New lease holder at Port of West Memphis

New lease holder at Port of West Memphis

Port Authority, City Council ink deal with Watco Inc.

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The TIGER has begun to purr in West Memphis, as the city’ Port Authority and the West Memphis City Council have approved a new lease holder at Port of West Memphis. The move was made in a special joint called meeting on Dec. 19.

Watco Inc. runs the Port of Memphis, and the potential development with the Transportation Investment Generating Economic Recovery (TIGER) discretionary grant — a planned West Memphis bulk-transfer facility adjacent to the Port — has begun to capture attention from a variety of business interests.

Watco also operates other port, truck, and rail transfer facilities. The company specializes in short-line railroads, and the Friday-Graham Rail Spur running from the Union Pacific Railroad line in West Memphis, south to the Port, will now be a part of that operation. The area attracted Watco, which assumes the Port lease and operation from previous lease holder, Kinder-Morgan.

The two municipal boards got together at City Hall to hear the details of the lease/operation transfer before approving the new assignments.

The Port has come a long way during Mayor Bill Johnson’s tenure, the mayor explained.

“When I came on, we began to research the Port,” said Johnson. “It was on a 50-year lease at $600 per month. We upgraded the lease and an operating agreement. Our revenue has increased drastically.”

The current lease and operation transferred from Kinder-Morgan and assigned the lease to Watco Inc. with 36 years remaining on the balance of the deal, with extensions available for certain capital improvements made.

Kinder-Morgan already improved the facility with a building to handle fertilizer. “That built up our equity position in the Port which we own,” said Johnson.

“They are paying $6,250 per month to operate that.”

Despite the name change, many of the employees will stay on with the new outfit according to the City Attorney David Peeples.

“There are a lot of people familiar with the operation and will continue on,” said Peeples.

T.J. Van Wagner with Watco confirmed staff holdovers and was optimistic about potential business growth immediate area. West Memphis holds land purchase options adjacent to the Port and plans improvement the Friday-Graham rail spur which tracks through the area eyed for development under the TIGER.

“Most certainly we have an eye for looking at new business opportunities,” said Van Wagner. “With the right customer partnership there, there is a lot of potential for further growth and development.”

By John Rech