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House budget has $150,000 for thorough study of economic impacts of coal export facilities in Washington

Post by Brad Shannon / The Olympian on April 10, 2013 at 7:12 pm | No Comments »
April 11, 2013 9:01 am
Rep. Reuven Carlyle
Rep. Reuven Carlyle

An overlooked item in the House Democrats’ operating budget is a $150,000 proviso for a study of the economic impact of coal-export facilities on Washington state.

Rep. Reuven Carlyle, D-Seattle, called attention to the tiny allocation in the Democrats’ $34.5 billion proposed budget released Wednesday. He said in an email that it “recognizes the need for Washington to thoroughly evaluate the economic impacts of coal exports in our state. By utilizing the expertise of our state agencies, we hope to capture the net economic impacts of the proposed projects so that Washington taxpayers have an apples-to-apples comparison of the pros and cons.”

“We refuse to let the project proponents and the federal government be the only sources of information on this issue, and this study will produce a rigorous and objective analysis that will properly inform decision-makers at the state level,” Carlyle added. “The people of Washington deserve the whole picture.”

As we have reported before, the exports could hit 100 million tons of coal a year and increase carbon emissions by some 240 million tons a year.

Gov. Jay Inslee campaigned on a clean-energy platform and has talked a lot about the economic opportunity in moving away from fossil fuels, and his first major legislative request bill passed into law sets up a working group of legislators to look at the state’s best approach for meeting state goals for reducing greenhouse gas-emissions to 1990 levels by 2020. Last month he also  joined Oregon Gov. John Kitzhaber in asking the White House’s Council on Environmental Quality to consider climate-change and air-pollution impacts of exporting coal from federal lands to Asia, saying:

“We believe the federal government must examine the true costs of long-term commitments to supply coal from federal lands for energy production, whether that production occurs domestically or in Asia. We cannot seriously take the position in international and national policymaking that we are a leader in controlling greenhouse gas emissions without also examining how we will use and price the world’s largest proven coal reserves.”

The National Federation of Independent Business chapters in both states put out a joint statement condemning the governors’ requests to the White House on greenhouse-gas emissions:
“Adding GHG emissions to the local, environmental evaluations of export facilities is a costly overreach of an already stringent environmental review process,” said Patrick Connor, Washington state director for the National Federation of Independent Business, America’s leading small-business association. “This added hurdle threatens future and existing exports among numerous industries and commodities. A stifled flow of trade from the Pacific Northwest would have a significant negative economic impact to our region and our members.”

The House budget proviso has this language spelling out what Inslee’s own Office of Financial Management would need to look at:

(a) The office of financial management must work with all relevant state agencies to examine the potential cumulative economic impacts of proposed coal export projects in the Pacific Northwest. The economic impact study must:

(i) Identify and analyze the net economic impact of the gateway Pacific terminal project, and other projects if sufficient data exists, at the local, county, and state levels, including:

(A) The incremental and aggregate impacts to transportation infrastructure;

(B) The impact to state commerce and economic development opportunities forgone in favor of coal export projects;

(C) The impact coal export projects will have, directly and indirectly, on global carbon emissions, and the localized costs to the state’s major economic clusters resulting from carbon-induced global climate trends, including ocean acidification; and

(D) The cost to taxpayers of mitigation measures and other public expenses, including additional public health costs, relating to coal export projects;

(ii) Examine the price volatility and durability of demand for coal, focusing specifically on the long-term viability of coal export operations in the Pacific Northwest;

(iii) Examine the lease rate of state-owned aquatic lands, specifically those included in proposed coal export facility sites, compared to the fair market value of such lands considering the value of the commodities passing over the leasehold and the contributory value of the land to the lessee; (iv) Examine the impact of coal export projects on the cost volatility of commodity transport within Washington state, specifically analyzing the price sensitivity of short haul rail transport;

(v) Determine whether exporting coal on a scale consistent with current proposals is compatible with the state’s economic development strategy and priorities; and

(vi) Review all elements in light of other coal export proposals in the Pacific Northwest and effectively gauge cumulative impacts of coal export projects on Washington state.

(b) The office of financial management must, during the course of the study, provide for stakeholder involvement and public input.

(c) The study must utilize the latest research available through the environmental impact study process.

(d) The office of financial management shall report to the appropriate fiscal committees in both legislative chambers by December 1, 2013.

The Republican-dominated Senate Majority Coalition Caucus may not go along. It watered down Inslee’s signature bill on climate change, reducing him to the role of non-voting chairman and stripping the legislation of  language spelling out Washington’s vulnerability to global warming and acidifying oceans.

Stay tuned.

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