Study questions coal's value to Bellingham

As an environmental review approaches, opponents and supporters of exporting coal to China are angling to shape the perception of how a proposed facility will affect Bellingham and even cities like Seattle and Edmonds.

A coal train runs through a Bellingham waterfront slated for economic re-development.

A coal train runs through a Bellingham waterfront slated for economic re-development. Paul Anderson/Chuckanut Conservancy

It's called an Environmental Impact Statement (EIS), but as opposing sides in the debate over locating a huge coal-export terminal at Cherry Point north of Bellingham are preparing to enter the first stage of developing an EIS, it is increasingly apparent that the most contentious topics may not be the traditional assessments of flora and fauna.

Critics of the Gateway Pacific Terminal (GPT) are lining up arguments that center on economic issues and quality-of-life impacts of an additional 18 coal trains a day on communities throughout the state, and even the global significance of helping Asia pour more pollution into the air from coal-burning plants.

Terminal backers hope to keep the scope of environmental review within the 1,000-acre project site and a short rail spur. That appears increasingly difficult, as the terminal picks up opposition well beyond its location in the nation's furthermost northwest corner.

Backers of the terminal — SSA Marine, the international marine-terminal operator based in Seattle, the Burlington Northern Santa Fe Railroad (BNSF), Peabody Coal, the nation's largest coal miner and prime customer for GPT, and Goldman Sachs, which owns 49 percent of SSA Marine's holding company — stress jobs and tax largess from the terminal's construction and operation. A corps of canvassers, hired by GPT, has been going door-to-door in Whatcom County for several weeks, promoting the project.

In Bellingham on Tuesday, a national financial consultancy unveiled a counter side of the jobs issue: Largely because of increased rail traffic, the export terminal could wind up costing Whatcom County (and by extension other communities impacted by rail traffic) more in lost economic opportunities than would be gained by the new terminal's jobs.

"To the extent that GPT's construction and operation could put other projected or planned growth at risk, it is possible that even if all of the projected employment benefits of GPT were achieved, it could still have a net negative employment impact on Whatcom County's economy,"concluded David Eichenthal of Public Financial Management Inc. (PFM), headquartered in Philadelphia and specializing in "sound independent financial advice to state and local governments."

PFM cited a high risk of loss of jobs at the proposed new downtown waterfront Bellingham is planning, a 216-acre site of a former pulp mill, bisected by BNSF tracks. The site is largely cleared and waiting for approval of plans by the city and Port of Bellingham. The study also cited a potential loss of tourism jobs and a decline in the in-migration of "skilled workers and entrepreneurs" to a community that advertises livability and a green image. The "stigma" of mile-and-a-half-long coal trains is a real liability as the city tries to hold its attraction for visitors and incomers, the report noted.

These concerns are not new in Bellingham, but the PFM report creates a legitimacy to rival two economic studies commissioned by SSA Marine, which tout a permanent workforce of 294 direct and 573 indirect jobs when the terminal reaches capacity, along with thousands of temporary construction jobs. PFM spread the job-creation figures out over a 10-year span and said that in 2015-2024 the terminal would create — using SSA's figures — up to 14,110 "job years," while Whatcom County without the terminal would create — using state economic figures — up to 107,597 job years. If the presence of added coal trains and other impacts of the terminal caused as little as a 13 percent loss of jobs during that period, the new project would be a net economic loss for the county, the study stated.

Most of these figures, on both sides of the coin, are of necessity conjectural, depending upon economic trends as well as local conditions, but the PFM report gives structure to an argument that has been obscured by the pressure for family-wage jobs in Whatcom County. The county has a strong history of job creation, but wages run well below the state average; some of this is due to the large student population at Western Washington University, which feeds a ready demand for part-time service jobs. The terminal would utilize union longshoremen, at a stated annual salary over $90,000, but some of the jobs created would not be local, merchant marine and railroad jobs in particular.


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Comments:

Posted Wed, Mar 7, 9 a.m. Inappropriate

The 216 acre waterfront project in Bellingham is not described. Is it the usual entertainment, hotels, condominium assembly? PFM group must have had something to compare to the jobs provided by the coal port and one probably should assume that those jobs are in the hospitality industry. Those jobs are not usually "family wage" (although there are exceptions). Also there seems to be an underlying assumption that attracting tourists and accommodating them is an environmentally benign industry.

kieth

Posted Wed, Mar 7, 9:18 a.m. Inappropriate

Kieth: I should have linked to this site: http://www.cob.org/services/neighborhoods/community-planning/waterfront/index.aspx
It explains what the city and port have in mind. It's pretty ambitious, certainly will need adjustments as conditions change, but the site is excellent, between the present downtown and Bellingham Bay. They envision mixed-use, with light industry, expansion of Western washington University's environmental programs, some civic and commercial use and residential. The port is already working with a light industrial client, should be in this year. The WWU plans are sidetracked due to budget cuts. I think housing will be highly dependent on what happens with the railroad. In any event it will be phased in over a bunch of years (as would the export terminal). Pretty much all the studies on future job growth are speculative for reasons we all know.

