Good morning ladies and gentlemen thank you all for being here, this is, if you're following your score card, this is transportation procreation we are late about three minutes off schedule so we'll begin our business. I'd like to first and foremost welcome our Pagers here today and ladies and gentlemen when I call your name if you'll stand up and just give us your wave we have Charles Ben Night from Wake, hey Charles thanks for being here, and he's sponsored by that is Peter Moore, we've got Mark Libber from Pitt, and he's sponsored by Brandon Brown thanks for being Mark, Harry Kid from Wake, Marilyn Avila's her sponsor how did I do with that last name is it okay? Sergeant at Arms check and confirm that the names Sir. William Jackson, Johnston, Lilian, thank you for being here [xx] Sergeant at Arms, [xx] Adams, Joel Osteen my favorite it is Martin Jonathan hey master good morning don't fill [xx] Charles Godwin how did you build extra all which make setup okay you do go work okay which one would you prefer Godwin thank you very much so explain on his now oh we have yes loyal master Janely[sp?] Soldier[sp?] Ladies and gentlemen today agenda implementation from power course executive directive court in North Carolina state court authority I'm sure you do not have a lot of 18 years for your information, Horace Paul, thank you for being here. And also Ed Goodman from director of parry division, North Carolina department of transportation ladies and gentlemen, what we're going to do here special few presenters we did count the following that they did put we may stop you in midtopics and answer questions that is why we major on public internet[sp?] thing so please take note we kind of say, Stop for a second, we'll just answer questions pertaining to the topic that you were currently on and then we will move on. So ladies and gentlemen, without further ado bring to the podium the Executive Director North Carolina State Ports Authority Paul Cozza. Good morning, I appreciate the chance to address the committee again today. As Representative Torbett said I have a few slides to go over, some information. Again, please feel free to ask if any questions. What I'm going to do is a lot of a review of what we discussed a few months back when I presented to the Transportation Committee. First of all, I'll start with what we call our Five Year Plan. Again, what we completed in North Carolina Ports in this past year is a very detailed strategic plan, nothing more than looking at where we want to go over these next five years, and what I want to emphasis is there is a huge amount of detail and data that's behind this plan we looked at what are our opportunities from the stand point of a market, and also what are our opportunities in stand point of what we can do to bring additional business to our ports that's going to help the economy North Carolina so one of the first things we did is we did a deep dive and I've talked about this public. We have all this information it's available to us so we can see imports and export United States, you can see everything that comes in to the country, that leaves the country, port it comes through, origin destination, who is the receiver, who is again and we that data we look and said, what's available for us from the perspective of the market. What came out is this in our strategic plan is we're looking at growing our business on the container side, we do have a business we compete with the ports around us by to a total of 500, 000 TEU's. What that means in our speakers that's doubling the size of our container business. What we think is possible for us even the business that comes through this day. The other part of it is that it expands also our general terminal, so what we mean by that that is we have two sides of our business, one side is the container port the other portion of it is the basis of what we call general cargo which is bulk cargo. We're looking at expanding that by four million tonnes as well which is about doubling of that business over this next five years, very aggressive but at the same time we think it's attainable. With this though when we put together this plan after the stand point of what we see as the market we also looked at and said what do we need to do from an infrastructure stand point. As you all are aware the infrastructure at North Carolina ports is not the most modern, we've not been as a state investing in our ports over the last years and to be able to obtain this additional business like any type of a heavy infrastructure we're going to need some investment, and I'll talk more about those numbers
but we did again it's a very detailed look of particular projects, particular investments everything from equipment to infrastructure to replacing older requirement, and what would be needed to meet this demands of the next years. The next portion that we have in the strategic plan is channel enhancement Morehead city last time we met we we're in more of a difficult position Morehead City. We had extreme showing up what's going on, I'm happy to report that the dredging is taking place right now they're almost done and their channels is not at its 45 feet however it's going to be in upper 30's which is going to help quite a bit of being able to get vessels through, and we also have a plan for the floor but we're are working with the federal government on that side. Other question? Yes Sir. Will that floor plan will that take you to the 45? We're not sure yet, we need to see first that comes out of the first bases of the completion and then there's a combination of what is going to be a federal portion which is going to about $9 million, and we're also still talking to the state about a supplement of $4 million. Which will then get us very close to that 45. Let me ask that a different way if I may to have Morehead operating at its peak performance. What depth does that channel need to be? I'd like to see the channel at 45 feet would be is the best because that's what we're authorized to. Other portion of this channel enhancement is also for the port of Wilmington. and to be able to continue to compete with the ports around us. We all hear about larger ships, the Panama canal changes, that's going to be taking place in the market. We need to also look at our Wilmington channel and everything from [xx] to [xx] basin, to also some the turns coming in through Battery Island. That's part of our strategic plan. What I wanted to note also is that we have started the North Carolina Ports with a corps of engineers as a non-federal sponsor to fund ourselves feasibility study, which is the first step of looking at the channel for Wilmington, and what we can do as a basis of being able to move forward with some enhancements for the future. Again emphasizing, this is something we're doing ourselves that's coming through port's money, state's money on the basis of this channel enhancement there. Lastly which I think is most important we've spoken about before, what we do want to get to is achieve a long term financial