2 0 0 8 a n n u a l r e p o r t Striving for Peak Performance
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Bags of rice are hoisted by a crane.
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CON T EN TS 2. 2008: Striving for Peak Performance 5. Shipping Activities: New Cargo from Trading Partners 6. The Longest Direct Ship-to-Rail Facility in the Western U.S. 9. Port Tenants Continue Expansion of Facilities 10. New Environmental Programs Implemented 13. Olympic Athletes Train at Port 14. Security Operations Enhanced with new Systems & Training 17. Port Hosts Community Events & Dignitaries 18. 2008 in Review: Port Statistics 26. Port of Stockton Team 2008
Coiled steel.
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2 0 0 8 : ST R I V I NG FOR PE A K PER FOR M A NCE We are very pleased to report that during 2008, the Port of Stockton’s long-term efforts to establish a broad, diversified foundation of maritime activity and property development has resulted in a private sector investment exceeding $340 million in recently completed projects. This diversification has greatly helped the Port to weather the recent dramatic changes in our economy as construction-oriented cargos such as cement and steel imports have decreased as regional projects have slowed. However, an additional operating year of port-initiated infrastructure improvements has supported efforts to attract and maintain the nonconstruction dependant tenants and the jobs they bring to our community. For example, the recently opened two-mile direct ship-to-rail facility at the Port, the largest such facility in the Western United States, contributed to a 44 percent increase in rail activity. Meanwhile, the Port of Stockton Expressway provides our tenants with a direct connection to the state and federal highway
W. Ronald Coale Chairman
Robert V. Kavanaugh Commissioner
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pollution control technologies. The Port also provided leadership in removing invasive plants from our waterways, and expanded the Owl Nest Box Program which provides an environmentally friendly and cost effective method of rodent control, among many other activities. In conclusion, after 75 years of operation, the future remains very bright for the Port of Stockton, “California’s Heartland Port”. Active negotiations on a wide variety of projects representing private sector investment of more than $735 million are proceeding. Also continuing are port dredging, rail, electrical, road, and sewer infrastructure projects. These investments will provide significant dockside, construction, and long-term job opportunities for our community. These port-initiated “stimulus projects” will proceed without taxing the citizens of the Stockton Port District while we successfully compete with many West Coast ports that actually tax their citizens. We hope you enjoy our 2008 annual report: “Striving for Peak Performance.”
Elizabeth Blanchard Commissioner
Gary Christopherson Vice-Chairman Steven A. Herum Commissioner
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system improving their efficiency, while recently dredged docks are proving to be quite popular with importers and exporters. This has resulted in the Port hosting 172 vessels in 2008, an average of almost one every other day, with the Port trading with more than 55 countries around the world. The Port’s efforts to attract green industries and green jobs have also reaped great dividends for our community. Ships carrying windmill towers to the Port from Vietnam increased from just seven ships in 2007 to 30 ships in 2008, significantly adding to the family-wage dock, rail and yard jobs. Also in 2008, the nationally recognized Community Fuels biodiesel plant was completed, and the Pacific Ethanol production facility also inaugurated operations. These activities combined have resulted in the creation of more than 300 “green” family-wage jobs. In addition, the environmental impacts of port operations were significantly improved as old cargo-handling equipment was retired in favor of new equipment or updated using the latest in air
Ronald J. Ferrario Commissioner Sam L. “Butch” Toccoli Commissioner
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Richard Aschieris Port Director
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© Turner Photographics, Rich Turner
STOCK TON PORT DIST R IC T BOA R D OF COM M ISSIONER S A ND PORT DIR EC TOR
Stockton Port District Board of Commissioners and Port Director: (front row, left to right) Commissioner Sam L. “Butch” Toccoli, Commissioner Elizabeth Blanchard, Chairman W. Ronald Coale, Commissioner Ronald J. Ferrario (back row, left to right) Port Director Richard Aschieris, Vice-Chairman Gary Christopherson, Commissioner Robert V. Kavanaugh, Commissioner Steven A. Herum
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Sunset at the Port of Stockton.
