Council to Vote on Taking Bids for City Dock Use

Monday, March 30 2015


Horizon Lines' local freight delivery comes into the Unalaska Marine Center every Friday. (Annie Ropeik/KUCB)

An open bidding process for new long-term shipping contracts at the Unalaska Marine Center will go to a vote when city council meets on Tuesday.

It’s the culmination of weeks of back-and-forth between the city, council and residents about the best way to secure a long-term user at the dock -- while still preserving local freight service.

For almost 25 years, Horizon Lines has been the primary user at Unalaska’s city dock. Their long-term contract gave them discounts and a guaranteed schedule.

When their contract lapsed in 2013, they started paying the city’s full tariff -- and the port began operating without a contract-set schedule.

But now, the city’s looking ahead to a port expansion that could cost as much as $46 million. Former city manager Chris Hladick said before he left town that he hoped council would approve putting the contract out to bid. He says it would let the city find companies to help finance the expansion.

"Why are we talking about this? Because we’re doing planning for 20 years," says Hladick. "And what are the needs? If you’re going to do a $46 million-dollar project, what’s the scope? So we need input from the shippers, obviously."

The city’s attorney has said the lowest-risk way to give everyone a fair shot at the dock space is to hold one public bidding process. It would let companies give details on upgrades they want to see at the port -- and on when and how they’d like to use it in the long term.

Port officials haven’t revealed many companies that are interested so far -- but they say Maersk Lines, the main international shipper at the city dock, was one of the first to ask about improvements.

Maersk spokesman Tim Simpson couldn’t confirm the specifics of those talks, or whether Maersk plans to bid on a contract.

"We’re aware of the proposal and we will review it," Simpson says. 

He also couldn’t say how their local partnership with Horizon Lines might change if Maersk winds up with a long-term contract of its own. But he noted that Maersk doesn’t aim to interfere with any of Horizon’s current operations.

That’s been a concern for councilors and community members in recent weeks. They’ve said they’re worried that a shake-up in the port’s users could threaten Horizon’s weekly domestic freight delivery. The ship that comes in every Friday carries groceries, mail and supplies for local seafood processors.

Of course, that ship may not be Horizon’s much longer. The company is in the midst of being acquired by Matson. Spokesman Jeff Hull says Matson will follow Horizon’s lead on any local negotiations that happen before the merger is finalized. Right now, he says they plan to keep the same schedule and labor that Horizon already uses.

Horizon’s Alaska vice president, Marion Davis, says Horizon isn’t interested in a long-term port contract or in any upgrades. He says they would bid on a contract if that was what it took to secure their domestic freight spot -- but he hopes it doesn’t come to that.

"I just think the city should really think about this before putting this out," he says. "For us to respond to it, I’d be glad to commit to the weekly service that we’ve always provided, but I really don’t need any additional dock space or anything."

Councilors asked earlier this month if the city could secure Horizon’s Friday spot outside of the bidding process for the rest of the schedule. But Ports Director Peggy McLaughlin says council will likely have to choose between one bidding process, or none at all -- or leave the city open to legal challenges.

The request for proposals council will vote on this week hasn’t changed from what they considered earlier this month. It still includes extra points for companies that use local labor -- another big sticking point during council discussions.

City officials have stressed that union laborers will keep their jobs. And McLaughlin says the public bidding process is the easiest way to keep current port operations intact.

"If council chooses not to move forward with the [preferred use agreement] for the container terminal, this whole dock, all cargo companies, will be operating under the tariff, which means that we have to create that opportunity for whatever entity wants to call here that’s in good standing with the city, the opportunity to dock and conduct business," she says. "So there is no securing this for a schedule -- it’s first come, first served."

Beyond that concern, she says she hopes the council will think bigger than Horizon, and consider the city’s long-term growth in voting on the bid. It’s on council’s agenda for their regular meeting on Tuesday.



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