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43 4.1 Introduction Superstorm Sandy was a multi-state weather event in October 2012 that resulted in significant physical damage to the Port of New York and New Jersey, the largest port on the U.S. East Coast. Sandy also affected nearly all elements in the supply chainâports, airports, railroads, trucking firms, and warehouses/distribution centers. The situation was further complicated because Superstorm Sandy occurred during the peak shipment week of the year. While the physical devastation was largely centered in the New YorkâNew Jersey area, the effects of the storm and its impact on the supply chain were experienced by ports, freight transportation suppliers, and shippers/receivers along the entire U.S. East Coast and further inland. Massive power outages affected communications, repairs, and resumption of service. Emergency supplies needed to move. Alternative routes and modes were pressed into service. Federal and state regulations pertaining to certain aspects of goods movement needed to be addressed, were sometimes waived, and sometimes affected modal options. Nevertheless, the preparation for, immediate response to, and long-term actions resulting from Superstorm Sandy, as discussed in this case study, illustrate the following: â¢ All three layers of supply chain considerationsâphysical operations, information and com- munication flows, and regulatory activitiesâcan be affected by disruptions and can play key roles in the immediate response and speed of business resumption. â¢ Ongoing high-level public-private groups consisting of key port community organizations that have direct roles in operations, disruption response, and other issues, can expedite business recovery. â¢ The availability of electrical power and other utilities is essential to recovery and business resumption. â¢ A major port closure can negatively affect the operations at alternative ports by generating unanticipated surges in vessel and cargo operations at those locations. â¢ Modal flexingâthe ability of alternative freight modes to assist in response and business continuityâis essential. â¢ Facility recovery requires balancing immediate needs versus more time-consuming equipment repairs. This case study, which focuses on a major port disruption involving containerized cargo movements, includes the following: â¢ A description of Superstorm Sandy, including characterizing the storm within the supply chain disruption characteristics identified in Methodologies to Estimate the Economic Impacts of Disruptions to the Goods Movement System (GTRC, 2012, pp. 30â32). C H A P T E R 4 Case Study: Response to and Recovery from Superstorm Sandy
44 Making U.S. Ports Resilient as Part of Extended Intermodal Supply Chains â¢ A discussion of the topographies of import and export maritime cargo movement affected by disruptions. â¢ Overviews of preparations, impacts on port operations and responses, and business resumption. â¢ A summary of the lessons learned and actions being taken or considered. The following organizations interviewed for this case study reflect the range of public and private organizations involved in port operations. â¢ Federal agencies: USCG and CBP. â¢ Port agencies: The Port Authority of New York and New Jersey, the Virginia Port Authority, and the Maryland Port Authority. â¢ Maritime terminal operators: Global Marine Terminal, APM Terminal, Virginal International Terminals LLC, and the New York Shipping Association (which represents the terminal operators and provides labor for port operations). â¢ Railroads: Norfolk Southern and CSX Railroads. â¢ Trucking and Drayage Companies: International Motor Freight and Cross Port Transport. â¢ Barge Operator: Columbia Coastal. â¢ Container Lines: Maersk and Hapag Lloyd. Additionally, three major retailers with large distribution centers provided material used in this case study. The discussion guides used to frame the interviews are provided in Appendix 4A of this report. 4.2 Description of Superstorm Sandy This section provides a timeline of the superstorm (Figure 4.1) and provides a context for the port-related supply chain discussions that follow in the case study. According to Accuweather (http://www.accuweather.com/en/weather-news/timeline-of-events-surrounding/2665639), âSandy was the strongest hurricane on record to strike the United States north of North Carolina.â This section focuses on the general storm; the timelines and actions specific to ports are described separately in a later section of this case study. Sandyâs reported timeline (http://www.fema.gov/hurricane-sandy-timeline, http://newswatch. nationalgeographic.com/2012/11/02/a-timeline-of-hurricane-sandys-path-of-destruction/, http://www.accuweather.com/en/weather-news/timeline-of-events-surrounding/2665639, http://www.cnn.com/2013/07/13/world/americas/hurricane-sandy-fast-facts), is as follows: â¢ Monday, October 22, NOAAâs NWS officially designates Tropical Depression 18 as Tropical Storm Sandy. The storm formed in the southern Caribbean Sea off the coast of Nicaragua. The maximum winds are 40 mph. â¢ Tuesday, October 23, NWS issues advisories for a Tropical Storm Watch for portions of south Florida and the Florida Keys. â¢ Wednesday, October 24, The storm, now a Category 1 hurricane, moves northward across the Caribbean and crosses Jamaica with winds of 80 mph and generates 20 inches of rain on Hispaniola. More than 50 people die in the flooding and mudslides in Haiti. Hurricane Sandy is now monitored by the FEMA regional office in Atlanta. NWS storm warnings extend to southeastern Florida. â¢ Thursday, October 25, Hurricane Sandy is located in the eastern Caribbean Sea with maximum sustained winds of 105 mph. FEMA is now in close coordination with state emergency manage- ment partners in Florida and the potentially affected states in the Southeast, Mid-Atlantic, and New England. The American Red Cross takes preparatory steps as far north as New York. â¢ Friday, October 26, Sandy strengthens as it moves from Jamaica to Cuba and strikes the historic City of Santiago de Cuba with winds of about 110 mph, only 1 mph below the status
Case Study: Response to and Recovery from Superstorm Sandy 45 of a major Category 3 hurricane. New York; Maryland; Washington, D.C.; Pennsylvania; and North Carolina declare states of emergency. The governor of Maine signs a limited emergency declaration allowing power crews from other states and/or Canada to help Maine prepare for Sandy. FEMA deploys Incident Management Assistance Teams to Connecticut, Delaware, New York, New Jersey, Massachusetts, New Hampshire, Pennsylvania, and Vermont, as well as liaison officers to EOCs in multiple states. In addition to Florida, the NWS issues Tropical Storm Watches for coastal areas in South Carolina and parts of North Carolina from the Savannah River (which delineates the border of Georgia and South Carolina) northward to Oregon Inlet, North Carolina, including Pamlico Sound. USCG issues warnings, closes several ports, and sets specific conditions for operations in storm conditions as far north as the Port of Baltimore. The U.S. National Guard positions more than 61,000 personnel along the East Coast and coordinates with local authorities in preparation for Sandyâs landfall. The Federal Aviation Administration, U.S. Department of Energy, U.S. Department of Agriculture, and U.S. Geological Service also are engaged. Additional federal agencies engage as the storm progresses. â¢ Saturday, October 27, Sandy moves away from the Bahamas and makes a turn to the northeast off the coast of Florida. The storm briefly weakens to a tropical depression, but quickly re-intensifies into a Category 1 hurricane. New Jersey, Connecticut, and Massachusetts declare states of emergency. New Jersey Governor Chris Christie orders residents living in the barrier islands from Sandy Hook south to Cape May to evacuate. Amtrak cancels several of its runs that originate or end at East Coast stations. FEMA activates the National Response Coordination Source: NASA Figure 4.1. Superstorm Sandy on October 29, 2012.
