government, the community and the private sector to succeed. By Candace .... Wooden, who coached at the University of Ca
SEAPORTS AAPA
THE OFFICIAL PUBLICATION OF THE AMERICAN ASSOCIATION OF PORT AUTHORITIES
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aapaseaports.com • aapa-ports.org
SUMMER 2017 • VOLUME 45
Partnering for SUCCESS
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CONTENTS
SUMMER 2017 — VOLUME 45
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22 FEATURES Stakeholders: A Seaport’s Secret Resource 10 The easiest way to pull the rug out from under a port’s success is to ignore stakeholders. Seaports need informed, supportive allies to set the stage for almost any project or initiative. By Lori Musser
Why Ports Need Allies: Maintaining a Working Waterfront Takes a Network of Supporters 14 Maintaining coastal property for maritime activities is critical to ports’ success and requires ports to find allies and partners in other levels of government, the community and the private sector to succeed. By Candace Gibson
The Next Generation of Leaders — Succession Planning Provides Security, Guidance for Future 18 Mentoring and teaching the next generation of leaders should be a simple progression if you’ve started the process early and have a plan in place. That is where succession planning comes in. By Sandy Smith
Port Security — An Exercise in Partnerships 22 Coordination among port police and technology personnel is critical for physical and cybersecurity, and partnerships between ports, terminal operators and others are necessary for successful security.
GUEST ARTICLES Cyber Security: What Port Authorities Need to Know 28 Effective cyber-risk governance does not require a degree in computer science. However, an understanding of the dynamics of cybervulnerability can assist directors in setting protection priorities and overseeing contingency and remediation plans. By Art Linton
Tomorrow’s Leaders Need More Than On-the-Job Training 32
PORTS + POLITICS
The port industry understands it can’t continue to depend on on-the-job training alone to prepare the next generation of leaders for the significant responsibilities they will assume.
Lessons From the Past: A Renewed Commentary on Port Security 26
DEPARTMENTS
By Barry Parker
Security measures are much different than 20 years ago, and as we experience and deal with new threats, we must take the lessons learned and build on that framework. By U.S. Representative Albio Sires (NJ-08)
By Erik Stromberg, Lamar University
AAPA Headquarters 6 From the President’s Desk 8 Index of Advertisers 34
View the digital edition of AAPA Seaports Magazine online at www.aapaseaports.com. Don’t forget to follow AAPA on Facebook (www.facebook.com/ seaportsdeliverprosperity), Twitter (@AAPA_Seaports) and LinkedIn (www.linkedin.com/ company/american-associationof-port-authorities) for the latest association news and events. SUMMER 2017 • WWW.AAPASEAPORTS.COM
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A APA HEADQUARTERS
AAPA 2017 Spring Conference Features Key U.S. Leaders
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he AAPA Spring Conference in Washington, D.C., (April 4-6) featured a keynote address by U.S. Secretary of Transportation Elaine L. Chao, the presentation of AAPA’s 2017 Port Person of the Year award to House Majority Whip Steve Scalise (R-La.) and the presentation of one of AAPA’s two 2017 Cruise Awards to Royal Caribbean Cruise Lines President & COO Adam Goldstein. Also presenting at the conference were House Transportation and Infrastructure Subcommittee on Water Resources and Environment Chairman Garret Graves (R-La.) and Senator Tom Carper (D-DE), Ranking Member on the Senate Environment and Public Works Committee. Other aspects of the conference included a session titled The Politics of Trade and Pressures on the Supply Chain that featured Bill Lane, former director of global government affairs for Caterpillar Inc., and Andrew Penfold, global maritime director for WSP|Parsons Brinckerhoff in London. Two panels, comprised of seven port CEOs and senior level port executives, highlighted “Success Stories in Port Planning and Development.” In addition, the program featured a special session on using technology to stake out a leadership position in the port industry. Tuesday, April 4, marked Western Hemisphere Ports Day – the annual recognition of the unity, importance and value of seaports throughout the Americas. Several AAPA technical and policy committees met, and the AAPA Board of Directors elected Steve Cernak, chief executive and port director for Port Everglades, to serve as the association’s chairman of the board for the 2017-18 activity year that begins in October. The final day of this year’s Spring Conference was punctuated by nine meetings of U.S. port representatives with key Congressional and Administration leaders and staff officials to advocate for U.S. port policy and funding issues. Presentations from the 2017 Spring Conference can be found here: http://bit.ly/AAPASpring17 ●
American Association of Port Authorities 1010 Duke St. Alexandria, VA 22314-3589 Tel: (703) 684-5700 Fax: (703) 684-6321 Email:
