Georgia Ports’ Curtis Foltz hopeful Savannah will receive federal funds

By Maria Saporta

The Georgia Port Authority’s executive director is optimistic that federal funding to deepen the Savannah Port will be in place in the next couple of years.

Curtis Foltz, executive director of the Georgia Port Authority, spoke at the Cobb Chamber of Commerce’s Chairman’s Club luncheon Tuesday at the Cobb Energy Center for the Performing Arts.

“We strongly believe that the federal government will step up to the plate in a big way in the Fiscal Year 2015 budget,” Foltz said in response to a question. “We believe it will bubble up to the top.”

The deepening of the Savannah Port’s channel from 42 feet to 47 feet has become a top economic development priority for the State of Georgia. The Panama Canal is expanding, which will permit mega ships to cross. Georgia officials believe that if the Savannah Port is to remain competitive in the future, it needs to be able to accommodate the larger ships.

Last October, the federal government recommended that the Savannah Port be deepened — a project that’s estimated to cost $652 million — $262 million coming from the State of Georgia and $390 million coming from the federal government.

So far, the state has allocated $231 million towards the project while waiting on the federal funds.

At the very least, Foltz said state officials had hoped President Barack Obama would have increased the spending limit for the project (the earlier budget projected a $460 million and that needs to be raised to $652 million) in his budget proposal for this year. But the decision was made have the spending cap increased be handled through Congressional legislation rather than the budget.

The U.S. Senate already has approved increasing that spending cap, and the U.S. House is expected to vote on the project by late summer or early fall, Foltz said.

When President Obama was in Atlanta on Sunday, he did reference the need to deepen the ports along the East coast to accommodate the new mega ships that can now travel the Panama Canal.

If significant federal dollars to deepen the Savannah Port were to be included in the FY2015 budget (which begins in July 2014), Foltz said the project would take about three years, meaning it could be completed by the end of 2016.

Foltz said the case to deepen the Savannah Port is strong. Currently the Savannah Port is the fastest-growing container port in the country yet it is “the shallowest major port in the world.” Also, the Savannah Port exports more goods (54 percent) than it imports (46 percent) — helping provide a better trade balance for the United States.

As Foltz said: “We can’t imagine there is a better investment in infrastructure for a port that’s export dominant and the fastest-growing port in the country.”

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8 comments
writes_of_weigh
writes_of_weigh

Maria - If there is a continual bemoaning of lack of funding for deepening the Savannah river there and out to the Atlantic, and if the Panama Canal is mostly ready for the post-Panamax super carriers, what's to prevent those ships from simply sailing on to Norfolk, where there is deep port hydrology in place, and even(in concert with the State of Virginia and Norfolk Southern Corp./RR)upgraded rail infrastructure, too. It suggests to me that the player's in this game, with their hands out for this "n" that but not THAT, are just a wee bit too deep into political gamesmanship/one up-man-ship. If Norfolk Southern, which stands to benefit immensely from an deepened Savannah River and the resultant expected traffic surge, can shoulder rail upgrade burdens in Virginia, why can't it do so in Georgia, as well? Too, why can't CSX make this sort of investment as well? I assume that if Warren Buffet owned those railroads, too, the upgrades or at least the capex plans for them would already be in place. The added benefit would be in keeping the GA DOT from "gumming up the works." As a reminder, Norfolk Southern somehow figured out how to run it's freight trains and some additional PASSENGER TRAINS on it's Virginia rights-of way, too(t)!

writes_of_weigh
writes_of_weigh

Maria - If there is a continual bemoaning of lack of funding for deepening the Savannah river there and out to the Atlantic, and if the Panama Canal is mostly ready for the post-Panamax super carriers, what's to prevent those ships from simply sailing on to Norfolk, where there is deep port hydrology in place, and even(in concert with the State of Virginia and Norfolk Southern Corp./RR)upgraded rail infrastructure, too. It suggests to me that the player's in this game, with their hands out for this "n" that but not THAT, are just a wee bit too deep into political gamesmanship/one up-man-ship. If Norfolk Southern, which stands to benefit immensely from an deepened Savannah River and the resultant expected traffic surge, can shoulder rail upgrade burdens in Virginia, why can't it do so in Georgia, as well? Too, why can't CSX make this sort of investment as well? I assume that if Warren Buffet owned those railroads, too, the upgrades or at least the capex plans for them would already be in place. The added benefit would be in keeping the GA DOT from "gumming up the works." As a reminder, Norfolk Southern somehow figured out how to run it's freight trains and some additional PASSENGER TRAINS on it's Virginia rights-of way, too(t)!

Bill Dawers
Bill Dawers

The Corps of Engineers' economic projections are fairly clear on a few points. If the long Savannah River Channel is NOT deepened, the amount of cargo handled by the port will increase at the same rate as it would with deeper dredging. The economic benefit to a deeper channel would come through increased efficiencies -- fewer total trips, more heavily laden ships, less time spent waiting for favorable tides. The cost savings would impact the economy positively, but Corps economists note that it's impossible to say exactly where that extra activity will manifest itself. 

As Mary Landers notes below, there has also been problematic rhetoric regarding weight vs. value of imports and exports. 

These points have been consistently downplayed in public discourse about this very expensive and environmentally risky project.


Bill Dawers
Bill Dawers

The Corps of Engineers' economic projections are fairly clear on a few points. If the long Savannah River Channel is NOT deepened, the amount of cargo handled by the port will increase at the same rate as it would with deeper dredging. The economic benefit to a deeper channel would come through increased efficiencies -- fewer total trips, more heavily laden ships, less time spent waiting for favorable tides. The cost savings would impact the economy positively, but Corps economists note that it's impossible to say exactly where that extra activity will manifest itself.  As Mary Landers notes below, there has also been problematic rhetoric regarding weight vs. value of imports and exports.  These points have been consistently downplayed in public discourse about this very expensive and environmentally risky project.