46 Making U.S. Ports Resilient as Part of Extended Intermodal Supply Chains Center (NRCC), a multi-agency center based at FEMA headquarters in Washington, D.C. The NRCC provides overall coordination of the federal response by bringing together federal departments and agencies to assist in the preparations for, and response to, disasters. Medical teams and support supplies are mobilized. American Red Cross chapters are mobilized. New York City Mayor Bloomberg tells New Yorkers in a pre-storm press conference to prepare for the arrival of Sandy by staying indoors and avoiding low-lying areas. â¢ Sunday, October 28, Sandy continues moving northeast on a track that takes it parallel to the coasts of Georgia, South Carolina, and North Carolina. The stormâs center stays well offshore as it approaches the coast of North Carolina. The storm sends powerful waves onto North Carolinaâs Outer Banks, washing out NC Highway 12 in several locations. An unusual con- figuration of weather factors converges, with meteorologists warning that the storm will likely become a powerful, hybrid superstorm as it churns northward. A high-pressure cold front to Sandyâs north is anticipated to force the storm to start turning to the northwest toward major cities such as Baltimore, Washington, Philadelphia, and New York (Figure 4.2). In addition, the full moon is anticipated to make Sandyâs storm surgeâexpected to be 11 to 12 feet in some placesâeven higher as it makes landfall. Sandy has expanded into a massive storm with winds covering about 1,000 miles. Keith Blackwell, a meteorologist at the University of South Alabamaâs Coastal Weather Research Center in Mobile, tells National Geographic News, âItâs so strong and so large, Normally protected areas like New York Harbor and Long Island are seeing the worst-case scenario.â The local actions reported by CNN and others are as follows: â New Yorkâs Metropolitan Transportation Authority suspends subway and commuter rail services at 7:00 p.m. Bus services are suspended at 9:00 p.m. â USACE mobilizes planning and response teams (PRTs) and other resources to support temporary power generator requirements. â New York City Mayor Michael Bloomberg orders evacuations in low-lying areas of the city and public school closures. â Rhode Island declares a state of emergency. â President Barack Obama declares a state of emergency in Connecticut; Washington, D.C.; Delaware; Maryland; Massachusetts; New York; New Jersey; and Rhode Island. Source: National Hurricane Center Figure 4.2. Superstorm Sandyâs track as of October 28, 2012.
Case Study: Response to and Recovery from Superstorm Sandy 47 â The Broadway League cancels all Broadway performances for Sunday and Monday nights. â The Port Authority of New York and New Jersey suspends all PATH train service at midnight until further notice. â Airlines cancel flights, Amtrak cancels service. Airports are closed in the area. â The Southeastern Pennsylvania Transportation Authority, New Jersey Transit, and the New York Metropolitan Transportation Authority suspend all services. â¢ Monday, October 29, Sandy makes its expected sharp turn toward the northwest on a path for the coast of New Jersey. The storm also starts interacting with the other weather systems, gaining energy in the process. The storm results in heavy snow in the Appalachian Mountains of Virginia, West Virginia, and North Carolina. The center of the storm makes landfall near Atlantic City, New Jersey. The storm is no longer considered a hurricane but is now classified as a post-tropical norâeaster. But the stormâs unusual path from the southeast makes its storm surge much worse for New Jersey and New York. The New York Harbor receives the surge and high winds. The surge is worsened because the full moon has added about a foot to the surge and Sandy arrives at high tide. Meteorologist Tim Morrin of the NWSâs New York office tells National Geographic News that the surgeânearly 14 feetâis a new record for a storm surge in the harbor. The previous record of just over 10 feet was set in 1960 when Hurricane Donna passed just offshore. The surge tops the Battery seawall in Lower Manhattan and floods parts of the cityâs subway system. The surge also floods the Hugh Carey Tunnel, which links Lower Manhattan and Brooklyn, as well as the PATH system. Winds, rain, and flooding impact New Jersey and New York throughout the night and through three cycles of high and low tides. â¢ Tuesday, October 30, Sandy moves away from New York. As the day progresses, Sandy weakens as it moves inland over Pennsylvania. President Obama declared major disasters for Connecticut, New Jersey, and New York, making disaster assistance available to those in the heaviest hit areas affected by the storm. In the end, the impact of Superstorm Sandy was historic. As reported in USA Today (http://www. usatoday.com/story/news/nation/2013/10/29/sandy-anniversary-facts-devastation/3305985/), Sandy â¢ Was responsible for an estimated $65 billion in damage in the United States, second only to Hurricane Katrina. â¢ Caused some 8.5 million customers to lose electrical power in a multi-state area. â¢ Was a âonce in 700-year eventâ creating the first time that a storm took a sharp turn to the west and hit New Jersey. â¢ Led to the retirement of the name Sandy, which only occurs if a storm is so deadly or damaging that the use of the name is considered insensitive. 4.3 Characterizing Superstorm Sandyâs Disruption of the Supply Chain Superstorm Sandy was devastating. The superstormâs impact on supply chains was equally disruptive. Supply chain disruptions are characterized in the following terms: â¢ The extent of the geographic area affected, â¢ The freight modes and facilities affected, â¢ The characteristics of the cargo affected, and â¢ The length of time needed to resume activity at the affected freight facilities. Superstorm Sandyâs disruptions to the supply chain, with a specific focus on containerized port operations, are described in the rest of this section.
48 Making U.S. Ports Resilient as Part of Extended Intermodal Supply Chains Geographic Area Affected Superstorm Sandy was a multi-state event that affected the entire U.S. East Coast, as well as areas inland as the weather event traveled north. Several ports were put on heightened alert or closed as Sandy moved north, including ports in North Carolina, Virginia, and Maryland. However, physical damage, if any, was limited in these areas. The most significant physical damage to ports handling containerized cargo occurred in the New YorkâNew Jersey region (Figure 4.3). Six terminals, all under the control of the Port Authority of New York and New Jersey, which operates as their landlord, and each operated by private entities, are located within the area. All were affected and sustained significant damage. The terminals included the following: â¢ APM and Maher Terminals in Elizabeth, New Jersey; â¢ Port Newark Container Terminal in Newark, New Jersey; â¢ Global Marine Terminal in Jersey City, New Jersey; â¢ New York Container Terminal on Staten Island, New York; and â¢ Red Hook Container Terminal in Brooklyn, New York. The Port of New York and New Jersey is the largest container port on the North American East Coast and the third largest in the United States (after the Ports of Los Angeles and Long Beach). The port is a major international trade gateway. Collectively, in 2012, the six container terminals within the port handled over 5.5 million 20-foot equivalent units (TEUs) translating into over 3.2 million containers (of, generally, 40-foot and 20-foot lengths). Freight Modes and Facilities Affected All freight modes and facilities were affected by Superstorm Sandy, particularly in the New Yorkâ New Jersey region. The port industry is defined as any activity directly related to the movement of waterborne cargo. The system involves the following three elements: â¢ The waterways and channels used by vessels; â¢ The terminals through which the maritime cargo flows; and Source: http://www.panynj.gov/port/containerized-cargo.html Figure 4.3. Container terminals in the Port of New York and New Jersey.
Case Study: Response to and Recovery from Superstorm Sandy 49 â¢ The inland and domestic movements of international maritime cargo, including barge, truck, rail, pipeline, andâ sometimesâair cargo. Trucks, railroads, domestic barges, and air cargo carriers also can act as alternative transportation options to facilitate business recovery when port infrastructure and operations are affected. All of these forms of freight conveyance were affected, particularly in the New YorkâNew Jersey area, as follows: â¢ The waterways were affected by floating debris, potential changes in channel depth and damage to navigation aids. â¢ The terminals sustained damage to equipment, buildings, and paved areas. Electrical power was lost. Surging salt water damage was widespread. â¢ Trucking firms directly serving the port/providing drayage service sustained losses of tractors and other equipment. In addition, roadways were damaged, blocked, or washed away. Fuel and chassis shortages impeded truck operations. â¢ The major Class I railroads serving the Port of New York and New Jersey moved equipment prior to the superstorm but still sustained damages to on-dock rail yards. In addition, the CSX Kearny Yard in Essex Countyâeventually used for the shuttle trains returning diverted cargo to the regionâwas flooded with more than 4 feet of water, with damage to equipment. â¢ Newark Liberty International and John F. Kennedy Inter- national Airportsâthe two regional airports that handle the majority of air cargoâsustained damages and were closed (though for a shorter time than the port facilities). New Jersey is also a major warehousing and distribution center node, with over 940 million square feet of industrial prop- erty. Major warehouses and distribution centers throughout the region that receive import shipments were significantly affected. Buildings lost electrical power and needed to rely on generators for up to 2 weeks at significant cost. Although some of the dis- tribution centers have large solar panel arrays on their roofs, these solar systems feed into the regional electrical grid and do not serve the buildings directly. Trucking firms faced the same challenges as described for the port areas. Characteristics of the Containerized Cargo Affected Containerized cargo typically consists of a wide range of products, particularly for retail markets. According to the Journal of Commerce (see http://www.joc.com/international- trade-news/trade-data/united-states-trade-data/top-100- importers-2012_20130524.html), the top 10 importers via ocean container transport include Wal-Mart, Target, Home Depot, Dole Food, Loweâs, Sears Holdings, the LG Group, Heineken USA, and Philips Electronics North America.
