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Wednesday, June 6, 2012

Could a Sodo Arena Sink the Port of Seattle?

Posted by on Wed, Jun 6, 2012 at 5:21 PM

Terminal 46 is the focus of concerns over freight mobility in the Sodo neighborhood.
  • Port of Seattle
  • Terminal 46 is the main focus of concerns over freight mobility in the Sodo neighborhood.

For all the obsessive editorializing from the Seattle Times over the potential negative impact a new Sodo arena might have on the Port of Seattle, they've done little to explain what this impact might actually be. And for all the positive things I've written about the financial guarantees in Chris Hansen's arena proposal, I freely admit that the potentially negative impact on the port might be a deal-killer in itself. So for the sake of fostering an informed debate on this issue, I thought I'd take a moment to discuss what's at stake, and how it might be threatened.

According to a 2009 economic impact study, the marine cargo operations at the Port of Seattle produce 12,428 direct jobs, mostly good-paying union jobs. The study also finds the cargo operations generating an additional 16,639 "induced" jobs and 4,224 "indirect."

That's a lot of jobs.

It also represents a lot of revenue, over $3 billion annually, and over $254 million in state and local taxes. Just from the port's marine cargo operations alone.

And the port has ambitious plans to grow. According to its proposed Century Agenda, over the next 25 years the seaport plans to grow its annual containerized cargo from 2 million TEUs (one TEU represents the cargo capacity of a 20-foot intermodal container) to 3.5 million TEUs, while tripling the value of its outbound sea and air cargo to more than $50 billion a year.

Clearly, the marine cargo operations at Seattle's seaport directly represent a huge chunk of our local economy, but they're also absolutely critical to sustaining other industries throughout the region and the state. Closer to Asia and Alaska than any other major US port (our biggest trading partner is actually Alaska, with nearly all of southeast Alaska serviced from the Duwamish), Seattle's seaport is a destination for imports headed throughout the nation, earning it the nickname "The Port of Chicago." This in turn leaves a lot of otherwise empty container ships heading back out, which among other things we fill with agricultural products, providing relatively affordable export transport for farmers from Eastern Washington and beyond.

All those Washington apples would cost a helluva lot more to export if not for the imports flooding the Seattle seaport. That's the way this business works. And the same holds true for nearly every other product we export. Seattle, King County and Washington state as a whole are trade dependent economies—indeed, Washington is perhaps the most trade dependent state in the nation.

Obviously, we wouldn't want to do anything to harm such a vital economic resource.

So, is that what a new Sodo arena would do? Port commissioners and maritime union leaders seem to think so, and their arguments hinge on two major concerns: east/west freight mobility and changing land use patterns within the Sodo neighborhood.

SeaportMap.jpg
  • Port of Seattle

I'm not sure what the editorialists are talking about when they fret about the additional traffic a Sodo arena might generate, but seaport stakeholders are mostly worried about east/west freight mobility between I-5/I-90 and the gates at Terminal 46 (and to a lesser extent, Terminal 30 just to the south).

You know those gigantic cranes you see towering over the waterfront just south of the downtown? That's Terminal 46, part of the heart of the seaport's cargo operations, featuring three natural deep-water berths, five container-handling cranes, an on-dock intermodal yard, and convenient access to both I-5 and I-90. And it's that latter feature that seaport stakeholders fear the new arena threatens.

It's not a new concern. Thanks to the tangle of railroad yards and freeways, east/west mobility has long been a problem through Sodo, a problem that has only been exacerbated as recent development has increased street traffic through the neighborhood. At the time Safeco Field was built, the port was promised new ramps and overpasses to ease truck access to I-90 at both Atlantic (Edgar Martinez Drive) and Royal Brougham, but only the former was built. And thanks to construction of the Silver Cloud Hotel and the new Viaduct tunnel, the Royal Brougham overpass is no longer even an option.

