 81.3 and Baltimore with 78.1.

Seven ports comprise the final, lowest tier. They are (in descending order of PAGI score) Houston, Tacoma, Virginia, Charleston, Oakland, Seattle, and Miami.

What predicated a change in the Big Three?

The Seaport Outlook made note of the Port of NY/NJ's many capital investments, including:

  • the $1 billion project to raise the roadbed of the Bayonne Bridge from a height of 151 to 215 feet to accommodate post-Panamax cargo vessels;
  • the ongoing campaign to dredge the Kill Van Kull and Newark Bay to a depth of 50 feet by 2014;
  • the rapid and ongoing expansion of ExpressRail double-stacked intermodal service, as well as the infrastructure to accommodate it;
  • a commitment from Global Terminal & Container Services to develop 70 acres of new container terminal in Bayonne that will handle 1.7 million TEUs a year by 2014.

Other key takeaways from the 2012 Seaport Outlook include:

  • U.S. exports have reached an all-time high. They increasingly drive activity levels at ports and, by extension, the real estate market surrounding those ports
  • Overall, seaport markets continue to lead the broader real estate market.
  • Strategic capital investments in seaport infrastructure create a direct relationship between a port and its surrounding off-dock warehousing and product distributions.

The Outlook maintained that ‘[real estate] momentum has slowed near the Los Angeles and Long Beach ports while Jacksonville, Miami, Seattle and Tacoma have swung significantly into landlord-favorable territory.’

The report states that Savannah, Charleston, Jacksonville, and Baltimore have ‘vacancy to burn.’

Vacancy-ridden or not, Savannah, Charleston, Jacksonville, and Baltimore have seen the fastest growth over the past 18 months. Should these ports continue to expand, they could very well create seismic shifts that will resonate throughout the shipping industry.

Meanwhile, NY/NJ maintains steady progress with consistently rising cargo volumes, lowering vacancy rates, and rising rental rates per square foot.

‘The development pipeline [for the Port of NY/NJ] remains significant,’ said the Outlook. ‘[A]bout 14 facilities amounting to about 7.1 million square feet are proposed in the port submarket.’

The report concludes:

‘Despite differing layers of connections between port throughput performance and leasing or development fundamentals, most of the prime U.S. industrial real estate in the trade areas around major seaports continues to outperform the market in general.’

New Technology Improves Port Security And Environment

On September 20, 2012, the Port Authority's Board of Commissioners voted to bring radio frequency identification (RFID) technology to the Port of New York and New Jersey.

The new initiative forges a partnership between the agency and Sustainable Terminal Services, Inc., a consortium of terminal operators. The plan mandates that all trucks seeking access to the port have the new RFID tag installed by Q2 2013.

"Securing our port facilities – the largest on the East Coast -- has been the single most important issue for the Port Authority over the past year," said Port Authority Chairman David Samson. "This technology will free up police resources and it will also help to reduce the environmental impact of our port commerce by ensuring compliance with our clean truck initiatives."

"RFID technology is a cost effective and reliable method to seamlessly monitor the approximately 16,000 trucks that access our marine terminals each day," said Port Authority Vice-Chairman Scott Rechler. "This system will provide a secure and effective way of identifying the trucks that request access to secure areas of our marine terminal facilities."

RFID technology employs wireless non-contact systems whose electromagnetic fields transfer information from tags to appropriate reader machines.

Unlike barcode technology, RFID systems do not require a line of sight between the reader and tag. Often no larger than a grain of rice, the RFID chip can be attached to an object or embedded within it.

Whether they know it or not, area merchants and residents are no strangers to RFID. It's the same technology employed by their EZ Pass transponders. Some people have RFID chips implanted in their pets to identify them should they get lost.

The new RFID system will supplement preexisting security programs that allow both the Port Authority and its terminal operators to know the content of containers coming to and from the port. RFID tags will also identify the backgrounds of people transporting and handling cargo, as well as their vehicle's VIN number and many other characteristics.

