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April 13, 2016 · Derek

NWIW Releases A New Economic Impact Report on the Proposed Methanol Plant

Conversations about the proposed methanol plant in the Port of Tacoma continue to be ... lively. The environmental review was paused in February. The lease extension between the Port of Tacoma and NWIW is under consideration at this very moment. Then, today, NWIW published an economic analysis of the project by ECONorthwest; and released safety, resource, and a draft site plan on their website. From the NWIW announcement:

An economic impact analysis published today shows the NW Innovation Works (NWIW) Port of Tacoma methanol production plant would significantly boost local economic activity and raise tax revenue for Tacoma, Pierce County, and Washington state. Highlights include:

Economic benefits during multi-year construction of the facility:

  • $3.6 billion total project cost
  • $1.3 billion in local spending on construction labor, goods, services
  • $2.18 billion in direct, indirect and induced spending in the nine-county region
  • $134 million in state and local taxes

Economic benefits during operation of the facility:

  • 260 full-time workers with an average compensation package of over $116,000 per year. This includes a $78,000 average wage, which is $26,000 more than the living wage in Pierce County for a family of four
  • Creation of over 1,000 jobs total, including indirect and induced impacts
  • $20 million annually in lease and wharfage fees paid to the Port of Tacoma
  • $73-106 million in annual tax payments paid to state and local authorities

You can read the full report here (pdf).

Filed under: Tacoma Business, Port of Tacoma

15 comments

  • Laura April 13, 2016

    After scanning, there is no mention of: - tax breaks - property values dropping - increased health care costs due to increased health risks (asthma) - increased utility costs to residents - increased home insurance - environmental liability (who will pay if things go wrong - it is City land and they are an LLC) - decreased businesses due to resource capacity - decreased businesses moving to area due to methanol plant - decreased residents moving to area due to methanol plant I could go on and on but you get the picture. This paper merely looks at the positive numbers not the negative numbers. If I look at only my paycheck deposits, I look great on paper. It would ignore my mortgage, my 401K contributions, healthcare, car insurance, utility bills, food, etc. This is not realistic. If Robert Whelan had any professional credentials, they should ethically question but alas he does not.

  • Michele April 13, 2016

    My husband and I are visiting Tacoma this week and enjoying everything we are seeing here, most of all the great beauty of the region. The economic benefits on paper for this plant sure look great. But the down-side is significant. Why does anyone really want to play with fire on this one? Why throw away the reputation this city finally has that it is progressive, going green, and is doing what's right for residents and neighbors? I'd love to move here and start a business. I'm ready to do it. But if you have a methanol plant that could fail and pollute on the scale predicted, why do I or any of my entrepreneurial colleagues want to bother? Turn down the plant. Move on to much cleaner, safer and more sustainable enterprises.

    • DeeBee Cooper April 14, 2016

      Tacoma: Progressive? No. The home of the 4th largest private immigration Prison is world-renowned as a prison town and has a very notorious reputation for failing in required oversight. Green? No. Go down to the Port this weekend and get a snoot full of Gypsy Moth killer bacteria spray - Bacillus thuringiensis. Yes it is in the Pacific NW and near Seattle but that does not mean it is close to either of those viewpoints (unless there is some available Federal money)

    • Jim C April 14, 2016

      So the possibility of a methanol refinery is enough to keep you from considering a move here but the existing oil refinery, massive oil & gas shipping terminal, paper mill, and lumber yards don't bother you? How about the LNG refinery and terminal that's on its way? Did you drive down South Tacoma Way while you were here admiring the great beauty? Tacoma is still an industrial town, don't let the false narrative confuse you.

    • JDHasty April 15, 2016

      "I’d love to move here and start a business. I’m ready to do it." Yea right. And what have you ever accomplished? By the way, Tacoma already has enough pot shops.

  • T-Town April 13, 2016

    Do the complete math, not just some rosy corporate green-washing: http://www.theolympian.com/news/politics-government/article62347537.html

  • T-Town April 13, 2016

    NWIW's president Vee Godely's last Chinese financed venture left Pocatello, Idaho holding the bag for about one billion dollars. Now in bankruptcy, "The firm never really had a technological differentiation in silicon manufacturing or in proton exchange membrane (PEM) fuel cells. Nor did it seem to have a strategic business plan, other than to go public and pay its executives." Incidentally, NWIW never built anything before, never mind the world's largest methanol refinery in the middle of a densely populated city. http://www.greentechmedia.com/articles/read/Hoku-Solar-and-Fuel-Cell-Aspirant-Bankrupt-With-1B-in-Debt