Posted Wed, Mar 7, 9:43 a.m. Inappropriate

Thanks for your continuing coverage of this issue, Floyd. As it happens, I was in Bellingham last week and drove past the waterfront site. I was surprised to see that old industrial buildings are still in the process of demolition. Things are moving more slowly than I thought they would.

I suspect parts of the acreage have more industrial pollution that anyone has anticipated. Growing up in Bellingham, I saw horrfic environmental damage being down to the area---although it was not recognized as such then. Anyway, it seems likely to me that the present plans for this waterfront area will be revised many times before the project comes to fruition years from now. The city and port no doubt will want to revisit
plans for a WWU or other facility which will not produce needed tax revenues. As a hometowner, I also am concerned about the fate of the traditional downtown area, only now making a slow comeback, if and when
the waterfront project becomes a reality. Good to dream dreams but they should be practical dreams.

Posted Thu, Mar 8, 11:23 a.m. Inappropriate

For the world outside Bellingham, increased rail traffic will be an economic loser. Edmonds, Marysville, Stanwood, Mt. Vernon, Burlington will get more noise and congestion which will decrease property value. The loads carried may be unprecedented, which could affect masonry buildings and foundations.

Western Washington absorbs the losses, Warren Buffett and the BNSF get the profits. Maybe Bill Gates will miss a meeting, stuck in traffic backed up by his friend's coal train.

Posted Thu, Mar 8, 4:20 p.m. Inappropriate

Floyd,

Didn't Eichenthal of PFM also say that their analysis estimated something like 45% fewer jobs would be created by GPT than the number reported in the study that was commissioned by SSA?

Thx.

Posted Thu, Mar 8, 5:03 p.m. Inappropriate

Stephanotis: PFM did not attempt to do its own analysis of the jobs projections. Its study simply accepted SSA's figure, which was based on a midpoint between the analysis of Martin and FMRC economic studies.The FMRC review of the Martin study (FMRC is a local consultancy, Martin a national firm working with large marine projects) predicted fewer jobs than the Martin study. FRMC for the first phase of the project, found 7.5% lower "direct job years" than Martin, 45.7% lower "indirect/induced job years" than Martin and 29.5% lower total job years than Martin. Obviously, it is the indirect or induced jobs that are most speculative (and easiest to exaggerate).
These big projects are almost invariably over- or under- realized and PFM just raises the issue that if the jobs aren't created as predicted, or the project and associated rail effects chase off other jobs, then the Bellingham community might be better off without it. It's a valid point not raised by the SSA economists, but one that surely should be part of any EIS that goes into economic benefits and/or community cost-benefits.

Posted Fri, Mar 9, 9:49 a.m. Inappropriate

Thanks for clarifying.

Posted Fri, Mar 9, 3:16 p.m. Inappropriate

EIS's do not -may not - address economic impacts, unless there is an environmental "hook" to pull them in. See, e.g. WAC 197-11-448 Relationship of EIS to other considerations, WAC 197-11-450 Cost-benefit analysis, and WAC 197-11-444 Elements of the environment.

WAC 197-11-448(1) SEPA contemplates that the general welfare,
social, economic, and other requirements and essential considerations
of state policy will be taken into account in
weighing and balancing alternatives and in making final decisions.
However, the environmental impact statement is not
required to evaluate and document all of the possible effects
and considerations of a decision or to contain the balancing
judgments that must ultimately be made by the decision makers.
Rather, an environmental impact statement analyzes
environmental impacts and must be used by agency decision
makers, along with other relevant considerations or documents,
in making final decisions on a proposal. The EIS provides
a basis upon which the responsible agency and officials
can make the balancing judgment mandated by SEPA,
because it provides information on the environmental costs
and impacts. SEPA does not require that an EIS be an
agency's only decision making document.

So, the battle over the economic impacts will be parallel and related to the EIS process, but only peripherally part of it.

Steve E.

Posted Fri, Mar 9, 4:13 p.m. Inappropriate

Floyd,

Your article mistates the project's projected jobs. This mistake repeats a common tactic of opponents, and as well it ties to a key shortcoming of the PFM report.