50 Making U.S. Ports Resilient as Part of Extended Intermodal Supply Chains As described by one major retailer, Superstorm Sandy occurred during the peak intake week of the yearâthe week when warehouses and distribution centers are stocking fully for the holiday season. As such, the containerized shipments affected by the superstorm were time sensitive, in peak season, and generally comprised of higher value products than at other times of the year. An interviewee characterized the situation, saying âThis was Christmas season. Everyone was in a rush. The customers wanted cargo to move immediately and not stop because one port was shut down. These diversions were unwelcome.â Length of Recovery Period For the purposes of this case study, the length of the recovery period is defined as the length of time that was needed to return the majority of the Port of New YorkâNew Jerseyâs container terminals to operation, even though significant repairs were still under way. Under this definition, the port was closed for nearly 1 week. Although the terminals were reopened and handling vessel operations, the import containers diverted to other ports took varying lengths of time, sometimes beyond this 1-week period, to be moved to their original U.S. destination. 4.4 Topographies of Import and Export Containerized Cargo Operations Another approach to understanding the impact of Superstorm Sandy on ports and supply chains is to identify how the elements of import and export containerized cargo operations were affected. Of the over 5.5 million TEUs handled by the Port of New York and New Jersey in 2012, over 2.7 million TEUs, or 50 percent, were loaded import containers. Figure 4.4 summarizes the topography of import container movements and diversions based on industry knowledge, along with the research and interviews conducted for this project. Vessel Operations Vessel operations are scheduled and monitored by carrier operations personnel who assess the conditions at the ports of call and at sea, along with the options available. The Merchant Marine Act of 1920, commonly referred to as the Jones Act, requires that goods and passengers transported solely between U.S. ports must be done on vessels made and staffed in the United States (referred to as âflaggingâ of the vessels). Foreign-flagged vessels can transport passengers and cargo on rotations that include at least one overseas port but cannot move cargo and passengers between two or more U.S. ports; the origin and destination of a shipment carried on a foreign-flagged vessel must include an overseas port. As weather and ocean conditions during Superstorm Sandy deteriorated and the USCG closed ports on the U.S. East Coast, ocean carrier operations staff considered their options. These options included keeping going, slowing down, or speeding up vessels to work around the worst elements of the vast superstorm, as well as whether to skip one or more East Coast ports that were typically part of the vesselsâ scheduled rotations. As a result of these conditions, as well as the week-long closure of the Port of New York and New Jersey, vessels with import containers offloaded shipments at alternative locations along the East Coast. The Port Authority of New York and New Jersey estimates that 57 vessels, including 15,000 containers and 9,000 vehicles, were diverted to other U.S. East Coast ports as a result of Superstorm Sandy (PANYNJ, 2012).
Case Study: Response to and Recovery from Superstorm Sandy 51 Port and Terminal Considerations To resume the flow of imported cargo, the âoriginalâ impacted port must focus on immediate recovery and restarting of operations. As discussed in this case study, this effort involves addressing physical damage, information flows (in terms of coordinating recovery and the information needed for resuming cargo movement), and meeting agency requirements, particularly security and cargo inspection. The issues are equally as complex for alternate ports handling the diverted cargo and vessels. These ports must balance the handling of cargo from their regular customers with the surge in diverted vessels and cargo. The considerations for âdiverted portsâ include having sufficient equipment and labor to handle the additional loads, information regarding how the diverted cargo will be moved inland to customers (availability of barge, rail, and/or truck options), and the physical capacity to store the containers at the port until these movements occur. The speed at which decisions are made regarding these movements, as well as obtaining sufficient equipment and CBP clearance, contributes to determining how long the diverted cargo must be stored at the diverted port. Federal agencies, such as CBP, also must deal with reassigning at least some of the shipments from the original customs district to the district where the diverted port is located so the cargo Figure 4.4. Topography of import container operations and diversions. Source: A. Strauss-Wieder, Inc.
52 Making U.S. Ports Resilient as Part of Extended Intermodal Supply Chains can be cleared to be moved inland. Otherwise, the cargo must travel âin bondâ in the original customs district for clearance. Import cargo also must satisfy CBP requirements. Most of the containerized cargo diverted by Superstorm Sandy was handled by the Virginia Port Authority. The Ports of Baltimore, Halifax, and Philadelphia also handled some diverted vessels and cargo. According to the interviews, Baltimore handled approximately 2,800 containers, and Virginia Port Authority handled some 8,000 to 10,000 diverted containers. Inland Movement Considerations At the original port of call where the physical damage occurred, the restarting of cargo operations is also dependent on the availability of inland modal connections. The considerations regarding inland movement vary by mode and include the following: â¢ Truck movements are dependent on access and regional roadways to be open; having suffi- cient tractors, chassis, fuel, and drivers to handle the movements; and having the data systems operational for gate clearances and needed cargo information. Trucking companies are also dependent on the inland customerâs location, such as a warehouse or distribution center, being operational (i.e., recovered from any damage; is accessible; and has power, data systems, and personnel) and accepting deliveries. â¢ Rail movements are similarly dependent on on-dock, near-dock, and other rail yards on the system being operational and rail lines being clear for train movements. Sufficient locomotives, fuel, labor, and intermodal equipment (including the equipment for the loading and unloading of trains) are needed. â¢ Barge movements are dependent on the waterways being certified for operation; the facility where the barge is calling being operational; sufficient equipment, labor, and fuel being available; and the conditions at the location where the barge is calling. Over 80 percent of the cargo at the Port of New York and New Jersey moves inland via truck, a reflection of the regionâs population density and as a major North American distribution center node. Most of the remaining shipments move inland through the ExpressRail yards located at the Port. Many of the trucking firms serving the Port of New York and New Jersey suffered significant losses of tractors. Some trucking firms worked closely with their suppliers to secure replacement tractors as quickly as possible. Others, including owner operators, did not have such business relationships and capital to recover quickly. The ExpressRail yards at the port experienced surges in salt water, with sand, fencing, and other debris deposited on track, and power out for controls and signals. In general, the damage to the rail infrastructure was characterized by the interviewees as less severe than the trucking damages. Much of the rail infrastructure is located further from the wharfs, and the Class I railroads had moved equipment out of the area prior to the storm. A different set of inland movement considerations confront the ports handling the diverted vessels and cargo. The Jones Act, as previously discussed, does not permit diverted cargo that is offloaded at one U.S. port to then be picked up by another foreign flag vessel to be moved to the original port. A U.S.-port-to-U.S.-port move must be done by a U.S.-flagged vessel, such as a U.S.-flagged coastal container barge, or moved by rail or truck, generally after clearing CBP. Diverted containers needed a permit from CBP to transfer within the original port, an in-bond transfer between ports, or an entry release/clearance by CBP prior to inland movement. The resiliency and flexibility of the U.S. multimodal freight system thus becomes a consider- ation in the ability to move cargo from the diverted ports to customers, as do existing contractual