Seaport stakeholders have long fought for a promised Lander Street overpass (money that has since been diverted toward fixing Mercer), but even that would not fully address their concerns. There simply aren't a lot of options available for mitigating east/west traffic within the vicinity of Terminal 46, whose lease expires in 2014. "The mere perception by a terminal operator of the risk of continued disruption of freight movement is enough for reconsideration of their operations for that location," ILWU Local 19 president Cameron Williams recently wrote in a letter to the Seattle City Council. "We can build an arena anywhere," Williams continued, "but we can't build a world class deep water port terminal anywhere."

Hansen and his backers point out that the gates at Terminal 46 and Terminal 30 both close at 4:30 pm, while weekday sporting events almost always start at night, hours later. Furthermore, at little more than 18,000, the arena's maximum attendance would be smaller than the Mariners' average, and yet these terminals already manage to function during the long baseball season. Playoffs pose the possibility of NBA/NHL/MLB seasons overlapping, but even the combined attendance of the two facilities would be less than that of the Seahawks, who occasionally play on Monday nights. Other bookings could be scheduled so as not to overlap.

But even if all that were true, that still wouldn't alleviate the concerns of seaport stakeholders who cite changing land use patterns in the neighborhood as an existential threat to cargo operations as a whole. The Sodo arena Hansen is proposing is part of a larger complex that includes an "energetic mix of retail, dining, and entertainment establishments" north of the arena site and a pedestrian mall along Occidental between Atlantic and Massachusetts. This sort of development would almost surely generate upward pressure on surrounding land values, while serving as an engine of further "gentrification" in and of itself. As more light industrial property is converted to entertainment, retail, commercial, and even residential use, Sodo gentrification would expand, pricing even more port related businesses out of the neighborhood—businesses that are crucial to supporting freight operations.

This is a process that can already be seen up and down First Avenue, and one that a new arena will likely only accelerate. It is also a process that generates its own traffic independent of an arena, as Sodo transforms into a daytime and nighttime retail and entertainment destination. While NBA games may not start until hours after the terminals close their gates (I'll leave for others the debate over when pre-game traffic actually starts), the changing character of the neighborhood is gradually increasing traffic throughout the day, exacerbating existing freight mobility problems. Meanwhile the Viaduct tunnel is projected to dump thousands more cars onto crowded city streets, further slowing traffic through the area.

That, as I understand it, is the heart of the anti-arena argument from the people the arena would impact the most. So do I buy it? Yes and no.

I've no doubt that the seaport stakeholders I've talked to would prefer to see the arena proposal killed, but while they deny it, I can't help but wonder if they'd grudgingly drop their opposition in exchange for the Lander Street overpass and other mitigation. Meanwhile, city hall and SDOT officials uniformly acknowledge the existing need for the Lander Street overpass, but seem fearful of creating the optics in which the cost of construction is seen as a taxpayer subsidy of the arena project. Furthermore, if east/west freight mobility was really on the verge of choking cargo operations, I've got to wonder why the Port of Seattle—subsidized by a $73 million a year King countywide property tax levy, and with bonding capacity of its own—hasn't stepped up to fix the problem? The Port's Century Agenda looks to a substantial expansion of cargo operations over the next 25 years, but says nothing about addressing freight mobility issues it claims could cost it existing business. That just seems weird.

Finally, I'm not so sure that the Sodo gentrification that seaport stakeholders rightly fear, and the higher property values and increased traffic it would bring with it, wouldn't happen regardless of whether a new arena was built? It wouldn't happen as quickly as it would with a new sports/entertainment development driving the process, but thanks to low land values and proximity to the downtown, it is already happening nonetheless. So while I empathize with seaport stakeholders, their opposition doesn't strike me as a long term solution to the ongoing erosion of Sodo as an industrial district.