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SHIPPI NG AC T I V IT IES: NE W C A RG O FROM T R A DI NG PA RTNER S Shipping activities at the Port of Stockton cooled off during 2008, after shattering a variety of records the year before. The regional slow-down in home construction in 2008 presented some new challenges to the Port, with the demand declining for cement, steel, lumber and other constructionoriented products. However, the Port was successful replacing these cargos with a dramatic 329 percent increase in windmill segments imports. In addition, the continuing investment in rail infrastructure has resulted in rail usage increasing by 44 percent. In 2008, a total of 172 vessels called on the Port during the calendar year, nearly a vessel every other day. More than 270,000 metric tons of liquid fertilizer arrived at the Port, representing the largest imported commodity. Cement shipments dropped to 268,834 metric tons as the construction industry continued its decline. Other large incoming cargos received during 2008 included anhydrous ammonia, molasses, steel products and large components for the construction of alternativepower wind turbine parts. However, the maritime highlight in 2008 was the 30 ships carrying windmill components that docked
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at the Port. These components were manufactured in Vietnam and China and were bound for destinations in Kansas, Texas and Wisconsin. The lengthy components were unloaded from their ships directly to dockside flat rail cars. The Port offers the longest direct ship-to-rail facility in the Western United States. Sulfur and rice exports continued to be the primary commodities leaving the Port of Stockton during 2008, with the Port exporting more than 227,000 tons of sulfur and more than 155,000 tons of California bagged rice, the highest tonnage in the past three years. Also in 2008, West Coast longshore workers ratified a new six-year contract with the Pacific Maritime Association of waterfront employers following bargaining that lasted for more than eight months. The new pact covers some 65,000 longshore workers and marine clerks, members of the International Longshore and Warehouse Union, at 29 West Coast ports. The PMA represents 71 domestic and international carriers, terminal operators and stevedoring companies operating at those ports.
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T H E L ONGE S T DI R E C T S H I P-T O -R A I L FACIL IT Y I N T HE W EST ER N U. S . More than 30 ships arrived at the Port of Stockton during 2008 carrying alternative energy wind tower components using the longest ship-to-rail facility on the West Coast. Each weighing up to 60 tons, these components were destined to be assembled into wind energy towers rising more than 260 feet above ground at wind farms located throughout the Midwest. The Port of Stockton’s 12,000 feet of dockside rail allows the tower segments to be unloaded directly onto flat rail cars, significantly reducing handling costs. The Port is an excellent gateway for these cargos due to the many rail connections into the Midwest. The rail cars are put together in what is called a “unit train”, which is a single source, single destination train that goes straight from the Port of Stockton to the project sites. The Meridian Way Wind Farm near Concordia, Kansas is among several new wind energy projects being built in the state with windmill segments shipped through the Port of Stockton. In addition to Kansas, windmill components arriving at the Port have also been delivered to Texas, Wisconsin, and Illinois. In addition to the direct use of windmill components using the Port’s ship-to-rail, other project
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cargos also made use of these and other key dock facilities. During 2008, 13 vessels called on the East Complex with their heavy and flat cargos totaling 5,781 metric tons. These project cargos consisted of items such as generators, cooling towers and evaporators used for the generation of electric power and large tank vessels used by regional oil refineries and chemical plants. Unit weights for some of these components were more than 300 tons. When completed, these components are expected to begin producing up to 201 megawatts of electricity. The Port has also partnered with the private sector to provide the required specialized equipment such as heavy haul railcars and multi-axel truck trailers to deliver the cargo to their final destinations. Given the multi-faceted capabilities of the docks and overland infrastructure supporting the Port facilities, the Port of Stockton is now recognized as a premier west coast gateway for handling these oversized, heavy and expensive project cargo components.
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Windmill components on the Port’s two mile direct ship-to-rail facility.
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Construction at Yara North America’s dry bulk fertilizer facility.
