Study questions coal’s value to Bellingham
by Floyd McKay
A coal train runs through a Bellingham waterfront slated for economic re-development. Credit: 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.
The PFM group tied an economic cost to an issue that has motivated citizens in other Washington communities: regional livability and environmental concern. Coal does not fit that picture for many folks, and Washington’s last coal-fired power plant is being phased out. Many of Washington’s westside cities are bisected by BNSF tracks already carrying heavy traffic, including about six coal trains a day to and from Vancouver, B.C. In Edmonds and Marysville, grade-level crossings separate auto traffic from vital services. The cost of overpasses or upgraded crossing guards would be in the millions, stressing budgets of small communities.
“Quiet zones” have been implemented in a few communities impacted by heavy train traffic; essentially they involve overpasses or heavily-secured crossing gates to make track-crossing difficult. PFM observed, “Quiet zones would require capital investments — gates and signage — and maintenance. A 2007 report evaluated the creation of two quiet zones in Bellingham — the Fairhaven zone (5 grade crossings) had a projected capital cost of $1.3 to $2 million. A waterfront zone (7 grade crossings) had a projected capital cost of $1.4 to $3.5 million. At the time, there was also a projected annual maintenance cost of $5,500 per crossing, per year.” A similar project in Pomona, Calif., in 2007 cost $3.7 million for five crossings.
Local governments could attempt to load those costs onto the terminal sponsors, which have not shown any interest in assuming the burden. To cover impacts on communities along the rail line, agencies leading the environmental review — Whatcom County and the State Department of Ecology — would need to expand the scope of review outside the Whatcom County line, as opponents are advocating. County and state officials have indicated a desire to include state and regional issues in the EIS.
The scope of review is critical to these requests, and a scoping process may begin as early as next month, if SSA Marine files its second set of formal applications as expected before March 19.
It is those scoping hearings that will determine the breadth of environmental review. It is a given that fish and wildlife, wetlands, shipping, and air pollution will be studied; the list of items that can be included is long, and includes both natural and built environment. It is in the latter category that rail transportation can find a slot. The question is how far from the GPT site the environmental review will expand.
King County Executive Dow Constantine, in a January letter to Gov. Christine Gregoire, is among local government executives calling for a broad environmental review, including economic factors as well as a host of livability elements. Similar concerns have been voiced by Seattle Mayor Mike McGinn and mayors and councils of smaller cities and counties.
Gibson Traffic Consultants last year conducted railroad studies in Burlington, Stanwood, Mount Vernon, and Marysville and is doing one of three transportation studies commissioned by Communitywise Bellingham, which sponsored the PFM study.
Communitywise Bellingham (CWB) was formed as a citizen group to address issues raised by the Gateway Pacific Terminal project. It has not taken a formal position on the project, and lists its goal as, “To improve the community’s chances for mitigating or eliminating negative impacts of the proposed terminal on our quality of life, local economy, environmental health, and waterfront access.” Communitywise is frequently regarded, however, as part of the opposition to the terminal. The PFM report, at a cost of $60,000 was funded in part by the Bulliit Foundation, Rockefeller Family Fund and the Flora Family Foundation as well as local citizens.
Both sides in the Gateway Pacific Terminal struggle need help on the margins to win public and official support. Define “margin” as the inclusion of “indirect” costs and benefits. GPT wants to be credited for indirect jobs: how many more waiters, motel maids, store clerks, car salesman or others will be hired to deal with added workers? Opponents want demerits for the terminal’s coal trains, coal dust and diesel fumes and, indirectly, losses to quality of life.
The PFM report focuses on some unique characteristics of Bellingham, but also speaks to regional concerns.
Bellingham’s uniqueness plays off its green reputation, its remarkable record in building a vibrant downtown complete with affordable housing, and, as PFM points out, in-migration of a substantial percentage of well-educated families. “The County has attracted residents who migrate with higher AGIs (aggregate gross income) than those who leave the County: migration between 2004 and 2010 resulted in an aggregate net increase of approximately $172.3 million in AGI . . . The choice of living in the County or City is worth something to individuals and they appear willing to pay for the region’s location, lifestyle, and geography.” Conversely, Bellingham also has a high percentage of well-educated people living below the poverty level — 22.4 percent of over-25 residents who live below this level have at least a bachelor’s degree, well below state and national averages. “The relative high level of poverty experienced by those in Bellingham with high educational attainment suggests there is some level of choice or desire to reside in Bellingham as opposed to other locations,” PFM concluded.
SSA Marine’s Whatcom County spokesman, Craig Cole, said an emphasis on “the more fortunate few” doesn’t recognize “getting working families linked up with new good paying jobs (as) the county’s best path to a sustainable future for the many.” Similar sentiments were voiced by new Mayor Kelli Linville, who told Crosscut that the need for high-paying blue-collar jobs so people could afford a home in the city concerns her more than attracting high-income immigrants.
Western faculty recruiters have often benefitted from a “livability bonus” in seeking new professors; the region’s natural beauty and accessibility are often able to offset relatively high home prices and lower wages. It is this sort of image that PFM sees endangered by the grit and grime of coal transport and processing, even in cases where an individual is not living adjacent to rail lines.
“Stigma is real,” particularly in terms of property values adjacent or near active railroad lines, Eichenthal told a briefing for community leaders. “There is a clear economic advantage to the livability that has been maintained in this community.”
Regional pride in livability factors into other communities along the BNSF line, particularly in the Puget Sound region. In most of those communities the export terminal offers no offsetting economic gain, as is the case with Whatcom County. An exception is Longview, where a similar terminal is proposed. Other communities would feel the impact of added coal trains, with no commensurate job gains.
Environmental lawyers say there is plenty of room in federal and state law for the scope of an EIS to include communities some distance from actual construction, if a case can be made that the project damages either natural or built environment. Those categories are broad enough to drive a truck through — or a coal train, even — but lines must ultimately be drawn as the process moves forward.
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