What I can say for sure after exploring these issues is that maintaining a competitive seaport is absolutely crucial to our economy, and in fact should take priority over other land uses in the Sodo neighborhood, regardless of how much we might want an NBA and/or NHL team. The question is whether these two goals are mutually exclusive, and that's a question that's not quite as easy to answer as both sides in this debate insist.

 

Comments (32) RSS

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Free Lunch 1
Great write-up, Goldy.

I don't really buy into their fears that building an arena in this area will somehow attract other businesses, as that hasn't been the case with the previous two sports venues, despite similar predictions. And this is going to be even further south, right?

DOT's estimates put the cost of this overpass at $36 million. (Looks like it has bike/pedestiran lanes as well - nice, since east/west is getting more and more difficult in that area for bikes/peds). Such a tiny cost relative to a $3 billion industry. Weird that the port hasn't moved on this, indeed.
Posted by Free Lunch on June 6, 2012 at 6:00 PM
Ph'nglui mglw'nafh Cthulhu R'lyeh wgah'nagl fhtagn 2
It will also hurt Seattle's existing nightlife, movie theaters, and other amusements. It's a myth that sports brings in new money; in fact, sports fans spend less in other parts of the city and more in the new stadium.

And since the city gets to keep the taxes from the other entertainment venues, it would be a net loss, since this kooky basketball deal has all the taxes earmarked to pay off the loan that private money wouldn't touch with a ten foot pole. Because it's too risky for private money. Hint.
Posted by Ph'nglui mglw'nafh Cthulhu R'lyeh wgah'nagl fhtagn http://youtu.be/zu-akdyxpUc on June 6, 2012 at 6:07 PM
Baconcat 3
Um, yeah, so remember how the port was confronted with a few hundred additional trips diverted by the tunnel but they were all "OMG LET'S BUILD THE TUNNEL"?

Yeeeeaaaahhhhhh, so as cool as I am on the arena this Port of Seattle argument is utter bullshit from the Captains of the Bullshit Industry.
Posted by Baconcat on June 6, 2012 at 6:11 PM
4
So who's going to pay for the traffic improvements? Suppose we use a bond to pay for the costs upfront and then rely on taxes and other fees imposed on this new arena? Suppose we ask that this new arena benefit the city and bring in tax revenue rather than the other way around?
Posted by keshmeshi on June 6, 2012 at 6:54 PM
5
I believe the phrase they're looking for is - "What's in it for me?"
Posted by DanielJ on June 6, 2012 at 6:58 PM
gloomy gus 6
FInding it hard to give a fuck about the stadium. It's a loser. "Bank study debunks claim of public benefits from new sports arenas". Just the latest, not the last. This and the weak polling suggest we're not going to have to keep abreast of this much longer.
http://crosscut.com/2012/06/04/sports/10…
Posted by gloomy gus on June 6, 2012 at 7:02 PM
Fnarf 7
The thing is, what the port and port defenders are saying isn't "freeze the area in time"; it's "spend as much time and money planning for the future of this land use as you do for all this other stuff". The tunnel is just another example: we get a hard-on for some jazzy new thing, and we don't even give the impact on the port a second thought.

If you took the $200 mil that the arena would cost, and spent it instead on a major port access project, you might be able to create something that really helps the economic future of the entire region -- starting with good-paying union jobs. The arena doesn't create anything, really -- construction jobs while it's going up, a few sub-minimum-wage jobs after. All the economic benefit goes to the rich and the super-rich.

It's just another example of this city's twin fascinations with (a) shiny "world-class" signifiers and (b) I forgot what you were saying, we're on to something new now. Short attention spans, that's what it is. Even if a new arena is in fact the greatest damn idea anybody ever had, if this particular funding plan falls through, no one will spend an instant on fixing it or coming up with a new one -- the idea will be gone. That's not really planning at all.

