One of the things that popped out to most of us that followed the May 2 vote closely were the comments made by two of the council members that voted "no" on the street vacation.
Council member Lorena Gonzalez mentioned that the Port of Seattle provided her with a "stack of papers" (or something like that) the Friday prior to the vote with new information that apparently significantly influenced her vote.
Dave ‘Softy' Mahler with KJR radio stated that Council Member Sally Bagshaw told him she had received "new information" from the Port of Seattle that also caused her to change her stance. Although, as she was already aggressively lobbying against the arena days prior to the committee vote, maybe she was made aware of this new information ahead of the other council members.
A Public Disclosure Request was submitted on May 11 for a copy of whatever it was that the council members received. On June 3, the City provided a portion of the information requested. Although more information is forthcoming, the four documents below appear to represent the "new information" submitted by the Port of Seattle.
CAI - Economic Impacts of the Proposed SODO Arena 4-28 (CAI.POS SODO Arena )
Seattle 2035 Comprehensive Plan - Container Port Element
Is it New Information?
The most significant of the information are the two reports prepared by a company named Community Attributes, Inc., the arena impacts report and executive summary. The date of the impacts report and other information certainly appears to be a few days ahead of the May 2 vote. Though it appears to contain much of the same information put out by the Port of Seattle over the past four years, the report looks professional, and the packaging and presentation of the data gives it a more credible appearance. But where did all that data come from?
What's the Source of the Data?
The report primarily uses data provided to CAI by the Port and from interviews with maritime and industrial stakeholders, mostly people connected to the Manufacturing Industrial Council (MIC).
Here is the list of the 13 people interviewed by CAI, with additional information (not in the report) that was found on their own websites, through an objective Google search, or through Public Records Request obtained from the Port of Seattle:
Rick Blackmore, Total Terminals, Inc. Note that Total Terminals is owned by Hanjin, the shipping company that handles the so-called "mega container ships." The Port’s Terminal 5 in West Seattle is currently undergoing environmental review of planned renovation to be the mega container terminal. T5 is far away from the Stadium District, but its impact could alter the use of Terminal 46, frequently cited to be the most affected by a new arena. Review our article on the Port's Plans for T46 here. The Port's long-term plans for T46 were never mentioned in the CAI report.
John Delaney, Washington State Fruit Association. I love apples and pears, but something about the statistics and numbers in the report didn't seem quite right. CAI states, "According to interviewees, for shipments within a 500-750 mile radius of the Port of Seattle, freight via rail is typically not feasible." Gee, ya think? I don't know how those apple growers out in the middle of the Pacific Ocean could possibly use rail (or for that matter, truck) to get their apples to the Port. The wide net cast in that 500-750 mile radius also includes a very large portion of our friends to the north, Canada. Apparently, Canadian growers and/or freight carriers will also not want to use the Port of Seattle because of the SODO Arena.
The report also keeps it vague by referring to the "vast majority of apples and hay shipped through Washington ports." So it's no longer just the Port of Seattle, it's all Washington ports. This is a trick used often in the report. Visually, they are attempting the inference that the Port of Seattle is the central receiving point of all apple growers in the 500-750 mile radius. When in reality their subtle word changes explained something else. It was very clever (see Page 26).
Jon Felix, Avalon Glass Works. Jon and his wife Shannon own Avalon Glassworks but what I'm confused about is their website shows they are located in West Seattle, near the Luna Cafe, far away from the Stadium District and the proposed SODO arena. It appears CAI included them as a stakeholder for the larger Duwamish/Industrial zone. Again, a clever way of creating murkiness by attempting to connect the SODO arena with areas of development and industry far outside the Stadium District. Actually, it's 3.2 miles from Safeco Field heading west. Their hours of operation are 10 am to 5 or 6 pm everyday. I don't understand how this business would be materially impacted by the arena. Nowhere are their concerns documented in the report with a direct quote or example.
Todd Fryhover, Washington Apple Commission. As noted above, the eastern Washington apple and hay growers/farmers took some prominence with some of the council members. It's easy to say it's important to have areas where there can be refrigerated storage for perishable commodities, to be sure. However, CAI interchanges "Port of Seattle" with "Seaport Alliance" where it fits the narrative. Northwest Seaport Alliance is the agreement between the Ports of Seattle and Tacoma to manage operations, but here Seaport Alliance is code for Port of Tacoma. Port of Tacoma is huge and has a lot of land and a lot of refrigeration storage facilities. The Port of Seattle does not.
