Communitywise says GPT job promises didn’t add up

Monday the Army Corps of Engineers rejected SSA Marine’s application to build the Gateway Pacific Terminal, ruling it would violate the Lummi Nation’s treaty rights. Since it was first proposed, the controversial coal export project had raised many red flags for its foreseeable negative impacts locally. Not only did GPT carry with it significant risks and costs for our county, its potential benefits were overstated. In particular, GPT’s job promises had always been on shaky ground.

Over the last five years, SSA Marine and joint public relations efforts with the railroad and mining companies had cast GPT job promises in many variants. Estimates varied from 430 jobs to 1,250 jobs – most recently claimed at 5,680 jobs in a public relations piece backed by the corporation and other project proponents last year.

There were several major red flags around SSA Marine’s chosen job “ripple effect”— and therefore the job numbers the corporation advertised.

Unfortunately, this flow of claims often left our community and important decision makers with misleading and unverified approximations that were presented as “facts.” Behind these numbers lay both flawed methodologies and outdated data, seriously inflating these rough “estimates” on how many jobs GPT would have helped support or potentially created.

Communitywise Bellingham documented several serious problems with how SSA Marine calculated GPT’s “direct jobs.” Another area of likely miscalculation in the GPT job promises is the chosen “multiplier” — the job ripple effect used to magnify the “direct job” numbers.

The ripple effect is what it sounds like — it indicates how far out jobs from a project will “ripple” through a geographic area, creating some new employment and supporting existing other jobs. The greater the ripple effect, the greater total jobs. If you are selling a controversial project to a community, a strong ripple effect is a good selling point.

There were several major red flags around SSA Marine’s chosen job “ripple effect”— and therefore the job numbers the corporation advertised.

First, back in 2012, SSA Marine directed its consultants to calculate all of GPT jobs based on a “multi-product bulk cargo export terminal” such as ports of Seattle or Houston.

These ports were very poor proxies for GPT’s core business model: a highly automated coal export facility. Only 10 percent of GPT would have been dedicated to other commodities, if the developers had found a viable market.

WWU economists Hart Hodges and James McCafferty explored this issue in a Bellingham Herald piece last year. They noted that the SSA Marine contractor assessing GPT’s job numbers, “estimated the impacts of a multi-product bulk cargo export facility,” (our emphasis) because that was the business plan SSA Marine gave them, even though it only describes, at best, the plan for 10 percent of the facility.

Automated coal ports produce a smaller job ripple effect than more complex, multi-commodity ports. This was the second problem with SSA Marine’s chosen job ripple. Applying the higher ripple effect then to all of GPT produced an inaccurate — and inflated — job number.

A final concern on this issue: The ripple effect of 2.9 that SSA Marine uses to calculate its job numbers was not actually for Whatcom County but was an average of other counties in the west. Instead, the Bureau of Economic Analysis’ most recent estimate for the ripple effect in Whatcom County in the closest category to a coal port — according to Bureau of Economic Analysis — is 1.8. This ripple effect is an unbiased government estimate.

Even the ripple effect used by the similarly-sized, proposed Millennium coal port in Longview — whose project backers have the same interest in presenting their project in the best possible light — is much lower (at 2.2) than SSA Marine’s.

The result? Millennium promises 400 jobs while GPT promised 1,250.

Despite these shaky job numbers, SSA Marine continued to promote GPT as a singular silver bullet economic solution for our area. Meanwhile, established employers in our county increased new employees at growing rates. Data released in March 2015 showed Whatcom County added some 4,200 new jobs in just one year — 10 times the direct jobs SSA Marine says GPT would have created over the life of the terminal’s operations (using their seemingly high estimates and assuming the coal market would rebound).

Our county welcomes good employment opportunities — we can all agree on this. In judging potential benefit or loss from a high-risk project like GPT, however, due caution is warranted in accepting job numbers that just don’t weather close scrutiny. GPT backers only offered the community inflated and unsupported job claims and no viable strategies to offset the predictable, long-term negative impacts that the largest coal terminal in North America would have had on our quality of life and local economy, in addition to the Lummi Nation’s rights. These facts remain even as the GPT proposal comes to an end.

Shannon Wright is executive director of Communitywise Bellingham, which advocates for the community’s economy, health and livelihood in relation to the proposed Gateway Pacific Terminal coal project.