Port of Brownsville officials will have solid proof on hand of the maritime industry’s economic value to the city, region and state when Texas legislators come calling this Friday.
That proof comes in the form of a recently finalized report by Pennsylvania-based Martin Associates/ John C. Martin Associates, one of the world’s top port industry economic analysts.
Among the key findings is that vessel and cargo activity at the Brownsville port’s marine cargo facilities and ship repair/oil rig maintenance operations generated 21,590 jobs in the state in 2011.
Of that number, 11,230 jobs directly impact the local and regional economy, while business revenue related to the handling of marine cargo generated an estimated $925 million in local economic impact in 2011, according to the report.
Overall, maritime operations at the port produced a total of $2 billion in economic activity in the state, said Martin Associates. In addition to overall jobs and economic impact, the amount of income and local expenditures generated is estimated at $771.3 million for 2011, generating $134 million in local and state taxes.
The report, commissioned as a companion to a Martin Associates study of ports’ impact statewide, covers only maritime activities at the Port of Brownsville and not the economic contributions of non-maritime port tenants.
It includes offshore drilling rig fabricator Keppel AmFELS and the port’s various ship recycling companies, said Eddie Campirano, port director and CEO.
A 2006 study took into account all port activities, maritime and otherwise, and showed an impact of around 12,000 in terms of jobs, he said. In comparison, the new study shows more than 11,000 jobs created by maritime activities alone.
“You can see that we obviously have a big economic impact in the region and how that economic impact compares to the state as well,” Campirano said.
According to the statewide study, commissioned by the Texas Ports Association, waterborne cargo operations at Texas’ public ports totaled $277.6 billion in 2011. The study covered 16 public ports in Texas. Houston is the “800-pound gorilla” among Texas ports, Campirano said.
The state’s maritime industry is second only to California, he noted.
Texas ports move 20 percent of all the goods that enter the United States, Campirano said. The Panama Canal, which is undergoing a massive expansion project to allow larger, next-generation container ships to use it, is a hot topic of discussion among legislators because of the increase in cargo it could bring to the Gulf of Mexico.
A report from the Panama Canal Stakeholder Working Group looks at what ports need to do to capitalize on opportunities presented by an expanded Panama Canal, which is expected to be complete in 2014.
The report makes recommendations for Texas, including “providing for a vibrant climate for port investment,” Campirano said. Despite the regional and statewide economic benefit from ports, Texas does not help fund port infrastructure improvements unlike other Gulf ports that get support from their respective states, he said.
“That’s something we don’t do in Texas,” Campirano said. “This is all generated by ports and port users. This is strictly private sector investment.”
The Port of Brownsville is self-sustaining when it comes to paying for its operations, pouring some of the revenue it generates into capital improvements. The only tax money it receives is a 4.5 cent ad valorem tax for retiring old debt.
While Houston, the biggest container port on the Gulf Coast, stands to benefit the most from the Panama Canal expansion, smaller ports, including Brownsville, will benefit in other ways, Campirano said.
“We all have our niches,” he said. “I think our opportunities are going to come from ‘transloading’: Big vessels going into big ports will parcel out the cargo, and smaller vessels will take it to other Gulf ports. That’s where I believe the Port of Brownsville has the greatest chance of being able to participate in that business.”
Campirano said the port’s goal is to “be an economic engine for the region and create good-paying jobs,” and that the Martin Associates report is evidence that the port is meeting that goal.
It also shows that the port is recovering from the bleak period during the global economic crisis and the Gulf drilling embargo, enacted as a result of the 2010 Deepwater Horizon spill.
Though steel is king, much of the bulk cargo the Port of Brownsville handles is petroleum based such as gasoline and diesel.
“We’ve fared fairly well,” Campirano said. “If we would have done this study in 2008 at the peak of our activity, you kind of wonder what it would have looked like.”
He said the port “hit rock bottom” economically speaking during the recession, but that if cargo and jobs continue their current upward trajectory things will be fine.
Campirano conceded that the timing of the release of the Port of Brownsville study isn’t entirely coincidental.
“The legislators are going to be spending time in Brownsville on Friday,” he said. “Part of that will include a boat tour of the port. I wanted to make sure I incorporate (the study) into my presentation. I felt that it would be timely to do it now.”