Council Extends Last Chance to Save Todd Shipyards

In a bid to reopen the old Todd Shipyards in San Pedro, the Los Angeles City Council agreed Wednesday to temporarily block the Harbor Commission’s plan to sell the yard’s assets.

The council’s 13-0 decision represented a rare rebuff of a city commission and, politics aside, may give the 110-acre site one last chance to reopen as a shipyard.

“This is their last opportunity,” Harbor Councilwoman Joan Milke Flores said of two start-up companies bidding to lease the site. “They have already expended a lot of energy and money on their proposals, and I believe that they know this is their last (chance).”

Two weeks ago, the Harbor Commission moved to end months of speculation about the site’s future when it decided to sell off the yard’s assets for $6 million. The decision, port officials said, followed three years of unsuccessful efforts to find a shipbuilder with the interest and financial wherewithal to lease the site, which closed in 1989 and for decades employed more than 6,000 workers.

The commission’s action, while not unexpected, renewed complaints by suitors of the site that the port had set unreasonable financial demands for a lease because, critics said, it was interested in converting the former shipyard to another use like a high-profit container yard.

But immediately after the commission’s action, Flores urged the council to inject itself into the shipyard debate by invoking a rarely used City Charter section that permits lawmakers to temporarily block--even overturn--decisions by independent city commissions. In this case, Flores’ action suspends the port’s decision for 21 days--enough time, she and others say, to determine if any company can be found to reopen the site as a shipyard.

During a half-hour public hearing Wednesday, nearly a dozen speakers, from politicians to potential investors to former Todd workers, pleaded with the council to intervene in the shipyard debate. Otherwise, said many, including Assemblyman Dave Elder (D-Carson) the possibility of shipyard employment for thousands may be lost forever.

“We are a serious enterprise. And we desperately need the opportunity to continue the quest to occupy the yard and employ thousands of people in meaningful, long-term, sustained work,” said John Chernesky, general manager of Los Angeles Shipyards Inc., one of two start-up ventures bidding for the site. Joining Chernesky in addressing the council was one of the company’s investors, former Harbor Commissioner Fred Heim, and former City Atty. Burt Pines, who represents another investor in the new shipbuilding firm.

Retired Rear Adm. Stuart Platt, who heads the competing Los Angeles-Long Beach Shipyard Co, also stressed the importance of giving the site every chance to return to shipbuilding or repair.

“It would be very sad to send all of this equipment to the junkyard rather than create jobs,” said Platt, whose company’s assets include some $250,000 invested by 100 former Todd workers eager to return to shipbuilding.

By the reckoning of Platt and others, the port’s plan to sell off the yard’s assets not only foreclosed the possibility of reopening the site for shipbuilding but also represented a financial fiasco. Indeed, Kevin Sullivan of the Industrial Union of Marine and Shipbuilding Workers of America, Local 9, noted that port officials were ready to sell off the site’s assets for $6 million when, earlier, they had demanded $10 million for the equipment from companies bidding to lease the site.

Charging port officials with a “hidden agenda,” Sullivan added that port officials had also earlier demanded that bidders to lease the property pay $2 million for its environmental cleanup. “We think this is comparable to a landlord asking new tenants to pay for destruction left behind by a former tenant,” Sullivan said. “Who would ever rent such property? That’s exactly the point. No one ever would.”

The criticism of the port’s actions--and agenda--was dismissed by Lonnie Tang, the Harbor Department’s director of commerce and principal negotiator for the site.

Appearing before the council, Tang insisted that port officials had done everything possible to find a viable tenant for the property. However, Tang said, officials were repeatedly confronted with companies that could not deliver on their promises to prove financial wherewithal.

“Everyone is concerned about jobs and hard times and clearly the harbor commission, going back three years ago, was very interested in maintaining the jobs that go with a shipyard,” Tang told the council. “However, the port’s objective is to ensure it manages the port and land areas effectively and makes sure its scarce resources . . . are spent responsibly.”

Without challenging Tang’s presentation, council members said they disagreed with his--and the commission’s--conclusion that the port must move ahead with sale of the yard’s assets.

“We’ve got to give more than just lip service when we talk about jobs,” Councilman Joel Wachs said. “It may cost a little to provide jobs, but how much does it cost us to allow them to go away.”

Under the plan adopted Wednesday, port officials will meet with the city’s legislative and financial staff to review shipyard proposals for the site and determine if more can be done to accommodate a new shipyard. Proposals will then be forwarded to the council’s Commerce, Energy and Natural Resources Committee, chaired by Flores, before presentation to the full council.