Commission approves lease extension with California Sealift Terminals for MARAD ships at Piers 50 and 96

San Francisco — The Port Commission approved a lease with California Sealift Terminals Inc. to berth and maintain MARAD Ready Reserve Fleet vessels at Pier 50 and Pier 96, a relationship the port has held since 1998.

Maritime Director Peter Daly described the Ready Reserve Fleet arrangement and the importance of keeping ships in readiness to support Department of Defense or emergency activations within 96 hours. "These ships require ongoing shipyard services and generate jobs," Daly said. The contract covers three vessels — two at Pier 50 (Cape Horn, Cape Hudson) and one at Pier 96 (Chesapeake) — and operates as a coastwise MARAD solicitation award to the contractor; the federal contract with MARAD is renewable annually and the proposed port lease term mirrors that structure.

Financial and operational terms: The lease term proposed is an initial one year with renewal options, with annual rent reported as approximately $323,025 and the contractor responsible for capital improvements and berth readiness including fendering, shore power, dredging and security. Staff noted the federal Maritime Administration awarded the operating contract to California Sealift and the port must provide like berths if MARAD requests ship relocation.

Why it matters: Staff framed the ships as both a tenant revenue source and an emergency readiness asset that has supported recovery operations in past disasters, including New Orleans after Katrina and responses to other events.

Vote: The Commission moved and approved the lease; public comment was supportive.

Provenance: Presentation and approval appear in SEG 1550 through SEG 1710.