1 / 21

THE BIG PICTURE Globalization, Discretionary Cargo, Containers, And Ports

Will The Investment of $1 Billion in Taxpayer Funds to Dredge/Deepen the St Johns River Produce the Claimed Return On Investment? David Jaffee Professor of Sociology Northeast Florida Center for Community Initiatives University of North Florida djaffee@unf.edu. THE BIG PICTURE

ila-calhoun
Download Presentation

THE BIG PICTURE Globalization, Discretionary Cargo, Containers, And Ports

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. Will The Investment of $1 Billion in Taxpayer Funds to Dredge/Deepen the St Johns River Produce the Claimed Return On Investment? David Jaffee Professor of Sociology Northeast Florida Center for Community Initiatives University of North Florida djaffee@unf.edu

  2. THE BIG PICTURE Globalization, Discretionary Cargo, Containers, And Ports • OBJECTIVE: • Moving imported goods as quickly and cheaply as possible • from the point of production to the point of consumption

  3. GETTING THE GOODS From Landbridge to All-Water Rail 6 days Landbridge 12.3 days All-Water 21 days Widening the Panama Canal See: Impact of Panama Canal Expansion on US Intermodal System

  4. WHY YOU SHOULD NOT TRUST THE COST-BENEFIT NUMBERS PROJECT/PUBLIC APPROVAL = (underestimate costs) + (overestimate revenues) + (undervalue environmental impacts) + (overvalue economic development effects)* Lesson: Conduct/commission independent cost-benefit analysis of the project * B. Flyvbjerg, M.S. Holm, & S. Buhl, S. “Underestimating costs in public works projects”, Journal of the American Planning Association 2002 Volume 68(3) p. 279-295.

  5. The USACE Jacksonville Harbor Deepening Report is not a comprehensive cost-benefit analysis The only “benefit” that the report calculates is Reduction in Transportation Costs These benefits accrue to retailers,shippers and carriers Public costs, private benefits. This is a return to those who made no investment.

  6. WHO BENEFITS? “The economic function of competition between established regional container ports is to incentivize them to be more responsive to the needs of global maritime freight transportation industry.” (USACE Response to Independent External Peer Review) Destructive Competition “…interport competition results in an unnecessary and unrewarded transfer of wealth from local taxpayers and users to global firms.” Potter, “Boxed In: How Intermodalism Enabled Destructive Interport Competition”

  7. Job Benefit Claims Cannot Be Trusted “65,000 jobs supported/generated/provided by the port” ~66% are “related jobs” that and should not be included Leaves ~22,210 Of which 8,965 are “direct jobs” ~8,845 are “induced” ~4,400 “indirect” Based on Martin Associates report (2009)

  8. Current Job Claims for Project If 47’ vs 40’ 13,844 additional jobs generated by 2035 5,587 are direct private sector port jobs, “The Regional Economic Development (RED) benefits are incorrectly attributed to the harbor deepening and therefore overemphasize regional benefits of the Jacksonville Harbor Project.” (External Peer Review)

  9. Martin job/revenue numbers -- assumptions to question: • Based on capturing how much cargo from other ports? • Factor used to translate TEUs into jobs and revenue? • Income level of jobs used to estimate induced jobs?

  10. Job Quality Data Inaccurate Claim: Avg Salary 43,000 Transportation and Material Moving Occupations* Occupation Code = 53 Total Employment = 44,260 Median Annual Income = $28,538 Median Wage in this sector: $13.78 Living Wage for Duval County** 1 adult, 1 child = $19.71 per hour * Bureau of Labor Statistics’ Occupational Employment Statistics (OES), May 2013 ** Living Wage Calculator, Massachusetts Institute of Technology http://Livingwage.mit.edu

  11. Job Quality Transportation and Material Moving Occupations* 61% of employment in three largest occupations: Laborers and Freight, Stock Material Movers (34%) Heavy and Tractor Trailer Drivers (21%) Packers and Packagers (6.4%) Average Median Income for these three = $28,395 (assuming FT/Year round employment) * Bureau of Labor Statistics’ Occupational Employment Statistics (OES), May 2013

  12. Geographic Distribution of Benefits Unanimous conclusion of research on changing socio-economic impact of ports as a result of containerization and intermodalism: The geographic concentration of costs ($, infrastructure, environmental, air/water, congestion, noise) and the dispersion of benefits (jobs, income, revenue) USACE recommendation based on national not local economic benefits

  13. If ROI Depends on Bringing In Largest Post- and New Post-Panamax Vessels, And/or Jaxport Being a First-In/Last-Out Port It Won’t Happen

  14. 47’ Water Too Shallow/Bridge to Low Dames Point Bridge air draft = 175 ft

  15. Shallow Water Designed Maersk SAMMAX Vessel

  16. If ROI Depends on Capturing Cargo Why No Multiport Analysis? “Federal interest has not been demonstrated in the General Reevaluation Report II (GRRII) because a multi-port analysis assessing competition among regional ports is not provided.” (Peer Review: High Significance) If a multiport analysis had been conducted, it is likely that the USACE would not have recommended dredging. See multiport analysis in Savannah Harbor deepening study. http://www.sas.usace.army.mil/Portals/61/docs/SHEP/reports/GRR/SHEP%20FINAL%20GRR%20APPENDIX%20A%20Economics%20Att%204.pdf USACE response: “Historical data indicates that many of the ports that would be regional competitors to the Port of Jacksonville are also on the same itineraries.”

  17. Multiport Analysis of Where Carriers Will Be Taking Cargo

  18. “Revealed Preferences” of Carrier Alliances JAXPORT Losing Market Share to Other Ports Alliance Port Rotation

  19. East Coast Port Competition And Fiscal Irresponsibility: Why no national plan? How many deep water ports do we need? “Our challenge is to invest in capacity expansion in the right places at the right time consistent with industry needs. ..South of Norfolk there are no ports that are fully post-Panamax ready. The ports of Savannah, Charleston and Miami are at various stages of capacity expansion. Successful development at these ports would fill the critical need on the Southeast coast. However, there may be a need for “cascade ready” expansion at some of the smaller ports.’ U.S. Port and Inland Waterways Modernization : Preparing for Post-Panamax Vessels Institute for Water Resources U.S. Army Corps of Engineers http://www.iwr.usace.army.mil/Portals/70/docs/portswaterways/rpt/June_20_U.S._Port_and_Inland_Waterways_Preparing_for_Post_Panamax_Vessels.pdf

  20. 'Certainly we as an association and in the industry as a whole recognize and believe that not every port in the country needs to be at a depth to be able to accommodate the largest vessels in international trade,' Kurt Nagle, American Association of Port Authorities “Post-Panamax Ready” “Cascade- Ready” http://www.iwr.usace.army.mil/Portals/70/docs/portswaterways/rpt/June_20_U.S._Port_and_Inland_Waterways_Preparing_for_Post_Panamax_Vessels.pdf

  21. Playing on Jaxport Strengths Without 47’, $1 Billion, Bond Debt, Overcapacity, and Environmental Destruction • Diverse range of cargos – containers, bulk, breakbulk, and ro-ro • Niche carrier development with growing markets/economies of Caribbean, Central America and South America – SAMMAX vessels? • Developing LNG bunker fuel facilities for Puerto Rico and Caribbean shipping • Receive feeder vessels from transshipment hubs in Central America and the Caribbean • Cultivate Port of Jacksonville firms and private terminal operators such as Crowley • Mile Point fix will ensure 24 hour access

More Related