Big projects, big dollars
Deepening the Savannah River: $706 million
Deepening Charleston’s harbor: $509 million
Building the port of Jasper: $4.3 billion
Deepening (again) the Savannah River: $1.5 billion
Savannah port upgrades: $1.8 billion
Charleston port upgrades: $1.7 billion
Note: Costs are estimates
Sources: South Carolina, Georgia, federal and contractor reports
Georgia and South Carolina are ready to start spending some real money to build the $5 billion Jasper Ocean Terminal planned for a scrubby patch of South Carolina dirt and sand 15 miles below downtown Savannah.
The Georgia Ports Authority is expected to dedicate $7.5 million Monday for environmental studies for the hoped-for port that wouldn’t open for at least a decade. South Carolina legislators have already ponied up their share. In three years the states will need to kick in an additional $50 million to $100 million each for engineering, design and further environmental work.
Taxpayers are already spending about $1 billion deepening harbors and upgrading terminals and roads at the ports of Savannah and Charleston. The construction and maintenance price tag for all three ports could top $9 billion over the next 15 years, though not all costs would be borne by taxpayers.
Thousands of new jobs and billions in potential revenue are projected for the 1,500-acre port that would revolutionize a sleepy corner of South Carolina low country. Yet critics question whether any additional taxpayer money should be spent on a from-scratch port dependent upon an unpredictable global economy, especially if Jasper steals business from upriver Savannah.
“Are these projects in the ports’ and states’ interests? Probably. Are they in the federal interest? Absolutely not,” said Steve Ellis, vice president of Taxpayers for Common Sense in Washington. “The federal government looks at these ports in isolation when, in reality, all these ports, like it or not, will be in competition with one another. Sure, everybody’s making nice right now, but as we’ve seen before, there’ll be conflict between South Carolina and Georgia over the port of Jasper.”
Georgia’s ports account for an estimated $40 billion in statewide economic impact and tens of thousands of jobs, according to a University of Georgia study. Metro Atlanta, a distribution hub with huge truck and rail traffic, reaps about 70 percent of the economic benefit.
Savannah’s Garden City Terminal is projected to nearly run out of room in 15 years. Jimmy Allgood, the vice chairman of the Georgia Ports Authority, said now is the time to plan for, and begin paying for, a new port.
“We don’t know exactly what’s coming, but we do know there’ll be bigger ships and we’ll need more capacity,” said Allgood, who is also chairman of the bistate port project. “It’ll put thousands of people to work and add billions of dollars of tax revenue. It could really be a huge engine driving the South Carolina and Georgia economies.”
Ports along the Eastern seaboard are in a building frenzy in anticipation of a surge in big container ships delivering steel containers from Asia to U.S. consumers. A widened Panama Canal is due to open next month, allowing ships carrying as many as 14,000 containers a quicker route from China to the East Coast.
The U.S. Army Corps of Engineers is in the midst of a $706 million project to deepen 41 miles of the Savannah River. Georgia taxpayers have contributed $266 million; Congress is supposed to cover the rest.
Charleston, long a bitter competitor with Savannah for Southeastern U.S. port supremacy (Savannah handles 50 percent more containers annually), is planning a $509 million deepening project. Taxpayers have already contributed $300 million.
Well before either project is completed, though, the two states have committed to build an estimated $4.3 billion terminal with docks, warehouses and roads along the Savannah River. Deepening and widening, again, a 21-mile stretch of the Savannah River into the Atlantic Ocean could cost an additional $1.5 billion, depending on how deep Jasper backers want to go.
So far, the two states have contributed $10 million on preliminary plans. The next installment — $7.5 million each — goes for an environmental impact study with public hearings scheduled this fall.
Within three years, though, each state must come up with $50 million to $100 million more for engineering and design work. It’s unclear where that money will come from. The Georgia Ports Authority, with a projected $343 million in revenue this upcoming fiscal year, could readily pay its share without taxpayer help. South Carolina, which pulls in about $210 million annually, might have a harder time.
The port of Charleston has a $1.7 billion wish list for new terminals, roads and rail lines over the next decade. The state’s Legislature, though, is grappling with ways to pay $3 billion to fix deteriorating roads.
(Georgia has a $1.8 billion construction and maintenance wish list for Savannah’s Garden City terminal, with revenue likely to cover most of the costs over the next decade.)
“We certainly are committed to (funding Charleston and Jasper),” said David Posek, a board member for both ports. “We’ll have a compelling story about having the deepest port on the East Coast, (which) you can bring to the legislatures of both states, but also to third party investors.”
Board members downplay the location of the Jasper port — squarely in South Carolina — by touting the jobs and shared revenue to come from a massive development.
“The whole area already acts like a hub where people who live north of the river work in Savannah and its port,” said Jason Ball, a maritime engineer with Moffatt & Nichol, which is managing the project. Jasper, he said, “will break down the whole concept of borders.”
“It will be almost like the port of New York and New Jersey, where there’s one port authority for the region,” Ball added.
Board members can’t say how, or by whom, Jasper will be financed. Financing possibilities include port revenue, municipal bonds, private investment and tax dollars. But federal money can’t be used for the $4.3 billion terminal. The feds, however, historically cover 60 percent to 70 percent of the cost of deepening a river.
“But they’d have a hard time justifying another Savannah project because many other ports on the East Coast are also deepening and there’ll be a lot of competition for very limited dollars,” said Ellis, the federal watchdog.
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