stability. What I mean by this is that through our own business, through our own cash generation, with revenues that come through that were able to really fund our own projects so no longer [xx] we recognize very realistically is that us to be successful for North Carolina ports for the long term firm we can't keep looking at the state for funds we need to be able to generate our own cash flow. Just a quick review as I said before when I came to this position I was asked to operate the port as much as possible as a commercial business. I've come out of the private sector I haven't been in the public sector and we're spending a lot of time this past year and going forward on the basis of looking at our profits. How can we put in place [xx] for our programs for expense control like KPI ways that we can be more efficient in our business so that we areN't loosing money and we're actually at a surplus. I'm happy to report right now we aren't 100% audited but at the same time we just completed our June year and we're at $3.4 million in net income profit for the ports for this past year this will be a record for the port. It's a start it's the first year it's far from the trend but there's no question that we're moving in the right direction a lot of revenue growth during that year and a lot of cost savings which is possible to make that happen. Other parts now get into more details if I can on the infrastructure plan which I know a lot of you have questions today so again what when we got to the detail of the five years and five years out we looked at the potential growth we see that's possible we also looked very realistically and said what's the equipment infrastructure that's needed to support it. So I had my operations folks come up with a plan of what would be needed to be able to meet this doubling a business? What we came up with is a $114 million in the first five years and another 134 in the next five years and it's broken between Morehead City as well as Wilmington and we're veryspecific project behind it that makes up this dollars, this are not just round numbers that we put in place, wehad very specific task if it's going to be for extending gauge rail that working at berth eight, if it's purchasing new cranes it's needed so that our capabilities and mind that we can compete with the [xx] around us. Let's get more specific and I discussed together last time its a 75 million and this's although they's various parts of this project, I want to emphasize that this's is one project, and what this essentially does is this is gives ability right now in the port of Wilmington in our container business, we've what
we call berth nine and berth is capable of handling a large vessels which we do see now and the future and we've berth eight which is not capable of handling vessels that size want to do and is very specific will be able to have the capability there we can work as berth eight and berth nine basically simultaneously, two ships, same time and possibly most capable with that mean within any impressing any mark and now. Why this is an important? in the congestion is becoming much much more of a problem around this state, you've heard about that in the West cost which is freezing[sp] this is happening in the East cost. I would play we talk about coming to North Carolina ports and we discuss with customers being involved shipping companies as well as cargo companies in our state is that we don't have any type of infrastructure issues. That we don't have any types of problems with congestion. This is congestion meaning at the berth which this project will assess and also congestion in our yard and congestion in our gate[sp?]. Very happy to report right now, and we're watching this very closely, we're continuing to monitor and get better is that we are congestion free currently, and that's a real plus in our world. Because we do see Virginia is having a lot of promise with congestion. Charleston's having issues with congestion, all this is happening and this is our competitive advantage. However, to be able to keep that competitive advantage for the future we need to show the community that we have the possibility of working these vessels, and I realize it's more of a technical basis for our side of the business, but essentially think of that there is all different components of this project, the extended gauge, of the work from the berth itself new cranes, but all that is packaged together which makes up $75 million that gives us this very very important capability that we need to move forward for the expansion that we think is very much possible. One part that I want to emphasize too that you all understand is that this is really visible. What happens at our ports, in the shipping community it's known what is going on around, it's known the type of infrastructure that's being supported by the States. It's understood, it's used by the ports around us when they go to customers it's saying, We're investing this type of money. The State is supporting us with these type of capital funds, because like any business if a shipping line is going to come to a particular patient[sp?] they want to know that there is infrastructure in place, they want to know the infrastructure is modern, and they also want to know that there's going to be support for the future. So if we [xx] and accepting it does happen that we're able to get this fund and what we'll immediately do besides starting this project is that we will immediately go out to our marketplace and to advertise how North Carolina as a State and support from the State is working in an unprecedented funding to be able to do a berth modernization and expansion in the port of Wilmington. I just can't emphasize enough of how important it is in our market that this takes place, and if it's possible to do it, what a good step forward will be. Just to give you some ideas of what happens around us. Virginia has announced that next year alone, they would will be investing $123 million at their port. The state of Virginia gives on an annual basis historically looks to continue, about $35 million a year to their port, that's just part of appropriations that comes through. There's 123 years in addition to it, part of port funds as well as state funds. South Carolina, Charleston is looking at, they've announce $165 million next year in port funding that they're going to be going forward with next year alone. The federal maritime commission, they've reported this past year that's coming to play, that they are looking at port congestion issues around the US, they have looked at for the South Atlantic ports, and that's everything from Wilmington down through Florida. They're talking about a total number of spending that they through port funds, through state funds, of somewhere around $4 billion. It's a heavy infrastructure business, there's no question about it, but on the other basis of it I just want to give, just some clarity as to what's happening around us. Other opportunities, not just to talk about the container port. We've a lot of exciting things that's going on. General Cargem[sp?], when we use that term, think oppose, non container that's bold by cargo, admiral city this past year in carnage, we were able to increase our business by 43%, unprecedented and what's taken place in that that is new projects, we've a new picture here that is to say, part of a verterbridge[sp?] and this is a bridge girders that's supporting [xx] in New York. Something real that's happening is about capabilities. Our customers are looking for specialized handling options, that's what we have capabilities in Mohit city but we want to be able to expand it. Capital improvements needed to make