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PORT T EN A N TS CON T I N U E E X PA NSION OF FACIL IT IES Yara North America Expands Yara North America plans to build a bulk dry fertilizer storage and distribution center capable of storing up to 80,000 tons of fertilizer at the Port. The company will also have the option to use existing adjacent buildings on Rough and Ready Island for additional expansion. Yara currently moves about 75,000 tons of dry bulk fertilizer a year, and the new facility is expected to double capacity within two or three years of opening. The Port of Stockton is uniquely suited to efficiently handle dry bulk fertilizers, and its central location is ideal for distribution to a variety of Western States. Following the completion of the new Port of Stockton distribution center, most of the company’s dry fertilizer storage and distribution operations will shift to the Port. The Port Attracts More Biofuel Plants During 2008, US BioDiesel Group LLC, a biodiesel refining and trading startup announced plans to build a refining plant at the Port. It would be the second biodiesel plant and the third biofuel facility at the Port of Stockton, where Pacific Ethanol Stockton LLC is building an ethanol refinery and Community Fuels is installing biodiesel production equipment.
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The Port is attracting attention from biofuels producers because of its transportation links, specifically two major railroads providing connections to the Midwest as well as worldwide maritime shipping. H.J. Baker Facility Grand Opening In September of 2008, H.J. Baker & Bro., Inc., hosted a grand opening ribbon cutting of its new facility at the Port of Stockton. The new facility will allow the company to continue to provide top quality sulphur-based fertilizers to customers in the region and will also allow them to reach international customers more efficiently. Pacific Ethanol Begins Operation In October, Pacific Ethanol, Inc., began operations and has the capacity to produce 60 million gallons of ethanol a year. The $140 million facility employs the equivalent of 40 full-time employees. It uses corn to produce motor fuel for the California market as well as byproducts for sale as cattle feed. The Port leased 30 acres to Pacific Ethanol for the plant, which will process 21 million bushels of corn per year, producing both ethanol and 500,000 tons of wet distiller’s grains, which can be sold as cattle feed to dairies and feedlots.
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NE W EN V IRONM EN TA L PROGR A M S I M PL E M EN T ED The Port of Stockton continues to establish itself as an environmental leader in San Joaquin County and to set an example for conducting business in a responsible and sustainable manner. 2008 was an exciting year as the Port continued its environmental stewardship and implemented new environmental programs. Arundo Eradication and Native Habitat Protection Arundo is an invasive, non-native plant that resembles bamboo, which spreads rapidly and quickly displaces valuable native riparian habitats which species depend on for their survival. The Port’s Arundo Eradication Program goal for 2008 and 2009 is to effectively remove all colonies of Arundo along the waterways surrounding the Port, without the use of chemicals, so that native vegetation has the opportunity to establish itself to provide habitat for fish and wildlife of the region. Port of Stockton’s Owl Nest Boxes In 2006, the Port launched its Barn Owl Nest Box Program. The program goal is to enhance the barn owl population by providing suitable nesting locations throughout the Port. Thus COVER
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far, the Port has installed 15 barn owl nest boxes. Anecdotal evidence suggests that the barn owls are having a significant impact on the rodent population and are a very effective, environmentally friendly, and cost-effective method of rodent control. Repowering/Replacing Old Diesel Powered Equipment In an effort to reduce harmful air emissions, the Port is in the process of updating its diesel powered equipment. This process involves retiring old “dirty” equipment and replacing them with new clean or low emission equipment. To further this effort, the Port provides guidance and assistance to its tenants on ways to update their equipment and truck fleets to reduce harmful emissions. Healthy Air Living The Port adopted a resolution to support the San Joaquin Valley Air Pollution Control District’s valley-wide initiative to clean our air. This program encompasses a year-round approach to weaving choices into the fabrics of our lives on a daily basis that results in cleaner air and therefore better health for the Valley’s residents. PRINT
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Ships pass through San Francisco Bay on their way to the Port of Stockton.
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An Olympic athlete trains at the Port of Stockton.
