PORTLAND — Expansion plans along the west Commercial Street waterfront could be an economic boon to the container shipping industry.
But the growth would alter the boatyard plans of local businessman Phineas Sprague Jr., and could be stunted if the governor follows through on a threat to withhold state borrowing.
The proposed $5 million expansion of the International Marine Terminal, which would include new rail lines and infrastructure, will be discussed Wednesday, March 12, at 6 p.m. in the State of Maine Room in City Hall.
It is a project that could boost economic development for container shipping as soon as a year from now, if construction goes according to schedule, Maine Department of Transportation project manager Joel Kittredge said Monday.
But it requires the state to acquire about 18 acres of waterfront land west of the Casco Bay Bridge, including land Portland Yacht Services owner Sprague bought and leased last summer with hopes of building an expanded boatyard.
Kittredge said the state is working to strike a deal for the land with Sprague and Pan Am Railways, to control acreage extending west toward Cassidy Point.
Patrick Arnold, director of operations and business development for the Maine Port Authority, which oversees the terminal, said extending rail access could possibly double or triple container business, which is principally carried out by the Icelandic shipper Eimskip.
Sprague on Monday said he sees the project as vital.
“Logistically, Portland is perfect for the relationship with Eimskip,” he said. “No one else can fit the niche as well.”
After two years of work, including getting needed state and federal permits for the boatyard, Sprague said he is amenable to shifting his plans west to 12 acres of land now owned by Pan Am.
“I am acutely aware of how important this is to Portland and the state to do this, so I will get over it, provided they give me a fair price for the land,” Sprague said.
Approaching its first anniversary of doing business in Portland, Eimskip handled more than 4,100 containers from March 13, 2013 through the end of January, Arnold said Tuesday.
The initial annual projection was to handle 5,000 containers, and Arnold said more than 70 percent of containers have been used to import goods.
In the second year, he hopes to expand to 6,000 containers by increasing exports as businesses take advantage of Eimskip’s direct links to international markets.
A direct rail link could boost container business by 5,000 to 10,000 annually, Arnold estimated. But he said the increase would not likely be immediate and is contingent on factors beyond his control, including how rail companies set freight rates.
“We don’t believe in a ‘Field of Dreams’ approach,” he said.
A rail line could open the terminal to more regional traffic, he said, but business expansion will also come as Maine business owners realize the container industry is viable.
“It’s more about Maine companies capitalizing on export opportunities,” Arnold.
Plan details presented in a Feb. 25 meeting at Reiche Elementary School showed the acreage would be filled in to better hold the weight of containers; specialized outlets would be added to store refrigerated containers; more than 2,600 of rail lines will be added, and improvements will be made to Commercial Street.
Kittredge said he anticipates the project going out to bid in June with construction beginning in August.
The expansion will be funded as part of $100 million of bonds approved by voters.
Funding could be jeopardized, however, if Gov. Paul LePage makes good on a vow last month to not release some bonds because the Legislature approved using “rainy day” reserve funds to fill a gap in municipal revenue sharing.
A spokeswoman for the governor’s office did not respond to two requests for comment about LePage’s intentions.
State plans to expand the International Marine Terminal in Portland along west Commercial Street and extend rail lines will be the topic of a City Hall meeting March 12 at 6 p.m.