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The Port of Paulsboro

by Christina Paciolla

The site has already been suggested as the assembly point for New Jersey’s future offshore wind industry. What else could be in store when the state’s first port in decades opens for marine traffic next year, and is there confidence that tenants will fill the property in this economy?

In early 2013, one of the biggest ports along the Delaware River will be open to receive marine transportation in Paulsboro, which, according to supporters, could mark the beginning of an economic game changer. But exactly what industry will it bring in? The offshore wind industry could make South Jersey its home. So could food corporations. Even electric companies could ship their components into Paulsboro for assembly. All the specifics aren’t ironed out just yet. Actually, no tenants have been secured for the port—a $250 million project aimed to re-invigorate commerce in an industrial area of Gloucester County where BP once occupied space.

While nothing is set in stone, officials at the South Jersey Port Corporation (SJPC) are working hard to get the port occupied, so by this time next year, it can hit the ground running.

Those working on the marine terminal in Paulsboro are still confident the project will be a huge win for South Jersey, regardless of the current state of the economy. And, with the addition of not only more than 700 temporary jobs, but almost 2,000 positions once the marine is going, it’s one of the most important projects in the state.

“The port is going to be one of if not the most important economic development tools South Jersey has seen in decades,” says State Senate President Stephen Sweeney (D-3), who has been a major proponent of the project for years. “It is going to bring in thousands of good paying, long-term jobs at a time when middle class folks need them the most. It is not only going to revitalize Paulsboro, but it will have a ripple effect for the entire region. Businesses will come in, and with them, the kind of economic growth we desperately need in the region.”

The project, made possible by an alliance with the SJPC, the Gloucester County Improvement Authority and the borough of Paulsboro, is a redevelopment of an industrial brownfields site along the Delaware River. It’s set to feature a modern port facility, a solar power facility and an industrial park—if all goes according to plan.

Phase 1 of the project, which saw construction begin in the fall of 2009, is about a year away from being finished. This includes everything from environmental remediation to the construction of at least two berths—the wharf structures for ships. The next phases of the port project depend on the need for more berths. Dredging of the entire site has already been done in anticipation of more berths.

“It’s the first new port in New Jersey in just under 50 years,” says Assemblyman John Burzichelli (D-3), also the former mayor of Paulsboro. “It fits in the state’s thinking about how New Jersey would be positioned to better be engaged in a global economy.”

There have been a few construction setbacks, says George Strachan, Gloucester County Improvement Authority administrator, especially with heavy rain last summer.

“All things considered, I think we’re doing well,” Strachan says.

But his position with the port is to build it to operation, not to attract tenants.

“I know there’s a diverse need for port facilities in recent studies, certainly before the economic downturn,” Strachan says. “It’s shown as the regional economy grows, there’s going to be a need for more ports, whether it’s importing or exporting. There are things you just can’t move other than by ship. That’s not going to change. Even if there are problems now, it remains a good investment.”

This “good investment” is also a flexible one, according to Kevin Castignola, executive director for the South Jersey Port Corporation.

The port will be designed to handle various cargos. For example, wind turbines—a proposed tenant—could arrive at the port for assembly and ship back out fully constructed.

In 2010, Gov. Chris Christie went to the site of the port to sign the Offshore Wind Economic Development Act, a bill that provides market-based credits for offshore wind production. The bill—which was co-sponsored by Burzichelli—helped create an offshore renewable energy certificate (OREC) program that requires a certain percentage of electricity sold in the state to be wind energy manufactured offshore. The legislation also made it clear that Paulsboro would be the preferred hub for turbine assembly.

“Offshore wind would obviously be a great fit for Paulsboro,” Castignola says. “That would be a true perfect fit and almost fill up all of [the port], and put to bed in terms of space what we’ll be able to do there. It would be a great opportunity if that occurred.”

However, Castignola says officials at the SJPC who are trying to nail down port users “just can’t focus on one item.”

Burzichelli and Sweeney have been pushing for this port for nearly a decade. With Phase I scheduled to open next year, there’s little worry about the timeline.