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PORT PROV IDES T R A I NI NG FACIL IT IES FOR OLYM PIC AT HL ET ES During 2008, some of the top track and field athletes in the country trained for the Beijing Olympics at facilities provided by the Port of Stockton. The previous year, the athletes trained at a remote location in Isleton. The group’s rental property was sold and ultimately signed a rent-free, one-year lease with the Port of Stockton in order to complete their training. The athletes then moved truckloads of cumbersome equipment from Isleton on January 25 and were up and running three days later. Building 812 on Rough and Ready Island provided the athletes with 40,000 square feet of space to train under the supervision of Coach Dan Pfaff, who has coached elite Olympic athletes at several top American universities, including University of Texas at Austin and University of Florida. The facility is equipped with a pole vault runway and pit, a high jump pit, weightlifting equipment, two 90-meter sprinting lanes, and a throwing area. Daily activities included weight training, sprinting, plyometrics, jumping and vaulting. In May 2008, more than 30 athletes were preparing at the Port’s facilities for Olympic trials in June.
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Among the athletes participating in the training were Olympic gold medal winner Stephanie BrownTrafton; Amy Acuff, a four-time Olympian in the high jump; Suzy Powell-Roos, a three-time Olympian in the discus; Brad Walker, the 2007 world champion in the pole vault and current American record holder; and Hyleas Fountain, who won the Olympic Silver Medal in the heptathlon at the Beijing games. In all, eleven athletes who trained at the Port of Stockton competed at the Olympic Games in Beijing. The athletes, who had no financial support from their national dele gations, accepted donations and raised funds to cover expenses. Many athletes shared living expenses and worked side jobs to support themselves. Following the Beijing games, the group’s coach Dan Pfaff took a position with the United States Olympic Committee. Several athletes have continued to train at the facility, and some are preparing for the World Championships in Berlin, Germany in August 2009.
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SEC U R IT Y OPER AT IONS ENH A NCED W IT H NE W S YST E M S & T R A I NI NG Protecting America’s ports and goods supply chain is critical to the safety and growth of the United States economy. American ports handle 95 percent of all overseas cargo, providing billions of dollars worth of commodities and products that must be protected. During 2008, the Port of Stockton continued its commitment to comply with the United States Department of Homeland Security and United States Coast Guard regulations by improving overall port security. The focus has been to enhance security through improved access control, perimeter security, remotely operated video surveillance, increased internal security, and the training of port employees and port tenants. The Port focused on educating its tenants and business partners for the implementation of the Transportation Worker Identification Card (TWIC) program mandated by the U. S. Department of Homeland Security beginning in March of 2009. The addition of new Port businesses provides an ever changing face to challenge the security providers. The Port of Stockton has continued to meet the challenges by enhancing the police force through the training and proficiency testing of its academy-trained officers and security technicians. The Port’s award
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winning Canine Unit compliments the overall security for the Port and the surrounding community. Automated access control gates and the remotely monitored video camera system provides for quick response to breaches of security. They also provide for quick and timely processing of persons needing access to the secure maritime facilities on a 24-hour, seven days-per-week schedule. The digitally recorded video system also provides the ability to observe, record, and review activities captured by the cameras. Security however does not come without a price. The Port of Stockton has invested operating revenues and grant funding to achieve this goal. Also, like other ports in our nation, increases in operational funding required security fee assessments, and state/federal grant funding to sustain long-term security goals. Over the course of the year, all of the critical security requirements and challenges were met on time and as prescribed by law. The Port of Stockton is in full compliance with applicable regulations and is providing optimum security for the Port of Stockton and its clientele.
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The Port Police patrol the Port 24 hours a day.
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Olympic pole vaulter Brad Walker clears the bar while training at the Port.