  • T-Town April 13, 2016

    China thinks allowing chemical plants in the middle of densely inhabited cities is not such a good idea. 85 chemical facilities have to be moved away from populated areas. It cost over $ 4 billion just to move two. Why not try it in Tacoma? Why not try it with the world's largest experimental petrochemical refinery? http://bigstory.ap.org/article/1df26d8ee8584b96b8c73001581c36d0/china-moves-10-chemical-plants-after-explosion-review

  • Bones April 14, 2016

    The PR piece put out by NWIW incorrectly assigns the term 'economic benefits' to what the ECONorthwest report clearly states are 'economic impacts.' These two terms are not equivalent. The study only uses 'benefits' in two contexts: for labor benefits, such as health insurance, and when it mentions tax revenue being a benefit to local governments. In economics, the costs of construction are a cost, not a benefit. Those costs do create economic impacts, some of which might be economic benefits to some groups, but ECONorthwest did not calculate such benefits, which might have been termed 'consumer surplus' or 'producer surplus' (which are approximations of the true benefits, for any economics purists lurking about). Stakeholders who change 'economic impacts' to 'economic benefits' are not being honest in presenting the case to the citizens of the region. Watch out for any politician who keeps the 'benefits' tag on the 'impacts.' [To drive home this point, NWIW would have us believe that a meteorite that destroys a house creates economic benefits, when I think the residents of the house would clearly consider it a catastrophe that happens to create economic impacts.] A few other issues, from a Pierce County perspective: (1) The ECONorthwest study looked at the impacts over a nine county region, without giving a hint as to the impact on Pierce County, or even Pierce County combined with southern King County. A large portion of the inputs into the construction of the plant will be from King County, not Pierce County. (2) 260 new permanent jobs are directly attributable to the operation of the plant. While the study notes that 96.9 percent of those working in the nine county region also live in the region, this doesn't address what percentage of the jobs might go to people who move here explicitly to take a job at the plant. What if half of the jobs are filled by people moving from their jobs at other methanol plants (let alone from outside Pierce County)? (3) No mention is made of potential supply constraints for inputs such as water. Should water need to be rationed in the future, either by price or some other mechanism, how will this affect current residents and businesses? The model used by ECONorthwest is not capable of addressing economic impacts when supply or demand conditions cause prices to change. For a venture that will increase direct employment by just 260 jobs, but use a large share of the region's electricity and water, that seems to be relevant. That's my two cents.

  • Phil April 14, 2016

    The study is one-sided propoganda continuing NWIW's public relations campaign of half-truths & greenwashing. It's offensive. Get ready for more--this same outfit just bought an electronic billboard on I-5, which went live this morning.

  • Jesse April 14, 2016

    It's interesting how this has unfolded. I mean, in the old days, this would probably fly through the system without a peep of angst from the public. It's really great, I think, how the perception of what Tacoma is, has changed. It's changed inside of Tacoma but obviously it hasn't at the state level or even the regional level. The outside perception is that Tacoma is a place to put these sorts of things and not a place to put white collar jobs. Anywhere else, the tide flats would be considered an environmental disaster in their own right. Infilled wetlands with polluting industry. Sometimes even gas tanks sinking in the infilled land... Keep fighting this off. Tacoma is doing a good job of redefining what it is - maybe even the Governor and County Council will see that vision someday... Maybe the Port and the City need to be one in the same as to not have conflicting visions for the future - working against each other.

  • Lisa April 15, 2016

    No amount of money is worth the poisoning of our beautiful region! This is not environmentally responsible! The health of all Tacoma citizens and all our natural resources must come first!

    • RHTCCComedyfan April 16, 2016

      I hate to say this but if NWIW bribed every Tacoma voter with say an offer of $5,000 or maybe $10,000 each to approve the plant they would probably have a lot of supporters.Let's say as an example that there are 50,000 Tacoma voters (the rest being non voter Tacoma residents).That would cost a total of between $250,000,000 to $500,000,000 for payment to all the registered Tacoma Voters. As another example lets say you pay every resident (man,woman,child ,infant) $2,000 as a bribe.For 210,000 residents that would cost $420,000,000. Again they would have a lot of supporters. But I do agree with you completely.Someone who was not a long term Tacoma resident like a renter (who could easily leave the area) would probably take such a bribe whereas a long Term Tacoma such as a homeowner having a stake in the community would not.

  • LeftyBender April 16, 2016

    Is it true that China wants to use Methanol so they can stop using coal? Which one is worse for the environment? It seems to me that coal is one of our biggest polluters so any other fuel may less harmful than coal. My biggest concerns is the use of water and power in our region when it comes to this subject. Maybe a "no" on Methanol is a "yes" for coal? Tough decision.

  • Samson April 19, 2016

    Announced today: Northwest Innovation Works (NWIW) is terminating its lease for a site on the tide flats with the Port of Tacoma.