With 30 years in banking and five years on the Galveston’s Wharves Board of Trustees, I’ve been impressed with the Port of Galveston staff’s progress to strengthen the port’s financial and operational performance.
Certainly the city of Galveston’s greatest asset, the port is a self-supporting business that doesn’t rely on tax dollars. Running the port like a business has produced record-breaking results since Rodger Rees became port director in January 2018.
In 2018, the port reached a record $43.5 million in operating revenue, a 15 percent increase over 2017, and a net operating income of $8 million compared to $4.5 million in 2017. The port also set a record of almost 1 million cruise passengers, and is on track to break that record again this year. Cargo and vessel services revenue was up 16 percent compared to 2017.
This net income will allow the port to pay for much-needed waterfront improvements to generate more business for the port. Growth will also benefit our partners operating in and around the port, including dozens of private businesses, the International Longshoremen’s Association, G&H Towing and the Galveston-Texas City Pilots.
Remember, the port has no taxing authority, so it must fund all improvements through income, grants and public-private partnerships.
The saying “A rising tide lifts all boats” certainly is true on the waterfront. For example, more cruise passengers mean more income for ILA porters, as well as increased parking revenues and city sales tax from port- and privately operated parking lots.
The 21 percent increase in ship calls year-to-date reaps exponential benefits for port partners like ship pilots, line-handlers, harbor tugs and suppliers.
Earlier I mentioned the positive changes at the port under Rees’s leadership. Lay dockage is one example of how he has empowered his staff to seek new revenue sources to benefit the Port of Galveston and its partners.
Port staff took the initiative to attract ships for lay dockage, when ships dock a short time for refueling, inspections, minor repairs, supplies, etc. Since 2018, this new business has generated a total of 467 ship calls with more than $4 million in dockage fees for the port. That doesn’t include the revenue generated for our partners.
Rees also rearranged the port staff and the police force to reduce costs. It involved some tough decisions, but they have produced good results.
Rees and his staff also are planning for the future. For the first time in its 194-year history, the port is developing a strategic master plan to identify and prioritize infrastructure improvements over the next 20 years to benefit the port, its partners and the community.
Rees also is negotiating with Royal Caribbean International to build a new cruise terminal at Pier 10, a major development that will generate more cruise revenue, city sales tax revenue and jobs.
Rees and his staff have a number of other projects planned to improve port operations and financial performance. Stay tuned.