5. Chase Manhattan Trust Company, National Association ("Trustee")
Chase Manhattan Corporation ("Chase Manhattan") is one of the largest bank holding companies in the United States. Major subsidiaries include The Chase Manhattan Bank, Chase Texas Bank, N.A., and Chase Manhattan Trust Company, National Association ("CMTC"). CMTC is serving as Trustee under the Resolution (the "Trustee"). The Trustee is a national trust association with its principal offices in Pittsburgh, Pennsylvania and with aggregate capital and surplus of approximately S 170 million. The Trustee will administer the accounts under the Resolution through the Chase National Corporate Services, Inc. office in Seattle, Washington.
6. Black & Veatch Corporation ("Independent Engineer")
Black & Veatch is one of the largest, oldest and most experienced engineering, consulting and construction firms in the world, Founded in 1915, the firm employs over 9,000 professionals in financial, economic, and engineering studies and design of power, water, wastewater, telecommunication, maritime and transportation facilities for clients in government and industry. The firm has extensive experience in the design and analysis of the operation and financing of large complex public works and industrial facilities similar to the size and scope of the T18 Program.
C. Overview of Industry Trends
This section presents a brief overview of container trends, carrier requirements, and railroad activities, and identifies the Port's position in the market.
1. Container Trends and Forecasts
During the past 15 years, container traffic through West Coast ports has grown at an average annual rate of 8.9 percent. Future growth through West Coast ports is projected by BST Associates to average five percent per year, BST Associates is an economic research and strategic planning group that focuses on transportation and trade planning analysis, market research, forecasting, and project evaluation. BST Associates has undertaken numerous studies of ports and transportation systems, and all types of cargo throughout the United States, Canada, Latin America and Russia.
Competition for containers affects mainly intermodal cargo, i.e., shipments bound for locations beyond the region served by the receiving Port, and involving more than one mode of transportation. Competition for containerized intermodal cargo has accelerated in recent years, and during the early 1990's, Puget Sound ports lost part of their market share in both imports and exports to the Ports of Los Angeles and Long Beach. However because of the overall expansion of the market, the volume of intermodal cargo through Puget Sound ports has increased. Further, recent congestion in Southern California ports has also led to diversion of some of the lost container traffic back to Seattle and Tacoma, resulting in some improvement in the market share for Puget Sound ports (Section V.C.1.g). If congestion in Southern California decreases, as is expected once the Alameda Corridor Project is completed in 2002, the diverted container traffic may revert back to Southern California. Regardless, overall volumes are expected to grow during the Forecast Period at all major West Coast Ports, including the Port of Seattle.
2. Steamship Line (Carrier) Requirements
The ultimate users of container facilities are the steamship lines or carriers. It is critical that marine terminal infrastructure be planned to meet the needs of the carriers within the context of changing market conditions. Two of the most significant trends that impact the industry are: (1) the reduction in the number of lines and (2) the use of innovative business arrangements to increase profitability and improve ship utilization.
Trans-Pacific containerized cargo trade is dominated by several carriers. The principal carriers are American President Line/Neptune Orient Line ("APL/NOL"), Evergreen Line. Hanjin Shipping Company, Hyundai Merchant Marine ("Hyundai"). Sea-Land Service, Maersk, China Ocean Shipping Company ("COSCO"), Kawasaki Kisen Kaisha ("K-Line"), Nippon Yusen Kaisha Line ("NYK"), Orient Overseas Container Line ("OOCL"), Yangming Marine Line ("Yangming"), Mitsui Osk Line. DSR Senator Line and Cho Yang Line. These 14 lines account for more than 93 percent of West Coast Trans-Pacific containerized import trade and more than 91 percent of export trade.
To manage vessel capacity, many of the carriers have entered into Vessel Sharing Agreements ("VSAs"), also referred to as "Alliances" or "Consortia," which allow participating carriers to place their containers on one another's vessels, thus enabling each shipping line to protect its investment increase its rate of return, and provide more efficient service.
The effect of VSAs on liner operations has been to increase the frequency of vessel calls (ship arrival/departure) available to a single shipping line, provide faster transit by eliminating secondary ports from schedules, and focus activities on load centers.
