Good Gravy!

We ended our last commentary by stating that our firm will pay the entire cost of the container terminal we’re proposing to erect in Rhode Island. We forgot to mention that we’d be paying a pretty fair price to lease the land we’d need.

A fair price? Well, let’s just see how fair that price will be. Let’s compare it with some of the arrangements already in effect, or proposed, for waterfront acreage in the Quonset Point area.

North Atlantic Distribution (NORAD) has been offloading foreign-made vehicles at the northern pier in Davisville for a number of years, and because of its low visibility no one has ever objected to that operation. In fact, Rhode Island’s Economic Development Corporation has just agreed to a 40-year lease of an additional 38 acres to the firm … and no one seems to have a problem with that either.

Beginning in March, NORAD expanded its property to 104 acres from 66 acres, and the annual lease for this 38 acres, it has been announced, will be “$ 1.28 million in its first year”. The announcement failed to mention the agreed upon leasing arrangements for subsequent years, an omission which may be of some concern. NORAD now imports more than 100,000 cars per year, and according to reports, the Quonset Development Corporation (QDC) expects to collect $ 3.00 for each of these vehicles, as well as docking fees and port storage fees.

On the other side of the ledger the QDC is drawing operating funds from a 2004 $ 48-million bond referendum as well as from the state’s $ 225-million Freight Rail Improvement Project. In reality, then, the annual income at the Quonset/Davisville site … whatever it turns out to be … isn’t all gravy. The taxpayers have already paid through the nose for those very questionable benefits.

Simple math would show that $ 1.28 million for 38 acres works out to be a little less than $ 34,000 per acre. Another $ 300,000, plus ancillary fees, will fatten up that per-acre figure … but not by much. Sound like a lot of money? It does? How about $ 500,000 per acre per year, for as long as the state demands it of us? That’s what we’ve been offering for acreage in the Quonset Point/Davisville port area, but we’ve yet to get a response from a ranking official.

Our $ 500,000 per acre for a 38 acre plot would work out to be $ 19 million annually, and along with this expense we’re proposing to pay, not $ 3 per offloaded unit, but $ 10 per container … loaded as well as offloaded. We wouldn’t need any part of a $ 48-million bond issue, nor would we require assistance from Freight Rail Improvement Project funds. We’d be providing relief for Rhode Island taxpayers and we’d be creating thousands of job opportunities.

Yesterday’s editorial reminded readers of the significant increase in port activity since the study Martin Associates conducted in 2000. The Ocean State has lost precious time, was the editor’s thoughtful lament.

[… And the taxpayers have lost precious money, he shoulda said.]