Posted on July 1, 2020
Near 16 percent drop from 2020 spending plan due to decline in cargo, air traffic
Oakland, Calif. – June 29, 2020:Coronavirus-induced business declines have prompted the Port of Oakland to curtail Fiscal Year 2021 spending plans. Port Commissioners last week approved a budget for next year down 15.84 percent from FY 2020 levels.
The Port budget projects $432.5 million in operating and capital expenditures and debt service payments next year. That’s reduced from last year’s $513.6 million budget. According to the Port, lower spending reflects anticipated declines in its Aviation and Maritime businesses.
The Port said its new budget would achieve key financial objectives that include:
- Protecting cash reserves
- Ensuring adequate revenue to pay down debt; and
- Maintaining full operations at its Airport, Seaport and Commercial Real Estate holdings
“This budget is based on neither unsubstantiated hope nor on speculation of any worst-case scenario,” said Port of Oakland Executive Director Danny Wan. “It is based on best estimates of how our business may recover, assuming that our communities and country make slow but steady progress in containing the COVID-19 virus.”
The economic impact of COVID-19 is likely to continue depressing revenue in FY 2021, the Port said. Oakland International Airport passenger volume plummeted 80-to-96 percent this spring, the Port said. It warned that recovery in the aviation sector could take 2-to-3 years. Maritime business could recover faster, the Port said, but Oakland’s total cargo volume is off 7.8 percent so far, this calendar year.
The Port said its FY 2021 budget includes $19.1 million of federal coronavirus relief funding. An additional $25.5 million will be used in 2022 and 2023, the Port added.
The Port’s FY 2021 budget takes effect July 1, 2020.
Source: ajot