By including the vast land of the Port of Tacoma, CAI and the Port of Seattle confuse the reader by using seemingly big numbers to give the appearance of importance. Per CAI: "For example, 85% of Washington's containerized apple exports (by weight) were shipped to Asia, exiting through West Coast (and primarily Washington) ports." (Page 15) There is nothing that quantifies how many apples the containerized apples represent of the entire apple growing industry. There is nothing that states the actual percentage of apples that went through the Port of Seattle. What readers see are numbers like 85% and $393 million. Further down, you read that nearly 30% of all Washington pears are exported (again through "Washington" ports). But is this true? According to the Brookings Institute, the majority of our agricultural trade in Washington State travels by truck to Portland and Los Angeles, about $4 billion in total. The amount of agricultural trade with China? $266.6 million. That's ALL agricultural trade between the Seattle-Tacoma metropolitan area. The way the apples and hay commodities were presented in the CAI report was highly misleading. The growers don't use the Port of Seattle exclusively and the commission's biggest issue appears to be labor strife at the Ports.
Dave Gering, Duwamish MIC. Mr. Gering is the Executive Director of the Duwamish Manufacturing Industrial Council. It appears he and Tory Gering run two non-profits, the Duwamish Manufacturing Industrial Council and the Duwamish Transportation Management Association. A public records request received from the Port of Seattle shows the Duwamish Transportation Management Association and the Manufacturing Industrial Council were paid $103,000 and $97,000, respectively, by the Port. Dave Gering is also a writer/journalist. He's been with the MIC since 1998. I could not find any information on the Duwamish TMA. It does not appear in a corporations search (including charities) with the State of Washington. These two organizations are very active in all issues regarding SODO and the Duwamish industrial area. They appear to work closely with the Mariners, the Port of Seattle, and the Seattle Public Schools for their efforts in SODO. Of note, Linda Styrk, Managing Director of Maritime for the Port of Seattle, is the Co-Chair of MIC. Ms. Styrk also serves as the Executive Director for Puget Sound Pilots (since September 2015). Ms. Styrk's 2015 wages with the Port of Seattle was just over $173,000.
Johan Hellman, BNSF. Mr. Hellman serves as Executive Director of State and Government Affairs for the Pacific Northwest for Burlington Northern Santa Fe Railway. He is also an officer (or perhaps former) of the Manufacturing Industrial Council (aka Duwamish MIC). His name is listed as an officer of MIC on the State of Washington Corporations search page. However, his name does not appear on the MIC website under Executive Committee. Prior to working for BNSF, he served as Deputy Director of the Washington Public Ports Association, and he has worked in Washington State politics for over 20 years (per his bio on BNSF's website). The Port of Seattle paid the Washington Public Ports Association over $2 million during the past five years. In addition, they've paid BNSF over $2.6 million during the past five years, likely to buy part of the rail lines.
Patrick Jablonski, Nucor Steel. Mr. Jablonski is an Environmental Manager at Nucor Steel. He's an associate of Matt Lyons, Vice President of Nucor Steel Seattle. Mr. Lyons is on the Executive Committee of MIC. Nucor Steel Seattle is owned by Nucor Corporation based in Charlotte, NC. Nucor has locations throughout the United States. Similar to Avalon Glassworks above, Nucor Steel is located many miles southwest from the proposed SODO arena location.
Kathy Johnson, Seattle Public Schools. According to the Duwamish TMA website, they work closely with the Seattle City School District. Ms. Johnson is the Facilities Operations Program Manager for Seattle Public Schools, according to her LinkedIn page. The Seattle Public Schools administrative offices are a mile south of Safeco Field. I'm not sure if Ms. Johnson speaks on behalf of the Seattle Public Schools, or if she potentially works closely with MIC and was included as a stakeholder. Perhaps the Seattle Public Schools would like to increase their facilities in the SODO area, outside of the zoned Stadium District overlay, of course. I would think the many amendments and additional public benefits agreed to by Chris Hansen would have helped with any traffic or safety concerns, as it was much more that what is in place right now.