sure that we can keep up, crane rehabilitation, building rehabs, our current engine more Mohit city in 1960s vintage, very, very old and we are sales right now in our budget are investing a million dollars next year just to keep our two primary cranes in Mohit city going. It's a band-aid, it's far from a long term solution but we need to do that to keep us in business. So we we're focusing no question on the container side but I don't want to leave you with the idea that we're just looking at Wilmington, we're looking at both locations, capabilities in both locations. I'm sorry, [XX] that is why I'm [XX] Clerk turn the mic of the gentleman on. I'm very incidentally mixed of export, import. The increase supported 3% will that higher percentage to your export increase or combination of both. The gutter side is oil export, these are gutters that are manufactured in both Virginia and further North Carolina that's oil export a large part is also import of DRI which is a type of iron for new core. So in that base it's also balanced in our container business. We're very much balanced. about 50/ 50 which is unheard. Speaking just to the general cargo I'm obviously in the agricultural base for which projected some time back, is that happening? Is that increasing your export? Or is that yet to be, Mr. Chairman. A little bit of yet to be determined, there's no question as the agriculture is not obviously the gutters, it's much that were seeing it but on the container side we are increasing our exports in that, in sweet potatoes as well as other areas. Not as much as we should be getting to that we want to get to more, but always it's a little bit of a start. A question of a sound investment, we've discussed before that we have North Carolina say did an economic analysis and business that comes to our port may if we remember come last number if we work it on annual basis $14 billion of economic contribution come through this state in North Carolina annually it business that comes through our ports. To give an idea of future investment what could it do as a return of an ROI. If we double the container business, to let as an example of it, we have another Far East post panama's[sp?] coming in, and that supports totally new North Carolina business that's $3.7 billion of annual directive impact economic contribution that comes into the state. What we talked about of other parts of tonnage if it is 15% increase on the tonnage side for a general cargo. 500 million all of calculated amount that shows I think that bases we invest in our ports we are able to improve the the business that comes through that's and sustaining and supporting our customers being or companies in North Carolina its [xx] to the state. Those types of numbers when we are discussing of investments of about a 100 millions, definitely add multipliers around them for the first part of presentation if there's questions is one more if I can just talk about it happens I've forwarded it to some of the members of the committee. The competition that we are seeing with reports around us is real. We hear things from South Carolina Ports talking about that, North Carolina has not invested in its port business especially its container business. We are going to put them out of business. We 're going to take that business away from them. This are real things that we see every day, we're doing a lot of work to make sure that doesn't happen we've increased our container almost 20% this year. It's a start it's far from final but what we do need at this stage right now if possible to get some financial help so that we can continue to keep infrastructure somewhat modern improve it, and it keeps our capability for the future. I think if you look at either the house or the senate you see funding mechanism is there for the ports and I would think it would be safe to assume that some company[sp?] wpuld come at a level to get the modernization done. unless the whole thing were to [xx] not the port but I don't happen but I think it's safe to say at this point that the situation awareness of the status of the port has been risen special level both chambers understand. If we are going to be in this market then we are going have to [xx] and get our ports online. We've had this conversations personally I'm extremely concern about the [xx] of the [xx] in keeping our navigational channel at Morehead
to the proper depth to keep it working at it's almost efficiency that concerns me deeply. I know a lot of you and it's utmost efficiency, that concerns me big. I know a lot of you guys and some of us wrote letters and the Senate was thereby working [xx] match with the plugs and this year that messageof it but still it sounds like we are getting for lack of a better term we are getting OK what kind of get this work done and operate it it will be better but it doesn't seem like it will be better I don't feel the work and I dont see the inquest to get More head operating at it's full capacity with the 45 [xx], what can we do, I think we can start about that, and when that goes out to the rest of the members I feel certain they will be concerned [xx] The biggest thing is what I talked about sir this MOA the agreement that we have with the [xx] engineers if we can get this state funding, that we're looking at this year that is almost $5 million it's $4.8 million, that's supplemented with what they're showing is the President's budget right now again if that happens and comes through that's almost $9 millions, that should put us in a scenario or will put us in a scenario by 45 feet, the ifs are 100% if we see the state fund and then the second part is that the federal funding does takes place in the President's budget [xx] let me see what couple of [xx]. Now of course right behind that, directing one thing in the [xx] duty. Makes you keep going I know you got to look or at least began a little bit of talk is what can we do, and I specifically [xx] at this juncture is to reduce the probability of having to continue to come back and do that pending closure of the port dredge. Are we [xx] or looked at or I think the largest questions or the, what we can look at for the future is the amount for the federal government to be able to fund dredging throughout the entire US is limited, I think that's the reality of the situation that we see, so for the state faces and we continue to fight and