Tuesday, August 7, 2012

FOUND: Rail Propaganda Data Source [Updated]

Posted By on Tue, Aug 7, 2012 at 3:20 PM

Update, 3:20 p.m.: In a follow-up email to the Journal, the Humboldt Bay Harbor Group's citizen leader, Susana Munzell, confirmed that the data now being used to promote the east-west railroad project is from a 15-year-old study that operated under a very different set of hypotheticals:

As I recall, the information came from a study by a professor at UC Berkeley for the Harbor District's harbor deepening project.  More info later if I can locate it.

Original post:

Yesterday we reported on the "rah rah rail" resolution that will appear before the Eureka City Council tonight, and we wondered about the "economic modeling" cited therein. The "summary" that precedes the resolution paints a colorful picture, casting the battle over Humboldt Bay's future as a fight between Ayn Randian leaders whose economic visions are grounded in hard data and, on the other hand, nay-saying, no-growth whiners whose motives are nigh unfathomable.

One major thrust of this treatise, which is being presented by the Humboldt Bay Harbor Working Group, is that local governments and citizens should support the construction of an east-west rail line connecting Humboldt Bay to the national rail system in the Sacramento Valley.

No source is given for the "economic modeling" cited in the document as evidence that a "revitalized harbor" could:

  • Handle up to 5 million tons of cargo per year;
  • Create more than 3,500 jobs;
  • Increase local payroll by more than $90 million; and
  • Increase gross regional product by more than $400 million

In an email to the Journal, the group's citizen leader, Susana Munzell, said:

The modeling, figures and projections for harbor jobs and funds are listed in documents from the Harbor Commission, among them Waterfront Revitalization Plan; The 2003 Harbor Revitalization Plan; 2009 Economic Development Plan and Draft Strategic Plan; the Shore-Based Aquaculture Terminal Project, and  county documents such as the Harbor Revitalization Plan, the Local Coastal Plan, etc.

The Journal so far hasn't found the figures in any of those studies, but we did come across a close fit in a 15-year-old economic impact report commissioned by the harbor district. Back then, U.C. Berkeley economist John Quigley attempted to predict the economic benefits of a series of major infrastructure improvements to the harbor, starting with a deepening project.

The report was used in an attempt to sell voters on the creation of a harbor assessment district -- a proposal that was rejected by voters in 1997. Regardless, using estimates provided by harbor district staff, Quigley estimated that, with major investments from both local taxpayers and the federal government, a series of major infrastructure projects could, among other things: 

  • Increase shipping to more than 5 million tons of cargo per year (by 2005)
  • Create 3,000 jobs;
  • Increase local payroll by more than $90 million; and
  • Increase gross regional product by more than $400 million

Is this the economic modeling being used today by the Humboldt Bay Harbor Working Group? If so, it's more than a little bit problematic. As Munzell herself notes, there have been numerous studies and reports since Quigley's, none of which have agreed with his robust predictions. Even at the time they were greeted with skepticism. For example, in this 1998 memo to local business leaders, Gregg Foster, then with the Humboldt Area Foundation, noted that, "The cargo shipping assumptions used in the Quigley report significantly exceed any other projection made to date." 

Another problem: The major component of Quigley's assumptions was not a rail connection but the harbor deepening project -- which has already been completed.

Also: It's not 1997. As justification for building an east-west rail, which is how it's being used here, Quigley's analysis is both off-topic and hopelessly obsolete. 

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Ryan Burns

Ryan Burns

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Ryan Burns worked for the Journal from 2008 to 2013, covering a diverse mix of North Coast subjects, from education, politics and marijuana to human suspension, sex parties and amateur fight contests. He won awards for investigative reporting, feature stories and news coverage.

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