You stated that the project will have "a permanent workforce of 294 direct and 573 indirect jobs when the terminal reaches capacity." That's not correct, as those numbers would be achieved at half the potential buildout. At full capacity, the project is expected to have 430 direct and 821 indirect/induced jobs.

It's common for opponents to cite the highest level of potential negative impacts of a project and to acknowledge only the lowest level of potential benefits. In the PFM report, they only use the first tier of expected jobs. Obviously, this technique makes it much easier to project potential net negatives. Whether they are realistic and fair is another matter.

Gary Smith

gts

Posted Fri, Mar 9, 7:20 p.m. Inappropriate

Steve: You are correct as regards to SEPA. My understanding--and I may be wrongly informed--is that economic impacts may be studied as part of NEPA, the federal environmental act.
Gary: You are correct in stating that 294 jobs is the Phase I projection. But that is exactly what PFM (not me) said it was using as its base for making its conclusions. PFM accepted your (I assume you are speaking here on behalf of SSA as its spokesman) jobs figures and the state's employment projections; neither they nor I challenged that figure.

Posted Sat, Mar 10, 12:39 p.m. Inappropriate

What is the impact of ship traffic in Puget Sound. Will it get too crowded or impact marine life. Is Greys Harbor a better option for ocean shipping?

Posted Sat, Mar 10, 3:10 p.m. Inappropriate

I may have missed it but I don't see who hired PFM. The objectiveness of the SSA/Goldman Sachs report is rightly questioned but the PFM report is presented with no balancing skepticism. A 2010 presentation on the Bellingham waterfront project (included in the link above) shows the waterfront development as including "living", shops, offices, light industrial, parks and trails, moorage and so on. It is not presented as a tourist destination. "Shops and Offices" sounds good but the architect's visualization suggests that the economic driver is housing. "Light Industrial" would probably refer to boat maintenance and repair? Housing and waterfront go together very well, especially with a sizable marina on site. Unless tourism is involved, "Shops and offices" might seek lower rent elsewhere. If it is the author's contention that the Bellingham Waterfront will be developed as a job producing entity, that is, that there will be ongoing jobs at this site after the construction is over with and, further, that those jobs are imperiled by the coal trains... I don't think a good case has been made.

If you asked local residents what they thought about forty or fifty trains going through Seattle every day they'd probably say it's a bad idea. Well maybe it is a bad idea but that many trains go through Seattle right now and most people are only vaguely aware of the fact.

kieth

Posted Mon, Mar 12, 12:31 p.m. Inappropriate

There are only two ways for trains from Wyoming to get to Bellingham. They could go over the Stevens pass route, but my understanding is that that route is already operating over capacity. The only other way is through Seattle. I understand that there is even some question about whether the rail capacity to the south of Seattle could handle the amount of increased traffic a coal export facility in Bellingham would entail. The only rail route through Seattle goes in a tunnel under downtown and after it exits it skirts the waterfront north of the Alaskan Way viaduct. As someone who frequents that area and already has to deal with the existing trains along that route, I can't imagine the increased disruption that many more trains would cause. Is someone from the City of Seattle cognizant of these plans?

Lawrence

Posted Tue, Mar 13, 10:34 a.m. Inappropriate

Responses to recent posts:
Toughbretts: depending upon the route selected to reach Asia, Puget Sound could be heavily impacted by proposals to ship more crude from Alberta to British Columbia’s shipping terminals. See Dan Chasan’s recent piece on this: http://crosscut.com/2012/03/06/environment/22011/Why-a-new-invasion-of-tankers-threatens-Northwest-waters/
SSA Marine’s 2011 vessel traffic and risk assessment RFP for studies states that up to 487 ships will call per year when the terminal is fully developed; 169 will be the largest cargo ships on water, cape-size ships. Assuming that each ship is in fact a round trip, that would mean 974 annual trips of coal ships either full or in ballast through either Haro or Rosaro straits to serve SSA's proposed terminal at Cherry Point. There is already a large tanker traffic serving the two refineries at Cherry Point, plus container ships serving Vancouver’s large port. I don’t have those figures at this time but the traffic is substantial.

Kieth: My story referenced the sponsorship of PFM at the top of page 2. The organization is CommunityWise Bellingham. I link to CWB and identify its donors.

Lawrence: Last time I went to a Mariners’ game, I crossed rail tracks that would carry coal cars. As to a “pinch” on the mainline, the most serious is that between Bow and Bellingham, which runs below the Chuckanut Drive scenic highway and does not lend itself to double-tracking. Sidings are being constructed at Bow to help relieve this.

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