The biggest needs at the port, that would make all this traffic worry moot, are grade separation and rail access. What kind of rail connection to the terminals could you buy for $200 mil? Or $400 mil? That's the kind of question the city should be asking -- not "how can I get my name on a plaque -- ooh, is that glitter?"
Posted by Fnarf http://www.facebook.com/fnarf on June 6, 2012 at 7:07 PM
8
@7: "If you took the $200 mil that the arena would cost, and spent it instead on a major port access project"

Haven't Goldy and everyone else repeated themselves enough by this point that the $200M is bonds on the arena that can't be spent on other things because it doesn't exist if the arena doesn't?
Posted by algorhythm99 on June 6, 2012 at 7:24 PM
9
We can be pretty assured that Goldy is only saying this because the port is all unionized.
Posted by goldy is a partisan hypocrite on June 6, 2012 at 8:33 PM
10
Great write up Goldy, you lay it out nicely. I'm not up on the issue to have an informed opinion, but that doesn't stop me from having an uniformed opinion. Personally I suspect we will have a new stadium deal one way or the other in the next 10 years. The next one isn't likely to be nearly as good a deal for the taxpayers. Let's grab this deal while we have a chance, the next one will likely involve the taxpayer bending over, as usual.
Posted by ohthetrees on June 6, 2012 at 8:38 PM
gloomy gus 11
The Municipal League on Wednesday released a six-page analysis of the Seattle basketball arena proposal, saying the deal is "not risk-free and may not be self-financing as claimed by proponents."
http://seattletimes.nwsource.com/html/lo…
Posted by gloomy gus on June 6, 2012 at 9:03 PM
12
"Estimating Seattle arena's total public outlay: $22m-53m, depending how you count"

http://www.fieldofschemes.com/news/archi…

And Richard Conlin chimes in on a $15m property tax bill:

http://conlin.seattle.gov/2012/06/06/how…

Not. Free.
Posted by hmmmmm on June 6, 2012 at 9:12 PM
Teslick 13
Considering the Port of Seattle is competing with every other port out there, they'd be fronting the money for better access. But the Port hasn't had a stellar track record of wise spending.
Posted by Teslick on June 6, 2012 at 9:16 PM
Supreme Ruler Of The Universe 14
The plan to cause more congestion and hardship for 99% of citizens is so stupid and hypocritical and self serving that I'm surprised that it doesn't accelerate the depopulation as people realize they have no power here and everything is done by force and fiat power for a very few.

Meanwhile, Thunder kicked the Spurs...proving that you can take the team out of Seattle, and also you can take the Seattle out of the team!!
Posted by Supreme Ruler Of The Universe http://www.you-read-it-here-first.com on June 6, 2012 at 9:36 PM
NaFun 15
The port needs to be constantly improving to keep ahead of vancouver, portland, and long beach. And even then it will be a Sissyphian task. Containerized shipping is a bitch (read _The Box_). Fuck a stadium, the city does not need to finance some millionaires childhood dreams and .09% of Seattle residents who like a sport where bare knuckle fighting is a regular part of the game.
Posted by NaFun http://www.dancesafe.org on June 6, 2012 at 9:44 PM
16
you know... you could easily get 75,000 inhabitants on harbor island/T5/T30/T46, literally a mile from downtown. and i'm not talking shanghai towers, but a livable/walkable urban density, a la park slope. think they could squeeze 13,000 jobs in there? triple that.
property taxes? could definitely hit $300M.

that's what a city that wanted to be affordable, livable AND have reduced CO2 emissions would do. want to keep the port? build a superharbor that combines the ports of vancouver/bellingham/tacoma. keeps the ships out of downtown. have bjarke ingels design it: http://www.big.dk/projects/superharbour.…

frankly, it's absurd that such a large quantity of prime real estate in the city is devoted to anti-urban environs.
Posted by holz_box on June 6, 2012 at 10:28 PM
17
Good writing Goldy. But when you say this,
"the financial guarantees in Chris Hansen's arena proposal, "
I can't help but remember the baseball stadium. We were assured the public wouldn't have to pay for "cost over-runs" . But of course we did - they just re-named it "unforeseen capital expenditures" clever, huh? What's to say this won't happen again?
And I agree with those above, a viable, competitive port is FarMoreImportant than an arena.
Posted by Up all night on June 6, 2012 at 10:33 PM
Ernie1 18
I work on Harbor Island and drive or bike through the area daily. My observation is that the bottleneck for trucking isn't traffic in the surrounding neighborhoods, but the entrances to the terminals themselves. You commonly see dozens of trucks lined up to go through the scanners, sometimes completely grid locking the surrounding roads.

