The advertisement in the December issue of American Shipper magazine was blunt. "Every year," it said, "many hundreds of ships needlessly enter the Chesapeake Bay and make the long trek up the Baltimore channel."
The ad, placed in shipping industry publications by the Virginia Port Authority, is part of a $500,000 public relations campaign designed to attract shipping business from other East Coast ports to the port of Hampton Roads, an expansive 100-mile stretch of harbor that includes docks at Norfolk, Newport News, Portsmouth and Chesapeake.
Already the leading coal exporting port in the world, Hampton Roads is now unabashedly competing for general cargo such as cars, trucks and household items going to and from Chicago, the trade center of the Midwest. Its arch rival for this market is Baltimore, which for 200 years has been the dominant port along the mid-Atlantic coast.
Although the total volume of trade through Baltimore increased last year by 20 percent, to 26 million tons of cargo, the last six years have seen a decline in the number of ships using Baltimore's docks, from 4,300 to 2,900. Some Maryland port officials and politicians fear this is a sign that aggressive competition by Hampton Roads may be paying off slowly.
Last year Hampton Roads had almost twice the total tonnage of Baltimore but most of it was coal. Its success in attracting general cargo, however, was considerable. Last spring Nissan Motor Co. Ltd. decided to switch its headquarters from Baltimore to a terminal near Norfolk, costing Baltimore 50,000 imported cars each year and about 200 jobs. In November, two Far East shipping lines said they would make the same shift. And Pennsylvania-based General Electric, which traditionally used Baltimore to ship locomotives to China, is now using Hampton Roads.
This week the battleground for the Baltimore-Hampton Roads rivalry has turned to the statehouses and to Capitol Hill, where the Maryland and Virginia congressional delegations for the second year in a row are pitted against each other in a quest for scarce federal funds to deepen their harbors.
Maryland Gov. Harry Hughes, seeking to expedite harbor dredging, is scheduled to meet with the Maryland congressional delegation today to discuss a plan he unveiled earlier this week in which part of the state's share of the Baltimore project -- half of the total cost of between $330 and $360 million -- could be financed by the sale of the World Trade Center to private investors. The elegant pentagonal building on the edge of the Inner Harbor is assessed at $83 million.
At stake in all of this political maneuvering is the economic future of both ports. Whichever harbor is dredged first, according to Maryland and Virginia officials, will be able to attract the bigger and heavier ships now being used in international trade, giving that port a competitive edge that could translate into millions of dollars of revenue and thousands of jobs.
On Capitol Hill harbor dredging has created unusual factionalism and strained the mostly friendly regional alliance of Virginia and Maryland members of Congress.
As soon as the 99th Congress convened this month, Rep. Barbara Mikulski, a Baltimore Democrat, introduced legislation seeking 50 percent in federal matching funds for the Baltimore dredging project. Maryland's U.S. senators, Republican Charles McC. Mathias and "We are looking at very strong competition from the south . . . .It may be that the port now faces its most critical competitive era." -- Maryland Port Administrator W. Gregory Halpin Democrat Paul S. Sarbanes, have sponsored a measure that would require the federal government to pay 75 percent.
Meanwhile, Virginia Republican Sens. John W. Warner and Paul S. Trible were to introduce a bill today that would for the first time give congressional authorization for a $254 million federal-state project to deepen the port at Hampton Roads.
Last year President Reagan, who has publicly endorsed federal funding for Baltimore harbor, vetoed a measure that included money for Baltimore's dredging on the grounds that the bill was laden with unnecessary pork-barrel projects.
The House last year approved a $248 million authorization, the first step necessary in securing federal funds, for Virginia's dredging proposal, but it was not approved by the Senate. As part of last year's continuing budget resolution the Senate approved $10 million to begin deepening the channel at Hampton Roads, but the measure was killed in conference committee along with several other water projects.
Despite these frustrations, both congressional delegations are confident their bills will be approved this year, but they concede that winning support of the Reagan administration will be a big hurdle, given massive budget deficits and the inevitable politicking that goes along with all water projects.
For Maryland, the potential costs of losing the dredging battle would be enormous: The port is the state's largest industry, now contributing about $2 billion in annual revenues and 79,000 jobs, according to the Maryland Port Administration.
"We are looking at very strong competition from the south," said W. Gregory Halpin, the port administrator. "It may be that the port now faces its most critical competitive era."
Halpin's counterpart, Bobby Bray, executive director of the Virginia Port Authority, talks with the brashness of the upstart. "We have been very successful thus far and we want to be even more successful," he says. "It's simple market strategy. Our future growth is going to be in the Midwest, so we have oriented our advertising strategies toward those companies."
Still another coup for Virginia may be in the making.
The Taiwan-based Evergreen Marine Corp., one of the largest cargo shipping companies in the world, couldn't decide which mid-Atlantic port to use for its lucrative new around-the-world shipping routes, so it arranged a six-month trial for both Baltimore and Hampton Roads.