Ryan Nesbitt, DSG Logistics. Mr. Nesbitt works in International Logisitics for DSG Logistics, a trucking/freight company located out of Yakima. DSG started in 2009 and is a subsidiary of Domex, Inc., also a Yakima-based, privately-held company which according to public records has under 50 employees. Domex is a fruit grower (apples, pears, cherries). I'm guessing this is the company used for a statement in the report that inferred eastern Washington growers would like to make the trip to/from the Port of Seattle in a day.
John Odland, MacMillan-Piper. Mr. Odland is a Vice President at MacMillan-Piper, a transloader of freight. They have four facilities, two in Seattle and two in Tacoma. Of the two in Seattle, the location closest to the proposed SODO arena is their Massachusetts Facility located about three blocks east of the proposed SODO arena. It consists of 5.25 acres and a 100,000 square foot warehouse with 24 truck doors. They appear to primarily serve BNSF at this location. Their second Seattle location is located on S Edmunds St., almost 3 miles south of the proposed SODO arena location. This facility, larger in acreage but smaller in warehouse space, also primarily serves BNSF. The two locations in Tacoma have recently undergone expansion and are 10 acres each with 100,000 sq ft of warehouse space at each location. It is clear the majority of their operations occur in Tacoma. Mr. Odland also serves on the Executive Committee of MIC.
Geraldine Poor, Port of Seattle. Ms. Poor is the Manager of Regional Transportation for the Port of Seattle and serves in their Public Affairs division. Her 2015 salary with the Port was just over $158K. She has attended many meetings at the Port with many of the above persons from 2011 to date concerning freight mobility.
Joe Ritzman, SSA Marine. Mr. Ritzman is the Vice President of Business Development for SSA Marine, a privately held container terminal operator. It's a wholly owned subsidiary of Carrix, Inc., a very large, privately held entity with deep reach across ports nationwide and internationally. According to a bio found on Mr. Ritzman, his port privatization and development experience includes assignments in Vietnam, Panama, Mexico, Chile, Jamaica, and Bangladesh. SSA Marine attempted to increase coal exports through the ports. Mr. Ritzman was highlighted in several articles discussing this effort. He and Mr. Hellman with BNSF have attended conferences in Wyoming regarding the transportation of coal from Wyoming mines through Washington and other states.
Jordan Royer, Pacific Merchant Shipping Association. Per its website, PMSA is an independent, not-for-profit association focusing on global trade. They represent owners and operators of marine terminals and U.S. and foreign vessels operating throughout the world. That's a big representation base. Sometime over the past five years, the Port of Seattle paid the PMSA just over $46,000. Mr. Royer is the Vice President for External Affairs and is also on the Board of Crosscut.com. Over the past five years, the Port of Seattle has paid Crosscut Public Media just over $1.04 million.
Missing from list of interviewees and data sources is the wealth of information regarding port operations in articles from the Journal of Commerce (joc.com). At first glance, it's curious these were excluded. Yet, these articles focused on the ongoing work of the Ports of Seattle and Tacoma to combine their operations and begin the transition to Terminal 5. (Thus, looking for new development uses of T46, the terminal in closest proximity to the SODO arena).
The Subtle Art of Wordsmithery
As noted above, CAI did a good job of presenting a crisp report with a sense of urgency. They overwhelm with large numbers and percentages, interchanging "Port of Seattle" with "Washington Ports" and "West Coast Ports" where it fit the narrative. This obscuring of the context of the data, combined with the Port of Seattle's own penchant for providing murky data and information, was neatly packaged in a report that appears a combination of propaganda and seemingly intentional graying of the facts.
Here's an example when they discuss the potential loss of revenue to Key Arena (Page 38).
Key Arena may also be affected by the introduction of a new arena. Between 35 and 40 events per year are anticipated to switch from being held at Key Arena to the proposed arena, causing $3.2 million to $3.7 million to be displaced from Key Arena.