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PORT HOSTS COM MUNIT Y E V EN TS & DIGNITA R IES 75th Anniversary On the evening of February 2, 2008, the actual 75th anniversary of the Port of Stockton, the Port hosted the opening night celebration “Diamond on the Delta: 75 Years of the Port of Stockton” a six-week public exhibit tracing the 75 year history of the Port of Stockton at the Haggin Museum in Stockton. The event was attended by more than 300 dignitaries, port tenants, employees and members of the public. Food stations representing some of the Port’s trading partners were located throughout the museum and a brief program was held in the Museum’s North Hall recognizing the contributions of many people throughout the years who have made the Port the job-generator it has become today. State of the City The Port hosted the Greater Stockton Chamber of Commerce’s annual State of the City event, attended by more than 1,000 people, including elected officials, members of the business community, and the general public. In addition to the featured address by Mayor Ed Chavez, the audience also heard from Port Director and Chamber President Richard Aschieris, and from Port Commission Chairman W. Ronald Coale who delivered a “State of the Port” message to the assembled group. The Port also premiered the COVER
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2007 annual report “California’s Heartland Port” which received the American Association of Port Authorities highest honor known as the “Award of Excellence” later in the year. Association of Pacific Ports The Port of Stockton hosted the Annual Meeting of the Association of Pacific Ports, an organization of ports from throughout the Pacific Rim in August, 2008. The conference was attended by 150 representatives from more than 30 ports. Delegates from Pacific Rim ports of Guam, Taiwan, Saipan, Mexico, Alaska, Canada, American Samoa, and California, among other places, participated in a combination of business meetings and locally-hosted social events, which included a Stockton Ports baseball game, tour of Lodi wineries, and a visit to Murphys, California. Chamber Mixer As part of the 75th Anniversary celebration, the Port hosted a mixer for nearly 300 leaders of the local business community. Held at the Commander’s House on Rough and Ready Island, attendees were acquainted with the Port’s role in the community, environmental efforts, and future plans to bring more jobs to the community. 17
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2 0 0 8 I N R E V IE W: PORT STAT IST ICS
TOTAL WATERBORNE TONNAGE FOR CALIFORNIA SMALL PORTS San Diego
3,142,691
Stockton
2,098,684
Redwood City
1,487,064
San Francisco
1,362,694
Hueneme
1,269,462
Sacramento
852,849
Humboldt
522,604
Richmond
331,604
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Dock warehouse with steel coils.
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Spools of steel are unloaded.
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2 0 0 8 I N R E V IE W: PORT STAT IST ICS
OUTBOUND TRADING PARTNERS Total Tonnage: 431,923 Metric Tons
INBOUND TRADING PARTNERS Total Tonnage: 1,306,193 Metric Tons
Japan
China
155,628
315,236
Trinidad
248,235
Norway
Brazil
106,939
84,783
Japan
105,436
Russia
86,252
Mexico
Taiwan
76,616
81,876
Thailand
59,940
China
South America
51,192
55,384
Australia
52,491
Vietnam
Turkey
37,072
47,551
Korea
30,603
Egypt
28,115
India
Chile
14,730
20,788
New Zealand
2,609
Other
Other
1,423
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2 0 0 8 I N R E V IE W: PORT STAT IST ICS
INBOUND COMMODITIES Total Tonnage: 1,306,192 Metric Tons
OUTBOUND COMMODITIES Total Tonnage: 431,922 Metric Tons
Liquid Fertilizer
Sulphur 227,033
271,571
Cement
268,834
Anhydrous Ammonia
227,914
Molasses
Bagged Rice
200,188
155,628
Steel Products
125,841
Windmills
77,622
Bagged/Bulk Fertilizer
59,228
Bulk Rice 47,551
Barite 38,040
Bulk Rice
29,986
Project Cargo
4,359
Lumber/ Pebbles
Other
1,710
2,609
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Rice at dockside warehouse.
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The commander’s house is host to many community events.