to be very much in front of getting additional funding from the federal government first, that doesn't through what we'll need then is additional state funding to make it happen. And I guess when it concerns some of our senate colleagues have expressed that will it be paid for it once the federal government will be expecting us to pay for it [xx] and my reflection of that is I understand that concern full well but at the same time I don't think we're to the point that just sit back and not doing anything [xx] so we understand that the State at some point in time [xx] acting with their Judicial responsibility that they should in a state at some point in time. What I'm saying, we also need to mitigate that at some point and do what we can to appropriate from continuing at the same time, so we get the most efficient, most effective [XX] [xx] Correct. So, I guess what I'm saying is, has anyone been accessing long term to disable the rapid inflow of sand back into the port or? The main thing that we are looking at now sir, is just getting through this year and getting it back to the 45 feet and the best answer is there's one potion of it, and what also got us into this situation is that if we let it continue to deteriorate. The annual or if it's maybe every other year the type of work that's needed to maintain the channel. So our channels are no different than channels around this is what's going to make sense. As soon as it starts degrading you know you've been you see it is that the catch up is much harder, it degrades each year we're not able to keep up with what we need as basics then the catch up expanding to try to get back to 45 feet or keep us is much more difficult. Thank you very well stated, [xx]. Mr. Chair I want to mention to you I know that we talked about doing more to make it a deep water city [xx] city, last week I was [xx] with some discussion about that and some of it, which means we are concerned about if we did that what it would do the beach version and that sort of thing. Are you familiar with any one that have any complain about way it is the way forward the [xx]? I have questions to come up at any part that there is any changing that is going on that we use back dredging material to be used at the beaches obviously a federal question because it's been done by the [xx] if it can be done more efficiently it's great if it is rely beach quality sand. Follow up Follow up [xx] [xx] and looking at this what do you think that would be better? or to protect the sand along the beach, keep the channel clear more
rather than have the dredge all the time, when you look at the money we spend on the dredging all the time, if you look at any way to that? We're working with the court to examine that we don't know the answer to that right now, and I think you're aware that came up as question before as far I see lets not determine, we don't know if it would be a longer term if it does and obviously make sense, we be very much on it [xx] [xx] respond to Rep. Shepard that is out there that is put at the base on the navigational channel or [xx] at navigational [xx] to allow for free flow of the natural [xx] contains [xx] from upper beach to lower beach and that rightly pretty much provides for that beach [xx] but magnitude[sp?] [xx] hand built pipeline that's trying to come down so if you do a [xx] or dig a big channel that you don't lose that down stream beach [xx] Senator Tillman is that what will be calling a pipeline dredge that would pumping it back on to the beach, is that something different? No sir, this is a permanent structure that allows for a free flow of sand a tunnel, if you think of a pipe under a [xx] for example, that allows for the same [xx] It will be different Yes, no would be different [xx] you have no outsiders the pipeline trench would then just be a trenching of a equipment that comes in for that specific time. And then obviously, what we're talking bout is shackle for banks and shackle for banks continues to deteriorate. We have that to discuss it court, there's just as not pure information yet as to what would be as a long term fix to it. Thank you sir Thank you Paul for being here as always, our focus for lack of having lone over the last couple of decades I think we have a pretty strong focus on building the economy of our folks relative to the operations of the port, and just echo what representative [xx] was stating there, we're keenly focused on the balance between import and export and it's my understanding, we'd like to of course not seek perhaps a little bit more exporting and at least down start with importing, and I know we're all focused on that today is the Director of the Ferry Division, North Carolina Department of Transportation Mr. Ed Goodwin. Ed, welcome. Thank you for being here today. Just to remind you that we may jump in with questions during your presentation, so. Good morning, thank you all for allowing me to be here today. I'm going to address a couple of issues in the Ferry Division. You have spoken with me about this before, and I'll start off with the RFI regarding advertising and sponsorship on the ferries and at the terminals. That RFI is on the street, I'm not heavily involved in the processing of that and by law I have to stay out of that, but I have had inquiries that were approved for me to talk to them with four or five of the advertising companies who have obtained that RFI off the website and are looking at it. I think it closes down in two more weeks, is the deadline and it'll shut down then and we'll find out how much interest it was this time it's put more interest because we have actually reached out and touched some people to remind them that it is there and to show them how to get access to it. I did find out that initially on the first release on that RFI, they were having difficulties finding it and getting to it, so what I did was send them the link. When they would call me I would send them the link and then ask for a response. They'd call me back they got it. And that's as far as I took it. I was pleased that at least this time they were interested in it and more and more were calling. That was better than it was last time, we did not have any. And another thing I'm sure you want to talk to me about is probably the passenger ferry and if I could put this thumb drive in a computer and show it up there. Can I do that? And I will show you just a brief synopsis of where we are and some pictures there
