The Port of Galveston is the oldest port west of the Mississippi, and frankly, folks, it shows in the state of some of our infrastructure. Crumbling piers, deteriorated roads and collapsing storm sewer lines have resulted from decades of neglect.
As a self-funding city entity with no taxing authority, the port pumps every available dollar of revenue into capital projects and maintenance improvements to fulfill our mission: Generate and reinvest port revenues to benefit the Galveston community with economic growth, jobs and sales tax revenues.
Since I became port director in 2018, I’ve used my training as a certified public accountant to cut costs and maximize revenues to reinvest in port infrastructure to fulfill our commitment to the citizens of Galveston. Our board and staff have worked tirelessly to make the port profitable so that we can invest in this port’s – and this island’s – future.
Following a Strategic Plan
In 2019 the board adopted a 20-Year Strategic Master Plan as our roadmap. The plan, which has a roughly $600 million price tag, identifies a list of projects for each of four areas in the 840-acre port. Broadly, here’s how it breaks down:
- West port will be the main cargo area.
- Mid port will have the two existing cruise terminals, parking and a commercial area.
- East port will have the third cruise terminal, another commercial area and some cargo activity.
- Pelican Island has tremendous potential once a new bridge is built.
But how do we fund more than half a billion dollars in improvements when our net revenue is less than $10 million a year?
Unlike all other public ports in Texas (our competitors), the Galveston Wharves has no taxing authority and must rely significantly on self-generated cash flow for repairs and capital improvements.
The master plan identifies four funding sources:
- Revenue (pay as we go)
- Grants (federal, state, local)
- Public-private partnerships
- Bonds issued by the city on the port’s behalf
The maritime business is extremely challenging. Our profits are influenced by factors beyond our control, including pandemics, wars, natural disasters, international trade policies and market changes.
We must be competitive, nimble and forward-thinking to be ready to capture new business as opportunities arise. We also must have cash reserves to weather a natural disaster or business downturn like the 15-month suspension of our cruise business.
If we continue to manage expenses and build revenues, we can fulfill our mission to grow the port and benefit Galveston – and the region. If managed properly, the port is a powerful economic engine for the community. It’s critical that we continue to invest our profits in improvements to generate local jobs and to remain competitive.