by Evan Marczynski
Special to the Sounder
Supporters of the proposed Gateway Pacific Terminal at Cherry Point have found new reasons to claim the export facility would bring benefits to the region.
But critics are still concerned over potential downsides to the project.
SSA Marine of Seattle, the company behind the $665 million proposal, released a study in October that projected the Gateway terminal could bring $7 million in annual property tax revenue and tax savings, including more than $1.7 million to Whatcom County and more than $1.6 million to Washington state.
SSA commissioned the consulting firm FCS Group to complete the study, which looks at the terminal’s potential financial benefits should it reach its full build-out, with an expected annual shipping capacity of 54 million metric tons.
The terminal is expected to ship mainly coal, at least initially.
Coal, which would be brought to Cherry Point along rail lines from mines in the Powder River Basin in Montana and Wyoming, has been the hot point of controversy as the public comment period for the environmental “scoping” process of the project continues around the region.
Craig Cole, a SSA spokesperson, said even though the Gateway terminal is not projected to be at full capacity right away – the company has said the terminal could handle up to 25 million metric tons of commodities initially, while full capacity would depend on market values – the property tax benefits would be seen immediately upon its completion.
That would be the result of the company building a new wharf and pier on the Cherry Point property, a 1,200-acre parcel of land about 18 miles northwest of Bellingham.
Cole said the wharf and pier would raise the overall value of the terminal, regardless of how much material is shipped.
“The property tax benefits are upfront,” Cole said. “That is front-loaded in the construction.”
According to the study, the terminal is also expected to generate more than 1,200 jobs at full capacity with a payroll above $128 million. It would also generate $700,000 in annual sales-and-use tax revenues for Whatcom County jurisdictions, with the bulk of the impact going toward Bellingham, Lynden and Ferndale, according to the study.
But while supporters see these numbers as selling points for the project, the terminal’s critics look at impacts of a broader nature.
Shannon Wright is the executive director for Communitywise Bellingham, a nonprofit group that has released several studies in the past year critically analyzing the Gateway terminal.
Communitywise’s studies have focused on the negative impact of coal-train traffic in Bellingham, including impacts on waterfront businesses, rail congestion and public access to parks. They have also looked at the trains’ potential impediment of the massive redevelopment of the former site of the Georgia-Pacific pulp and paper mill, currently being led by both the Port and the city of Bellingham.
In one report, released by Communitywise in March, researchers found that if the terminal’s operation negatively affects Whatcom County tourism and economic growth, it could result in a 17 percent loss of job growth over a decadelong period.
According to project documents SSA Marine filed with county officials earlier this year, during its initial operation, the terminal would handle up to five 125-car trains – each up to 7,000 feet long – making daily roundtrips. Once the terminal reached full build-out, it would handle up to nine trains per day.
Wright said her organization’s main critique of the FCS Group study was that there was no assurance the terminal’s potential tax benefits would outweigh the potential costs.
“You can’t look at economic impact and understand it simply by looking at the benefits and revenues,” Wright said. “You have to look at the full balance sheet. There are many potential costs to Whatcom County and Bellingham.”
Wright also worried that coal trains could negatively impact property values for homes and business near the rail tracks all across the Pacific Northwest.
An October study commissioned by Climate Solutions, a nonprofit group firmly against coal exports in Washington state, looked at the impact of coal trains on property values north of Everett and found that with the Gateway terminal at full capacity, the residential, commercial and industrial properties near rail tracks could drop anywhere from 5 to 20 percent in market value.
Craig Cole of SSA Marine was not convinced the evidence of declining property values due to coal trains was conclusive.
“Rail traffic is variable. It ebbs and flows with customer demand,” Cole said. “Whether this project exists or not, rail traffic will ebb and flow.”
Cole was also dismissive of Communitywise’s belief – which is shared by a number of other groups critical of the Gateway terminal – that the impact of coal trains on property values all along the Northwest rail corridor should be included in the project’s Environmental Impact Statement.
He said transportation systems such as railways are designed to serve commerce. Should any project that proposed to increase traffic be put to such broad environmental review, Cole said, commercial activity such as the Gateway terminal would never be feasible.
Lauri Hennessey, a spokesperson for the Alliance for Northwest Jobs and Exports, which supports the construction of new shipping terminals in the Northwest, agreed with Cole.
Hennessey said putting the Gateway project to higher standards of review could set a harmful precedent for other major commercial or industrial projects that might bring jobs to the region.
Shannon Wright of Communitywise Bellingham said her organization was encouraging people, whether they support or oppose the terminal, to attend public meetings or submit comments to the official “scoping” website at www.eisgatewaypacificwa.gov.
“We are encouraging local residents to ask whatever questions they have,” Wright said.
Hennessey said the three agencies charged with completing the environmental review – Whatcom County, the Washington Department of Ecology and the U.S. Army Corps of Engineers – should be given the chance to address any concerns residents potentially affected by the project might have.
Marczynski is a reporter at the Bellingham Business Journal.
