Virginia Gov. Terry McAuliffe on Thursday replaced five members of the Virginia Port Authority Board of Commissioners, including Chairman Jeffrey Wassmer, saying it is a necessary step to improve the Port of Virginia's fiscal management and return it to profitability.
One of the new appointees is John Milliken, an Arlington, Va., lawyer and long-time Democrat who previously served as chairman of the VPA Board before being swept out along with the rest of the board in 2011 by former Republican Gov. Bob McDonnell.
"The Port of Virginia is one of the Commonwealth's most important economic assets and improving its performance is one of my top priorities," McAuliffe said in a statement. "This team of Virginia leaders has the right experience and vision to strengthen the port financially and put it on the path toward long-term, sustainable growth."
McAuliffe administration officials had hinted earlier this month that a change in the board was possible. In a speech to the Hampton Roads Chamber of Commerce, the governor expressed dissatisfaction with the Port of Virginia's financial performance
, even though the port has achieved extraordinary cargo growth in the past 18 months, is in the midst of implementing many reforms after a major reorganization last year, and has a new executive director who is barely two months on the job. He appeared especially upset that a recent internal audit found that the port's losses during the past five years were greater than previously disclosed.
Under the VPA’s bylaws, board members serve staggered five-year terms, with a maximum of two terms, but always at the pleasure of the governor. There are 11 appointed board members, plus two automatic members from state government.
The board will vote on who will be its chairman, although McAuliffe indicated at a news conference in Norfolk that he preferred Milliken, according to the Virginian-Pilot
, which covered the event.
McAuliffe has been openly critical of the 20-year lease the VPA signed to take control of the privately held APM Terminals facility in Portsmouth. Milliken headed the board that pursued the deal, although it was finalized by McDonnell's administration. The Virginian-Pilot
quoted McAuliffe as saying, "it's one of the worst deals I've ever seen negotiated."
The intent was to consolidate Norfolk International Terminals and APMT under one roof to give the port operational flexibility and power to market services to liner carriers and shippers. The port authority is making annual payments of $40 million for the facility, but the amount can rise depending on cargo volumes.
When McDonnell replaced the board in 2011, his staff said it was because the board lacked a strong business background and blamed it for slower-than-expected container growth, focusing on expansion projects at the expense of operational efficiency, marketing and profitability. The state even considered a proposal to privatize the Port of Virginia before opting to overhaul its structure and streamline operations.
The port authority officials attribute much of last year's loss to being unprepared for the rebound in cargo volume and having to take expedited measures to keep containers flowing through the terminal. The turmoil surrounding the privatization and reorganization also likely distracted port managers from planning ahead. Since John Reinhart took over as chief executive officer in February, the port has instituted a series of steps to address motor carrier congestion and improve efficiency.
The new members of the board are:
- Robert Alston, Jr., chairman, CEO and founder of TowneBank and past director of Virginia International Terminals, the port authority's operating arm.
- Alan Diamonstein, a former member of the Virginia House of Delegates and law partner with Patten, Wornom, Hatten, Diamonstein.
- Gary McCollum, senior vice president and general manager for Cox Communications.
- Val McWhorter, founding partner of Smith, Patcher, McWhorter, which specializes in construction law. He served on the Commission on Higher Education under Democratic governors Douglas Wilder and Tim Kaine.
- John Milliken, is a partner with law firm Venable LLP. He served nine years on the VPA board. He was secretary of transportation under Democratic Gov. Mark Warner and was a member of the Washington Metropolitan Area Transit Authority. He served on the Arlington County Board from 1981 to 1990 and was the chairman in 1984. Last year, he co-chaired McAuliffe's transition committees on Commerce and Trade and Transportation.