"This [new system] is an important component of our comprehensive port security program," said Pat Foye, the Port Authority's Executive Director. "We know what is in the boxes going in and out of the port, we know who is handling the boxes, and now we will know vital information about the trucks serving our port on a daily basis."

Bill Baroni, the agency's Deputy Executive Director, agreed. "The Port of New York and New Jersey is the busiest on the East Coast and one of the busiest in the world. We take the safety and security of our ports and the region with the utmost seriousness, and this is another level of security."

The RFID system will also allow the Port Authority to ensure 100 percent compliance with its Truck Replacement Program. TRP removes older, dirtier trucks from the road.

Currently, TRP is monitored by random Port Authority Police Department checks as trucks exit terminal facilities.

This method has identified approximately 400 violations since March 2011, but the use of RFID technology will reduce delays and cut costs while stopping violators prior to their gaining access to the port.

Supply Chain Experts - The Next Generation

The Port Authority has a long history of working with local universities.

Lately, members of the Port Commerce department welcomed students from Rutgers Business School and the Center for Supply Chain Management.

Program participants visited the Port of New York and New Jersey on October 26 and spend the day touring Maher Terminals, East Coast CES, and FAPS.

TWIC Updates Extended Expiration Date Option

The TWIC program has reported overwhelming demand for Extended Expiration Date (EED) TWICs.

"Workers are calling to request an EED TWIC up to two years in advance of their current TWIC's expirations," says John Schwartz, TWIC Program Manager. "Our data shows the average request is being made 277 days prior. That's creating high volumes for our call centers which in turn yield lots of busy signals or waits over 30 minutes to speak to a representative. We’re hoping to interact

The Transportation Worker Identification Credential (TWIC) is required by federal law for all workers, including drayage and truck drivers, that need to access secure or restricted areas in maritime facilities.

The TWIC program is administered jointly by the U.S. Transportation Security Administration (TSA) and the U.S. Coast Guard. TWIC's many security standards can be hard to keep track of. Workers are encouraged to visit the Port Authority's TWIC page and clicking on the tab marked "Notice to All Truckers" before venturing on to the official TWIC site for more comprehensive information.

Meanwhile, contractor Lockheed Martin has been working to address the demand. "They’ve added more [phone] lines and hired more call center representatives to process EED requests," says Schwartz. "But these steps may take a while to implement."

Schwartz and the TWIC program have requested the port community's assistance until call centers achieve increased capacity.

Please adopt the following measures.

  • Workers should refrain from ordering their EED TWIC until their card's expiration falls within a four month window.
  • Workers whose cards expire within four months or who have lost a card and need an immediate replacement (regardless of the card's expiration date,) should call the TWIC Help Desk at 1-866-DHS-TWIC (1-866-347-8942).

Following these measures should help alleviate high call volumes and long call waits while maximizing workers’ time.

Port Industry Day Another Resounding Success

On October 16, 2012, the maritime community of the Port and New York and New Jersey held its 12th Annual Port Industry Day at the New Jersey Performing Arts Center on Center Street in Newark. This year's theme was "The Importance of Strategic Planning."

"Today's global economic conditions have had an impact on every industry, including ports worldwide," said Richard M. Larrabee, the Port Authority's Director of Port Commerce. Mr. Larrabee said the Port Authority has begun an effort, called Project Port Horizon, which will produce the next strategic vision for the port.

The event drew an estimated 350 executives who shared their information and perspectives on industry trends. The morning session and its speakers were followed by an international food festival and an afternoon networking event.

Contact

Lucy Ambrosino
212.435.4259

Bill Cronin
212.435.4251

Brian Kobza
212.435.4264

Robert LaMura
212.435.4247

Sharon McStine
973.578.2177

Peter Zantal
212.435.4250

Photos of Port Activity

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Hilary McCarron
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Fax: (212) 435-6934
hmccarro@panynj.gov



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