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The proposed Public-Private Partnership accomplishes several important goals:

Maryland Port Administration Seagirt Marine Terminal Public/Private Partnership Presented to By James J. White Executive Director Maryland Port Administration. Seagirt Marine Terminal Public-Private Partnership Overview/Key Outcomes.

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The proposed Public-Private Partnership accomplishes several important goals:

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  1. Maryland Port AdministrationSeagirt Marine TerminalPublic/Private PartnershipPresented toByJames J. WhiteExecutive DirectorMaryland Port Administration

  2. Seagirt Marine Terminal Public-Private Partnership Overview/Key Outcomes The proposed Public-Private Partnership accomplishes several important goals: • Funds construction of Seagirt Berth IV with 50 foot depth and four cranes in economically challenging times. • Repays the Maryland Transportation Authority for its investment in Seagirt. • Provides an ongoing revenue stream to the Maryland Port Administration (MPA) for administrative and other port purposes. • Ensure MPA maintains direct control of port security functions.

  3. Seagirt Marine Terminal Public-Private Partnership Competitive Process A competitive and open process was used to solicit and obtain offers: • MDOT/MPA retained Public Financial Management (PFM) as an advisor. • Valuation analyses were undertaken by both PFM and other consultants to estimate the value of the deal and provide reasonableness checks. • The solicitation was widely dispersed so that the State’s goals were advertised and interested parties had an opportunity to participate. • Two respondents qualified based on technical standards. The short-listed firms performed operational and financial due diligence. • Once an offer was received, confidential negotiations proceeded to obtain the best offer and protect business sensitivity. • The Maryland Port Commission and the Maryland Transportation Authority were engaged throughout negotiations, and both bodies approved the final proposal. • Outreach to select members of the Maryland General Assembly (Legislature) as well as the Governor, Comptroller and Treasurer during every phase of the process.

  4. Seagirt Marine Terminal Public-Private Partnership Ports America and Highstar Capital Qualifications Ports America • Ports America is the largest independent terminal operator in the Americas operating at 84 terminals in United States handling over 12m TEUs annually. • Proven Long-standing Operator, operating in Baltimore for over 88 years. • Strong Labor Relations with the International Longshoremen’s Association. • Existing Business with Major Shipping Lines. Highstar Capital • Independent, value-added infrastructure investment fund that currently manages over $4.5 billion in investor capital commitments and $15.0 billion in assets. • Long-term investor and partner that facilitates growth organically and through the execution of strategic acquisition strategies. • Commitment to the public trust with high standards for safety, environmental, customer service and labor relations.

  5. Seagirt Marine Terminal Public-Private Partnership Negotiations and Final Offer Summary of Financial Components

  6. Seagirt Marine Terminal Public-Private Partnership Protections and Transfer of Risk The Seagirt Agreement protects the State’s interest while transferring risk to the private sector. • Ownership of Seagirt Marine Terminal remains with the State. • A number of risks are assumed by Ports America Chesapeake: • Operational and cargo volume/growth risks • Construction risks • Future capital, infrastructure maintenance and enhancement risks • Performance • Ports America Chesapeake is obligated to use Seagirt primarily as a container terminal • Ports America Chesapeake must perform all maintenance to Seagirt Marine Terminal including but not limited to all infrastructure, system preservation and capital investments throughout the term. • Commitment from both parties to a continued successful business relationship is very strong.

  7. Seagirt Marine Terminal Public-Private Partnership Value to the State of Maryland The total investment and revenue from this Agreement has the potential to reach $1.8 billion over the life of the Agreement. • 5,700 new jobs, and new tax revenues of $15.7 million. • A commitment to invest $105.5 million in a new, deeper Berth IV at Seagirt, and associated cranes, to be operational by 2014. • Maryland Transportation Authority, as the current owner of Seagirt, receives an immediate payment in excess of $140 million to pay for needed system preservation of roads, tunnels and bridges. • MPA will receive an annual lease payment for Seagirt, as well as revenue sharing for business in excess of 500,000 containers per year. • Ports America Chesapeake has committed to future system preservation and capital expenditures to maintain Seagirt as a world class container facility. • Acreage on Dundalk Marine Terminal is returned to MPA to grow the important roll-on/roll-off and auto business.

  8. Seagirt Marine Terminal Public-Private Partnership Lessons Learned • The process was very time consuming for executive staff. • A need to go deeper into staff resources to better manage the process.

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