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Detroit/Wayne
County
Port
Authority
ends
Master
Concession
Agreement
with
Ambassador
Port
Company
DETROIT
– The
Detroit
Wayne
County
Port
Authority
(DWCPA)
announced
that it
is
moving
forward
on a
plan to
bring
about an
end to
the
100-year
exclusive
arrangement
held by
the
Ambassador
Port
Company
(APC)
under a
Master
Concession
Agreement
(MCA)
signed
between
the
Authority
and APC
in 2005.
At their
regular
meeting
earlier
today,
the
Board
approved
a set of
agreements
- known
as the
MCA
Release
Agreements
– that
will
free the
agency
from the
constraints
of the
MCA and
allow
the
Authority
to move
forward
with its
mission
to spur
economic
growth
through
port
development
projects.
In
short,
the MCA
Release
Agreements
would
accomplish
the
following:
1. End
the MCA
and
APC’s
100 year
right to
manage
and
profit
from
port
facilities
owned by
the
Authority.
2.
Satisfy
over
$2,000,000
in
Authority
debt to
APC, the
entire
balance
currently
owed by
the
Authority.
3.
Provide
the
Authority
with
over
$1,000,000
in cash
proceeds
for
general
use.
4.
Transfer
ownership
of the
34+ acre
port
facility
on West
Jefferson
Ave to
APC,
returning
the
waterfront
property
to
public
tax
rolls.
5.
Require
APC to
demolish
the
Boblo
Building,
a blight
and
hazard
currently
located
on the
port
facility
property.
The
transactions
approved
by the
Authority
today
are
subject
to the
City of
Detroit
agreeing
to waive
its
reversionary
interest
in the
property.
As part
of the
MCA
Release
Agreements,
APC will
pay
$10,000
to the
City to
cover
the
legal
expenses
associated
with
terminating
City’s
reversionary
interest
in the
property.
“Anyone
who is
familiar
with the
Port
Authority
is aware
of the
heavy
burden
this
agency
has
borne as
a party
of the
Master
Concession
Agreement,”
said
Jonathan
C.
Kinloch,
Chairman
of the
Board of
Directors.
“The MCA
has kept
the
Authority
saddled
with a
debt
that it
cannot
repay
any time
soon, it
has not
resulted
in the
capital
improvements
and
growth
our port
facility
needs,
and the
exclusivity
provisions
have
made it
impossible
for the
agency
to be a
partner
to
others
in
driving
maritime
expansion
and
economic
development.
The MCA
Release
Agreements
represent
a
fundamental
change
to the
landscape
we have
been
forced
to
operate
in under
the
MCA.”
The MCA
was
signed
in 2005
when, as
part of
an
effort
to avoid
default
on bonds
issued
by the
Detroit
Port
Development
Corp (a
City
entity),
the Port
Authority
assumed
ownership
of a
general
cargo
property.
The
Authority
agreed
to pay
APC the
$2.1
million
it
loaned
to avoid
the
default.
In
exchange
for the
loan,
APC
became
the
exclusive
port
operator
for the
property,
until
the year
2105.
Under
the MCA,
APC’s
exclusive
rights
also
extended
to any
new
projects
owned by
the
Authority.
Since
2005,
only
$100,000
in
principal
has been
paid on
the
Note,
with
interest
and
other
costs
consuming
the
Authority’s
payments
under
the MCA.
Absent
today’s
action
approving
the MCA
Release
Agreements,
the
Authority’s
rights
to the
property,
as well
as the
City’s
reversionary
rights,
would
otherwise
remain
encumbered
by APC’s
exclusivity
until
2105.
“We look
forward
to
greatly
expanded
opportunities
for the
Port
Authority
post
MCA,”
said
Bryan
Powell,
Vice
Chairman
of the
Board of
Directors,
and VP
of the
Seafarers
International
Union of
North
America,
which
represents
licensed
and
unlicensed
maritime
workers
on the
Great
Lakes
and
world-wide.
“Freeing
ourselves
from
from the
MCA
means
the Port
Authority
will be
in a
much
better
position
to
realize
its full
potential,
including
more
robust
involvement
in
maritime
and
related
projects
which
will
create
thousands
of
direct
and
indirect
jobs in
Detroit,
Wayne
County
and
throughout
the
State.
In
addition,
the
Authority
will now
be in
the
running
for
millions
of
dollars
more in
grants
to
develop
port
infrastructure,
remediate
environmental
hazards
along
the
riverfront
and help
build a
greener
economy.”
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