The Port of Oakland has cut its budget for the 2020/2021 financial year by 15.8% due to the effects of the COVID-19 pandemic.
In a statement, the port said commissioners approved a budget for the next financial year and projects expenditures of $432.5 million, when operating costs and debt service payments are counted.
The budget decline means it expects to see a fall in business performances across its operations, in particular maritime and aviation.
The port said its new budget would achieve key financial objectives that include protecting cash reserves, ensuring adequate revenue to pay debt and maintaining full operations.
“This budget is based on neither unsubstantiated hope nor on speculation of any worst-case scenario,” said Port of Oakland Executive Director Danny Wan.
“It is based on best estimates of how our business may recover, assuming that our communities and country make slow but steady progress in containing the COVID-19 virus.”
The economic impact of COVID-19 is likely to continue depressing revenue in FY 2021, the port said.
Oakland said its FY 2021 budget includes $19.1 million of federal coronavirus relief funding. An additional $25.5 million will be used in 2022 and 2023, it added.
The pandemic has had a substantially negative effect on many of the biggest ports in the world. This is particularly true of the US, and even more so of its West coast hubs which are gateways for trade with China.
The ports of Oakland, Los Angeles and Long Beach have all seen traffic fall in the first half of 2020 but there are a few signs that business might be recovering.