The Port of Los Angeles is a major engine for economic growth and job creation, handling more than 20 percent of all incoming cargo to the United States. Owned by the City of Los Angeles and operated by the City’s Harbor Department, the Port of L.A. accounts for one of every 13 jobs in Los Angeles.
While the volume of cargo movement at the Port of L.A. is at its highest point in its 110-year history, L.A.’s share of the cargo business has declined due to competition from other West Coast and Canadian ports and shipping industry consolidations. To keep up, the Port needs to strengthen its efforts to remain competitive and expand and diversify the scope of its business activities, according to a report issued today by L.A. Controller Ron Galperin, along with Mayor Eric Garcetti and the City Council.
The Industrial, Economic and Administrative Survey (IEA) of the Los Angeles Harbor Department is a 130-page review of both business and management issues at the Port of L.A., and offers recommendations to improve the way the Port functions.
Development and tourism
The IEA report identifies key business challenges the Port faces, including increased competition from other cargo ports, and the need to diversify the Port’s business portfolio, while retaining a focus on cargo. The Port of L.A. has enjoyed some recent success with real estate development, but needs to pursue additional development opportunities, revamp its leasing practices and find ways to attract more visitors and tourists to the area. Right now, the L.A. waterfront at the Port captures just a fraction of the City’s overall tourism.
Cyber security and technology
The report flags concerns about cyber security facing all of the world’s ports. To address the ever-present challenges, the report highlights the need for the Harbor Department to update some of its more antiquated technology systems. Currently, each division of the Port uses its own software programs and many are not compatible with one another.
“The City’s Harbor Department and its management are doing many things right, but to remain a leader, the Port of L.A. needs to diversify with new development and leasing opportunities, while continuing to update vital technological functions,” said L.A. Controller Ron Galperin. “We can’t grow the Port’s economic footprint without first modernizing the way we do business there.”
“Every time the Port of Los Angeles sets and surpasses new records for container volume, we all benefit – with more jobs for our workers, more growth for our businesses, and more prosperity for families in L.A., throughout Southern California, and across America,” said Mayor Eric Garcetti. “Today’s report underlines what we already know: if we want keep seeing ships dock at our port, unload on our waterfront, and fuel our economy long into the future, we have to invest in efficient operations, cyber security, clean technology, and the world’s best labor force right now.”
The IEA report makes the following recommendations:
Deepen collaboration between the Ports of L.A. and Long Beach to maintain a competitive edge with cargo;
Explore opportunities to increase business development and modify cargo terminal pricing;
Identify future real estate development opportunities, modify leasing prices and provisions, and do a better job marketing major waterfront events;
Work with Port tenants to assess and strengthen cyber security; and
Develop a standard approach to technology by creating uniform data and systems requirements.
“This report gives the Port of Los Angeles a road map to improve and move forward,” said Councilmember Joe Buscaino. “It is imperative the City and Port continue to invest in making the L.A. Waterfront a world-class destination, while bringing port operations to the technological forefront of the goods movement to maintain our standing as America’s number one port.”
“I thank Controller Galperin for taking the lead on this detailed report and acknowledging the many strengths and accomplishments that have occurred at the Port in recent years,’’ said Port of Los Angeles Executive Director Gene Seroka. “We appreciate the feedback on areas where we can focus and improve operations. Based on the priorities outlined, we will be evaluating our business practices, as well as examining opportunities and the recommendations put forth in the study.”
The Port IEA is mandated by the Los Angeles City Charter, which requires the Controller, Mayor and L.A. City Council to administer a survey of each of the City’s proprietary departments – the Harbor Department, Department of Water and Power and Los Angeles World Airports – every five years. The report was prepared for the Controller’s office by the firm of BCA Watson Rice, LLP.