As State Takes Stand Against Coal, Business and Labor Fear for Economy

Scene at a coal loading facility.

Scene at a coal loading facility.

OLYMPIA, Aug. 2—An essentially political decision by the state Department of Ecology to inject train traffic and worldwide climate-change concerns into a review of a local coal-port proposal has business and labor sucking in their breath. The precedent-shattering decision appears certain to have enormous implications for the Washington economy – and some are wondering if it might be read as a chilling message for future industrial development in the state.

Bowing to political pressure from environmental groups and the green-leaning Inslee Administration, Ecology announced Wednesday that it will launch an environmental review of a coal port proposal near Bellingham using criteria that are breathtaking in scope. The state will attempt to assess the impact of fossil-fuel burning on the other side of the world, as well as the coal trains that would pass through Washington state. The concerns involved are ones that cannot be refuted or dealt with in the ordinary sense, nor can Washington state do anything that will influence environmental policy in China. Yet it is hard to imagine in the current political climate that regulators will give the thumbs-up. By injecting national and global issues into what normally would be a review of local environmental impacts, Washington regulators appear to be making a statement – they’re the ones who get to decide which products are exported from the state.

Which explains why green groups are cheering, and why business and labor are steeling themselves for the worst. Says Mark Lowry, president of the Northwest Washington Central Labor Council, “I wonder which state Mr. Inslee is governor of?”

Count the state Labor Council among the broad range of interests that are supporting the project — business of every stripe, agriculture, shippers, railroads, individual labor unions — all arguing that the central issue is the economy. And with the announcement from the Department of Ecology the battle lines are drawn. On the other side are Gov. Jay Inslee and the greens.  At the very least, the matter drives a wedge between labor and environmental groups, normally allies in this state on matters of political debate. The final decision, likely to come sometime within the next two years, could have great bearing on future proposals for local projects of economic significance when they face well-organized political opposition on general principles. Today the target commodity is coal. What next? And what does it mean for future proposals for industrial mega-projects? “Anyone who has a commodity they export from this region should be looking at this decision pretty closely,” says Lauri Hennessey, spokeswoman for the pro-port Alliance for Northwest Jobs and Exports.

Fossil Fuels the Issue

At the Vancouver protest, three horsemen of the apocalypse.

At the Vancouver protest, three horsemen of the apocalypse.

Key problem is that the fate of the world is a rather difficult thing to change with an environmental impact statement. The Gateway Pacific Terminal at Cherry Point, proposed by Seattle-based SSA Marine, would be the largest coal port in North America. It is one of three proposed Pacific Northwest coal terminals spurred by the burgeoning demand for coal in China and the booming coal-mining industry of the Midwest. For environmental groups Cherry Point has become something of a crusade — yet their beef really isn’t about that project or any other, or even just about coal, but rather about fossil fuels in general.

The same environmental opposition heard in Bellingham is being sounded at the Port of Longview, where Millennium Bulk Terminals hopes to develop a slightly smaller facility, and at the Port of Morrow in Oregon where barge shipping is contemplated. It applies as well to plans for a crude-oil shipping terminal at the Port of Vancouver that would be served by rail lines from the East, and for proposed liquefied natural gas terminals along shipping corridors in Oregon and Washington. Behind the conflict is really a matter of geography – national transportation corridors force all traffic in the Pacific Northwest through the greater Portland and Seattle areas, two of the greenest-leaning cities in the country. And it has made the two states ground zero in a fight of national significance.

Trip Jennings speaks at Vancouver rally.

Trip Jennings speaks at Vancouver rally.

The point was underscored last weekend at a Vancouver demonstration on the shore of the Columbia River, organized by Portland Rising Tide, an environmental group that is coordinating a summer of protest against the terminal proposals en masse. Geography is destiny, speakers declared, and it is their duty to save the planet. “We know that these terminals are not compatible with life on Earth as we know it,” declared Trip Jennings of the Portland group. “We believe that we must move immediately to address the climate crisis, we must stop building all new fossil-fuel infrastructure, we must resist all fossil fuel infrastructure – and that includes these terminals, because if they can’t ship it, they can’t burn it, and they can’t extract it.”

It was a most colorful protest attended by perhaps 500 people from Western Washington and Oregon – they staged a flotilla of kayaks on the Columbia River while hundreds marched across the nearby Interstate Bridge. One jazz aficionado waved a sign that read, “Coltrane – not coal trains” and other placards equated fossil fuels with death. Of course, along the parade route you couldn’t escape a view of the crowded parking lot. Most of the protesters arrived by private automobile.

