President Obama’s recently released 2015 budget doesn’t include construction money for the Savannah Harbor deepening project, something that has upset Georgia leaders, and threatens future agriculture-based exports in the region.
Last week, all of Georgia’s congressional delegation sent a letter to Sylvia Burwell, director of the Office of Management and Budget, expressing their disappointment in the office’s failure to support the Savannah Harbor Expansion Project, or SHEP.
“The president previously included SHEP in his 2012 ‘We Can’t Wait’ initiative, in which he specifically pledged to expedite SHEP and four other port projects. Just seven months ago, Vice President Biden visited the port in Savannah and said the project would be expedited and built ‘come hell or high water,’” the letter stresses.
According to the letter, the Consolidated Appropriations Act of 2014, signed by the president Jan. 17, “gave clear direction to the administration to begin construction on SHEP and to request the necessary funding. The administration’s position, as evidenced by the Office of Management and Budget, is that they will ignore the explicit guidance from congress, and will instead request more funding for studies this year, further delaying the project.”
With a cost-benefit ratio of 5.5 to 1 and an annual net benefit to the nation of $174 million, SHEP has wide support, the letter continues.
Savannah is one of the nation's top ag exporters
Agriculture products account for about 40 percent of the cargo exported through Savannah. In 2012 Georgia exported $37.9 billion worth of goods. The state is the top exporter of U.S. poultry, pecans and wood pulp.
Georgia has allocated $256 million for the state’s share of SHEP construction. “As the livelihood of this project has little alternative at this point, it is now imperative that the finalization of the Project Partnership Agreement with Georgia be completed as soon as possible and the (The Army) Corps be allowed to utilize the state’s $266 million to initiate construction contracts this year. We intend to make this point clear to the Army Corps of Engineers as well,” the letter says.
Savannah boasts the fourth largest port value wise in the country and it is not too far behind the leading ports in New York and New Jersey. Savannah is the country’s leading exporter of agricultural goods, including poultry, cotton, timber and paper products. According to the Georgia Ports Authority, the Savannah Port handles about 3 million TEUs, or 20-foot equivalent container units, annually. Over the next decade, harbor improvements -- anchored strongly on the harbor’s future expansion -- hope to double that volume to 6.5 million TEUs.
At this time, the Savannah Port is the shallowest depth wise of any major port in the world. It has 42 feet of draft for ships with a tide flux of seven or so feet. This threatens Savannah’s future growth in the world trade business, including those that trade ag products. The SHEP project looks to deepen the port there by six feet or so to accommodate the larger cargo-vessels that will soon start passing through the Panama Canal, which is being expanded now to accommodate larger ships by 2015.
Larger ships carry more with less overhead, but they need deep-water terminals to deliver to and load products from. After more than a decade of working to secure state and federal funding to do this in Savannah, the exclusion of the federal funding in the proposed 2015 budget throws a monkey wrench into those plans.
The Garden City Terminal in Savannah has berthing space for nine cargo-container vessels at once, or right now the largest continuing berthing space for any port in North America. Most terminals have space for two or three such vessels at a time.