"We were approached by Hampton Roads with a very aggressive and very flexible system of pricing," explained Dominic C. Obrigkeit, manager of Evergreen, which has an office in the World Trade Center. "It was very refreshing and new."
That trial period expires in February, and maritime officials from both states say privately they expect Evergreen to take its business to Virginia.
Virginia's success at wooing Baltimore's traditional customers stems from several factors. As the Virginia advertisement says, "It simply makes good sense to lessen steaming time by putting in at the Ports of Virginia -- the closest U.S. port to the open waters of the Atlantic."
Ships, which cost as much as $50,000 a day to operate, must pass Hampton Roads and sail for 10 hours each way up and down Chesapeake Bay to dock at Baltimore. With deregulation of the trucking industry, Baltimore, which is served primarily by trucks, no longer has a competitive edge on inland shipping rates even though it is 150 miles closer to the Midwest.
"No question that deregulation has helped us," said Stan Payne, general counsel of the Virginia Port Authority. "We're seeing some positive results. The steamship lines simply don't want the additional expense of going up the Chesapeake Bay."
Even in the face of such stiff competition, Baltimore hoped to retain its edge in general cargo over Hampton Roads and other East and Gulf Coast ports by being the first to get congressional authorization -- in 1970 -- to deepen its 42-foot harbor to 50 feet. But former Democratic U.S. Rep. Clarence D. Long of Baltimore County blocked the project for 10 years, arguing that it was an environmental hazard to dump spoils from the dredging on nearby Hart-Miller Island.
In 1981 Long reversed his position, but since then the opposition of the administration has caused further delay. The 15-year lapse has been costly, giving other ports such as Hampton Roads, which has a 47-foot channel, a chance to begin lobbying for their own dredging projects.
The race to deepen harbors began when shippers started to use bigger ships -- weighing about 150,000 tons when fully loaded -- for transporting coal, grain and iron ore. A 42-foot harbor such as Baltimore's can only accommodate a ship that weighs 91,500 tons when loaded. If Baltimore is deepened to 50 feet, as proposed, ships weighing as much as 125,000 tons could sail to its piers. Virginia port officials say Hampton Roads could accommodate the 150,000-ton giant coal ships if its channel was 55 feet deep.
With their relatively shallow harbors, American ports such as Baltimore and Hampton Roads have lost valuable trade to foreign competitors. South Africa, a major exporter of coal to Japan, for example, has a 62-foot port at Richards Bay.
The fact that harbor depth is such a critical consideration has given the Maryland-Virginia rivalry an unusually sharp tone.
"It is a concern of mine that if Hampton Roads were successful in obtaining such a deep channel and Baltimore were not, the place of Baltimore as a world-class port would be irrevocably damaged," said Gilmore.
But Virginia officials see the situation in reverse.
"It is of deep concern to Virginia that either we go together, or we get dredged and Baltimore doesn't," said Bray of the Virginia Port Authority. "We are the largest coal exporting port, so if one port is going to be dredged it ought to be ours."
"I don't know what the justification or rationale would be for deepening Baltimore first," said Jack Mace, executive vice president of the Hampton Roads Maritime Association.
Mace and other Virginia officials add that the Virginia project is cost effective. To deepen one outbound channel to 55 feet would cost only $50 million, compared to $360 million officials estimate might be needed for the 50-foot plan to deepen two channels at Baltimore.
"If only one port gets deepened it gives the other a competitive edge," said U.S. Rep. Frederick C. Boucher, a Democrat who represents Virginia's coal-producing counties in the southwest.
Maryland officials maintain that their port should be deepened first because it was authorized by Congress 15 years ago, a feat that Virginia has yet to accomplish. Furthermore, these officials said that in the next decade general cargo ships, the majority of vessels docking in Baltimore, will be as big and heavy as coal ships and will require deeper waters when they are fully loaded.
"Our position has never been to gang up on Virginia," said Richard Lidinsky, director of tariffs and national port affairs for the Maryland Port Administration. "Where we differ is that we feel we have been authorized and our project is waiting and ready to go. Other ports obviously don't want us to go ahead of anyone else. We argue with that."
"We've got problems with the federal government and we've got problems with Virginia," said U.S. Rep. Roy Dyson, a Democrat from a district that includes Maryland's Eastern and Western Shores. "For some reason they don't want to see ships come that far up the Chesapeake Bay, and they have some key people on committees in the Senate."
Last summer, some behind-the-scenes maneuvering by Warner threatened to undermine a compromise agreement that would have provided federal funds for Baltimore's harbor.
Warner said later that he had not intended to interfere with Baltimore's dredging project, but some Maryland officials were not amused by the congressional machinations.
"In looking at the ashes from that affair, it seemed that some overzealous staff people on the Virginia side perhaps carried this thing a little farther than they should have," said Lidinsky. "It was an unfortunate incident we hope will not be repeated this session."