Case Study: Response to and Recovery from Superstorm Sandy 53 arrangements among carriers and transportation providers. The distance between the diverted port and the location of the customerâs U.S. facility is a consideration. Based on the interviews, in general, if the distance is under a half-dayâs drive, then trucks can become an option where timely movement of the diverted loads can justify the additional trucking costs. The trucks picking up this cargo must have the credentials to call on the terminals at the diverted port. Movements by barge and rail offer more cost-effective solutions for large-scale transport of diverted cargo to customers. Barge movements offer the opportunity to move the containers in bond to the original port for clearance. Based on the interviews, movement of diverted containers via rail required the containers to have cleared U.S. Customs. Movements by barge and rail are also dependent on the availability of these options at the diverted ports. Such âmodal flexingâ was crucial to handling the cargo diverted by Superstorm Sandy. For example â¢ CSX created special rail shuttles between Norfolk, Virginia, and Kearny Yard in New Jersey, and qualified crews moved diverted containers to customers in the New YorkâNew Jersey region. Most of the containers diverted to Norfolk were handled via these trains after each container was cleared by CBP. Diverted containers that were destined to locations further inland could be handled by the existing CSX and Norfolk Southern trains at Norfolk after clearing CBP. â¢ Columbia Coastal similarly sent special barges to Virginia to bring containers back to the Port of New York and New Jersey. The companyâs existing barge service between Baltimore and New Jersey handled containers diverted to Maryland. â¢ Cargo diverted to Philadelphia destined to the New YorkâNew Jersey area could be picked up by truck, given the shorter distance. Considerations at Customer Locations Customers had to handle a wide range of supply chain issues due to the port disruptions, including â¢ Damage to the container contentsâThe surge in salt water enveloped many containers at the Port of New York and New Jersey. The high winds also toppled stored containers. Both situations resulted in damaged contents that needed to be replaced quickly given the urgent demands of peak season. â¢ Increased waits for containersâIf the containers were at the original port, the customer had to wait for the port to reopen to obtain the containers. Resumption of business service at the port, including information systems, equipment shortages and clearing CBP, and arranging truck delivery, increased the amount of time needed to obtain the containers. Where containers had been diverted, customers had to wait while these containers were located and arrange- ments made for their delivery from the diverted port. In addition, the party responsible for the containerâs transportation to the customer (which can be either the supplier or the customer) was also responsible for any additional costs associated with the move from a distant location. â¢ Truckers serving the warehouseâWhen fuel is in short supply, arrangements may need to be made to ensure that trucks have sufficient fuel to operate. Some customers, as well as trucking firms, arranged for tank trucks to be available on site to service trucks and their own labor force. â¢ Conditions at buildingsâIf electrical power was out at the buildings, then generators were needed to power equipment and the warehouse information management systems that are crucial for material flows and facility operations. In addition, customers had to take care of
54 Making U.S. Ports Resilient as Part of Extended Intermodal Supply Chains their labor force, including making sure those workers had access to fuel and supplies for their homes. Any damage to buildings and access roads had to be repaired sufficiently to restart operations. â¢ Conditions at their customersâ buildingsâIn some cases, when retail stores being served by the warehouses were not open, product had to be held at the distribution center. In other cases, where supplies were urgently needed for response and recovery, customers had to dispatch their own trucks to pick up supplies as they became available at the warehouse. The organizations interviewed for the case study primarily focused on the movement of import containers. However, one interviewee did note a decision point unique to export containersâ whether to hold the product at the domestic origin or reroute the shipments based on the anticipated resumption of business operations. The next several sections of the case study detail the preparations for, impacts of, and responses to Superstorm Sandy. 4.5 Superstorm Sandy Preparations The preparations for the superstorm reflect the vast geographic area and freight modes affected, as well as the uncertainties regarding the stormâs path and potential impact. All ele- ments in the topography prepared for the event, with preparations occurring on the physical, information/communications, and regulatory levels. Preparations by Public Agencies Numerous public agencies at the federal, state, and local levels prepared for Superstorm Sandy. Decisions and levels of preparation varied based on location and intensified as the path and attributes of Sandy became more apparent. For example, the path of Sandy is clearly evident in the port conditions set by the USCG as the weather event proceeded up the East Coast. The initial USCG announcements focused on the Florida area. As Sandyâs path proceeded, on October 26, the USCG set Hampton Roads (Virginia) and the Port of Baltimore on port condition âWhiskeyâ (http://www.fema.gov/hurricane-sandy-timeline), a port readiness condi- tion indicating that hurricane force winds are possible within 72 hours (http://www.nrlmry.navy. mil/port_studies/tr8203nc/miami/text/sect3.htm). On October 27, the USCG set port condition âX-Rayâ for the Port of Philadelphia, meaning that gale force winds were expected within 48 hours (http://www.uscgnews.com/go/doc/4007/1591207/). Philadelphia moved to condition âYankeeâ (gale force winds possible within 24 hours) the next day (see http://www.uscgnews.com/go/doc/ 4007/1591215/) and to âZuluâ (gale force winds within 12 hours) on October 29 (http://www. uscgnews.com/go/doc/4007/1591223/). On October 28, this condition was raised to âZuluâ for Baltimore and Virginia (http://www.uscgnews.com/go/doc/4007/1591327/). The USCG opened all ports from Philadelphia to North Carolina on November 1 (http://www.uscgnews. com/go/doc/4007/1594499/). In the New York area, the captain of the Port of New York and New Jersey provided advanced notice on Saturday, October 28, that the port would be closed effective by mid-Sunday afternoon. The USCG set condition âYankeeâ for the Port of New York and New Jersey on the same day, and made the following requirements (http://www.uscgnews.com/go/doc/4007/1591335/): â¢ Commercial deep-draft vessels greater than 500 gross tons are not authorized to remain in port alongside a pier after 6 p.m., today. â¢ All vessels must be out of Bay Ridge, Stapleton, and Gravesend Bay Anchorage Grounds by 6 p.m., today.
Case Study: Response to and Recovery from Superstorm Sandy 55 â¢ Only one barge per commercial mooring buoy, with a tug in the vicinity, is authorized after 6 p.m., today. â¢ After the hurricane has passed, all facilities must fill out a post-storm assessment survey. The USCG set condition âZuluâ and closed the Port of New York and New Jersey on October 29 (http://www.uscgnews.com/go/doc/4007/1591571/). Ultimately, ports from Virginia to Boston were closed. The following timeline of actions by the Port Authority of New York and New Jersey (PANYNJ, 2012) shows the initial monitoring of conditions, with significant ramping up of actions as it became evident, on the day before the Superstorm Sandy hit, that the New Yorkâ New Jersey region would be at the epicenter of the weather event: â¢ Notification to port authority tenants began Thursday, October 25 (following USCG Sector NY Hurricane/Severe Weather Plan and Port Authorityâs Emergency Operations Plan). â¢ The Port Authority EOC is activated on Oct. 28. The October 28 National Weather Service briefing indicated surge of 6â-11â above normal high tide. Based on emerging conditions, the port authority decides to close the maritime terminals to all but essential personnel by 23:59 hours. All vessels were required to be at âsafe harborâ (not at the berths) or out to sea by 18:00 hours. â¢ Monday, Oct. 29, 12:00 hours, the agency orders all tenant personnel and port authority contract security off the port; port authority and staff, including the port authority police department are vacated at 19:15 hours (just prior to the anticipated surge). â¢ Monday, Oct 29, 20:00 hours, the agency notes that NOAA has reported water levels at the Battery and Bergen Point at 9â-10â above MHW; winds at 80 to 90 mph; surge 13â14 feet. These metrics are far greater and more sustained than the conditions experienced during Irene the year before. Several interviewees noted that it was at 11:00 a.m. on Sundayâthe day before the superstormâ that it became certain that Sandy would hit the New YorkâNew Jersey region with devastating winds and storm surges. Source: New York Container Terminal Figure 4.5. Conditions at New York Container Terminal during the Storm: White Caps in the Middle of the Terminal.
