SEVEN QUESTIONS TO ASK ABOUT $1 BILLION SPENDING OF PUBLIC FUNDS FOR ST JOHNS DREDGING/DEEPENING David Jaffee Professor of Sociology Northeast Florida Center for Community Initiatives University of North Florida

#1: WHAT ARE THE TRUE COSTS/BENEFITS? PROJECT/PUBLIC APPROVAL = (underestimate costs) + (overestimate revenues) + (undervalue environmental impacts) + (overvalue economic development effects)* Lesson: Conduct/commission independent cost-benefit multi-port analysis of the project. How are costs/benefits distributed? * B. Flyvbjerg, M.S. Holm, & S. Buhl, S. “Underestimating costs in public works projects”, Journal of the American Planning Association 2002 Volume 68(3) p

At 47’ 13,844 additional jobs generated by 2035 How reliable are 20 year predictions? Based on capturing how much cargo from which ports? What is the factor used by Martin to translate TEUs into jobs and revenue? What income level is used to estimate induced jobs? #2: HOW DOES MARTIN ASSOCIATES CALCULATE THE JOB NUMBERS? “the potential distribution center activity associated with an annual first inbound Asian service” is 11,500 jobs How likely is it that Jaxport will receive a first inbound Asian carrier? How is the 11,500 jobs figure calculated? What are direct, induced, and indirect?

#3: WHAT KIND OF JOBS WILL BE CREATED? Claim: Avg Salary 43,000 Transportation and Material Moving Occupations* Median Annual Income = $28,538 61% of employment in three largest occupations: Laborers and Freight, Stock Material Movers (34%) Heavy and Tractor Trailer Drivers (21%) Packers and Packagers (6.4%) Average Median Income for these three = $28,395 (assuming FT/Year round employment) * Bureau of Labor Statistics’ Occupational Employment Statistics (OES), May 2013

CONTAINER VESSEL NAME TEUs (nominal) Water Draft (ft) Air Draft (ft) Evergreen Ever Laurel 8, ~175 Susan Maersk 8, ~180 MSC SINDY NA New Panamax 13, > 180 Emma Maersk 15, Maersk Triple-E 18, Dames Point Bridge air draft = 175 ft #4: WILL 47’ OF WATER MAKE ANY DIFFERENCE? Water Too Shallow/Bridge Too Low

#5: WHY HAVE ALLIANCES CHOSEN OTHER PORTS? “Revealed Preferences” of Carrier Alliances JAXPORT Losing Market Share to Other Ports Alliance Port Rotation

'Certainly we as an association and in the industry as a whole recognize and believe that not every port in the country needs to be at a depth to be able to accommodate the largest vessels in international trade,' Kurt Nagle, American Association of Port Authorities #6: WILL THERE BE ENOUGH CARGO TO JUSTIFY EAST COAST DEEPENING PROJECTS?

#7: IS THERE A STRATEGY FOR AN ECONOMICALLY VIBRANT PORT THAT DOES NOT DEPEND ON $1 BILLION AND DAMAGE TO THE ST JOHNS RIVER? WHAT ROLE FOR PRIVATE TERMINALS AND THE PORT OF JACKSONVILLE?