Anyway, it doesn't seem like the Port actually gives a crap about how easy/hard it is for trucks to get in and out, because the drivers are paid by the load so they are the only ones paying for traffic delays. I think the Stranger did a story on this recently.

Also, isn't the new Spokane St Viaduct project supposed to route trucks from Harbor Island and E. Marginal to 5 and 90 when it's done? That's how I would go if I was driving a truck.
Posted by Ernie1 on June 6, 2012 at 11:00 PM
MrBaker 19
How does relocating the arena to Seattle Center or Bellevue help the Port with its existing issues or future plans?

It doesn't, Goldy. You said it your self.

The solutions for the Port will not come as a result of killing the arena in that location.

The Port gets a lot of tax money, what are they doing with it besides solving their own traffic problems?
Posted by MrBaker http://manywordsforrain.blogspot.com/ on June 6, 2012 at 11:02 PM
20
@Baker You know where to get that info. You are a smart man after all. Don't be dumb.
Posted by hmmmmm on June 6, 2012 at 11:50 PM
21

Hey, I was just thinking about Scott Walker's Democratic opponent...what was his name?

...
...

Yeah...see, you guys spent so much time badmouthing Walker no one even knew who his opponent was or why in the world they would ever vote for such a cardboard cutout!
Posted by James Carville's Whale of A Dad on June 7, 2012 at 12:23 AM
Timrrr 22
One thing that keeps getting left out of all these discussion is that we are already currently spending $394.8 million to mitigate east-west traffic flow problems for Terminal 46 and make the Port happy.

It's called the Holgate & Atlantic Street Overcrossing and the whole point was to do exactly all the things they now claim they need a shiny new Lander overpass for!

I call BULLSHIT here. Deep. smelly. bullshit.
Posted by Timrrr on June 7, 2012 at 12:24 AM
23
Hell with the economy. I want to watch a bunch of guys throw a ball through a hoop.
Posted by yuiop on June 7, 2012 at 12:33 AM
24
This whole conversation is another example of why the region's ports should be merged. Lately Tacoma has been stealing business from Seattle, and with good reason - it has direct rail access, which much of Seattle lacks. Merge the ports, shift most of the container traffic to Tacoma, and problem solved. Tacoma's port area doesn't have any of the conflicts Seattle's does, as it's totally industrial with no potential residential development.

But mainly I think it's hilarious that the port of Seattle is complaining about a lack of infrastructure in sodo after all the years of mismanagement there. There's a reason these overpasses haven't been built - the port has done a piss poor job over the years of actually running the port.
Posted by Bax on June 7, 2012 at 6:59 AM
25
Here's a solution: Start the Northbound I-5/Eastbound I-90 distributor/collector further south, so that it starts with traffic coming from West Seattle, Spokane Street, and Columbian Way, instead of having that traffic enter the freeway. This will allow for an expansion so the traffic coming from those three sources don't all have to merge into a single lane (causing big backups for all of them). It will also speed traffic on I-5 by reducing lane changes just before the northbound traffic enters downtown.

