You asked how many states have port districts, how the districts are governed, and what their powers are. You also asked if any states provide tax incentives for businesses developing or using port facilities.

Port districts operate in at least five states (Illinois, Michigan, Oregon, Texas, and Washington), most under laws allowing counties to form autonomous or semi-autonomous special taxing districts to develop, maintain, and operate port facilities. The districts may levy property taxes, charge user fees, and issue bonds.

Illinois' port district is different—it was created by the legislature, spans six counties, and is overseen by a nine-member board consisting of gubernatorial and county representatives. It cannot levy taxes, but may charge user fees. It may issue bonds to finance terminals and other capital improvements, but back them with only the revenue the improvements generate (i.e., revenue bonds).

(Connecticut law allows municipalities to designate port districts and establish port authorities to administer them. The authorities may issue revenue bonds to finance capital improvements, but cannot levy property taxes. A board appointed by the municipality's chief elected official oversees the authorities, which have been established in Bridgeport, New Haven, and New London.)

At least seven other states (Georgia, Indiana, Louisiana, Mississippi, North Carolina, Rhode Island, and South Carolina) offer tax incentives to businesses that use ports or develop property in port areas. Most offer business income tax credits based on the fees and charges a business incurs when shipping goods and materials through a port. Connecticut does not offer port-specific incentives, but businesses that develop property or create jobs in the state's deep-water ports qualify for generic economic development tax incentives.

As Table 1 shows, port districts operate in at least five states. Most were formed under a statute allowing municipalities or counties to establish special taxing districts specifically to develop and operate deep water ports. The exception is Illinois' TransPORT, which the legislature established in 2003 to develop transportation facilities along a 95-mile stretch of the Illinois River. The districts can acquire property and develop, operate, and maintain port facilities. They can sell bonds, charge fees, and, except for TransPORT, assess property taxes. An elected or appointed board oversees them.

Table 1: States Authorizing the Formation of Port Districts

Connecticut law allows municipalities to designate port districts and establish port authorities to run them. The authorities must be governed by a five- or seven-member commission appointed by the municipality's chief executive officer. Like the port districts described above, Connecticut's port authorities may impose fees and charges for using port facilities and issue bonds back by this revenue. But the authorities cannot assess property taxes (CGS §§ 7-329a to 7-329u).

1967, PA 900 authorized municipalities to create port authorities. PA 98-240 and PA 02-42 subsequently limited this authorization to Bridgeport, New Haven, and New London, which had already established authorities under the 1967 act. Other municipalities seeking to establish authorities must obtain the legislature's approval.

As table 2 shows, at least seven states, mostly in the South, offer tax incentives to businesses for using ports or stimulating business activity there. Most of the incentives are for businesses that increase the amount of goods and materials shipped through state ports; Louisiana's are for businesses that develop or improve industrial, warehousing, and cargo-handling facilities in public ports. Rhode Island's are for businesses that create jobs in the Port of Providence Enterprise Zone. Georgia, Louisiana, and Mississippi each offer two or more incentives.

Table 2: Port-Specific Tax Incentives

The type and amount of incentive varies. Most of the incentives for increasing port usage are business income tax credits equal to all or a portion of the charges and fees for handling, storing, and shipping goods and materials through the ports. Some states link the credit to other programs or goals.

● Georgia's port incentives are linked to the state's generic investment and job creation tax credits. Businesses that invest in new facilities or create new jobs qualify for bonus credits if they also increase port usage.

● Mississippi limits its credit for importing goods through state ports to businesses headquartered in the state and that meet other criteria.

Indiana and Mississippi offer property tax abatements to increase port usage. Indiana's Maritime Opportunity Districts offer a 10-year property tax abatement on new manufacturing machinery and equipment and inventory slated for export. Mississippi's cities and counties may exempt goods stored in state-licensed warehouses from property taxes if they will be shipped out of the state.

Rhode Island's tax credits are for creating jobs in the Port of Providence. Like Georgia's they are part of a broader economic development strategy aimed at stimulating business activities in the state's 10 enterprise zones, which include the Port of Providence.

JR:ts