and some facts. Also Representative [xx] I have a copy of the interim report from who was doing the feasibility study for the passenger ferry and I can leave a copy of that with you and you can make copies for everyone. Yes sir they've had the public meetings, and they will have another public meeting in [xx] regarding the passage of [xx] we're half way through they've come up with a lot of recommendations, at this point, that does not mean those recommendations are permanent, they may change as they do in next half of the study that they're working on, but they did put some preliminary recommendations based upon the data that they had collected to this point and they analysed it. We continue to have student committee meetings on a regular basis, I think we have one this week. I also have a meeting that the [xx] of LPO want to pass for this week is [xx]. You need to answer more than [xx]. Aah no just thinking [xx] that's why I was talking. OK. We still have a lot of write offs, along the coast in the local and Mr. Representative [xx] district mayor I think over coating [xx] and the other one down there and save a couple of write offs, as well as in the radio station, secretary [xx] was down July 4th on a radio station and was being asked questions and naturally ask him about that and he responded with some of the facts as I have told you before and you will see today. We're still working with that, a couple of companies regarding public private partnership own this ferry own the passage of ferry, if it comes to that that's what we should go to. The problem is like I told you before we have difficult in finding a boat to lease more and likely they may have to view build one and one captain that is interested in public private partnership that is interested in building a boat for the state of North Carolina and then operating it and leasing it to the state of North Carolina over a long term contract. I do not know whether that's what we will present to you one day in consideration, but we are looking in all possibilities there. Okay Bryson, [xx]. Any question on that, are you may have some question that you see then any question on passing before order before I move from there. Here we go. That's the photograph of the boat similar to what would be recommended to operate in that area, that is the boat that we lit for two days to run the trial runs from [xx]. That's a 149 passing your boat to Caterpillar engines in [xx]. That is a current photograph we have cameras that head those terminals, and a couple of others not all of them yet, but that's how busy that location state the first line of traffic is a priority lane traffic and the rest of them just come as you will those lanes go all the way up to the street, this year we've been handling the traffic a whole lot better than we did last year, but also I cannot tribute a lot of that to the reduction in the number passengers arriving to ride over. And while you're there, you mentioned a lane we got regulars what we call [xx], and what you'll see is these are regular [xx] that [xx] and they base the funds, that's how we can quickly count it because they're in these spaces here. This lane is a priority fast lane. And what is that exactly? That is for the full time [xx]. For North Carolina? Yeah North Carolina to [xx] who to us authentication that they're residents over there, reside there, and handles visitors whole people providing supplies to the house. So what you're saying is that's a resident use like they're going back for the doctor, dentist, or taking their kids to school, and that [xx] the standard budget has $150 charge for coming out [xx] That's my own family, yes sir So those North Carolinian's now pay nothing for that Right, they apply to us on an annual basis and give us proof, authentication that they meet the requirements of that priority pass. And other budget next year they would apply for that and send you a check for $150, is that right? My department, the Ferry Division never gets money like that. It would come to Raleigh, yes Sir. my point. Yes Sir.
Alright, thank you. So the vendors will be stacked in this lane alone because they have priority as they apply for a priority pass as well and if they have the authentication and justification we will issue those. I think not counting the vendors I think it's 960, I think I'm right counting the vendors, the residents is 680 along those lines for the priority passes then and what that does, it does cause some hardships sometimes if people get aggravated, but when the workers rightly[sp?] explain it to them, Those people live over there, that truck is hauling groceries or supplies over there, medical supplies. Sometimes we have had FedEx or UPS, they have medical supplies to a patient and we find that doable, we couldn't get away from it. You'd be authorized to take that box and the person would, lots of locals will meet it on the other side and take that to him, we have done that in the past. But that's what the Stacker Lane looks. We have cameras, we'd watch those cameras[sp?] there's miles of cameras. We did change the schedule at Hatteras-Ocracoke trying to accommodate passengers and I think that has worked, that means we have extra boats there. We have boats in the schedule, say six boats in the schedule full time, and then one boat that is a shuttle in case traffic gets so bad and we can pick it up and handle it, and so far during the peak of the tourist season that shuttle boat runs on a regular schedule as well. So we're constantly trying to reduce those numbers there to our next line. And a lot of those vegetation so that's just a wonderful problem to have Well, every thing that you saw on that slide was tourism going over there the first line was is part that you saw is that moment in time so that they know or proud to [xx] were there, usually the vendors come early in the morning because if there are track drivers delivering, they leave warehouse has we can get over there and back according to transportation rules of the transportation part, this is just a slide thank you as very many times before what the reason I put it up there, the key thing is that you see it up to 52 departures per day, now we can only do 42 departures, you see 4.3 a mile, that's nautical miles versus the alternate round we are running now, the long round that goes around [xx] all the way that's 9.5 nautical miles that has reduced our number of departures from [xx] so that contributes greatly to a reduction in the number of passengers or the capacity that we and it also as you well know greatly increases our expenses there as well, and if I take the liberty of saying, the expenses there and a long up to now have not been appropriated for the state budget. Representative [xx] Yes sir. [xx] that into reserves for for during our big season, we've seen the third recent job or 30% job of 20% job. It fluctuates during that season because durng a year, we will have five schedule changes we start off it the tourist season, we change there it's not as and check if there's deal right now and then we [xx] at different times on the eastern, memorial weekend, memorial day weekend and then we will full tourist season and 4th of July is a little bit different, now we're in our regular schedule and we'll get out of that labor day and then well pop back up. And then the reduction day has been 18%, they got it works higher but we've got it [xx] a little bit but we still show it tend to purchase and that accounts for most of it. Follow up chairman [xx] 12 to 18 is that all year? My real question is about trying to [xx] that's when the whole economy runs for it's real all the businesses about the four miles. Little bit, So that's when the dollar needs to be made, that's when the economy needs to be [xx] and so that's what I really wanted to find out. The reduction on agriculture economy is directly related to these and it matches it. The number I'm looking concerned, follow up Mr. Chair. Follow up. The number I'm looking for is that 12 to 1 8 all year long or is that 12 to 18 from June to During the tourist season it will be higher than that. Do you know what that number is? Sorry, Mr. Chairman. I can't say for sure but the last time we it was 25 to 30%. Let me look and see if I have that in the financial things if I may jump in, is what I'm hearing a possible drop of 25% [xx]? Yes sir outer banks due to the longer route due to the reduction of those achieving the route [xx] speaking about and