56 Making U.S. Ports Resilient as Part of Extended Intermodal Supply Chains Physical Preparations The organizations interviewed for this case study summarized the preparations undertaken by each of the freight transportation modes and facilities for Sandy as follows: â¢ Ocean CarriersâEach carrierâs operations center tracked the superstorm along the U.S. East Coast, determining whether the vessels should continue as planned, slow down, speed up, or perform other actions. One carrier had more than 15 vessels in the area potentially affected by Sandy. In addition, following USCG-set port conditions, work on vessels docked at ports had to cease and vessels needed to be put out to sea. â¢ Barge OperatorsâIn addition to securing their equipment, Columbia Coastal, the major domestic coastwise intermodal barge service provider, began making preparations for providing port-to-port service to handle diverted containers. â¢ Terminal OperatorsâSimilarly, following USCG-set port conditions, work on vessels was suspended. In addition, with high winds anticipated, container stacks had to be lowered; with more containers placed at ground level. One interviewee noted that the availability of labor on a Sunday to move the containers was an issue. Positioning more containers on the ground addressed wind concerns but increased the number of containers inundated by Sandyâs unusually high and sustained salt water surges. Terminal operators also secured equipment, moving equipment where possible to the highest location available. Hurricane strappings on the large container cranes were secured. Following USCG and port authority orders, all personnel were evacuated as Sandy approached the port. At offices within the port, computers and other equipment were placed on top of desks and elevated in case of flooding (see Figure 4.5). â¢ Trucking FirmsâTrucking firms similarly secured their tractors and other equipment, as well as placed computer and other equipment on desktops in case of flooding. Many trucking companies are located proximate to the port in areas that had not previously flooded in storms. â¢ Freight RailroadsâNorfolk Southern and CSX, the two national Class I railroads that handle the majority of the rail cargo at the Port of New York and New Jersey and serve other ports along the East Coast, moved their equipment out of the Port of New York and New Jersey as well as repositioned their equipment and personnel along the East Coast. The railroads applied lessons from previous severe weather events such as Katrina. The railroads followed three procedures: â Stop all inbound trains before they arrive in the affected area. CSX stopped inbound trains in Syracuse and in northwestern Ohio. â Evacuate as much equipment as possible from the affected area. â Move all equipment that cannot be evacuated to the highest ground available. The railroads also began preparations for special intermodal rail shuttle service to handle diverted containers. â¢ Warehouse OperatorsâWarehouse and distribution center (DC) operators followed their individual plans for severe weather events. In one example, a DC operator with an emergency generator ensured that the fuel tank to support it was filled. Other DC operators proceeded with securing back-up generators from suppliers. These generators are quite large and expensive to rent. However, electrical power is required to operate warehouse information management systems, as well as the conveyors and other equipment in the building. All businesses made efforts to ensure that their personnel were safe and their facilities secured. Some major companies that had experienced large disruptive events previously also maintained emergency supplies for their personnel; for example, containers were preloaded with generators,
Case Study: Response to and Recovery from Superstorm Sandy 57 water, and other supplies for personnel and their families, and were quickly dispatched to affected locations. Communications and Information Flow The Maritime Transportation Security Act of 2002 (MTSA), among other provisions, requires the establishment of committees at each port that include the public agencies and private orga- nizations to focus on securing each location. MTSA also required that the National Maritime Transportation Security Plan include a procedure for restoring cargo flow following a national transportation security incident (USCG, 2008). Such committees proved highly useful in the resumption of activities following such events as Katrina. The SAFE Port Act of 2006 similarly required protocols for the resumption of trade. As a result, the USCG (USCG, 2008) established the Marine Transportation System Recovery Unit (MTSRU). In addition to a national-level MTSRU, regional-level MTSRUs were created to manage area events. According to the USCG, âThe District MTSRU will consider regional impacts of the incident and work to coordinate or prioritize regional recovery efforts in support of the overall national effort to facilitate the rapid resumption of commerce. District MTSRU staff also provide the linkages and coordination with the Joint Field Office (JFO), if a JFO is established. These MTSRUs will also provide the necessary capability to handle large-scale, broad geography and multiple-incident eventsâ (USCG, 2008). As one interviewee described it, the goal of the MTSRU is to provide a holistic coordinating approach and collective informed decisions for reopening the waterways. Superstorm Sandy was the most significant activation of MTS since Katrina. The MTSRU in the Port of New York and New Jersey is a public-private coordination group that meets regularly. The group includes âanyone with a significant footprint in the water.â The members include the Port Authority of New York and New Jersey, the New York City Economic Development Corporation (which manages waterfront properties in the city), major refineries, tug and barge operators, the Staten Island ferry, all of the terminal operators, the New York Shipping Association, the pilotsâ organization, and other maritime operators in the port. The public agencies include the port authority, CBP, and the USCG. The procedures and working relationships established through the MTSRU, according to the interviews, were instrumental in the portâs expedited return to service after Superstorm Sandy. The MTSRU does not currently include rail or truck organizations. However, the Port Authority of New York and New Jersey maintains e-mail, web, and other links with these stakeholders. The New Jersey Motor Truck Association issued numerous email blasts to their members regarding road, weather, and fuel conditions, as well as permit and regulation changes and suspensions. In addition to the MTSRU, the port authority held conference calls. The agency also notified more than 10,000 organizations by e-mail through its e-Alerts system and by fax. The port authority sent out two or more daily reports on port conditions. In the supply chain, information systems also included real-time tracking of shipments. Accordingly, the location of inbound shipments could be monitored. 4.6 Superstorm Sandyâs Impacts on Port Operations The Port of New York and New Jersey received the brunt of Superstorm Sandyâs impact. The other major container ports on the U.S. East Coast reopened quickly and sustained minimal damage. As noted by the interviewees, âBy the time the storm hit, the full port was evacuated and secured. This was our best decision. There was no loss of life, no injuries, and no theft.â All aspects
58 Making U.S. Ports Resilient as Part of Extended Intermodal Supply Chains of the import container topography were immediately impacted, affected by physical damage, power outages, communication outages, and damage to employee homes. Physical Damage The damage to the Port of New York and New Jersey was extensive and all operations halted. The facilities had no electric power, which is increasingly crucial as ports move toward using electrically powered equipment instead of diesel-powered equipment. The damages, which began to be identified and addressed the day after the storm, included the following (PANYNJ, 2012): â¢ Flooding (water level in buildings was between 3 to 5 feet); â¢ Damage to utilitiesâgeneral commercial power, motors, controllers; â¢ Damage to sewage/fire pump motors and controllers; â¢ Loss of rail relays and switches; â¢ Destruction of security fencing and guard booths; â¢ Damage to cranes and cargo handling equipment; â¢ Debris in roadways, channels, and berths; â¢ Road and rail track damage; â¢ Toppled container stacks and loss of containers (containers in waterways, on rail lines, etc.); and â¢ Loss of autos from flooding and fire. Containers and other debris were in the waterways. Shoaling and potential hazards to navigation had to be identified and addressed, as well as ensuring that all navigation aids were operational. The surge of salt water during Superstorm Sandy was aggressive, affecting areas that had never experienced flooding prior to the event. As shown in Figures 4.6 through 4.10, the rise in water was rapid and fueled by both the wind and tides. The first floor of the port authorityâs administration building was flooded, as were buildings in other areas of the port used by terminals, trucking firms, and other businesses. The flooding also deposited sand and debris throughout the port (including the on-dock rail yards), as well as damaged the required security fencing. Although many container stacks were lowered in accordance with preparation for a wind event, interviewees noted that the surging water still floated up the stacks and caused many to fall over. In addition to the damage to the security fencing and gates, the Radiation Portal Monitors maintained by the CBP, which screen all import containers leaving the port, were flooded and damaged. All perimeters and security measures had to be in good working order and meet CBP needs prior to restarting terminal operations. The large container cranes survived Sandy with the hurricane strapping. However, the engines that power the cranes located at the base of each structure were submerged in salt water. Salt water damage to this equipment had to be addressed. Yard equipment, essential to terminal operations, also sustained damage that came primarily from salt water submersion. Containerized cargo was not the only type of cargo affected at the port. The Port of New York and New Jersey is one of the largest auto import and export locations in the United States. It is generally an industry practice to store vehicles at ports either prior to delivery to dealerships or in preparation for export. Thousands of new vehicles stored at the Port of New York and New Jersey were flooded and destroyed. The engines of some electrical vehicles burned as a result of their exposure to salt water. Some interviewees noted the odd site of seeing fires in the middle of flooded areas.
Case Study: Response to and Recovery from Superstorm Sandy 59 Figure 4.6. Superstorm damage at the Port of New York and New Jersey. Source: Port Authority of New York and New Jersey, Terminal Operators
60 Making U.S. Ports Resilient as Part of Extended Intermodal Supply Chains Figure 4.7. Flooding at port terminal buildings and damage to security fencing.