Then trucks headed from the Port could go south to Spokane Street and use that as their East/West corridor.
Posted by Charlie Mas on June 7, 2012 at 7:32 AM
gloomy gus 26
I kind of like how the Port's leeriness over an arena can be easily solved by your suggestions. Merge with Tacoma! Take over from the elected commissioners! Fuck earthquake proofing, that's just kissing the Port's ass!
Posted by gloomy gus on June 7, 2012 at 7:39 AM
27
@26, all this stuff has been debated for years, particularly the concept of merging the ports of Seattle and Tacoma. The tideflats in Tacoma are a perfect place for this sort of activity, as it's basically a huge industrial wasteland. It's very different than Seattle. And if you haven't read about how the port of Seattle has taken all sorts of heat over the years for basically being incompetent, then you haven't been paying attention.

The point is that a lot of the things that the Port of Seattle is complaining about now in this arena debate are problems that they could have easily solved on their own if they had acted with foresight and good management practices. Lander Street a problem? Okay, so why haven't they done anything about it? Where exactly are my property taxes going if not to fix these problems that are so critical?

My concern is that they'll end up tanking the arena, which is the best deal we're gonna get (and make no mistake, at some point we WILL build a new arena, it's when not if), and then afterwards they'll continue to do nothing to solve the problems they now claim are so critical.
Posted by Bax on June 7, 2012 at 8:20 AM
28
Goldy,

This might be a good article, with valid points and interesting perspectives, but it is completely mooted by the inclusion of a map that is both improperly orientated and lacking a north indicator.
Posted by No point in going on... on June 7, 2012 at 9:15 AM
29
The Port should get its own house in order before barking so loudly about the stadium proposal.

The trucking system the Port has set up is a disaster. The pay-by-the-load, fake independent contractor system - detailed in the Stranger, the Times, King 5, ... - creates rushes of traffic and significant dead time (and unsafe trucks and pollution and ...) Fixing this would make container movement to the railyards and warehouses much more efficient freeing up capacity for more containers and other traffic. But the Port's dead set against it because the mega-shippers like Walmart are against it but it would mean actually paying the people who driver those trucks. (and oh yeah, those jobs the Port keeps talking about alot of them suck. bad.)

Vancouver had the same kinds of truck traffic problems when its Port was expanding six years ago. They managed to solve it but fixing the system. The Port's mode at this port seems to be whining instead.
Posted by Echo HIll on June 7, 2012 at 9:52 AM
the idiot formerly known as kk 30
Just imagine what this will do to the economy? A very small area of the city is zoned for stadium use. So someone buys some property in that area and declares his intent to build a stadium. Suddenly, everyone shits their pants that--my God!--someone wants to build a STADIUM!--a STADIUM I TELL YOU--on that parcel of land zoned for a stadium. It's heresy! It's awful! How could we allow that to happen?

I'll tell you what will happen. The next time we zone any land for any kind of economic development project that will generate tax dollars to pay for all the goodies that every Slogger wants, a prospective investor will say, "no FUCKING way. not in this crazy bullshit town where zoning laws don't mean shit. I'll take my chances in some banana republic where at least I can count on bribing the locals instead of playing by the rules."
Posted by the idiot formerly known as kk on June 8, 2012 at 12:52 AM
31
The big difference here, in my mind, is that Chris Hansen is investing a LOT of private money into the arena project, while the Port sits back and complains about the city not giving them a hand out. Unlike the two previous stadium projects, this new arena deal is being paid for by private investors. The $150-200 million in bonds put up by the city will be paid back by revenue from the new arena, not a new tax. They are not asking for these public bonds because a private loan is "too risky", they are doing it because it is cheaper. If we used that money on "more important things" we would all pay for it. That money does not exist without the arena and the revenue it will generate. This way, only the patrons of the new arena pay for it. So if you don't like the NBA, the NHL, concerts or the new arena in general, you can just not go and it won't cost you a thing.
Posted by Derpinator on June 18, 2012 at 12:28 PM
32
whatever happened to this plan? http://stadiumdistrict.org/media/11-08-1…

Seattle. All talk. No action.
Posted by joe_dee on August 8, 2012 at 9:42 AM

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