[email protected] Website: www.aapa-ports.org Administration
KURT J. NAGLE, PRESIDENT & CHIEF EXECUTIVE OFFICER
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JEAN GODWIN, EXECUTIVE VICE PRESIDENT & GENERAL COUNSEL
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COLLEEN O’SULLIVAN, EXECUTIVE ASSISTANT
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SUSAN MONTEVERDE, VICE PRESIDENT OF GOVERNMENT RELATIONS
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JIM WALKER, DIRECTOR OF NAVIGATION POLICY & LEGISLATION
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JOHN YOUNG, DIRECTOR OF FREIGHT & SURFACE TRANSPORTATION POLICY
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PAM MAHER, GOVERNMENT RELATIONS FACILITATOR
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EDWARD L. O’CONNELL, DIRECTOR OF MEMBERSHIP SERVICES
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JODI GIBSON, TRAINING & PROGRAMS COORDINATOR
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ALEXANDRA “ALEX” DORGAN, MANAGER OF OPERATIONS AND ADMINISTRATION
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TOM HRANAC, MEMBERSHIP SPECIALIST AND LATIN AMERICAN FACILITATOR
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RAFAEL DÍAZ-BALART, LATIN AMERICAN COORDINATOR
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DR. REXFORD B. SHERMAN, DIRECTOR OF RESEARCH & INFORMATION SERVICES
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CRAIG ESTABROOKS, PORT SAINT JOHN RICHARD SCHER (ADVISORY PANEL CHAIR), MARYLAND PORT ADMINISTRATION JEAN GODWIN, AAPA AARON ELLIS, AAPA MEREDITH MARTINO, AAPA Published by
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AAPA SEAPORTS MAGAZINE
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FROM THE PRESIDENT’S DESK
Winning Is Not the Same as Succeeding By Kurt J. Nagle President & CEO American Association of Port Authorities
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APA’s Spring Conference began this year on the night of the NCAA men’s basketball championship. For sports fans, it was the best kind of game – two wellmatched teams playing high caliber basketball in a close game that didn’t break toward the winner until nearly the end. North Carolina went home elated with their win. Yet one of the winningest coaches in all of college basketball didn’t really like to focus too much on winning. Coach John Wooden, who coached at the University of California Los Angeles and won 10 national championships from 1964 to 1975 (a record still unmatched in college basketball), became known at the end of his life for his eloquence in sharing the mindset he developed to drive his team to new heights: Winning was not the same thing as succeeding. In a TED Talk delivered in 2001 and viewed more than 5 million times since then, Coach Wooden says that success is “peace of mind attained only through self-satisfaction in knowing you made the effort to do the best of which you are capable.” This idea was the cornerstone of several books published by Coach Wooden, as well as an award given in his name and memory to honor the ideals of his life. While Coach Wooden focused mostly on what it meant to be successful on the basketball court, his definition of success translates far beyond sports. It’s a definition that lends itself well to the port world, where increasingly stakeholders and customers expect more from their ports than simply “winning” in the sense of moving the most boxes or tons of cargo. Ports are expected to bring the full extent of their resources to bear in all areas: cargo, yes, but also capital projects, community engagement, environmental leadership, financial health and other areas. What ports have realized is that they are capable of so much more if they don’t try to achieve their goals on their own. More and more, ports don’t even set goals completely on their own. They seek input, feedback and, perhaps mostly importantly, partners and allies for the work they are doing. This issue of Seaports magazine is built around the theme “Partnering for Success,” and we’ve taken a broad approach to both the idea of partnering and what success means. In some
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“What ports have realized is that they are capable of so much more if they don’t try to achieve their goals on their own.” instances, simply continuing the maritime operations of the port is considered a success. In communities where waterfront property is in high demand for real estate and commercial development, having support for a working waterfront is success in and of itself. In other areas, ports are expected to demonstrate growth – customers expect new landside facilities, deeper water and new equipment. Communities want to see more better-paying jobs. Standing still is not an option for these ports, but making decisions unilaterally would not be considered a success either. Reaching agreement on a common vision for the port’s future is the first step to success and positions a port to be successful in its efforts to change and grow. Sometimes, the partnership that is most critical to a port’s success is that between its staff and