Case Study: Response to and Recovery from Superstorm Sandy 61 Figure 4.7. (Continued). Source: Port Authority of New York and New Jersey, Terminal Operators The CSX Kearny Yard, a major regional rail facility used for intermodal rail service, was flooded by 4 feet of water, lost power, and suffered major damage to the container chassis at the facility. While not currently used for container operations, Greenville Yard, which is the New Jersey terminal for the rail car float between New York and New Jersey, as well as local carload rail, was completely destroyed. At Greenville, the float bridge was destroyed and one of the rail car float barges broke in half and sank at the terminal. The rail rights of way (located further inland) generally used for freight movement had minimal and, in some cases, no damage. The Norfolk Southern intermodal yards in the region (Croxton and ERail) were not affected as severely as the CSX Kearny Yard. Trucking companies that provide drayage service to the portâs terminals sustained damage to tractors and offices. The most affected trucking firms were located at the port, as well as in low-lying areas in the vicinity of the port. Trucking firms also needed to contend with damaged roads, non-functioning traffic signals, and detours, as well as fuel shortages throughout the New YorkâNew Jersey region. Determinations had to be made as to whether customersâ facilities were open and available to accept deliveries or pick ups.
62 Making U.S. Ports Resilient as Part of Extended Intermodal Supply Chains Note: Barge shown is the Red Hook Barge at/on Berth Six in New Jersey. Source: Port Authority of New York and New Jersey, Terminal Operators Figure 4.8. Damage to container barges, roadways and drayage trucks.
Case Study: Response to and Recovery from Superstorm Sandy 63 Source: A. Strauss-Wieder, Inc. Figure 4.9. Greenville car float prior to Superstorm Sandy. Figure 4.10. Greenville rail car float after Superstorm Sandy. Source: Port Authority of New York and New Jersey Note: Float bridges destroyed. Rail Car float barge broken in half and sunk.
64 Making U.S. Ports Resilient as Part of Extended Intermodal Supply Chains In addition to the damage to equipment, the portâs chassis pools were severely affected through submersion in salt water. The availability of chassis was crucial to resuming operations at the port. Major distribution centers located in New Jersey suffered power outages. Trucking companies suffered loss of equipment from the surge flooding, blocked and damaged roads, and fuel shortages. In addition to damages to container operations, the sea-level petro-chemical complexes and freight operations were affected. Impacts on Communications and Information Flows Superstorm Sandy caused power outages in a multi-state area. The port facilities in the New YorkâNew Jersey region, as well as key freight infrastructure, such as the CSX Kearny Yard, were without power. Although utility repair crews had already been mustered from around the country (and more would be called in), the extent of the damage and the many critical infra- structure elements and facilities needing power restoration required the port to âcompeteâ with other recovery priorities in the region. The area power companies were part of the MTSRU and were located with the port authority at the agencyâs EOC. The utilities understandably could not focus solely on the port because of the extensive geographic scope and severity of the damage from the storm. Power outages took electrically powered cell towers and communications hubs offline. Computer systems were offline. In addition, the salt water surges inundated first-floor and ground- level computer rooms and utility areas. Downed trees and utility poles severed fiber and copper communications lines. As one interviewee noted, âWe had no power or street lights. Clean-up operations could only be done during daylight.â Critical data and systems were not immediately available (even when back-up sites were available, there was no power to access the Internet). Paper copies and maps came into use in some organizations. However, the MTSRU and the port authority, along with other agencies, arranged daily confer- ence calls at set times. Knowing when a conference call was to take place enabled individuals to call in, sometimes from cell phones powered by car engines. The port authority held regularly scheduled conference calls twice each day. Two thousand additional people subscribed to the agencyâs messaging and âe-Alertsâ in the 12 hours prior to Sandyâs landfall in the New Yorkâ New Jersey region. As noted previously, messages were sent to such entities as BCOs and carriers at least twice daily. Impact on Public Agencies Public agencies were similarly affected by the damage and power outages. A wide regional response was underway by multiple agencies. Within that context, those public agencies with specific regulatory responsibilities involving port operations began mandated processes. The port authorityâs administration building at the maritime terminals was flooded; the agency set up a command center at Newark Liberty International Airport, which is adjacent to the port, immediately after Superstorm Sandy passed, and set up a Mobile Command Center at the port by the end of the first day after the Sandy. The agency was able to reoccupy their Administration Building at the port, despite the damage, on the second day after Superstorm Sandy. 4.7 Superstorm Sandy Port-Related Business Recovery The topography of import containers is particularly evident in the ways in which the supply chain recovered from the superstorm, along with the issues and considerations faced by the different elements in the topography. One set of issues affected the New YorkâNew Jerseyâs port
Case Study: Response to and Recovery from Superstorm Sandy 65 facilities, which suffered significant physical damage. A completely different, but equally disruptive, set of issues affected the ports handling the diverted vessels and cargo. The Port of New York and New Jersey was largely reopened for business in 1 week, a remarkable achievement given the extent of the physical damage. The timeline leading to the full reopening of the container terminals was documented by the Port Authority of New York and New Jersey (2012) as follows: â¢ Tuesday, October 30 (day after the superstorm)âAssessment, response, recovery, and restoration begins; â¢ Friday, November 2âUSCG re-opens port to deep-draft commercial traffic and Brilliance of the Seas, a cruise vessel, is the first to arrive at Pennsylvaniaâs Cape Liberty facilities; â¢ Saturday, November 3âPower restored at Elizabeth, New Jersey, the location of the two largest container terminals (Maher and APM); â¢ Sunday, November 4âMaher and APM work five vessels; â¢ Monday, November 5âTruck gates at all container terminals open for business; and â¢ Monday and Tuesday, November 5 and 6âAll remaining container terminals work their first vessels. The port agency also reported that 57 vessels of all types were diverted to other U.S. East Coast ports. The diverted containers were estimated at 15,000. Separately, about 9,000 autos were diverted. Outside of the New YorkâNew Jersey region, various freight modes and diverted ports worked together to handle the diverted shipments. As several interviewees noted, the diverted containers disrupted cargo flows and congested maritime terminals along the entire U.S. East Coast. Physical Flow Recovery in the New YorkâNew Jersey Region All physical elements of the supply chain within the New YorkâNew Jersey region began recov- ery and preparation for resumption of operations in parallel as soon as access to the facilities became available. Work was limited to daylight hours until power was restored. â¢ WaterwaysâUSCG had to ascertain that channels were navigable and clear of marine debris and underwater obstructions to ensure the safe passage of vessels. At first light on Tuesday morning as the storm was still passing through, the USCG and Sandy Hook Pilots conducted a visual waterway assessment using Sandy Hook Pilot vessels. Immediately following the storm, NOAA and the Army Corps of Engineers commenced a detailed underwater channel survey to identify any underwater obstructions. NOAA and USACE completed the main channel and approach to port surveys within 3 days after Sandy had passed through and continued to survey lesser trafficked areas the week following the storm. As a result of the storm surge, there were at least 50 off-station Federal Aids to Navigation, several marine debris fields throughout the waterways, and over 20 shipping containers in adjacent channels, all which needed to be put back on station or safely removed before the USCG could permit deep-draft vessels to transit the waterways. â¢ Maritime TerminalsâAs soon as permitted by the port authority, each of the terminals had the personnel who could travel to the facility begin inventorying and addressing the damage. The first order of business was the removal of the debris. Equipment and engines submerged in salt water needed to be pulled, cleaned, and serviced prior to use, including the container cranes. Knowing that vessels were waiting to call and that the port was in peak season, the terminal operators weighed making immediate repairs that may require additional work in the future or taking additional time to service equipment. Given the situation, the terminals generally pursued the safe immediate return of equipment to service and began plans for long- term repairs and replacements. Interviewees noted that replacement equipment was brought in from all around the country. Engine motors and electrical equipment had to be cleaned,