They shall not pass: Flotilla greets protesters on bridge. (Portland Rising Tide)

None shall pass: Flotilla greets protesters on bridge. (Portland Rising Tide)

The protest certainly captured the spirit of the movement, but there is more to it. The Sierra Club and other environmental organizations have been waging war at the permit level and in the courts – “paper-wrenching,” they call it. In June their coalition filed suit in U.S. District Court in Seattle against BNSF Railway – the dominant railroad in the region – arguing that coal dust escapes from passing trains and pollutes streams and waterways from here to Wyoming. They allege it is a violation of the federal Clean Water Act and yet one that has lurked unnoticed and unlitigated in the 41 years since the law was passed. Meanwhile the Department of Ecology noted this week that it received an astounding 125,000 comments from concerned citizens.

Environmental groups hailed the agency’s decision, as might be expected. “The scope is a reflection of Northwest values,” said Cesia Kerns of the Sierra Club’s Power Past Coal campaign. More important than the green campaign, however, is that the governors of Oregon and Washington have unambiguously taken its side.

Inslee Demands Broader Review

Gov. Jay Inslee.

At his first news conference as governor, Jay Inslee calls for an precedent-setting broadening of the environmental review.

It should be noted that Inslee and Oregon Gov. John Kitzhaber have not declared opposition to the individual terminal proposals per se – but by supporting efforts to broaden the criteria for environmental review, they are doing essentially the same thing. In a letter to the Obama administration last March, Inslee and Kitzhaber demanded a broad-based study by the Army Corps of Engineers before it issues environmental permits for any coal-port proposal. It didn’t appear that they were seeking a measured approach.

The three ports together might ship as much as 100 million tons a year to Asia, they said. “Before the United States and our trading partners make substantial new investments in coal generation and the infrastructure to support coal, extending the world’s reliance on this fuel for decades, we need a full public airing of the consequences of such a path.” They went on to declaim coal as the major source of global greenhouse emissions, and a major cause of ocean acidification, rising sea levels, wildfires, shrinking snowpacks, mercury in drinking water and other difficult-to-quantify environmental ills. In essence they called for a new national policy against coal, but in the form of a permit review for the three local port projects. Among other things they also called for the federal government to hike the cost of coal-mining permits, “to account for the direct costs of the resulting emissions to U.S. businesses and communities.”

Perhaps not surprisingly, the Corps of Engineers balked. Last month it revealed its decision during a hearing of House Commerce and Energy Committee in Washington, D.C. – it would limit its review to the impact of the terminals themselves. “The effect of the burning of the coal is too far removed from our actions to be considered as an effect of our actions,” testified regulatory director Jennifer Moyer. Interstate rail transport? That’s not a concern for the agency.

Where the feds won’t go, the state will. In its announcement this week, Ecology said it would conduct such a review itself, under the authority of the State Environmental Policy Act. It will involve such wide-ranging matters as out-of-state rail impacts, Pacific shipping, impacts on human health in Washington, greenhouse-gas emissions and the burning of coal in general. All of which points to an environmental permitting process so stringent no project could pass. And while it is an Ecology decision, the real responsibility lies in Inslee’s office, which sets policy for executive agencies. The “greenest governor,” elected last year on a platform of green-energy development, has been calling for a broad environmental review since his first press conference in January: “This is the largest decision we will be making as a state from a carbon-pollution standpoint, certainly during my lifetime,” he said. “Nothing even comes close to it.”

Phooey, Says Labor

Mark Lowry, president of the Northwest Washington Central Labor Council.

Mark Lowry, president of the Northwest Washington Central Labor Council.

It is the first major breach between Democrat Inslee and organized labor. By choosing the interests of one big element of the Democratic coalition, he antagonizes another. The Washington State Labor Council has twice endorsed the Cherry Point project. Though the port would be built and maintained by union labor, Lowry says it is more than a matter of self-interest. It is all about building an infrastructure that supports industry, jobs and a robust economy. “Labor is engaged in a number of fights in order to enhance our infrastructure, not just at Cherry Point, but many, many, many,” he says. “Our overarching goal is to reindustrialize America. We have to build this industrial capacity here.”