its board. As port directors retire or pursue new opportunities, a clearly-articulated succession plan can mean the difference between months of uncertainty or chaos and a smooth, successful transition from one leader to another. While the stakes are high in terms of an effective boardmanagement partnership, they are often higher in the short term for issues such as security. A port that fails to secure its assets – both physical assets as well as data and technology infrastructure – cannot succeed elsewhere. When the issue is as critical as security, partnership is often the only effective means of achieving success. The cornerstone of Coach Wooden’s philosophy was working to the best of one’s abilities all the time. I know AAPA’s member ports are not interested in simply checking boxes but in always finding new ways to do better, including leveraging partners and allies. I hope this issue of Seaports provides tools and inspiration for that journey. ●
» FEATURE
WHY PORTS NEED ALLIES
WHEN YOU HAVE WHAT EVERYONE WANTS, MAINTAINING YOUR WORKING WATERFRONT TAKES A NETWORK OF SUPPORTERS By Candace Gibson
Be Creative, Inclusive with Designs for Coveted Land At the Port of San Diego, President & CEO Randa Coniglio knows this challenge very well. “Our working waterfront is surrounded by a number of important stakeholder interests,” she says. “There are a lot of different interests in what goes on at the marine terminals and shipyards, and they aren’t only the interests of the neighbors nearby, but the interests of other small local businesses that serve the waterfront, traffic concerns relative to cargo-handling trucks on and off the terminals, and a number of impacts like that.” Coniglio adds that it’s a challenge to grow business because “every additional truck is an additional impact to the community,” and because the port must consider competing interests from developers, government and the public. “It’s coveted land. There are any number of interest groups that would like to gobble it up,” she summarizes. There is enormous value in making all of your stakeholders your allies, but that would 14
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be an impossible task to do every day, with every decision. “We work really hard to maintain good working relationships of mutual trust with a variety of stakeholders. I believe it’s important not to alienate any of them,” she says. Coniglio talks regularly with these stakeholders to keep them close and understand their concerns. She offers as an example Ships docking at the Port of San Diego, such as this the port’s relationship with Princess Cruises Star Princess, pull into areas that are considered prime real estate and coveted by many. the California State Lands Commission and the port’s recent certification of an Marine Terminal Expansion EIR, “It is difficult to successfully balance the abundance environmental impact report on the Tenth Avenue Marine Terminal modernization projof concerns and perspectives associated with ect. The report allows the port to quadruple a project like this, but the port worked hard to figure out the best way to modernize the business at this terminal, as well as to address maritime uses at the terminal and advance community concerns about air quality. “We identified beyond mitigation measures things important environmental projections. The we would do to benefit the neighboring comTenth Avenue Marine Terminal expansion munity,” she says. “It was a day we really celpreserves and bolsters the foundational ebrated. We had not only our cargo terminal maritime elements on the terminal, while tenants and other interested waterfront parharnessing innovation to diminish emissions ties there to support the board’s decision to and promote environmental sustainability.” certify the report, but we had neighbors and residents close to the terminal – some who Communicate the What, traditionally oppose port measures – lined Why and How up in support of the board action because of At the Port of Everett, maintaining allies at the benefits they would derive from air quality the working waterfront also requires constant and the consideration of improvements to a communication. CEO/Executive Director nearby elementary school.” Les Reardanz calls it a challenge “to make The chairman of the State Lands sure everyone knows what we do, why we Commission, Lieutenant Governor Gavin do it and why it matters to them. We’re conNewsom remarks on the Tenth Avenue stantly talking about why our projects matter.” Photo Courtesy: Port of San Diego / Dale Frost
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t’s a delicate balance to maintain a working waterfront and nurture relationships with parties who want a piece of valuable maritime real estate. Ports are under near-constant pressure to make available a portion of their water and land to the community, local government and even the private sector. Finding allies among waterfront stakeholders is essential to keeping ports’ welfare afloat. While it’s a challenge to keep a diverse portfolio of allies, ports that foster these relationships also enjoy economic success and healthy community ties.