representative [xx] discusiing [xx] because as most of you know that [xx] is the economy basically. Next line now you'll see the drop. You'll see June 2013 versus 14, short right, long right. Short right is the 4.3 miles is almost the 10 mile and we concentrated on that, Rep. Tine, just to show during that peak time when you looking at the influx of money into that economy. And the rest of the time it stays fairly flat. We can keep up somewhat that reduction and you put $50 per person per time over that and I need a copy of that. Can I get a copy of that carbon ? Yes, sir. And we'll get it distributed to everybody. That's fine now you see the economic impact from 2008 and we did it for 2014. You're looking at the percentage of visitors, the vehicle can't doing that predetermined and you see that drop from 2008 to 2014 if I separated like every year you would see instead it doing like this. If you go previous to 2008 [xx] but since that shouldering problem and I think I've spoken about that with you all before from Highrose port of the North of and Highrose Island to the central of Highrose Island used to be a port in Highrose last two and a half mile so the oceans comes in directly into the channels so where we could run yesterday, we may have to alter. Last week I was riding on them and Amaco engineers was with us and some of the boat cap in 20 years they have never seen shelling around a certain point there so the coast guard had to come by and remove the navigational aids because the channel had shifted eight feet to the north, where we used to be able to and you can see this, I am in the water since the water was so shallow and in the depth that we needed and moved over so come [xx] boats we went outside what was known as the channel outside the navigational coast guard markers, sometimes it is [xx] I think we share with article I saw the information somewhere the short raft has been officially abandoned now, is that [xx] consistent and will cost more to keep it [xx] just not economically there's a way we're permanently on the rock long run. Yes sir, the last time the short ride was [xx] and the state approach channel which the [xx] engineers were responsible for 2/3 of it, the state is responsible for 1/3. The last time the state did a [xx] the AMACO contracted with a small come from Illinois to come here and do it and we never rendered after he did it, it was about 3 or 4 million that was when I was spending there and we never ran that and he almost didn't get his [xx] and he said he'd never come back. So, but that's not only state [xx] engineers and everybody else. If you look at, we are talking about the [xx] this is a different story what you see is that red line is coming out of [xx] and going to [xx] that red line stays away from the ocean, it's on the other side or [xx] and were running design that round will take us the same amount of time as will with the regular fire boat on that long round we have now passed for that line that will run from Handel's terminal into steel like hobble obstacles hallen and that will take one hour with this fast as we got it on that past the food and we were not running one hour and three minutes. Give it Access to matters that really yes Sir, with manner changes which place will be recommend using an aesthetic next line we have public meetings and two different buildings on hanlesgalo[sp?] and aunclegalo[sp?] then open the fire boat for the people to come in. I had one negative from the people walking on the boat everything else positive a little bit different inside the building where I had maybe two or three more negative, but positive follow awave the negative next line representative problem when it gets to the copy that I have given here in past that the survey on free riders it went to Handles and people
in the land and in cars they're asking those questions if you see sletic how many of young riders 20% of the first time riders so they would ride so based upon the number that was estimated is 61600 people so they were right. There, then based on those numbers are over 150 passenger making four lines trips a day and then toreen[sp?] $15 will generate $924 in annual revenue, and that's [xx] finished in November. We didn't have all those numbers, we didn't have any of [xx] numbers, that's all [xx] feasibility set of people are doing it, next line. That's the benefits of passenger ferries, shorter wait times for the car ferries, direct route right into [xx] village it is a traffic nightmare over there when you're hauling that many cars over there during tourist season and also reservations. If you know you believe at a certain time then you don't have to hustle down there and waste three, four hours of your day trying to get there as well as waiting in line, and then it would relieve the vehicle traffic, vehicle traffic in Ocracoke and you carry more people over that and that's the bottom line. Going back to Representative Tine's comment that increased capacity and visitation I like the commerce admitted I was person, so next slide. That's just a picture again of a vehicle the size of the vessel 91 feet, 30 foot wide. You look at the bottom [xx] the crew, one captain two deckhands, we have one craft captain there and six other people on the boat including the engineers and all those and deck hands, so that's a reduction in the number there. That particular boat weighed 75 tonnes after average range from 500-700 tonnes, next slide. And that should be any questions on that? Yes same time. You said that there's a possibility of raising 14, 000 are for the tolls or the the peak [xx] Are there any projected saving inside of the ferry system if we're running this and just to make about what we've lost or is it actually dig into what we run right now? That part of the study will be in the final that's due in November and my caveat on that was we didn't say toes that's what that study is recommended to do that, and you're talking about a private-public partnership as well, that's something the State would have to workout based upon those recommendations. Ferry Division did not decide to do that, that's whether that study that's being done, they sent that to us in a report then