Updated: Wednesday, 27 Feb 2013, 5:14 PM EST
Published : Wednesday, 27 Feb 2013, 5:14 PM EST
DOVER, Del. (AP) — The state board that oversees the Port of Wilmington asked Delaware lawmakers Wednesday for $20 million in the coming fiscal year for capital projects. However, the head of the Diamond State Port Corporation also told lawmakers that the administration of Gov. Jack Markell doesn't back the funding request.
DSPC chairman Alan Levin, who also is Delaware's economic development director, said the administration still believes the best approach is to finalize a deal with Houston-based energy giant Kinder Morgan to privatize operations at the Wilmington port.
"It's merely a Band-Aid," Levin said of the requested $20 million in capital funding. "It does not get us to where we want to be. We need deeper pockets."
"The port continues to bleed red ink each year," Levin added. "The truth is, we are continuing to lose money on an annual basis."
Officials said that if the Kinder Morgan deal falls through, they will need the additional money from the state to keep the port operating.
If the request is approved, officials said they would use the funds for a new container crane, berth repairs, minor capital improvements and other expenses.
Lawmakers and unionized port workers who have concerns about the proposed Kinder Morgan deal urged members of the capital budget committee to support the port's funding request, implying that privatization would be a bad deal for taxpayers and port workers.
State Rep. John Kowalko, D-Newark, told the committee that failing to provide adequate funding for the port will lead to a "fire sale" to Kinder Morgan.
Kowalko also took issue with Levin's contention that the port is losing money, saying that claim, supported by state budget officials, is based on an accounting for depreciation expenses.
Union officials said that if Kinder Morgan signs a long-term lease deal with the state, the company will cut jobs at the port and the workers who remain will lose benefits.
"They will cut jobs, there's no doubt about that... God only knows what they'll do with the wages," said Paul Cutler, vice president of the International Longshoremen's Association Local 1694-1.
Cutler said his union is not opposed to a partnership at the port, but that Kinder Morgan is "not the partner that we need."
Kinder Morgan has proposed investing at least $200 million at the port, including $142 million in lease payments and an upfront payment of $16.5 million. The company also has said it would spend millions more on infrastructure, maintenance, and expansion.
"It's not an investment, it's a steal," Kowalko said of the Kinder Morgan proposal.
Levin noted that no final deal has been reached yet, but that the Markell administration hopes to have a proposal by April "that makes sense for everyone going forward."
Sen. David Sokola, a member of the budget committee, asked why port officials were asking for $3 million more for berth repairs when they've spent only $1.1 million of a $10 million appropriation they were provided last year for those repairs.
"I feel like we wasted a $10 million allocation... I feel like a chump," said Sokola, D-Newark.
Levin said port officials were trying to preserve funds while working out a deal with Kinder Morgan, suggesting that it wouldn't have made sense to spend $10 million to repair berths if Kinder Morgan decides to spend $60 million to replace them entirely.
"We would have repaired it for naught in the end," he said, adding that the process of trying to work out a deal with Kinder Morgan has taken longer than officials expected.
According to the company's website, Kinder Morgan has more than 11,000 employees and a combined value of about $100 billion.
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