Okay, but nowhere does the report reference the amount of money Chris Hansen agreed to put into Key Arena to take over operations and improvements as part of the MOU. In addition, the report states that Key Arena is operating profitably, which I hope it would after the City accepted a large financial settlement from Bennett when the previous Mayor and Council unanimously agreed to drop the lawsuit and let the Sonics go for money.
I'm not sure why but the Port of Seattle has also paid AECOM an enormous amount of money over the past five years. According to a public disclosure request, the engineering and project management firm was paid $22,536,747.69 from 2011 through early 2016.
Federal sources of employment in SODO are the Coast Guard and U.S. Army Corp of Engineers. Other major private employers include Restaurants Unlimited, Inc., the headquarters of Starbucks, and Charlie's Produce.
Just two bullet points down, they reiterate Starbucks’ presence:
Starbucks Global Headquarters occupies 2.2 million square feet along Utah Avenue South. An estimated 800 employees work out of this facility.
So you can see where they use a bold header of "Federal sources of employment" and then blend in private employers, then mention Starbucks again, this time using large numbers like "2.2 million" square feet and "800."
Update: There are actually about 4,000 employees that work out of Starbucks headquarters. Whether this was an error by CAI or a deliberate misstatement of fact, it's a serious oversight and greatly diminishes their argument about "who" creates the additional indirect and induced jobs (see below) in the SODO district.
Interestingly, Starbucks was not listed as one of the interviewees. Nor was the US Army Corp of Engineers, Restaurants Unlimited, Charlie's Produce, or the Coast Guard.
I encourage you to read the report and the separate nine-page Executive Summary and identify all the times they obscured the facts or interchanged the Port of Seattle with data from other ports.
Jobs: Direct, Indirect, Induced, and Misleading
Perhaps the biggest issue is the skewing of the job data, as well as the estimated "value" of jobs provided by the Arena and those that the Port of Seattle and the industrial area claim could be lost if the SODO Arena was built.
For example, the report immediately states that 42,700 workers are employed in the SODO study area. What is the SODO study area? US Census Tract 0093. This is a large tract (the largest geographically) within the Seattle area. They are claiming all jobs in this census tract, including those several miles south of the arena location, to be in jeopardy if the arena is built. They claimed they felt their numbers were a better reflection of the job data than those used in the FEIS because it encompassed the entire "at risk" area.
The 42,700 worker figure comes from the Washington State Employment Security Department. ESD doesn't distinguish between part-time or full-time employees. They look at who was on the payroll during the quarter. In another report issued by CAI a few years ago, they buried this information in a footnote. It is highly likely that many of the jobs they reference are part-time jobs, and that some of the employees may work two part-time jobs in the US Census tract 0093. A single worker may now be counted twice, or a part-time job given the same weight as a full-time position, obscuring the numbers.
They further claim that these 42,700 direct jobs create 12,200 indirect jobs (or 28.5% of direct jobs) and another 45,100 of induced jobs (or a multiplier of 105% from that initial direct job). Or a whopping 100,000 jobs in King County are a direct result of the 42,700 direct jobs.
Direct jobs are those that can be vouched for with a W-2 or a record of employment earnings as reported to a government entity.
Indirect jobs are those that are created by businesses that provide the direct jobs and purchase goods and services from other businesses (e.g., restaurants, janitorial assistance, windows, desks, furniture, etc.). Confusing as this is, say I own a company in Census Tract 0093 and employ five people. I also use a trucking company to deliver my goods, also in Tract 0093. The trucking company has 50 employees. According to the multiplier used by CAI, my business, which employs 5 people created 1.5 indirect jobs. If the 50 employees of the trucking company count the same, they also created 14.5 new jobs as well!
Induced jobs are those that are created by employees spending their earnings with companies and/or people either directly, indirectly, or induced from their employment with me. So my five employees who, according to CAI, make on average $70,400, actually create another five jobs. Wow!
What CAI doesn't make clear is how they came up with these multipliers, and whether or not the direct, indirect, and induced jobs are co-mingled. Buried in a footnote, they explain that they "modified" the model typically used but did not explain their reasons. If we were to use that same multiplier, well, then something is terribly wrong. In April 2016, there were a reported 1.35 million jobs in King County. Using CAI's formula:
1.35 million (direct jobs)
384,750 jobs (indirect jobs)
1.4 million jobs (induced jobs)
King County also creates 3.135 million jobs. Not bad when the total population is estimated to be 2.115 million, including children under 5 and people over 65.
