Seaports Magazine - Winter 2017 - 15

» FEATURE

CREATIVE FINANCING
DIVERSIFICATION
IN FUNDING
SOURCES AND
INCOME AVENUES
ARE HELPING
PORTS ACHIEVE
MORE FINANCIAL
STABILITY AND
SECURITY, AS WELL
AS BOOSTING THE
BOTTOM LINE
By Sandy Smith

hen Hurricane Katrina -
and a 24-foot storm surge
- destroyed the Port of
Gulfport in 2005, the port
had a choice: rebuild the port back to its
original layout, or take this as a once-in-alifetime opportunity to rebuild, restructure
and grow.
While the port received a $570 million
grant through the U.S. Department of
Housing and Urban Development (via the
state of Mississippi), it was just the drop
in the bucket of what would be needed to
capitalize. That set a path of exploring a
variety of funding options, using the HUD
grant as just the starting point.
"The only thing we haven't done is hold a
bake sale," said Jonathan Daniels, the port's
executive director and CEO.
There is no need to polish brownie baking skills - at least not yet. Ports these days
are exploring a variety of options when it
comes to diversifying their funding sources
and for good reason.
"Ports are capital intensive and it's not
only the docks and wharfs and need for
bigger cranes," said David C. Miller, managing director of PFM Financial Advisors,
LLC. "It's also about providing efficient
rail and highway access. Most ports aren't
generating the lease revenue and tariffs to
pay for all the capital they need. They're
looking for help, whether it is federal
grants or state and local money or private
sector participation."
To be sure, most ports are sitting on a
potential gold mine of opportunity - if they
can get the funding to invest. "With the
cost of energy and changes in the shipping industry, there is some opportunity for
ports," said John Pauling, national director
of ports and harbors for Cardno. "It's not a
static or declining market. It's a dynamic
and growing market."

Opportunity, Meet Obstacle
In this new market, though, old ways of
financing may not be enough. Competition
for grant money is intense.
"We've had several clients doing subordinate leases and subordinate debt structures
WINTER 2017 * WWW.AAPASEAPORTS.COM

15


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Table of Contents for the Digital Edition of Seaports Magazine - Winter 2017

Latin American Ports Debate Globalization and Protectionism in Punta del Este
AAPA Headquarters
From the President’s Desk
Anticipating Change … Progress Through Port Diversification
Creative Financing
Workforce Diversity
Preparing for Growth Through Multiple Modes
Highlights from the 2017 AAPA Annual Convention
Third Edition of the CMTS Federal Funding Handbook Now Online
Port Management in the Great Barrier Reef
Index of Advertisers
Seaports Magazine - Winter 2017 - Intro
Seaports Magazine - Winter 2017 - bellyband1
Seaports Magazine - Winter 2017 - bellyband2
Seaports Magazine - Winter 2017 - cover1
Seaports Magazine - Winter 2017 - cover2
Seaports Magazine - Winter 2017 - 3
Seaports Magazine - Winter 2017 - 4
Seaports Magazine - Winter 2017 - 5
Seaports Magazine - Winter 2017 - AAPA Headquarters
Seaports Magazine - Winter 2017 - 7
Seaports Magazine - Winter 2017 - From the President’s Desk
Seaports Magazine - Winter 2017 - 9
Seaports Magazine - Winter 2017 - Anticipating Change … Progress Through Port Diversification
Seaports Magazine - Winter 2017 - 11
Seaports Magazine - Winter 2017 - 12
Seaports Magazine - Winter 2017 - 13
Seaports Magazine - Winter 2017 - 14
Seaports Magazine - Winter 2017 - Creative Financing
Seaports Magazine - Winter 2017 - 16
Seaports Magazine - Winter 2017 - 17
Seaports Magazine - Winter 2017 - 18
Seaports Magazine - Winter 2017 - 19
Seaports Magazine - Winter 2017 - Workforce Diversity
Seaports Magazine - Winter 2017 - 21
Seaports Magazine - Winter 2017 - 22
Seaports Magazine - Winter 2017 - 23
Seaports Magazine - Winter 2017 - Preparing for Growth Through Multiple Modes
Seaports Magazine - Winter 2017 - 25
Seaports Magazine - Winter 2017 - 26
Seaports Magazine - Winter 2017 - 27
Seaports Magazine - Winter 2017 - Highlights from the 2017 AAPA Annual Convention
Seaports Magazine - Winter 2017 - 29
Seaports Magazine - Winter 2017 - Third Edition of the CMTS Federal Funding Handbook Now Online
Seaports Magazine - Winter 2017 - 31
Seaports Magazine - Winter 2017 - Port Management in the Great Barrier Reef
Seaports Magazine - Winter 2017 - 33
Seaports Magazine - Winter 2017 - Index of Advertisers
Seaports Magazine - Winter 2017 - cover3
Seaports Magazine - Winter 2017 - cover4
Seaports Magazine - Winter 2017 - divider1
Seaports Magazine - Winter 2017 - divider2
Seaports Magazine - Winter 2017 - 42
Seaports Magazine - Winter 2017 - 43
Seaports Magazine - Winter 2017 - 44
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