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SEVEN QUESTIONS TO ASK ABOUT $1 BILLION SPENDING OF PUBLIC FUNDS FOR ST JOHNS DREDGING/DEEPENING

SEVEN QUESTIONS TO ASK ABOUT $1 BILLION SPENDING OF PUBLIC FUNDS FOR ST JOHNS DREDGING/DEEPENING David Jaffee Professor of Sociology Northeast Florida Center for Community Initiatives University of North Florida djaffee@unf.edu. #1: WHAT ARE THE TRUE COSTS/BENEFITS?

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SEVEN QUESTIONS TO ASK ABOUT $1 BILLION SPENDING OF PUBLIC FUNDS FOR ST JOHNS DREDGING/DEEPENING

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  1. SEVEN QUESTIONS TO ASK ABOUT $1 BILLION SPENDING OF PUBLIC FUNDS FOR ST JOHNS DREDGING/DEEPENING David Jaffee Professor of Sociology Northeast Florida Center for Community Initiatives University of North Florida djaffee@unf.edu

  2. #1: WHAT ARE THE TRUE COSTS/BENEFITS? PROJECT/PUBLIC APPROVAL = (underestimate costs) + (overestimate revenues) + (undervalue environmental impacts) + (overvalue economic development effects)* Lesson: Conduct/commission independent cost-benefit multi-port analysis of the project. How are costs/benefits distributed? * B. Flyvbjerg, M.S. Holm, & S. Buhl, S. “Underestimating costs in public works projects”, Journal of the American Planning Association 2002 Volume 68(3) p. 279-295.

  3. #2: HOW DOES MARTIN ASSOCIATES CALCULATE THE JOB NUMBERS? • At 47’13,844 additional jobs generated by 2035 • How reliable are 20 year predictions? • Based on capturing how much cargo from which ports? • What is the factor used by Martin to translate TEUs into jobs and revenue? • What income level is used to estimate induced jobs? • “the potential distribution center activity associated with an annual first inbound Asian service” is 11,500 jobs • How likely is it that Jaxport will receive a first inbound Asian carrier? • How is the 11,500 jobs figure calculated? • What are direct, induced, and indirect?

  4. #3: WHAT KIND OF JOBS WILL BE CREATED? Claim: Avg Salary 43,000 Transportation and Material Moving Occupations* Median Annual Income = $28,538 61% of employment in three largest occupations: Laborers and Freight, Stock Material Movers (34%) Heavy and Tractor Trailer Drivers (21%) Packers and Packagers (6.4%) Average Median Income for these three = $28,395 (assuming FT/Year round employment) * Bureau of Labor Statistics’ Occupational Employment Statistics (OES), May 2013

  5. #4: WILL 47’ OF WATER MAKE ANY DIFFERENCE? Water Too Shallow/Bridge Too Low Dames Point Bridge air draft = 175 ft

  6. #5: WHY HAVE ALLIANCES CHOSEN OTHER PORTS? “Revealed Preferences” of Carrier Alliances JAXPORT Losing Market Share to Other Ports Alliance Port Rotation

  7. #6: WILL THERE BE ENOUGH CARGO TO JUSTIFY EAST COAST DEEPENING PROJECTS? 'Certainly we as an association and in the industry as a whole recognize and believe that not every port in the country needs to be at a depth to be able to accommodate the largest vessels in international trade,' Kurt Nagle, American Association of Port Authorities

  8. #7: IS THERE A STRATEGY FOR AN ECONOMICALLY VIBRANT PORT THAT DOES NOT DEPEND ON $1 BILLION AND DAMAGE TO THE ST JOHNS RIVER? WHAT ROLE FOR PRIVATE TERMINALS AND THE PORT OF JACKSONVILLE?

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