MAYOR MAY SHIP OUT EXTRAORDINARY PORT LEADER.

Byline: Robert L. Rodine

IN 1996, the city of Los Angeles was successful in hiring from Maersk, a major ocean freight company, an executive with more than 20 years of experience to lead the Port of Los Angeles. Though prior port leadership had been successful in helping the port grow to pre-eminence, the opportunity to have an executive with shipping company experience would expand the knowledge base and strategic advantage immensely.

But success isn't enough to satisfy the city that, during the recent months of the Hahn administration, has seen a constant flow of top advisers and mayoral appointees stream out the revolving doors at City Hall. Now it is reported that one of the targets for removal is Larry A. Keller, the executive who has led the Port of Los Angeles through an extremely turbulent period in the ocean freight business, but has nonetheless compiled an extraordinary record of successes.

Our port serves an enormous trading area, and that contributes to its success, but it is not without competition. That other Port on San Pedro Bay takes its performance very seriously relative to the Port of Los Angeles, and that competition has been very healthy for both ports and the region they serve. The combined ports of Los Angeles and Long Beach, in 2000, handled 68.3 percent of the Pacific Rim freight coming into and leaving the West Coast. That year, Long Beach had a slight edge in terms of market share at 35.3 percent versus 33 percent for the Port of Los Angeles. However, since then, under Keller's leadership, the Port of Los Angeles has increased its market share every year, and in 2003, L.A.'s share was 43 percent versus 28.6 percent for Long Beach. During 2003, the total for Pacific ports declined, yet L.A.'s absolute volume actually increased, as did its share of the entire West Coast.

It is reasonable to ask what that market share growth cost us. Clearly the Port of Los Angeles has wisely invested in its continuing role as an ocean freight leader. That investment included an increase in the number of berths and other freight-handling infrastructure. But let us consider some details. Looking at TEUs (20-foot-equivalent container units), volume has grown from 2.11 million TEUs in 1990 to 6.71 million TEUs in 2003. That is remarkable growth of 9.3 percent on an annually compounded basis. If one looks at the period from 1997 through 2003, including its attendant labor slowdowns and the interruption caused by 9-11, that rate of growth jumps to a spectacular 15.1 percent.

In a similar analysis, port revenues grew by 5.9 percent from 1990 through 2003. However, during the period 1997 through 2003, they increased at a compound annual rate of 8.65 percent. And, profitability has behaved exactly the same way, moving from 1.46 percent during the 1990 to 2002 period to 2.67 percent in the period from 1997 through 2002.

In response to all this success, community activists might nonetheless ask, ``But what has the port done for us?'' In addition to the 6,300 port jobs and $800 million in local spending by port users, the port has committed to $60 million of community and environmental improvement projects, including cleanup of truck exhaust, the addition of shipside power to reduce ship-stack emissions, Wilmington and San Pedro aesthetic improvements and crane and traffic modifications to satisfy community demands.

The Port of Los Angeles is a regional treasure and, by all objective measures, it has been managed with great success by Keller for all of our benefits. Please tell me: By what objective measure is there any basis for Hahn not to be ecstatic with Keller's service to this city?