The Sonics aren’t coming, and that’s a relief to the Port of Seattle. Eastern and Central Washington exporters can breathe a little easier too, but not for long. An estimated 200,000 Washington jobs depend on the port’s vitality, and challenges are bigger than an NBA center.
Expansion of the Panama Canal will be completed next year. Ships triple the size of those sailing through the canal today will be able to reach East Coast and Gulf ports instead of having to unload on the West Coast. Their cargos will not have to go as far by more expensive trains or trucks.
But even the expanded canal cannot accommodate the next generation of ships carrying 18,000 containers (most today carry 10,000), so the next threat is closer to home; just across the border, in fact. British Columbia is expanding container capacity at Vancouver and Prince Rupert to capture more incoming Asian cargo. At Prince Rupert alone, plans call for $900 million in improvements, including rail corridors that will get those goods to the American Midwest.
“Canada Starts Here: The BC Jobs Plan” has the enthusiastic support of the federal government in Ottawa.
Our federal government is their accomplice.
All U.S. ports pay a Harbor Maintenance Tax on incoming containers. The revenues are used to dredge harbors, which makes sense in many places, including Columbia River ports. But the channels to Tacoma and Seattle do not need dredging, and the tax puts them at a significant disadvantage – as much as $200 per container – when competing with the British Columbia ports.
And it’s those containers, once emptied, that are very important to exporters far away from saltwater.
Because Washington is a high-export state, empty containers are quickly filled and sent back to Asia. If empty containers are not available, Ellensburg shippers of hay pellets may have to rail those commodities to ports where containers sit idle. Boxes landed in Long Beach, Calif., for example, don’t have to go far because 80 percent of the contents are consumed in Southern California or adjacent areas.
Seventy percent of the goods inhaled by Puget Sound ports are exhaled to Chicago and eastward by rail, which accounts for many of the container-laden trains through Spokane.
And getting trains and trucks out of Seattle and Tacoma is taking more time and money. Building a Sonics arena in the middle of the congestion is a nightmare for port officials spending millions on what they call “last mile” projects: the distance from docks to interstates 5 and 90. The state has plans to alleviate the congestion, but not the billions to get the projects done.
Outgoing U.S. Transportation Secretary Ray LaHood is aware of the problem and is organizing a Freight Mobility Council to examine the problems at the federal level. Montana Sen. Max Baucus, chairman of the Senate Finance Committee, has said changes in the harbor maintenance tax could be part of a comprehensive tax reform bill he wants passed before he leaves the Senate in 2014.
If action does not come soon, the Panamanians and Canadians may have already stuffed Washington’s shot.