The Cherry Point terminal isn’t just a coal port, he observes, but rather a deepwater port that can serve multiple commodities – grain or any other bulk commodity Washington produces and anything else anyone ships through the state. For three decades labor has sought in conjunction with local economic development organizations to develop the site, one of the few in Whatcom County that are suited to industry. And with improved rail transport, including a new double-tracked line to the site, the potential for synergistic development becomes immense. Long after coal inevitably fades away as a leading source of energy for the world, the port will still be there, Lowry says. “We’ve seen Georgia-Pacific close, we have seen the timber industry fade away in terms of a jobs engine for the local economy, we have de-industrialized and we have become dependent on the service sector. These are not providing us living-wage jobs.

“We need an economic shot in the arm, and if it is not to be this, after 30 years of work, then when are we going to be bailed out? We can’t afford to hang on forever. Opportunities are being deferred, dreams are being deferred – my boy who just had a newborn baby works at Denny’s. I’m not happy about that. But there is no opportunity, and that is what we are asking for, the opportunity to work. And in the absence of this terminal, there is nothing to take its place.”

Then comes what Lowry and others consider the screwiest part of the argument. Stopping the coal terminal won’t keep the Chinese from burning coal. There are other nations eager for the business, Malaysia for example – but their coal is seen as less desirable because it doesn’t burn as clean. And there are other ways for American coal to get across the puddle. For some 25 years the BNSF railway has been hauling American coal through Bellingham on its way to Canadian destinations, including the fast-growing port of Prince Rupert – but it is less desirable for American shippers than a U.S. port because it is so far north.

For Lowry and others in labor the debate over climate change is an abstraction and a frustration. “We see the very same coal trains running through our towns right now, running to ports in British Columbia. So shutting down this terminal and preventing it from being built is not going to stop Montana coal from getting to China. It would be a gesture. And we can ill afford gestures when I’ve got 40 percent of my building trades out of work.”

First Coal, Then What?

John Stuhlmiller, CEO of the Washington State Farm Bureau.

John Stuhlmiller, CEO of the Washington State Farm Bureau.

If the fight was being scored the ordinary way Cherry Point’s advocates would likely run the table. Normal environmental impacts might be dealt during the permitting process – using things like drainage facilities, parks, bike paths. And in pitching the project to the public they can point to reports and studies and economic analyses about the impact that a new fully developed and modernized deep-water port might have on the Washington economy. One such economic argument, authored by Steven Globerman, professor of international business at Western Washington University, was commissioned by the Washington State Farm Bureau. He concluded that it is unlikely large-scale port development would take place without coal. But because the Longview and Cherry Point projects would have additional capacity for bulk shipment and rail improvements would be inevitable, Washington agricultural commodities would be able to piggy-back. Additional shipping facilities from the West Coast would produce a net gain in exports, rather than taking business from existing ports. Rail transport costs would decline. Washington would see higher employment and lower prices.

The Farm Bureau’s John Stuhlmiller has a simpler way to put it: “A rising tide lifts all boats.”

But here’s the hitch. The issue won’t be analyzed in ordinary terms. Take the train-impact issue Ecology will be reviewing. It is a new argument that has surfaced in recent months, about the wait-times at rail crossings, delays for fire engines, police and ambulances. Certainly more trains mean more waits, and nothing can be done about that short of an aggressive and costly effort to build more overpasses and underpasses. Yet for all the furor, BNSF anticipates perhaps nine additional trains a day running in each direction. That still would be short of the peak train traffic during the housing boom in 2006, when rail carried timber and construction materials. Not a peep of protest was heard at the time. “Would the same question be asked if it were exclusively a grain facility?” asks Steven Forsberg, director of external relations. “Is the same standard going to be applied to agricultural products? If Boeing were to double its production and that many more aircraft fuselages were to be transported from Kansas to Washington, would the same standard apply? What if Sound Transit decides the area is big enough that passenger trains ought to run as frequently as in Chicago? It goes to the heart of our concern about setting a precedent for all kinds of rail-focused expansion because of opposition to a single commodity.”

Lee Newgent, executive secretary of the Seattle Building and Construction Trades Council.

Lee Newgent, executive secretary of the Seattle Building and Construction Trades Council.

And some wonder if coal is just the beginning. What about other unpopular commodities? Stuhlmiller notes that the growing of sugar beets, for instance, has come under fire from environmentalists in the past, because of irrigation requirements – if expanded production requires more trains, does that mean state environmental regulators ought to have a say?  Lee Newgent, executive secretary of the Seattle Building and Construction Trades Council, wonders what might happen if Boeing needs a permit to build a new aircraft factory, and state regulators decide that the impact of airplane crashes has to be considered. “I’m a labor person, but I have to wonder, why would business want to invest if they have that kind of issue in our state?”