1958 - N&W Officials Ask State Aid for Port

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Roanoke Times - February 7, 1958

N&W Officials Ask State Aid for Port

RICHMOND, Feb. 6 - Two top Norfolk and Western officials from Roanoke 
asked the House Appropriations Committee today for funds which will 
enable Hampton Roads to compete with other ports on the Atlantic seaboard.

   Stuart T. Saunders, executive vice president, and Sydney F. Small, 
vice president, appeared before the committee on behalf of a Virginia 
Ports Authority request for 1 3/4 million dollars to begin 
state-aided development of harbor facilities.
   This original grant would be the first step in buying up vast 
railroad-owned harbor facilities with a book value of 17 million 
dollars which would be leased back to the railroads.
   As a follow up the authority would build other facilities costing 
an estimated 45 million dollars which would be paid for through 
leases. Both involve the sale of bonds.

  Small told the committee that immediate question is whether 
Virginia is willing to aid in the expansion of Hampton Roads and 
enable it to compete with other Atlantic Seaboard ports - all of 
which are receiving state aid.

   He had just come from the office of Gov. J. Lindsay Almond Jr. and 
told the committee that the governor said he "whole-heartedly" 
supports any "realistic program" that will enable Virginia to expand 
its maritime facilities.
   Small said despite inadequate facilities the port is doing a big 
volume of business because of overseas shipments stimulated by 
foreign economic and military aid.
   But, the rail executive said, Hampton Roads must expand if it is 
to keep pace and declared private business cannot do the job alone.
   Saunders emphasized that this long-range expansion is not a 
"railroad proposal" but one by the Virginia Ports Authority based on 
two years study.
   The 17 million dollars worth of railroad property to be acquired 
under the proposal is owned mainly by the N&W and the C&O. General 
cargo facilities are included; the N&W's widely publicized coal 
dumping terminal at Lamberts Point is not.

   The expansion of Hampton Roads facilities, Saunders declared, is 
"too big a job for the railroads alone" because they cannot compete 
with state aided ports from Boston to Texas.

   As an example, he said the N&W is not going to spend any more of 
its money for new facilities at Hampton Roads because of this competition.
   And Saunders predicted that unless Virginia steps into the picture 
the port "will start going backwards". He declared expansion of 
maritime commerce will greatly increase Virginia's income. But, he 
added, present income will steadily decline unless facilities are 
expanded to meet competition.
   Concerning the projected financing, Saunders said in letting the 
ports authority have the facilities for 17 million dollars, their 
book value, it is the railroads who are taking the "financial risk" 
in the proposed venture.
   The railroads would be paid off over a 10-year period, part of the 
money coming from the rent the railroad pays on these facilities.
   Several Appropriations Committee members questioned the financial 
details, noting that the General Assembly would be committing future 
legislators to an appropriation.

   Small argued that details of the financing and agreements have to 
be worked out - that the immediate question for the Appropriations 
Committee and the General Assembly to decide is whether Virginia will 
adopt a state policy of helping with the development of Hampton Roads.

   In effect, Small said, Virgina will be getting 75 million dollars 
worth of harbor facilities, which will strengthen its economy, for 17 
million dollars.
   Saunders said the railroad can sell its terminal facilities to the 
state for their book value, which is far below actual value, because of taxes.

  Joining in support the Virgina Ports Authority project was Clem D. 
Johnston of Roanoke, a former president of the U.S. Chamber of 
Commerce. He is now the state organization's world trade chairman.
   Johnston said Hampton Roads is getting only one-half its potential 
business but right now dock facilities are worked to capacity because 
they are inadequate.

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- Ron Davis, Roger Link