66 Making U.S. Ports Resilient as Part of Extended Intermodal Supply Chains flushed and, in some cases, baked. Interviewees noted that spare parts had been stored on pallets on the floor and were subject to flooding. Additionally, some equipment was beyond repair and had to be stored for insurance purposes. Interviewees described the âgraveyards of destroyed equipment.â New equipment was acquired, where possible, through vendors. Debris was removed from the terminals, containers were restacked or relocated as damaged, and damaged buildings were attended to. Experts at other ports in other parts of the United States that have encountered similar problems (such as after Katrina) were consulted. Security fencing and gates damaged by the superstorm were replaced in order to meet USCG, CBP, and other federal requirements, and were reviewed by the USCG. Interviewees noted that common sense approaches were used to bring the security measures back online. CBP examined and replaced the radiation detectors with the assistance of the U.S. Department of Energy. Replacement of the detectors, which had to be operational before the port could reopen, required parts to be flown in from elsewhere in the United States and installed. Terminal operators also identified and developed lists of the containers exposed to water. It was noted that quite a few containers were damaged by the storm surge. Customers were notified but were not permitted to open the damaged containers at the port. Terminal operators were concerned that damaged loads would be abandoned. Customers needed to pick up the damaged containers and examine the contents elsewhere. This decision was reflected in the damaged shipments and containers later seen in the yards of distribution centers awaiting insurance decisions. â¢ Rail YardsâAt the port and the CSX Kearny Yard, debris needed to be removed and the tracks cleared for operation. Generators were used to restore some systems. The railroads were generally in the best condition after the superstorm. Once the rail yards at the port and elsewhere were operational, the railroads âmeteredâ the traffic into them, building back up to full service. â¢ Trucking FirmsâDamaged equipment was inventoried and stored for insurance claims. Vendors were contacted to obtain replacement equipment. Some trucking companies that had tanker trucks in their fleet arranged to have them filled with fuel for use by their trucks and personnel. A shortage of trucks for draying port containers also ensued with the loss of equipment. The chassis pools, generally operated by third parties, sustained substantial damage. Each chassis had to be inspected, repaired, and made road readyâa process that took several hours for each chassisâbefore being used to haul containers. Chassis shortages were reported for months following the superstorm. Trucking firms located in flooded areas also had to deal with damage to offices and computer equipment. â¢ Distribution CentersâThe first order of business for buildings without power was securing and powering up generators. Power was needed for restoration of operations. Personnel needed to be contacted and staffing decisions made. The location of inbound shipments had to be ascertained from transportation providers. Additionally, as containers began to arrive, damage to contents from the salt water surge was ascertained. Damaged shipments and containers had to be stored at the distribution center for insurance claims, a process that took months to complete. Physical Flow Recovery Outside the New YorkâNew Jersey Region The interviews undertaken for this case study clearly demonstrated the strength of having a multimodal freight system, as well as the challenges faced. As previously noted, Columbia Coastal and the two railroads, CSX and Norfolk Southern, began repositioning equipment and qualifying crews for special container barges and shuttle trains. The Port of Virginia received the bulk of the diverted shipments, handling over 7,000 containers.
Case Study: Response to and Recovery from Superstorm Sandy 67 The impacts included â¢ Virginia Port AuthorityâWith vessels and thousands of containers diverted to the port, agency and terminal staff quickly had to ascertain how to handle the additional workload and the stowing of diverted containers. Decisions for the inland movement of diverted containers were made with the additional costs incurred by the shippers via their contracts. Although the majority of the diverted containers destined for the region were handled by CSXâs special shuttle trains, some of the diverted containers were moved back to the New YorkâNew Jersey region âin bondâ via the Columbia Coastal barge. The surge in containers and the need for additional paperwork caused delays in the supply chains. Problems with the disposition of the diverted containers caused disruptions to port operations and delayed shipment actions. Some container lines made arrangements directly with the railroads and barge companies (billing their customers at cost for the additional transportation charges), and some comingling of diverted containers with other containers at the port adversely impacted terminal operations. Some customers, caught in the midst of their peak season, added to the complexity of the situation by sending requests for release of specific containers. Interviewees reported delays ranging from days to weeks to receive some of the diverted containers. â¢ Rail at the Port of VirginiaâCSX, through existing contracts with the carriers that had diverted the majority of the vessels and containers to Virginia, handled most of the rail movements back to the New YorkâNew Jersey region into their Kearny Yard. Where diverted import containers were destined to locations outside the New YorkâNew Jersey area, Norfolk Southern and CSX accommodated these shipments per their existing contracts with carriers on their regularly scheduled trains to the Midwest, once the containers had CBP clearance. CSX handled 5,300 of the diverted containers, with about a third of these containers destined for the Midwest. The remainder had to be moved back to the New YorkâNew Jersey region. Although Norfolk Southern has existing doublestack service between Norfolk and New Jersey, CSX, which had the existing carrier contracts with the affected lines, did not have a âport-to-portâ service; CSX had to create the service and then work with the shipping lines to put together a recovery train service. Empty doublestack equipment had to be brought to Norfolk, along with train crews from around the country. Once containers were cleared by CBP, the shipments were brought by truck to a local rail ramp outside of the port; both on-dock and off-dock rail facilities had to be used to handle the surge in containers. The required X-raying of containers was a constraint; there were not enough machines on hand to handle the increased rail volumes. The first few trains were brought into Kearny Yard. Once the on-dock ExpressRail facilities were operational, the special shuttle trains used those facilities. â¢ Coastal Barge at NorfolkâColumbia Coastal moved from 2,500 to 3,000 containers in bond on their barges. Three special dedicated barges were arranged, with each capable of hauling from 300 to 400 units. â¢ Port of BaltimoreâBaltimore experienced a smaller surge in diverted containers but was also impacted by the additional unexpected activity. The port received about 2,800 diverted con- tainers and about 8,000 diverted vehicles. These arrived on vessels in their regular rotations; no diverted cargo vessels were handled. The port had space at its terminal to stack the con- tainers separate from the main stacks while decisions were made and paperwork processed. The diverted containers were moved back to the New YorkâNew Jersey region via the existing Columbia Coastal barge, existing CSX trains to Philadelphia (where they were then trucked to customers), and by truck. New York trucks coming to the Port of Baltimore had to be entered into the portâs eModal system and obtain clearance before they could pick up containers. Information and regulatory issues included how the containers would be processed and how the cargo manifests would be handled by federal agencies, as well as chassis availability. The Port of Baltimore is primarily a truck port, with 90 percent of its cargo handled by trucks. Chassis imbalances developed as equipment used to move cargo to the New YorkâNew Jersey
68 Making U.S. Ports Resilient as Part of Extended Intermodal Supply Chains area was not returned. The port estimated that it took approximately 2 weeks to return to normal operation after the superstorm due to the surge in diverted cargo. Communications and Information Flows At least four ongoing daily conference calls were scheduled during the recovery effortsâtwo were conducted by the USCG, one by the port authority, and one by the New York Shipping Asso- ciation (NYSA). The strong relationships built through the MTSRU were instrumental in the relatively quick recovery of the Port of New York and New Jersey. As one interviewee noted, âThis was why we were so successful with Sandy. Everyone was working together. The level of trust and cooperation was a strength of this area.