N.J. officials use GAO report in dredging fight

N.J. officials use GAO report in dredging fight    On Saturday, New Jersey Gov. Chris Christie and other state politicians seized upon a new Government Accountability Office report to bolster their opposition to dredging the Delaware River.
   “The GAO report released yesterday raises more questions about the economic justifications the U.S. Army Corps of Engineers is using to deepen the river, buttressing New Jersey’s position that the Corps is barreling ahead with this project armed with only half the facts,” said Christie said. “I call on the U.S. Army Corps of Engineers to immediately stop all work on this misguided dredging project.”
   The GAO last week said it recommends the Defense Secretary direct the Chief of Engineers and Commanding General of the U.S. Army Corps of Engineers to provide an updated assessment of market and industry trends and outlook that could affect the benefits of the Delaware River deepening project.
   Deepening of the main shipping channel — which could benefit ships calling at public terminals in Philadelphia, Camden, and Wilmington, Del., as well as the many private docks along the river — began in March after years of controversy and even as litigation over the project intensified.
   In 1992 Congress authorized the Corps to deepen the shipping channel from 40 feet to 45 feet, and in 2002 GAO reviewed the Corps’ economic analysis of the project, concluding that it contained significant limitations. GAO recommended the Corps prepare a comprehensive economic reanalysis, which the Corps completed in 2004.
   In a new report, issued last week, the GAO said the Corps’ reanalysis completed six years ago addressed many of the limitations it had identified in 2002 to correct invalid assumptions and outdated data, recalculating benefits and costs to correct miscalculations, and accounting for some of the economic uncertainty associated with the project.
   But GAO said there are three key outstanding issues that could affect the Delaware River deepening project.
   ' Continued resistance to the dredge material disposal plan from New Jersey, even though the Corps has lowered its estimate of the volume of dredged material, and the need for new disposal sites in New Jersey. New Jersey’s Department of Environmental Protection (NJDEP) has been demanding that the Corps “perform environmental studies to prove that dredging and the disposal of spoils won’t harm the river and South Jersey’s ecological resources,' said NJDEP Commissioner Bob Martin. He complained Delaware River sediment has not been comprehensively sampled and potentially contaminated dredged material will be dumped in New Jersey.
   ' Lawsuits filed against the Corps last fall by Delaware, New Jersey and several environmental groups, charging the Corps lacks the environmental approvals needed to proceed with the project, and other concerns.
   ' A court challenge by New Jersey and several environmental groups of the Corps’ National Environmental Policy Act (NEPA) process for the project. Although the Corps completed an environmental assessment (EA) in April 2009, stakeholders believe the process for soliciting public comment on its scope was unclear, did not allow enough time for comment, and that a new supplemental environmental impact statement is needed. Also, at the Army’s direction, the Corps did not provide a public comment period for the draft EA as it had proposed to do.
   GAO said the Corps was responsive overall to its 2002 recommendations, but there were limitations in the reanalysis because “the Corps considered the effects of negative-growth scenarios only for crude oil and refined petroleum, but not for the remaining commodities.”
   Since 2004 “current and anticipated future market and industry conditions have changed significantly. Several of the assumptions that underlie the Corps’ estimates of the project’s benefits are inconsistent with these changes. For example, the Department of Energy has lowered its long-term forecasts for growth in East Coast refinery capacity and U.S. imports of crude oil. Also, in the fall of 2009, Delaware River refinery firms closed two major facilities.”
   The GAO also noted that steel imports have declined since 2006 and were well below the reanalysis’ growth projection for 2009.
   It said, “Updates also did not determine the current status of shipping services on two trade routes that provide all of the benefits related to containerized cargo.”
   In recent months new services to the Port of Philadelphia have been announced:
   ' In April, Sea Star Line, the U.S. mainland-Puerto Rico container and roll-on/roll-off carrier, said it would start service from the Tioga Marine Terminal on April 23.
   ' In October Mediterranean Shipping Co. began service from the Packer Avenue Marine Terminal to North Europe.
   ' Last week, the Port of Philadelphia announced Wagenborg Shipping will begin regular calls to deliver paper to the port’s Forest Products Distribution Center at Piers 78 and 80 operated by Penn Warehousing & Distribution Co. Inc. ' Chris Dupin