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Port Cargo Concerns Community

By Hildi Flores

The Port of Olympia is currently under scrutiny for its questionable economic viability and controversial cargo, the most recent being ceramic proppants used in the oil fields of North Dakota for hydraulic fracturing, also known as "fracking." The Port's shipment of this cargo is embedded in more systemic issues that have been the concern of some community members for decades.

At a public meeting on April 22, Port Commissioners responded to public comments by stating it is outside the scope of their role to "arbitrarily" halt the movement of proppants. Commissioner Jeff Davis said almost every cargo has controversy, and as commissioner he has to consider "what is the immediate threat to the citizens of Thurston County?"

One of the concerns addressed at the meeting was the added greenhouses gases that would result from further oil extraction in North Dakota. It could be argued this in itself poses a threat to Thurston County and the Port's own marine facilities from the resulting sea level rise. The community caught a glimpse of what this could look like in December 2012 when a high tide endangered downtown businesses.

"This cargo poses an immediate threat to the community," local activist Robert Whitlock told the Port commissioners during the public comment session. "It's a divisive and destructive thing to use the Port for. We don't need to engage in the fossil fuel industry to have jobs. This effort to refrain the Port from shipping is not symbolic. I hope that people all over the world responsibility to make sure the Port is successful and to create economic development."

As it turns out, it was upon the Port's own initiative that Rainbow Ceramics, the proppant company, was solicited. Following the public comment session, Jim Knight, the Port's Business Development Manager, told this reporter he "went to North Dakota to discover if there were opportunities for the Port. One was ceramic proppants." According to Knight, this cargo was best fit for the Port's break- bulk facilities, which handles cargo not in freight containers.

"If they went to North Dakota then they are complicit in what is going on there," said Mike Coday, a local activist. "We can't get them to think in a long-term timeframe because they are focused on the fiscal year."

Beyond the short-term goal of halting the shipment of a particular cargo, citizens of Thurston County ought to consider the full scope of the influence the Port District has on the local economy. Commissioners Jeff Davis and Bill McGregor are up for re-election this year, but challengers have yet to step forward at this writing. The filing deadline for the positions is May 17. In the event voters are given a choice, they can consider the following questions concerning the future of the Port's role in the community.

What is the role of the Port as a public entity intended to facilitate economic development? How should it make use of its authority to levy property taxes and administrate its vast waterfront facilities?

Is it still necessary to have a deep water facility if the majority of the cargo merely passes through and is of no direct benefit to the community beyond the jobs created to transport it?

Who does the Port serve directly and indirectly? What effect would it have on the economy if any of the various functions of the Port were to cease operation, or operate differently?

In an early May interview with the South Sound Green Pages, Commissioner Davis said he sees ports as integral to Washington State's economy. "One in four jobs is dependent on trade, the majority of which is done through ports," said Davis. "We have to maintain healthy ports to have a healthy economy."

In addition to ceramic proppants and other break-bulk cargo, the Port has recently renewed its contract with Weyerhaeuser Co. to export raw to minimally processed logs to Asia. Some question whether it is in Thurston County's best interest to be exporting raw materials, but Davis says the Port's activities are largely subject to the whim of the private sector.

"We have to take what we can get," said Davis. "The private industry is the one that denotes whether it will be shipping a raw log or a finished product. I would rather it be a finished product of some sort, but as it stands we as the Port District are simply in the business of moving cargo."

Jeff Smith, the new Financial Director for the Port, explained at a Carnegie Group meeting that proppant shipments resulted in expected operating revenue being exceeded by $1.093 million. The benefit to this, he said, would be for the Port to have less reliance on the property tax levy, which is $4.8 million for the year 2013.

The Port insists the tax levy is only being used to pay for environmental clean-up and debt services on bonds, not salaries or operations. Some community members are not convinced and see the reliance on a property tax levy as proof that the Port cannot pay its way.

"It's the same old story they've been telling us for decades," says former Olympia mayor Bob Jacobs, who has been trying to hold the Port accountable since the '90s. "Debt service on bonds is for buildings and equipment used in the Port District's operations. Thus, these are operating expenses. Environmental costs are likewise costs of doing business. Both public and private entities must cover such costs out of revenues."

Currently, the Port District has four business operations, most of which primarily service specific groups of people. The marine terminal services shippers, the marina services boat owners, the airport services plane owners (since passenger commercial services are no longer available), and the peninsula properties service the businesses that operate there. It can be argued that the rest of Thurston County has an indirect benefit from Port activities, but it is clear that beyond the peninsula properties, the Port's operations are not of direct benefit to the general public.

However, the Port does have the Small City Funding Program which commits $40,000 annually to the cities of Bucoda, Tenino, Rainier, and Yelm for development projects. There is also potential for the land near the airport set aside for prairie habitat conservation to be used for a solar farm, but the viability of the project is dependent on the Port's ability to finance it.

"The only way we can have the solar project is if we're bringing something in," said Davis.

But the Port has been turning down cargo ships because they are too big to enter the harbor. Davis said the berthing area would need to be dredged an extra two to three feet, which runs the risk of stirring up toxic contaminants settled in the soil beneath the Budd Bay.

It is possible for the Port to cease operating its marine terminal, which Jacobs says has been obsolete since the construction of I-5, and still be an entity for economic development. In fact, many port districts in Washington do not have marine terminals.

Though the potential for redirecting the vision of Port's role in the community is somewhat open to public influence, ultimately Thurston County residents are going to have to decide if the benefits the Port's operations provide are worth its $4.8 million tax subsidy.

Hildi Flores is a senior at The Evergreen State College. She has a background in political economy, history, and journalism, with a particular interest in community networking and sustainable economic development.


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Updated 2015/01/07 21:14:22