â As one example, the USCGâs fuel piers were physically destroyed, and their vessel needed to be fueled to undertake the waterways inspec- tion. A private terminal operator on the MTSRU heard of the need and instructed his terminal personnel to fuel the vessel from the tank at their facility. The pilots had federal agency personnel join them on their inspection vessels so that the navigation aids could be checked more quickly. Information flows were crucial to ensuring sufficient personnel at facilities. NYSA was responsible for ordering the labor for the port terminals. At times working with cell phones and paper records, NYSA worked with labor to ensure staffing as needed for the terminals. Although labor negotiations along the U.S. East Coast were underway at the time, interviewees noted that labor and management worked closely together to reopen the port as quickly as possible. As noted, five vessels were worked on the first weekend once some terminals reopened. At some distribution centers, power outages disabled the personnel systems, making it difficult to contact staff as to whether to come to the building and managing whom was in the building. In the aftermath of Superstorm Sandy, back-up personnel systems were set up at sister facilities elsewhere in the United States. Information flows were crucial to business recovery. Some truck- ing companies lost their computer systems and access to back-up systems. Paper records were destroyed by flooding. For them, the first order of business was contacting their customers and vendors. Customers were contacted to ascertain their condition and ability to receive/pick up shipments. Customers needed to be kept informed as to port conditions and the location of their shipments. In some cases, customers had to be informed that their shipments had been damaged or destroyed. Vendors needed to be contacted to obtain replacement equipment and supplies. One company noted that its approach was to internally develop strategies and then quickly com- municate the solutions to its customers. It noted that the quicker it knew the situation and options, the better it could develop strategies and communicate with its customers. Regulatory and Public Agency Roles in the Recovery Daily coordination among the responsible agencies occurred. CBP had to be able to conduct any necessary inspections and radiation screening of import cargo coming into the terminals before the port could be reopened. The waterways had to be inspected. DHS rented a 747 to bring the replacement radiation detectors to the New YorkâNew Jersey region. PSE&G, the major power utility in the area of the maritime terminals in New Jersey, had a staff member imbedded with port authority staff to serve as the point person. While competing with other pressing needs for power restoration, the two organizations coordinated on the details of restoring electricity to the terminals, the installation of generators, and other issues. PSE&G also had a command post at the airport and housed maintenance staff at hotels near the airport. Although port agencies and carriers indicated that they pursued obtaining a Jones Act waiver for diverted containers (similar to the waiver authorized by federal authorities for fuel movements) no such waiver was approved. As a result, diverted containers had to be moved using specially
Case Study: Response to and Recovery from Superstorm Sandy 69 implemented services by private entities, including U.S.-flagged barges, container rail shuttles, and private trucks. In Virginia, CBP added staff and worked around the clock to revise paperwork, recode shipments, and hand-refile documentation in order to clear the surge in diverted containers. Adjusting bills of lading so that shipments could clear in Virginia was considered by interviewees to be a complex and time-consuming task, often involving manual work for individual shipments. 4.8 Lessons Learned The key lessons that emerged from Superstorm Sandy include the following: Physical/Logistical â¢ Prepare for the unexpected. As one interviewee noted, âThe predictive maps indicated that large portions [of the port] would be dry. We clearly were not prepared for the surges.â Another noted that âAll of the hurricane plans considered wind events.â â¢ Electrical power is crucial, even more today as ports move toward more environmentally sus- tainable equipment and increased reliance on automated information systems through the port and supply chain processes. As one interviewee noted, âPower was such a critical problem here.â Another interviewee noted that âPower was outside of our control.â Moving forward, proactive engagement with the areaâs power providers, as well as procurement of emergency generators and investigations of micro-grid technologies were mentioned as next steps. â¢ Balancing resiliency and maintenance costs should be considered. Moving traffic-light controls, pumps, and generators to higher elevations also means increased use of bucket trucks and the building of higher walkways for servicing. â¢ Modal flexing is a requirement for port and supply chain disruptions. The ability of modes to offer alternative services and routings was shown to be essential in resuming business operations after Superstorm Sandy. Informational/Communications â¢ Information technologies are integral to port and supply chain systems. Without power, these systems cannot operate. As one interviewee noted, âThere is no more âmanual.â We cannot go back to paper. Everything is now integrated.â â¢ Communication is keyâcommunication and coordination among public agencies, among public and private organizations, and along the entire supply chain. Communications with customers were crucial: Where were their shipments and in what condition? Several interviewees noted that it was important âto get information out to the customers quickly and ahead of questions.â â¢ Establishing relationships is also key. Mandated committees, such as the MTSRU, clearly facilitate recovery. Networks of vendors helped get replacement parts and equipment. Regulatory/Oversight â¢ Common sense solutions can expedite recovery. The interviewees noted how public agencies worked with private organizations to find acceptable short-term solutions in such areas as securing perimeters to allow reopening of facilities. â¢ Superstorm Sandy illustrated that storm-related vessel and cargo surges can be just as disruptive to supply chains and freight movement as port closures. Logistics plans and protocols should be considered to handle surges of diverted shipments.
70 Making U.S. Ports Resilient as Part of Extended Intermodal Supply Chains â¢ A temporary waiver of the Jones Act, similar to the waiver authorized for fuel movements, potentially would have provided a cost-effective means for handling diverted containers. One interviewee noted that a Jones Act waiver could have been an incredible relief valve. Several interviewees noted that with a Jones Act waiver, the diverted containers offloaded by one vessel in a rotation could have been picked up by the next vessel in the rotation for delivery to the original port. The interviewees noted that this approach would have facilitated plan- ning and handling of the diverted containers, as well as significantly reduced the need for alternative modes and the time-consuming paperwork for CBP clearing of the containers at the diverted ports. â¢ Similarly, CBP systems and procedures required intensive, and often manual, interventions to handle diverted containers. Interviewees noted the hard work of CBP staff but also noted the need to consider developing protocols for handling diverted shipments in the future. As one interviewee summed up the overall objective, âWe all serve the customer. Look for the best solution for the customer.â Superstorm Sandy uniquely hit during the peak season of customer demand. The response of ports and the supply chain has to be considered within that context. 4.9 References Georgia Tech Research Corporation, Parsons Brinckerhoff, and A. Strauss-Wieder, Inc. NCHRP Report 732: Methodologies to Estimate the Economic Impacts of Disruptions to the Goods Movement System, 2012, pp 30â32. National Geographic News, http://newswatch.nationalgeographic.com/2012/11/02/a-timeline-of-hurricane- sandys-path-of-destruction/ Port Authority of New York and New Jersey, NAIOP briefing, November 30, 2012. USCG, U.S. Coast Guard Commandant Instruction 16000.28, February 18, 2008, http://www.uscg.mil/directives/ ci/16000-16999/CI_16000_28.pdf Appendix 4A: Interview Guide 2 Interview Guide Used for Public Agencies Note that a similar form was used to guide discussions with private organizations. Introduction Superstorm Sandy struck the U.S. East Coast during one of the most critical weeks in the peak shipping season. We are assessing the impacts, recovery, supply chain and facility changes, and the lessons learned from this event as a key element of a project for the National Cooperative Freight Research Program (NCFRP). NCFRP is part of the Transportation Research Board and the National Academy of Sciences. A description of our project can be found at http://apps.trb. org/cmsfeed/TRBNetProjectDisplay.asp?ProjectID=3493 The results of our work will be released in a report to inform discussions of the supply chain and port disruptions throughout the United States. As we all know, keeping goods moving is important, particularly after a disruption. The information you provide in our discussion will help us to identify and elaborate on the steps needed to coordinate and continue freight movements through ports in times of severe stress. Our individual discussion is confidential. We will keep the information you give us confidential. No quotes or information will be attributed to an individual person or organization. We are also looking at three aspects of the supply chain: the physical movement of goods, information flows, and regulatory/governmental agency involvement.
Case Study: Response to and Recovery from Superstorm Sandy 71 Background on Your Agency â¢ Please describe your agencyâs role and responsibilities in port preparations, decision points, immediate response, and business continuity/recovery. â¢ What public agencies and private-sector organizations does your agency interface directly with in these activities? â¢ What is your agencyâs geographical scope of responsibility? As a follow up, does your agency coordinate with ports being used for diverted vessels? Coordination and Communication â¢ How do you coordinate with partner governmental agencies (e.g., FEMA, DHS)? â¢ How do you coordinate with private-sector shippers and transportation providers? â¢ What do you consider the strengths of your organization with respect to coordination and communication before, during, and after the event(s)? â¢ How would you improve your communication and coordination process for future situations? Continuity of Operations and Service In considering how to maintain service and cargo flow in times of disruption: â¢ What are the most important considerations (physical, information flows, and regulatory)? â¢ What are the major challenges or obstacles (physical, information flows, and regulatory)? Sandy Letâs talk about the Superstorm Sandy event: â¢ Preparations â¢ Impacts on your facilities and operations â¢ Immediate response and business continuity â¢ Lessons learned â¢ Anticipated changes in facilities and operations Next Steps â¢ What other organizations and individuals should we talk with regarding Sandy and port resiliency? â¢ Is there any other information that you would like to share with us at this time? Thank you! We will share the draft case study with you, as well as send you the final report once published by the National Academy.