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Ports of Seattle, Tacoma approve major renovations for Terminal 5

The ports of Seattle and Tacoma voted in favor of a nearly half-billion dollar deal to renovate Terminal 5 and bring significant changes to Terminal 46.

Editor's note: Above video originally aired March 12, 2019 - covering the proposed changes to Terminal 46

The Port of Seattle and Port of Tacoma approved a nearly half billion-dollar plan to renovate West Seattle’s Terminal 5 and shift existing containers to other terminals in the meantime. The deal will mean significant changes to Terminal 46 near Seattle's stadium district.

The Northwest Seaport Alliance (NWSA) authorized construction on the Terminal 5 Modernization Program, "readying it to return to use as a premier international container terminal."

The ambitious proposal is the result of years of work and comes after the Port of Seattle quietly approved a property tax increase in January to help subsidize some of the cost.

“The modernization of Terminal 5 represents a transformative investment in our region to support our state’s economy,” said Stephanie Bowman, Port of Seattle commission president and co-chair of the NWSA.

The NWSA was formed in 2015 to jointly handle maritime activities and investments.

The ports will spend $340 million for phase 1 of the redevelopment of Terminal 5 for the world’s biggest container ships.  Stevedoring Services of America Terminals (SSAT) and Terminal International Limited (TIL Group), are expected to chip in $140 million and sign a 32-year lease to operate the terminal. 

Now that the deal is approved, construction could begin this spring, with Phase 1 scheduled to be completed by 2021.

Once completed, Bowman says the terminal should be able to handle 1.3 million shipping containers a year.

The Terminal 5 investment will result in 6,600 new direct jobs and more than $2 billion in business activity, according to NWSA. 

The ports have faced stiff competition for shipping routes, especially from Vancouver, B.C. and Prince Rupert British Columbia. The latter is a remote outpost, which has been heavily supported by provincial government, and just topped the 1 million container mark, with a plan to do 1.8 million standard containers by 2022.

The Terminal 5 facelift would be years in the making.  Container operations were suspended there in July 2014.  The Port of Seattle and NWSA have since gone through an environmental review process and master use permitting.  The entities have also been issued a shoreline permit to make all their improvements and secure all the needed permits in November of 2018. 

Terminal 5 is considered valuable because of its size and access to on-dock rail for shipping purposes. 

Bowman specifically said the investment is needed for the ports to remain competitive with Vancouver, B.C. and Prince Rupert. 

“Cargo volumes equal jobs, that’s the why of why we’re doing this,” she said.

The changes will also prompt major movement elsewhere in Seattle.

Matson’s Hawaii service will move from Terminal 30 to the south berth of Terminal 5 in Spring 2019, which Bowman acknowledges will be a “tight fit.” The ports also plan to move international marine cargo from Terminal 46 to Terminal 18, and eventually Terminal 5.  Terminal 46 is the major terminal near T-Mobile Park and its access to I-90 has always been a strong selling point.

RELATED: Port of Seattle makes move to add 4th cruise ship berth near Pioneer Square

Based on the redevelopment, the ports plan on using it for other projects and break-bulk cargo and relocate Seattle-based Foss Maritime to Terminal 46. 

The Port of Seattle is also finalizing additional plans to use 29 acres of the 86-acre site for a fourth cruise ship berth. It previously suggested the berth would be constructed with $100 million from the Port, with the tenant assuming the other half of the cost.

The Port of Seattle recently approved a 3 percent property tax increase to offset some of the planned infrastructure improvements.  According to the port, “Median household property tax payment to the port would increase by $1.39, going from $68.80 per year in 2018 to $70.20 per year in 2019.”

“It is a big concern maintaining a working marine waterfront, that's absolutely the plan with T-46,” Bowman said. “It’s in a critical location.” 

Bowman believed the ILWU local would fully support the changes, because the plan helps maintain maritime jobs.  However, she acknowledged the potential for criticism. 

“Some folks can push back, but the farmers in eastern Washington will say it’s absolutely critical (to have the port). It’s a lifeline for their business.”

Port of Tacoma Commissioner Vice President and NWSA Managing Member Clare Petrich said Tacoma will split the cost of the renovations, much like Seattle did for the Husky Terminal improvements on the Tacoma tide flats.

“This is a very exciting process that we're going through, with the growth of both harbors,” Petrich said.

The Seaport Alliance estimates both ports are associated with 58,000 marine cargo jobs.

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