An economic impact study paid for by Westway Terminals and Imperium Renewables estimates the companies’ proposed crude oil shipping operations would directly create 148 local jobs and as much as $116.6 million per year in local economic activity.
For the first time, the report provides estimates on the amount of crude oil the companies expect to pass through the proposed terminals, as well as approximate wages of the jobs to be created.
“How many times have we talked about $100-million activity in Grays Harbor County?” Greater Grays Harbor Inc. Executive Director Tim Gibbs said.
He added that environmental concerns must also be addressed, but said it can’t be “an either-or equation.”
“If we can do things safely, and we can have this type of economic activity, that’s the type of win-win we’re looking for for Grays Harbor and the region,” Gibbs said.
The analysis, performed by Seattle economic consulting firm ECONorthwest, relies primarily on data provided by the companies themselves, along with spending and population data from the U.S. Census and a study performed for the Port of Longview.
“Imperium is proud of our record of job creation in Grays Harbor County and we are pleased to bring more family-wage jobs and economic development through our terminal expansion,” said John Plaza, founder and CEO of Imperium Renewables. “This study confirms that our planned expansion will bring significant benefits to the regional economy.”
“Since 2008, we’ve taken pride in providing family-wage jobs to the Grays Harbor community. With this expansion, Westway can grow our operations and strengthen our commitment to the safety of our employees and our neighbors,” Westway CEO Gene McClain said in a press release. “We’re happy to see our dedication to Grays Harbor reflected in the economic impact statement.”
The report also estimates that construction would generate $143.3 million in economic activity and directly create 231 jobs throughout Washington, but does not estimate the construction impacts to Grays Harbor County specifically.
The projects are currently in limbo after a letter from the state Shorelines Hearings Board stated the City of Hoquiam and state Department of Ecology failed to account for all the relevant factors before issuing shorelines permits. The final ruling has not yet been published, and it’s still unclear what will be required of the companies in order to move forward.
For the purposes of the economic study, jobs are defined as “full-year equivalent,” meaning a job that lasts a 12-month period in a given industry. A seasonal job lasting six months, for example, would be .5 FYE, and two would total one job. The study doesn’t specify how many individual people will be employed.
The report projects the terminals themselves, if they are constructed, would directly employ 45 additional workers at the sites themselves, and another 103 workers in the marine services and rail industry.
It also looked at indirect and induced impacts. Indirect impacts are those caused by interactions the terminals will have with other businesses, such as suppliers or companies providing services. ECONorthwest projected the terminals would indirectly create 87 jobs at other Grays Harbor businesses.
Induced impacts are those created by changes in regional household spending patterns, in other words, from workers spending their wages.
“Terminals are long-term investments. They operate steadily for decades. The jobs they provide and the jobs they support are generally high-paying and secure. As such, workers and area businesses that rely on these initial investments will make investments of their own,” the report stated.
The terminals are projected to induce another 68 jobs, for a total of 303 estimated jobs specifically in Grays Harbor County.
“Countywide, the total impact on jobs will be well more than six times the number working directly for Westway and Imperium Renewables,” according to the report.
The average wage estimated for all the jobs created is $84,000. The specific types of jobs to be created aren’t specified, and the potential range in wages are not yet clear.
The study estimates the terminals would directly generate about $97.8 million in goods, services and labor. The indirect impact on Grays Harbor County specifically could be an additional $11.3 million, the report states. Those workers would generate about another $7.5 million in local economic activity.
For the purposes of the report, the companies estimated they would bring about 1.5 billion gallons of crude oil per year, referenced in the report generically as “bulk liquid,” through the expanded terminals. That’s less than the maximum the companies are requesting under their permits, which is roughly 2 billion gallons combined.
“That’s the number they’re anticipating based on market demand,” said Westway spokeswoman Heidi Happonen.
The report does a fairly thorough job spelling out its own limitations. The construction and operating cost estimates are provided by Westway and Imperium, and it does not address any dollar figures on potential environmental impacts.
“This was an economic impact study, it wasn’t an environmental impact study,” Happonen said. “They’re doing the environmental studies as part of the permitting process. … It’s not that they’re not doing it, they’re just doing it through a different system.”
The report also notes one potential positive isn’t taken into account: The possibility that the construction and expanded business might draw other businesses.
“Large investments of infrastructure can start a cycle of economic expansion, which economists refer to as an expansion of the ‘production possibilities frontier’ of the economy,” the report stated.
Both Imperium and Westway declined to disclose the cost of the study, but said it was shared equally between them.
Happonen said the report was commissioned sometime during the summer in order to provide stronger estimates on the impacts of both projects.
“(Westway) felt like because it was not just them but also Imperium and there were a lot of questions around it, it was most valuable to have a third party take a look at it,” she said.
On the results, Happonen said, “I think overall it’s not really something they have an opinion on, it’s just fact, so people can have a fact-based conversation about what those projects will mean for the region.”