Miffed L.A. Council approves changes to over-budget port project

Miffed L.A. Council approves changes to over-budget port project
A file photo shows a cargo ship leaving the TraPac terminal at the Port of Los Angeles. (Ringo H.W. Chiu / For The Times)

The Los Angeles City Council signed off Tuesday on major changes to a harbor construction project whose cost doubled in four years, with lawmakers criticizing port executives for failing to consult the council sooner.

Councilman Joe Buscaino, whose district includes the port, said he was "blindsided" by the rising cost of the upgrade to the TraPac terminal in Wilmington, which soared to $510 million from $245 million in 2009. Councilman Mike Bonin said he and his colleagues should have been included in the port's decision to convert the terminal to an automated crane system, a move that triggered a major portion of the cost overruns.


"This situation is pretty much a hot, stinking mess," he said. "It [has] budget implications. It has serious governance questions. It speaks to the philosophy of how this port is going to be competitive."

Lawyers for the city and port officials prepared documents in 2010 dealing with the terminal change, according to reports on the project. But they were not submitted to the harbor commission and council for more than three years, according to a draft analysis of the construction program obtained by The Times.

Since then, the port's handling of the project, which is designed to expand and upgrade an existing terminal, received highly critical reviews. In one confidential report obtained by The Times, the city's lawyers said the port was building a project without the proper authorization from the harbor commission and council. That, in turn, had left the port vulnerable to lawsuits based on the state's open meetings law and other provisions, the document said.

Gary Lee Moore, interim executive director at the Port of Los Angeles, said the port should have sought council approval for the expensive design changes in 2011. "Nobody wants to have this happen again," he told lawmakers.

The TraPac terminal cost overruns were the subject of back-to-back meetings Tuesday, first in the council's Trade, Commerce and Tourism Committee, then in the full council. The latest cost increase became public two months ago, just as Mayor Eric Garcetti was carrying out his review of department heads, including the top executive at the port.

Geraldine Knatz, the port's top executive, announced her resignation last month. A Garcetti spokesman declined to say whether her departure was linked to problems with the TraPac project. A port spokesman said Knatz was traveling Tuesday and could not be reached for comment.

Asked if anyone at the harbor could depart in the future as a result of the TraPac project, Buscaino responded: "Possibly."

Lawmakers first approved the construction project for TraPac Inc. in 2009. A year later, TraPac and port executives agreed to change the type of cranes planned for the project, opting for automated cranes mounted on rail instead of rubber-wheeled ones. That change accounted for $175 million of the cost overruns, according to harbor officials.

Bonin said the harbor's move to new automated technology should have been part of a larger policy discussion that included elected officials. He also questioned whether the move to automated technology would result in fewer jobs for workers with the International Longshore and Warehouse Union.

If the council had been consulted, lawmakers could have worked with port officials to negotiate a better financial deal with TraPac, Bonin said.

Lawmakers also could have sought guarantees from TraPac that new jobs will be available for workers whose positions are eliminated due to automation, he said.

"I definitely think there need to be consequences for leaving the commision and the council out of the loop," Bonin said after the council's meeting.



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