I'm going to give him. Follow up after [xx] time since the city is directing the study, I would think that we would be looking at it all comes down to whether or not people are [xx], just because you put it there [xx] however structured, it all comes down to our people actually going to write it, and so I would think that we'd be looking at a variety of piece I think it's appropriate that we charge fees. This isn't getting carved the way I wrote it, this is more like carrying buses providing station [xx] so I think that we'll divulge again several different [xx] schedules to see what created [xx] reduction and federal [xx] to [xx] and create the right power that works for [xx] and that [xx] Yes sir in the study you see about four, five pages with different fees and no fees, so that's all been answered. And I think one of the positive is that you touched on, but thank you. I think Mr. Chairman [xx] district that pops I know you have on and they send someone enthusiastic and excite about that article work up very late [xx] on plus additional responsibility for on the other taxes this is what will be on, will look like [xx] tax each other on to talk about. Chairman Shepard do you have a question? Yes sir, Mr. Chair, on this passenger ferry is it still an hour trip from Ocracoke to Addison[sp?] and vice versa? Yes sir it's a 22 per four mile trail instead of ten mile trail that's at 38 to 40 miles a dollar. And it takes you into the site even horrible which could and it rides from the current [xx] into the village and take back the traffic in the village. Follow up? [xx] with the authorization on that passenger ferry. That is up to somebody above my pay level, that would be the recommendations whether they do
that or not that could be like a money making process [xxx] But that is, I'm here to [XX] Representative Sheppard Sir that is being discussed in some of the steering committee meetings as all possibilities are being looked at the company will make the recommendations to the state and then we will be guided by recommendations but that is been discussed here sir Chairman [xx] I was just going to say that just cut off 0 15 minutes, dries into and then comes into a different spot, right, right now it comes up the end of the park service area which then there's not much there take you down to down town, it's actually down town we can say downtown. It reduced the hour traffic in about, slightly coming at two hours Do you have any valuable [xx]? I got a few questions about the boats you're using I want to ask you about. There is a proposal in the senate side that pretty much provides a look at privatization of the [xx] I've done my own analogy I come through to ahairman [xx] and having talked that in committee, we want to hear from you, and I'll ask you a question on [xx] between a rock and hard place I cannot determine any feasibility, any feasible way for a company to come in, and operate that system. Hopefully too to become profitable, without putting on a very hefty haul per travel for more fuelling induced in that system, as a private company. Chairman you pointed as you see fit, but am I missing something or is it a way for a company to come in take over that system, operate it with no calls[SP?], and become profitable or be profitable please could we have any problems. Well, you asked me for my opinion, so I can give you my opinion and I'm not held accountable for that opinion because opinions can change. From my perspective as a director of the Ferry Division, and I've said this up here before two issues will greatly affect the privatization of the very system, first is the operational liability insurance the state itself insured so the liability insurance [xx] private if they come and operate will be astronomical, the second thing that we will be asking astronomical big change will be the state employees to cut the working affair division if they private companies comes in to do, they will have to pay the fair market rate, and that salary level will greatly increase so that's could be a hindrance I believe and then the [xx] to make money I think will be hard than that what you see it and then the state probably will still have to subsidize, and then you talk about [xx] rules, we got to have certain qualified people to do certain things, you got to have superiotity we sell the boat to them, lease to them or just let them use them, and what are you going to do going by those restrictions and the law has to be abided by there is more to it than just that, and then environmental issues that you are going to deal with, and you got the dredge a company is got to come in and do dredging we've no problem with dredging neither [xx] it is so you go ahead and have a dredging company that now deals with that and the environmental issues, the state could still have to get involved in the environmental issues so the answer to your question in my opinion is I did not see the work So, there's some stuff to me like it's just, the senate saying we are just going to wash our hands of it. The old Pontius Pilate president, chairman your deterrent question as it relates to passenger ferries right next to South Port full efficient ferry is a private ferry called [xx] ferry and it then apparently charging for about a less than a five mile round trip they're currently charging $25 plus a fuel charge, so it's over $25 a round trip, and once they get you over there, they won't let you come back We're talking a round trip here, but a round trip over there is 25 plus a fuel charge per person not validper person, so it's going to be heftier than learning needs to. I think I sermon chairman. Thank you Mr chairman, do you see any operational, any optimist for operational reduction in staff numbers in terms
of monitoring this that almost all of our staffing requirements are to meet the coast guards standards that they put forth to be able operate there and then require private work to state, I think there is some thought they would maybe some reductions there, but my understating is the coast guard is the one who states how many people per both academy have to be all there and all those functions, so see any opportunity for operational preparation by moving to private? no I do not, the law would not change so you'll still have that, as well as in the ship yard, you'll still have to have a certain number of welders and other employees, and there specialty built and we lose a lot of them because of the pay sometimes, and it's hard to recruit them and keep them down, but having said that, we from the private relationship stand point we do have private contractors that help us out in welding, the trench is being built in Louisiana, will be delivered in started to construct them in the end of modules in November and we're least on space on the concrete where it's available to us to do that in the ship yard and that's where that boat will be assembled because the place they had originally contracted to assemble had been sold and they can't use that no more so we will let them assemble