PORT MANSFIELD, RGV – The development of Port Mansfield can help offset the significant loss of tax revenues Willacy County suffered when the government pulled the plug on MTC’s tent city prison.
This is the view of Ronald Mills, port director of Willacy County Navigation District. Mills bases his optimism on two things: one, Port Mansfield’s channel has now been dredged by the U.S. Corps of Engineers, allowing more barge traffic to use the port; and two, legislation being carried this session by state Rep. René Oliveira aimed at spurring more residential leases at Texas ports.
“Do I think we are the savior, no, but do I think we can stimulate the economy in Willacy County? Yes, I do. I think we can bring in enough corporations of small scale, those with, say, 100, 200, 300 employees, that could stimulate the growth of the residential economy, of the retail economy, and allow the county to levy their taxes on the corporations,” Mills said, in an exclusive interview with the Rio Grande Guardian.
The U.S. Bureau of Prisons cancelled the contract of Management & Training Corp. to run a prison just outside of Raymondville when inmates inside “tent city” rebelled against what they said were poor living conditions. Mills said he understands this has cost Willacy County millions of dollars in tax revenues. He said he is sure Port Mansfield can help.
“I have said on many occasions that Willacy County is not in decline but that it is already dead. Ford is not coming here. General Motors is not coming here. Boeing is not coming here. The only way you are going to get anything for Willacy County is through our port. The County invested in wind, they are probably not going to get anything out of that investment. They invested in the prison and that has turned out to be a very bad investment. They have just lost $8.2 million annually in revenue out of the county budget because they closed the prison,” Mills said.
“The education standards are atrocious. You have an 84 percent graduation rate in the state of Texas and a 61 percent graduation rate in Willacy County. You do not have the base of persons living in the community – not that they are not capable of being educated, they are – but you do not have the base of people you need to bring in Ford or Toyota or Boeing. What can we do? We have a port there. Let’s bring revenue through the port.”
Mills explained how it would work.
“I get my money through the tonnage that goes across the waterfront. But, the county can levy their taxes on a corporation that does business there. There is no other way they are going to bring in money. There is nothing going on in Lasara. There is nothing going on in Lyford. There is nothing going on in Sebastian. The only place that has potential growth is Port Mansfield.”
In fact, Mills believes he helped persuade Brigadier General David C. Hill, commander of the southwest division of the U.S. Army Corps of Engineers, to dredge Port Mansfield’s channel because of the argument that dredging would not only help the port but Willacy County as a whole. “I told the General, you are not just helping Port Mansfield. We are the smallest piece of the pie. You are helping Willacy County and neighboring Kenedy County. There is no reason we cannot be the hub for any potential growth for these two counties.”
Mills thought it would take two or three years to persuade the Corps of Engineers to dredge Port Mansfield. In fact, it has been completed inside the first 11 months of Mills’ stint as port director. The channel is now 11.5 to 12 feet in depth, deep enough for small, coastal barge traffic. Before, the silt had built up to such an extent that the channel was five or six feet deep.
“Now that the dredging is done I want to talk about who is coming. Who wants to come to town? My doors are open now. My message is, Port Mansfield is open for business,” Mills said.
In fact, Mills said, anybody using the Gulf Intracoastal Waterway to transport goods can now come into Port Mansfield. “You cannot go up and down the Intracoastal Waterway with a barge that needs more than 12 feet because there are some shallow spots up around Corpus Christi where the barges can run aground. The barges run up and down that channel at about 11 feet so we can go after this business.”
Mills said there was some interest from a company that wanted to transport sand used in the fracking process. “That would be a plus for us,” he said, citing how the Eagle Ford Shale has turned around the fortunes of the Port of Victoria.
“Two and a half years ago the Port of Victoria, which is very land-locked and sits 30 miles inland, had a real problem. They had virtually no commercial traffic either. Some part of the Eagle Ford development came into their Port. They put one flare and two storage tanks on the bank. That was two and a half years ago. This year they are going to be the second busiest shallow water port in America. To get an idea, the Port of Brownsville is approximately going to do about five million tons of cargo. The Port of Victoria is going to do about 8.5 million tons of cargo. They are doing more business than the Port of Brownsville and yet they are much smaller and are landlocked. It is because of Eagle Ford,” Mills said.
Mills said he would welcome some businesses associated with the fracking of oil reserves.
“I am not necessarily leaning towards oil products because we are a very eco-friendly area but there are so many affiliated programs that have to do with the Eagle Ford strike and more importantly for me the Burgos Basin strike, or the Tampico strike. They have not even started to drill there yet because of the Pemex legal battles going on. Supposedly this is going to be resolved this year. Well, where is the closest port that can take material in and out? Not necessarily the oil itself but all the support products. The answer is, Port Mansfield,” Mills said.
“We have an interest in anyone who is expanding their maritime business, be it from the petrochemical industries, from sand, aggregate. All that caliche that came in for the wind towers in Willacy County could have just as easily come in through Port Mansfield, had it been dredged. Well, now it is. We have got things to do now.”
The legislation authored by Rep. Oliveira, D-Brownsville, that Mills supports is House Bill 1716. According to the bill analysis, it would “amend the Water Code to increase from 30 years to 50 years the maximum term for which the navigation and canal commissions of certain navigation districts may lease the surface of land by entry of an order on the commission’s minutes and the execution of a lease in the manner provided by the original order.”
The argument for the bill, the Texas House bill analysis team states, is:
There are concerns regarding the current maximum term of a lease for land surface that can be provided by a navigation district in Texas. Interested parties note that, due to increasing attention from investors seeking to invest in Texas ports, navigation districts need greater flexibility to extend the maximum leasing period to provide large investors assurances in their potential investment. H.B. 1716 seeks to address this issue.
“The state of Texas is the only state on the Gulf Coast that has such a restriction on leases. Most of the ports have leasehold property. We are exclusively leasehold, 100 percent. The state of Texas regulates its leaseholds for 30 years. The rest of the United States regulates 99 years or forever. We have a 30-year restriction,” Mills explained.
“House Bill 1716 increases that 30 years to 50 years. Right now, if somebody gets a lease from the port and they want a mortgage they have to start the mortgage the same day because the banks will not give them a 30 year note on something that only has a 30-year lease. It is really hard for people to build a house. If they can get a 50 year lease they get more comfort. The banks feel better about it.”
Asked if the 30-year lease provision has held up development of Port Mansfield, Mills said: “It has definitely had a restriction on development all over the state and particular in places like Port Mansfield. We have a lot of problems with people just leasing spots at all. They come to town, they fall in love with the community but they are not willing to enter into that lease property for 30 years because they may possibly lose their house at the end of it.”
Mills said Port Mansfield is not the only part of Texas where the 30-year lease issue is having a negative impact.
“It is the same way in Texas City, in Houston. You have someone like Shell Oil come in. They do not want to break down their costs over 30 years. They want to break it down over 50 or 100 years. It is really difficult for us to get people interested. This is, potentially, a big plus for us. We are a residential community. The residents are more likely to lease a piece of property that they can get a mortgage on. Right now there is only one financial institution that easily or openly gives out loans for Port Mansfield.”
Mills said Pat Younger, executive director of the Gulf Ports Association of the Americas, testified in support of HB 1716 when the legislation was heard by the House Committee on Business & Industry. It has been voted out of committee and will next be heard on the House floor.
“Pat Younger represents us, the Port of Harlingen and Port Isabel. She understands the plights of Texas ports with the 30 year lease provision, as compared to Mississippi or Alabama that have 99. It is a huge deal.”