A key federal agency on Monday announced plans to set aside a record amount of funding for the Savannah harbor deepening project following an intense lobbying campaign by the state and its allies.
The U.S. Army Corps of Engineers said it plans to spend nearly $35 million on the roughly $1 billion project in its 2018 budget work plan. That’s in addition to the $50 million Congress had carved out for Savannah in its March government spending package, on its own a high water mark for one of Georgia’s top economic development projects.
The total amount allocated still falls short of the roughly $100 million advocates were initially pushing for this budget cycle. But still, the Georgia Ports Authority and the state’s congressional delegation celebrated the news and said it was enough to keep the project “on track.”
“It speaks volumes,” said Griff Lynch, the executive director of the Ports Authority. The White House and corps “view this project as extremely critical to the nation and they’ve acted accordingly with the money.”
Georgia’s inland and coastal ports are vital cogs in the state’s economy. A study released in March by the University of Georgia found that maritime trade accounts for $44 billion of the state’s gross domestic product and the ports directly or indirectly touch more than 439,000 jobs.
About half of those jobs are based in metro Atlanta, where the warehousing and logistics industries have boomed amid a post-recession rise in consumer spending and e-commerce demand. Much of the freight travels initially by ship and then by rail and truck.
Project boosters hope the total set aside for the project in this year’s budget will be a benchmark for years to come.
“Ensuring the on-time completion of this project is a win for trade, a win for the economy and a win for the hundreds of thousands of jobs the Port of Savannah supports,” said U.S. Sen. Johnny Isakson, R-Ga.
Work to deepen the Savannah River channel from 42 feet to 47 feet to accommodate larger cargo ships from the expanded Panama Canal reached its midway point earlier this year.
The bulk of the early construction work has been funded with state money, but the feds are on the hook for nearly $678 million, or roughly 70 percent of the project’s costs.
Port advocates and state officials had been frustrated by what they saw as the slow pace by which the federal government doled out funding for the deepening work. After the corps refused to give the project any extra funding in its 2017 budget, the state’s congressional delegation ramped up a campaign to pressure the administration to more quickly fund dredging work. Several lawmakers made personal appeals to White House budget chief Mick Mulvaney, while others invited President Donald Trump and Vice President Mike Pence to personally tour the harbor.
“We recognize that in challenging fiscal times, careful decisions must be made in prioritizing where taxpayer dollars are invested,” all 16 Georgia congressmen wrote in a letter to Mulvaney in December. “In the case of (the Savannah port), we respectfully submit that we have a project that is fully underway, that will deliver proven benefits and has maximum matching support from the local sponsor.”
Georgia members of the House Transportation Committee, meanwhile, moved to increase the project’s federal authorization in a water resources bill this spring, a move designed to pave the way for more money down the line.
But lawmakers were limited in what they could do unilaterally because of Congress’ earmark ban. That is what made the corps’ work plan so critical.
“Finally, the Port of Savannah will receive long overdue investment from the federal government,” said U.S. Sen. David Perdue, R-Ga.
The port and delegation say an average of $100 million is needed annually to keep the project on schedule and on budget. It is currently set to be completed by January 2022.
Securing ‘economic prosperity’
Pat Wilson, Georgia’s commissioner of economic development, said the port is “one of the biggest drivers to economic prosperity in this state.”
“The state has been very good about living up to our end of the bargain, and we are very excited that the federal government has now turned and is now helping us do this dredging project, which is going to help make Georgia extremely competitive over the next 50 years,” he said.
At a state Department of Economic Development board meeting last month, Wilson said investments by the Ports Authority, the state and the corps have led to spinoff jobs for thousands of Georgians. State recruiters and the ports are working to lure new businesses to ship through Savannah, including produce and flowers from South America.
That surge in business is a result of the expansion of the Panama Canal, as larger freighters are entering the Savannah River channel.
The ships are limited to when they can enter the river and must do so when not fully loaded. The deepening is needed to allow those huge vessels to pass through the channel more freely and with heavier loads, meaning more containers and more goods moving through the port.
In March, the port broke ground on a $126.7 million rail terminal upgrade that will allow the port to double the amount of rail lifts annually to 1 million, which should remove some 200,000 semis off Georgia roads each year.
By the fall of 2020, 18 rail lines will crisscross the yard, and cranes will hoist metal boxes onto trains bound for Memphis, Tenn., Chicago and other points in the Midwest. The port currently has eight rail lines on campus.
Ports officials have said the completed terminal will cut rail travel time to Midwest cities by 24 hours, which will make shipping faster and cheaper, and in turn, make Savannah more attractive to businesses.
In April, the Savannah port saw a 7.1 percent increase in containers traffic over the same month a year ago. This fiscal year, the Ports Authority expects container traffic to surpass 4 million units for the first time.
Port system’s economic impact
A study released in March by the University of Georgia found that maritime trade accounts for $44 billion of the state’s gross domestic product and the ports directly or indirectly touch more than 439,000 jobs. About half of those jobs are based in metro Atlanta.