Mary Landers
Mary Landers

It's worth noting, as we have repeatedly in the Savannah Morning News, that the ratio of export to imports cited by Mr. Foltz is based on weight. Think about what Georgia exports: clay, wood products, frozen chicken parts. Those are heavy things. If instead you look at the value of those imports and exports the ratio changes dramatically. It's unclear what year he's talking about here, but World Port Source reports that, by value, imports outstripped exports in 2010 (the most recent year it reports) with about $34.4 billion worth of foreign goods coming into the port and $24.3 billion of domestic goods going out. That ratio works out to 59 percent imports to 41 percent exports. You can find the data to support this at http://www.worldportsource.com/trade/USA_GA_Port_of_Savannah_320.php The site has some nice bar graphs that indicate at a glance what's happening with imports and exports over the years. 2010 looks like the first year in which the weight of the goods going out was greater than the weight coming in. 

The port of Norfolk  had a much higher export to import ratio that same year based on weight. Here's its page: http://www.worldportsource.com/trade/USA_VA_Port_of_Norfolk_252.php Based on value it did a little better than Savannah, too: 56 percent imports and 44 percent exports. That's just the first one I looked at. I've looked previously and Savannah was an average performer overall in terms of import/export ratios based on value. 

Perhaps there's some reason weight is so important to this discussion and I'm just not grasping it. I can see where the shipping companies care, but as far as economic impact, shouldn't value be the driving factor?

Best,

Mary Landers, reporter at the Savannah Morning News

Mary Landers
Mary Landers

It's worth noting, as we have repeatedly in the Savannah Morning News, that the ratio of export to imports cited by Mr. Foltz is based on weight. Think about what Georgia exports: clay, wood products, frozen chicken parts. Those are heavy things. If instead you look at the value of those imports and exports the ratio changes dramatically. It's unclear what year he's talking about here, but World Port Source reports that, by value, imports outstripped exports in 2010 (the most recent year it reports) with about $34.4 billion worth of foreign goods coming into the port and $24.3 billion of domestic goods going out. That ratio works out to 59 percent imports to 41 percent exports. You can find the data to support this at http://www.worldportsource.com/trade/USA_GA_Port_of_Savannah_320.php The site has some nice bar graphs that indicate at a glance what's happening with imports and exports over the years. 2010 looks like the first year in which the weight of the goods going out was greater than the weight coming in.  The port of Norfolk  had a much higher export to import ratio that same year based on weight. Here's its page: http://www.worldportsource.com/trade/USA_VA_Port_of_Norfolk_252.php Based on value it did a little better than Savannah, too: 56 percent imports and 44 percent exports. That's just the first one I looked at. I've looked previously and Savannah was an average performer overall in terms of import/export ratios based on value.  Perhaps there's some reason weight is so important to this discussion and I'm just not grasping it. I can see where the shipping companies care, but as far as economic impact, shouldn't value be the driving factor? Best, Mary Landers, reporter at the Savannah Morning News

David Kyler
David Kyler

In regard to the Savannah harbor deepening project and claims about environmental responsibility made by the Georgia Ports Authority, consider a larger perspective on both natural resources and responsible government spending.

Any Corps of Engineers project that requires a minimum of $280 million in engineered “mitigation” efforts trying to control or compensate for environmental threats is simply not being done at a suitable location and should not be funded. No other world-class deep-water port in the world is nearly as far from the ocean as Savannah's harbor - some 38 miles up a hard-to-navigate, meandering river - which is one reason why mitigation for this project is so costly and tenuous.

Nor does the record of Corps mitigation performance inspire confidence in results.

Too often, mitigation either costs far more than expected or fails altogether — in some cases causing significantly more wasteful environmental havoc than predicted.

When a major portion of project costs are for damage control (nearly 50% in Savannah’s case), the environmental harm is too great and too risky — and the taxpayers are being bilked to subsidize an unjustifiable investment when better choices are available.

Until a reputable, comprehensive analysis of port-deepening needs and options throughout the Southeast is done, no more public funds should be spent on such projects. 

David Kyler, Executive Director, Center for a Sustainable Coast

www.sustainablecoast.org

 

David Kyler
David Kyler

In regard to the Savannah harbor deepening project and claims about environmental responsibility made by the Georgia Ports Authority, consider a larger perspective on both natural resources and responsible government spending. Any Corps of Engineers project that requires a minimum of $280 million in engineered “mitigation” efforts trying to control or compensate for environmental threats is simply not being done at a suitable location and should not be funded. No other world-class deep-water port in the world is nearly as far from the ocean as Savannah's harbor - some 38 miles up a hard-to-navigate, meandering river - which is one reason why mitigation for this project is so costly and tenuous. Nor does the record of Corps mitigation performance inspire confidence in results. Too often, mitigation either costs far more than expected or fails altogether — in some cases causing significantly more wasteful environmental havoc than predicted. When a major portion of project costs are for damage control (nearly 50% in Savannah’s case), the environmental harm is too great and too risky — and the taxpayers are being bilked to subsidize an unjustifiable investment when better choices are available. Until a reputable, comprehensive analysis of port-deepening needs and options throughout the Southeast is done, no more public funds should be spent on such projects.  David Kyler, Executive Director, Center for a Sustainable Coast www.sustainablecoast.org