You can see how misleading these multipliers can be. There is no way 100,000 jobs are created solely due to employees and businesses in census tract 0093. How many jobs in tract 0093 are because of direct jobs outside of tract 0093? There is no way to pin the number down accurately.
Another big number used throughout the report is $18.4 billion of containerized maritime imports and exports through the SODO terminals in 2014.
This isn't $18.4 billion of value of goods/commodities originating in King County. According to the Brookings Institute, only 8.3% of all goods in and out of the Ports of Seattle and Tacoma originate or end in the Seattle-Bellevue-Tacoma metropolitan area. So that $18.4 billion which sounds impressive is actually more like $1.5 billion. Even that's being generous given that the biggest commodity in and out of the Ports of Tacoma and Seattle is transportation equipment, the majority of that traffic going through the Port of Tacoma.
It's more like $16.77 billion of value of goods/commodities came through the Port of Seattle back on the highways where it was transloaded on a plane, truck ,or railcar and headed in/out of state.
Why was this Influential to some of the Council Members?
More than likely because of how the data and words were manipulated and grayed within the report. It took me several readings to pick up all the subtle data twists of this report. I doubt council members have time to re-read a report like this two or three times through.
The large percentages trying to make immaterial commodities (in relation to overall trade through the Port of Seattle) appear significant, visuals showing a huge radius with the Port of Seattle at the center. Essentially it was a snow job, delivered with a "rushed/frantic" pace of delivery/data, meant to dupe people who didn't read it closely or take the time to question its objectivity and accuracy.
We know it apparently swayed one vote, that of Council Member Gonzalez. I'm also not sure if any council members or their staff provided a copy of this report to SDOT or the Planning Department ahead of their votes to see if they were made of aware of this data and to discuss it further with them.
What the report does show are the fear tactics used by the Port of Seattle to create a "dire urgency" in what would happen if the street vacation was approved and an arena eventually built in that location.
The words "may be" and "some" and "estimate" are used many times throughout the report. For example, "some businesses think...." when they refer to the supposed concern of the businesses located in the industrial region. As you read above, the stakeholders seem to be a handful of people (13), and of those, the majority revolve around MIC and its tight connections to the Port. Missing in this report were the Mariners and Seahawks, especially since they are identified throughout the report as stakeholders employing up to 1,000.
None of this was new information. It was the same information put out by the Port of Seattle, for which they could not provide proof until they hired an external company and provided them with their data. This new "proof" was apparently not important enough to stop the vote and ask SDOT and the Planning Department to review and opine on it. It was also apparently not important enough to provide to Chris Hansen's development team with a request to amend or incorporate into the FEIS. Yet, it was deemed as influential and important enough to use as a reason to vote "no."
As we now know, these reports and data seemed to be a critical piece of research and study for some of the City of Seattle council members regarding the arena being placed in the Stadium District.
What about the Mayor?
Mayor Murray's office confirmed on May 23, 2016, that they received none of this information. In addition, it's important to point out that this Public Disclosure Request is still open. This is information provided by council president Bruce Harrell. I don't know if I'll receive the same from the other eight council members, especially since Mayor Murray was not provided this information from the Port of Seattle ahead of the vote.
Does this Change Anything?
In terms of the "new information" received by Council Members the Friday ahead of the vote, this report held enough gravitas for them to vote no and specifically mention it as a reason.
If this report was deemed critical to the arena vote, could Chris Hansen or even the City of Seattle request the FEIS be amended to address this information provided by the Port of Seattle?
The fact that the data used by Community Attributes, Inc. came from the Port of Seattle, and it doesn't appear CAI were asked to validate any of the Port's claims by looking at other external data available, it would seem unlikely it would have been deemed significant or credible enough. This is a 44-page report compared to an FEIS that took years to prepare and is over 600 pages. For some people with a voice in Seattle, the FEIS was not as thorough as necessary to approve a one-block street vacation for a potential new arena.
And apparently for a few of the city council members, a thin report essentially prepared by the Port of Seattle carried far more credibility.