CCT Port Authority projects $1.1 million surplus; annual third-party clean audit shows full compliance with all accounting standards

Revenue from offshore wind projects ensures ‘secure flow’ of funds for decade

The Port Authority’s external auditors, CohnReznick LLP of Hartford, today filed a clean audit report for the fiscal year that ended June 30, 2023, with no findings or recommendations. December monthly financial reports project a surplus of $1.1 million for the current fiscal year ending June 30, 2024.

The anticipated surplus, reported today during the Port Authority’s Finance Committee and Board of Directors meetings in New Haven, is the result of operations at State Pier in the Port of New London resuming in April following reconstruction of the early 20th-century facility that started in 2021 and transformed the site into a modern, heavy-lift-capable marine terminal.

State Pier is currently the only port in the nation that can support cargo of up to 5,000 pounds per square foot on each of two heavy-lift platforms and loads of up to 3,000 pounds per square foot over the entire terminal.

“The surplus is the result of new revenue sources flowing consistently and secure for the next decade,” said David Kooris, Chairman of the Connecticut Port Authority, referring to lease agreements now in effect.

State Pier is currently leased to Gateway Terminal as the operator under terms providing the Port Authority a percentage of Gateway’s stevedoring and dockage and wharfage revenues collected by

Gateway for moving goods through the terminal. Those payments are on track to approach $1 million for the Port Authority’s current fiscal year, which runs through June 30, 2024.

In addition, the offshore wind energy joint venture of Østed and Eversource is leasing the site for $20 million over 10 years. The joint venture in June took the first delivery of wind turbine components at State Pier and since then has continued receiving, assembling, and shipping turbines to its South Fork Wind Farm site 35 miles east of Montauk, Long Island, for installation. The first of 12 turbines began delivering electricity to the New York power grid on Dec. 6.

The joint venture also contributed just over $100 million, or about one-third, of the total $309 million improvement project to the state-owned facility. Other states undertaking similar port infrastructure improvements to capture offshore wind revenue are funding projects without the advantage of private investment.

Kooris commended the Port Authority staff for another “clean audit” of complex financial records involving multiple parties.

“As with last year’s audit, the Port Authority was found to be in full compliance with all laws, regulations and auditing standards as prescribed by GASB best accounting practices,” Kooris said. “This is an independent firm reviewing our books, our policies and procedures in detail and telling state leaders and taxpayers that all is in order, as it should be and as the board expects it to be. I commend my colleagues on the board and our excellent staff for the years of hard work that got us to this point.”

Ulysses Hammond, who has served as interim Executive Director of the Port Authority since April 2022, said the audit and surplus prove the value of the facility, which he and others have espoused throughout the project.

“Now we’re seeing all the pieces of this unique project – a first in the nation – coming together even better than envisioned,” Hammond said. “State Pier is not just back in operation, it has been remarkably transformed from an underused and deteriorating state asset into a modern marine terminal serving both, the new American industry of offshore wind and traditional maritime cargo at volumes and values only dreamed of before. And this is just the beginning of a revenue stream that will revitalize the economic development of our state's small harbors and ports for generations."

In the section of the audit titled ‘Report on Compliance and Other Matters,’ the auditors wrote: “As part of obtaining reasonable assurance about whether the Authority's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.”