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L.A. council approves changes to over-budget port project

With costs for the TraPac container terminal doubling over four years, City Council members say they should have been informed when the project's design changed.

November 19, 2013|By David Zahniser
  • A port police officer patrols near the TraPac terminal in Wilmington; the price tag for an upgrade at the terminal has ballooned.
A port police officer patrols near the TraPac terminal in Wilmington; the… (Bob Chamberlin, Los Angeles…)

The Los Angeles City Council approved major changes Tuesday to a harbor construction project whose has cost doubled in four years, with lawmakers criticizing port executives for failing to consult the council sooner.

Councilman Joe Buscaino, whose district includes the port, said he was "blindsided" by the rising cost of the TraPac container terminal project in Wilmington, which has soared to $510 million from $245 million in 2009. Councilman Mike Bonin said he and his colleagues should have been included in the port's decision to convert the terminal to an automated crane system, a move that triggered a major portion of the cost overruns.

"This situation is pretty much a hot, stinking mess," Bonin said. "It [has] budget implications. It has serious governance questions. It speaks to the philosophy of how this port is going to be competitive."

Port officials prepared documents in 2010 dealing with the terminal change, according to reports on the project. But they were not submitted to the harbor commission and council for approval for more than three years, according to a draft analysis of the construction program obtained by The Times.

Since then, the agency's handling of the project, which is designed to expand and upgrade an existing shipping terminal, has received highly critical reviews. In one confidential report obtained by The Times, the city lawyers said the port was building a project without proper authorization from the harbor commission and council. That, in turn, had left the port vulnerable to lawsuits based on the state's open meetings law and other provisions, the document said.

Gary Lee Moore, interim executive director at the Port of Los Angeles, said the port should have sought council approval for the expensive design changes in 2011. "Nobody wants to have this happen again," he told lawmakers.

The TraPac terminal cost overruns were the subject of back-to-back meetings Tuesday at City Hall. The latest cost increase became public two months ago, just as Mayor Eric Garcetti was carrying out his review of department heads.

Geraldine Knatz, the port's top executive, announced her resignation last month. A Garcetti spokesman declined to say whether her departure was linked to the troubled project. A port spokesman said Knatz was traveling Tuesday and unavailable for comment.

Asked if anyone at the harbor agency could depart in the future as a result of the TraPac project, Buscaino responded: "Possibly."

Lawmakers first approved the TraPac project in 2009. A year later, TraPac and port executives agreed to make a major change, opting for automated cranes mounted on rails instead of rubber-wheeled ones. That change accounted for $175 million of the cost overruns, according to harbor officials.

Bonin said the harbor's move to automated technology should have been part of a larger policy discussion that included elected officials. He also questioned whether the move to automated technology would result in fewer jobs for workers with the International Longshore and Warehouse Union.

If the council had been consulted, lawmakers could have worked with port officials to negotiate a better financial deal with TraPac, Bonin said.

Lawmakers also could have sought guarantees from TraPac that new jobs would be available for workers whose positions were eliminated due to automation, he said.

"I definitely think there need to be consequences for leaving the commission and the council out of the loop," Bonin said after the council's meeting.

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