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Published: Saturday, 12/9/2000

Port eyes bolstered budget proposal

BY JOE MAHR
BLADE STAFF WRITER

For years the Toledo-Lucas County Port Authority turned comfortable profits, but not enough to drop a tax levy that supplemented its operating budget.

But now, a profitable airport and increasing earnings from its finance program have bolstered the agency's bottom line to the point that agency officials are comfortable pledging to use the levy money only for capital projects, like runways and roadways.

“We're confident we can do it next year and the year after, at the very least,” Gary Berger, the agency's comptroller, said yesterday.

The full board is preparing to vote next week on a 2001 budget that, for the first time, doesn't use any tax money for operating expenses. Instead, the $890,000 in tax money the port has used for maintenance would be allocated for capital projects.

The agency hopes to appease Lucas County voters, who rejected a 1998 renewal levy amid allegations of mismanagement, but passed it in 1999 amid promises of reform.

The port authority runs the region's seaport, train station, and two airports. The seaport has long been the agency's cash cow - from renting dock space to shippers and charging shippers fees based on volume. Those profits, however, usually covered losses at Toledo Express Airport.

The airport is beginning to hold its own financially, and it's expected to earn bigger profits with the return of discount airline AirTran Airways.

Jerry Arkebauer, the agency's vice president of finance and strategic initiatives, said the agency historically saved $200,000 to $300,000 a year, at best. But in two of the last three years, the agency turned profits of more than $1 million.

Most of the financial turnaround is from increasing profits in the 12-year-old financing program, Mr. Berger said. This year, the agency is expected to earn $850,000 in fees from issuing bonds on behalf of area businesses and selling the bonds to investors. The investors are paid back by the businesses, which also pay a fee to the port authority.

Mr. Berger said agency staffers have historically offered conservative budget estimates, and the agency has generally ended the year earning more than anticipated. The 2000 budget called for a $140,000 profit, but the agency now expects 10 times that much.

The proposed 2001 budget would boost the pool of salary money for administrators and clerical employees by 4 per cent. The raises would be doled out under a five-year-old program that weighs employee performance with industry pay standards.

Three of the top six highest-paid staffers, however, are considered to have jobs with duties that can't be compared to any other job.

Those three are Mr. Arkebauer, who is paid $95,926 annually; Ralph “Chip” Hannon, vice president of new project development, paid $96,020; and Robert Greenlese, the director of surface transportation and logistics, paid $65,817.

Peg Hutchinson, the agency's human resources administrator and legal administrator, said the salaries of those three are based on internal factors.

“You determine where they fit into the organization based on what it is they do, their value to the organization, the realm of responsibility that they have,” she said.

Mrs. Hutchinson, who is paid $43,988 a year, and 19 other employees have pay ranges determined through a spring survey of area pay for different jobs by The Employers' Association, 5800 Monroe St. The association tracks local pay scales for specific jobs.

The port authority tacks on a 4 per cent increase to denote the projected raises for comparable employees, she said.

The salaries of airport Director Paul Toth, who is paid $85,000 a year, and Mark Fisher, the airport's safety director, who gets $59,003 a year, are determined through a special survey of 16 airports in the Midwest, ranging from Columbus to Kalamazoo, Mich.

Seaport Director John Loftus, who is paid $82,827, has a salary range based on a survey of Great Lakes seaport directors' pay set by the American Association of Port Authorities.

The board directly sets the pay of agency President James Hartung, who is paid $129,960.

A proposed 2001 budget worksheet includes a $10,000 raise for Mr. Hartung. But Mrs. Hutchinson said she inserted the figure only to help determine the projected budget. She said she came up with the figure on her own, as a conservative budget estimate based on news accounts of Mr. Hartung's request of up to $7,000.

“I rounded up,” she said.



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