Photo Courtesy: Port of Palm Beach
Photo Courtesy: Port of Everett
Port of Everett is a medium-sized niche port that strives for a balanced waterfront. Everett is a medium-sized niche port that strives to be a balanced waterfront. Reardanz explains, “We don’t have a ton of land, and we’re not going after the consumer container business. We have a very focused business plan on what cargo we do and how that benefits the greater Puget Sound region.” The concept of a balanced waterfront is providing recreational benefits from economic gains. “Part of the waterfront is a working waterfront,” Reardanz says, “and as you move north, you get to recreational areas. The port is also developing mixed-use property so people can live, play and work in the same area.” He describes the port’s approach thusly: “We recognize you need an area where jobs are created and tax base is developed so you can support these other projects that allow people to touch the water.” Recreational areas create a high rate of return to the community, but no monetary return. This is precisely why the port also pursues projects with a high rate of monetary return. An example of this kind of project is modernizing the south shipping terminal. Reardanz explains that the terminal was originally designed to handle lumber and isn’t capable of supporting the high-end heavy cargo the port handles now. “We do things that don’t fit neatly into containers, like agricultural equipment, industrial-sized batteries, bridge equipment, plus Boeing’s oversized cargo. The south terminal’s wharf isn’t strong enough for that cargo.” In addition to adding cranes to the wharf to accommodate larger ships, the port is putting in 3,300 lineal feet of rail to ameliorate congestion. Communicating the what, why and how of projects like this is a collaborative effort between the port, Mayor Ray Stephanson and the city council of Everett. “We’ve been able to get out to the neighborhoods, businesses and educational facilities to carry our message across,” says Reardanz. “Mayor Stephanson has been a fantastic ally to us, and the city 16
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The Port of Palm Beach is surrounded by some of the most beautiful areas in South Florida, and therein lies one of the struggles of this working waterfront.
council has been incredibly supportive of what we’re trying to do.” The appreciation for support goes both ways, according to the mayor’s office. “We are fortunate to have such a forward-looking, community-minded partner in the Port of Everett,” says Mayor Stephanson. “The port is critical to our economic vitality as a region, and is playing a key role in developing our waterfront as an asset that our entire community can enjoy.”
When Beauty and ‘Concentrated Risk’ Present Challenges The Port of Palm Beach is another selfidentified niche port that leans heavily on its allies, though its biggest challenge is unique among the Americas’ port profiles. Executive Director Manuel Almira is matter-of-fact about what he calls the port’s “concentrated risk.” Almira explains, “We only have one something: one cruise ship, one container operator, one bulk carrier, one dry dock. If any of these leaves, I have a hole.” Business is good for Palm Beach, and the scenery is good, too. And therein lies the struggle of this working waterfront: “We are surrounded by some of the most beautiful areas in South Florida. This is where people live with big budgets, and it’s because of those individuals and others that we at the Port of Palm Beach take our location very seriously. You need to be conscious of who lives around you and the proximity of their households to our working environment.” Almira is acutely aware of the inherent nuisances of a working waterfront to nearby luxury real estate. “Quite honestly, I wouldn’t want to live near a crane, noise and bright lights. I recognize that. We are extremely aware of how we can be intrusive in households just east, south, west and north of us,” he says. Not only do the surrounding communities wish to be unaffected by port business,
they also desire the port itself to maintain a costly level of beautification. To this end, the port has painted its walls with pink paint provided by the county, planted palms and shrubbery at the entrance and installed a new sign. “It makes a difference,” Almira admits, adding that the Florida Department of Transportation’s expansion of a major highway that leads into the port will require all of these changes to be redone once construction is complete. What’s more, the port partnered with one of its tenants to stack containers three-high to create a container wall that shields communities’ view of port operations. “It didn’t cost us anything, but it’s taking valuable land away from the port,” he admits. Almira also doesn’t bring through the port odorous products or bulk materials that could fly in the wind. “These would represent a challenge aesthetically and could create a bad feeling.” These are concessions the port makes to keep peace among its neighbors. A port is an industrial site, Almira emphasizes, and the balance of functional business and beauty could become a financial black hole. Fortunately for the Port of Palm Beach, it doesn’t face this challenge alone. Almira says that a ship repair yard, Lockheed Martin, a luxury yacht repair business and an electrical company plant all receive similar concerns and critiques from the community. “We all know each other and try to help each other. That’s a definite plus.” In addition to finding allies in nearby businesses, local elected officials are also active in promoting “peaceful co-existence.” Peace and prosperity aren’t just buzzwords as far as ports are concerned. The valuable real estate upon which ports are situated comes with major responsibility. As these three ports have proven, collaboration with allies across local business, government and communities keeps both relationships and operations running smoothly. ●