“There’s still a long way to go,” Castignola says of acquiring tenants.

He thinks the most important component of securing users is getting that first one in the door. “After that, it’s a domino effect,” he says.

Last year, one of the SJPC’s ports lost a major player—Fresh Del Monte Produce Co. in Gloucester City. That was a big hit and a contributing factor to the ports’ 40 percent decline in recent years.

Obviously, Castignola says, the ports aren’t doing as well as they were when the economy was booming. However, the ports’ commodities, minus Del Monte, are up from last year, he says.

Presently, plywood, steel cargoes, scrap export and cocoa beans are up. It's not a dramatic increase, Castignola said, but it's better than being down.

“We’re doing better,” he explains, “which is good. It’s a sign things are changing.” Burzichelli calls the port a “regional economic engine” as well as a significant state project.

“It adds momentum to Paulsboro reinventing itself,” he says. “One thing that hasn’t changed is its outstanding location.”

Paulsboro is located not only along the Delaware River, but right off of Interstate 295. The first phase of the project includes an access road from the I-295 exit directly into the port.

Looking back about five years ago, the ports in Camden generated nearly 3,500 jobs—family-sustaining ones at that, Castignola pointed out.

“There’s no question if we’re able to get this thing going the way we think we can, then you’re going to have a significant impact, not only to Gloucester County, but to South Jersey,” Castignola says.

Gloucester County Freeholder Heather Simmons calls the partnership and development of the port “transformational” for Gloucester County.

“We really need to bring manufacturing and international trade back here,” says Simmons, who serves as the freeholder board liaison to the departments of Economic Development and Public Works.

She likened the project to Rowan Boulevard in downtown Glassboro. There, crews have been working for a couple of years now on a $300 million redevelopment project that not only links the Rowan University campus to the borough’s downtown, but completely offers a facelift of the area to attract office, retail and residential spaces.

Paulsboro Mayor W. Jeffery Hamilton says that during this entire process, officials have been touting that Paulsboro residents would have first choice of potential jobs at the port. “That makes me feel good because there are a lot of people in Paulsboro, and in the surrounding towns, that are out of work,” Hamilton says. “Once they put this port all together, it’s revenue for us.”

Hamilton stresses its positive impact and says he looks forward to moving Paulsboro forward, both through this project and other planned redevelopment projects in the borough.

So far, there have been more than 700 temporary construction jobs in the last two years thanks to the port. Strachan, of the GCIA, estimates an upward of 2,000 jobs when the port is complete. He calls it the multiplier effect. For example, the South Jersey Port Corporation is home to the largest cocoa bean port on the East Coast. Shippers bring cocoa beans from Africa, which are then sold to companies and wholesalers that distribute them to the manufacturers.

“That’s how the economy is fueled and that’s what we’re talking about here,” Strachan says.

Jobs come from all parts of that multiplier effect, Strachan said. Construction and trucking workers are needed, as well as wharf workers and river pilots, just to name a few.

“It could be more; it depends on the tenants we get,” Strachan said. “The multiplier effect could be 20,000 jobs quite frankly, which is not bluster.”

And with international maritime commerce, any tenant that occupies the space will have that same effect on the market. That’s why Castignola says he and other SJPC officials are keeping their ears open.

“We’ll listen to anything,” he says. “If we can create jobs and create business and waterborne commerce, we’re going to entertain it and talk to them. There are a lot of possibilities.”

It will work, he says, because there are no other plans in place for the port.

“We’re moving forward,” he says. “We think this is a great project. It’s a process and we’re getting toward the end of construction and it’s positive to see it. We just have to keep pushing forward with the business.”

Burzichelli says he thinks the port is timed perfectly. The economy is slowly coming back and new industry—such as wind turbine energy—will most likely occupy the port. “When things are slow, you build public projects to put people back to work in anticipation the demand will be there when the economy comes back,” he says. “If the economy doesn’t come back in three years, we have bigger problems to talk about than the port.”

Published (and copyrighted) in South Jersey Biz, Volume 2, Issue 2 (February, 2012).
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