it there private contractors got their contract with the dredge company out of Louisiana to assemble that dredge there and then a local house mover will move it across the cement on to our rail system put it in the water and a dry slip and the rest of the H bag and interior stuff will be done. That is a help to the local economy and it's a help to us because by law when that vote comes in for its credit [xx] period to get rehab so that impasse a new coast guard inspection so that you can operate it we'll spend anywhere from 8500 to 12, 000 hours per boat depending on the age. Average age of our fleet is 25, I've got two boats now and they're over 50 years old and every time that boat gets old and old and it comes in you can look at a chart and see how much more it costs everytime to make up that old boat again look like new. Thank you Mr. Chairman. We moved in to another area that is another difference between the house and the senate and it's with regard to the water tower that [xx] water tower Yes sir The senate says that they can use revenues generated from that they're leasing space and doing work there and things like that, and from reserves, and we have a strict property. Is it there a capacity to move those types of projects under the senate system of funding or what would that money would be going to [xx] funding. Well, currently I cannot use that money for that so somebody sends a cheque or pays us or something it comes up here so it goes into a foreign fund I think for a replacement fund or something we never get that. If I could use that money for capital improvement projects in the ship yard or and that's what I had asked for just ship yard, I can make a lot of changes, and I could use the water tower would already been fixed it was in bad shape. That money for that water tower has been asked for that five years and it continues to be rejected I'm afraid that the fire Marshall or the FA is getting on pretty hard about the water pressure is not high enough and a light bulb on those lights, those blue lights and red light on top of the water tower had burned out, and someone has to get up there and replace them, and the ladders [xx] and the rails are on the side going up to the top resonate so that [xx] and [xx] they would go up so. You'd welcome that [xx] change that's in the senate regards [xx] Yes sir. To follow up on that the Amaco[sp?] Engineers they dredgers are coming back in we've had a meeting twice already and they're coming back in September, when they started dredging and [xx] trying to get in there but both of them dying [xx] we start to do the thing brought him in, picked them up and they do the work, they worked 24 hours straight. We usually get $150-250, 000 out of the Amaco[sp?] Engineers every year. That money comes in Raleigh and I can't use it, I lose my overhead cost now, and the same thing with the dredge, that dredge could be built there, they'll be and use an App overhead basically, and that money comes to Raleigh and we do not get an answer. I would love to use use that and earn it, use that to replace some of those critical names, be a fork lift, or be it a man-lift, or be it blasters, or painting and repair and then a water tap. Thank you for the information it
was useful information [xx] to do [xx] a review in I would need to adjusted for some of those monies to get there on site to event, to whatever needs or [xx] It much like we do at the railroads and member preference with evidence the from the railroad then the same thing could be applied to the very division. There's another different entity in the House budget, we followed the governor's lead about personnel or any division, and I believe the number is around 50. We did not list with that full procedure went to the coffers. The Senate listed lines spring forwards and you know well that you can take that number and you can go down, and you can put an employee name to that specific line and I understand in the Ferry Division, that there's one that just jumped up, when doing your research there's one guy in the ferry yard oblivious of a welder and you chair. And my concern is how in that, I mean is there some kind of mockery or some kind of vindictiveness or some kind of or something? I don't understand why one welder, everything we need in a ship yard pretty much has to do with some type of welding, I would think while we pick that, can you show me some information I was more baffled than you were when I heard it representative I just got a number said, we'll take this job from it, and we looked it up and it was a welder. That particular welder has been there about two and a half, three years. He moved out from Ohio, I think it's three children, he bought a home there, he loves it, no problems with the guy with the better will as we got, but he was singled out. We have not told him that, and I think they find a name we try to keep it quiet and keep him from it, but how critically he is we lost two welders as we went to a back entry and we went a drug test. He had a party to celebrate his friends weeding and he got carried away and involved over illegal substance and we had a random urine analysis, and he got caught. So whoever is our critical thing, and is ironic that last year in October, state OSHR and DOTHR recognize that the welders were so critical and they haven't had any increase in pay that they authorized bump in pay and two guys that will leave us and they had put in their resignation, I told them, give me one more week and I'll have this done. And they're still there today because of that bump up in pay. Otherwise they were going up north to ship yards in Virginia to work. So, a guy coma es from Ohio, comes here to work, loves it family involved in the community, and he selected by name, he has no political connections, he has no connections to anybody else in North Carolina he came here from Ohio, wanted to change. So were not [xx] just want to make No [xx] that I could find out. I figured But, I do not understand. Thank you for your honesty. Any questions? Anything else without taking mush of your time, I can talk about other things, but Thanks you for your time. Yes sir. Thank you for the work that you did. Any other questions from the members of the committee? I think we, Yes here Yes I'm sorry representative Martin. I think representative Ford we noted that out striking pal members are outnumbered by chairs two to one, and then we're going to stop coming to your meetings unless you make us honorary chairs. How about honor your chairs. I'll take that. And please if you stop coming to the meetings, perhaps in that free times you could locate the rest of the members that choose not to wake up early enough to get to the meeting. any other questions? Thank you representative Martin, representative Ford, Tom, Shepherd and Alex, thank you for your early morning attendance this morning and I wish all members were concerned as much as you were. Any other questions, anything from staff, seeing nothing, ladies and gentlemen this meeting is adjourned.