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2 0 0 8 I N R E V IE W: PORT STAT IST ICS
CARGO TYPES & PROPERTY LEASING Total Revenues: $31,878,401
REVENUE CENTERS Total Revenues: $31,878,401
Property Management
Property Management
General Cargo
$12,900,843
$15,750,049
$15,750,049
Terminal
$7,275,372
Warehouse
$1,323,583
Dry Bulk Cargo
$4,442,039
Other
$871,458
Liquid Bulk Cargo
Interest
$2,507,015
$560,109
Grant Revenue
Other
$1,903,926
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$472,359
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PORT EXECUTIVE Richard Aschieris, Port Director Jeff Kaspar, Deputy Port Director, Properties and Environmental Cheryl Taylor, Deputy Port Director, Finance and Administration Mark Tollini, Deputy Port Director, Trade and Operations Yvonne Ishimoto, Assistant to the Director/ Secretary to the Board Misty Escobar Victoria Lucero Barbara Snyder ACCOUNTING Dianna Baker, Controller Michelle Bowling, Assistant Controller Jeannine Anchartechahar Esmeralda Correa Rita Hernandez Kristy Krause Maria Perez Jan Perryman
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STOCK TON
COMMERCIAL EXCHANGE CLUB Beverly McConnell, Commercial Exchange Club & Special Events Manager Tim Montgomery, Golf Professional ENVIRONMENTAL AND REGULATORY AFFAIRS Jeff Wingfield, Manager, Environmental & Regulatory Affairs Jason Cashman Rita Koehnen FACILITIES MAINTENANCE AND CONSTRUCTION Gary Gentry, Director of Facilities Maintenance and Construction Tim Loveland, Facilities Maintenance and Construction Manager/ Safety Officer Jazoé Smith Juan Villanueva Scott Ballard Bob Belmont Gary Capehart Steve Cookerly David Gentry Randall Hawley Kazuo Higashi Mike Holmes
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Gary Johnston Joe Luke Bob Myers Ricardo Navarro Eric Osterlie Alex Perez Charles Piggee Vern Ragsdale Pete Ramirez, Jr. Joe Rhodd Steve Trindade David Zendejas HUMAN RESOURCES Christeen Ferree, Human Resources Manager Katie Cowan Melanie Rodriguez INFORMATION TECHNOLOGY Jim Cooper, Information Technology Manager Myra Lang Dennis LeClert MARKETING William P. Lewicki, Director of Marketing OPERATIONS Chris Mountjoy, Terminal Superintendent Mike Tyler, Operations Manager Jill McAuliffe, Accounts Manager
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Bodie Gonsales, Assistant Superintendent Randy Jerwa, Assistant Superintendent Mike Miller, Assistant Superintendent Jeff Vine, Assistant Superintendent Linda Cook Larry Lockmiller* Kyle Moutray Daniel Bautista Cecilio Gomez Eduardo Gomez Victor Gomez Michael Lopez Alfredo Maya Giovanni Maya Everardo Mendoza Raul Montanez Sam Montanez Samuel Montanez David Rodriguez PORT POLICE George F. Lerner, Jr., Chief of Police Steve Nichols, Lieutenant Mike Archibeque Jim May Jim Mitchell Noel Aviles Suzanne Craig Billy Hutton Timothy Ivey Rick LeChuga
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Tyler Moua Kerry Nicholas Tony Novaresi Allen Standley Lacy Biglow Janice Dias Fritz Encluna David McConnell Leslee Rogers Darrel Wade Wally Wallick PROPERTY MANAGEMENT Steve Escobar, Manager, Port Real Estate & Properties Development Debbie Calli PURCHASING AND GENERAL SERVICES Erin Potter, Purchasing and General Services Manager Judy Baumann Melissa Honey Kara McKinney SPECIAL PROJECTS Henry McKay, Special Projects Manager * 2008 Employee of the Year
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P.O. Box 2089, Stockton, CA 95201-2089 • 2201 West Washington Street, Stockton, CA 95203 www.portofstockton.com E-mail:
[email protected] • (209) 946-0246 • (800) 334-3213 • Fax: (209) 465-7244
The Port of Stockton received the prestigious AWARD OF EXCELLENCE for its 2007 Annual Report by the American Association of Port Authorities at its 2008 awards competition. There were only two Awards of Excellence given for Annual Reports in 2008 throughout the U.S and Canada. The Government Finance Officers Association of the United States and Canada has awarded the Stockton Port District with a CERTIFICATE OF ACHIEVEMENT FOR EXCELLENCE IN FINANCIAL REPORTING for the Port’s comprehensive annual fi nancial report for the 2008 fi scal year. This was the eighth consecutive year that the Port Stockton District has achieved this prestigious award. We would appreciate your opinion about this year’s Annual Report. Our web site, www.portofstockton.com, has a Feedback link on the Annual Reports web page. Please send us your comments and questions. Design & Production by Cummings Design + Advertising Printing by Parks Printing All images, unless otherwise noted, © 2008, Phil Di Marino, ColorNet, Inc. © 2009 Port of Stockton
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Printed with soy inks on recycled paper
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