progress update and discussion of technical memorandum 5a
TRANSCRIPT
July 26, 2006July 26, 2006July 26, 2006
Progress Update and Discussion ofTechnical Memorandum 5a – Draft Economic Impacts of
Goods Movement
Progress Update and Discussion ofProgress Update and Discussion ofTechnical Memorandum 5a Technical Memorandum 5a –– Draft Economic Impacts of Draft Economic Impacts of
Goods MovementGoods Movement
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MCGMAP OverviewMCGMAP Overview
Goods Goods Movement Movement
Action Action PlanPlan
Mitigation of community and Mitigation of community and environmental impacts environmental impacts
Develop a:Develop a:
Efficiency and productivity of goods Efficiency and productivity of goods movement throughout the study areamovement throughout the study area
Will include capital and nonWill include capital and non--capital optionscapital options
Solutions will address all modesSolutions will address all modes
MMAAXXIIMMIIZZEESS
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What About the MCGMAP is New?What About the MCGMAP is New?
Collaborative effort between 6 Counties, SCAG Collaborative effort between 6 Counties, SCAG and and CaltransCaltrans toward toward systemwidesystemwide solutionssolutions
Seeking input from all stakeholdersSeeking input from all stakeholders
Acknowledges ongoing local, regional, and Acknowledges ongoing local, regional, and State effortsState efforts
Goal of reaching consensus for regional Goal of reaching consensus for regional solutions & financingsolutions & financing
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3. Compile and Collect Goods Movement Data 3. Compile and Collect Goods Movement Data
2. Outreach Assistance2. Outreach Assistance
1. Project Management / Administration1. Project Management / Administration
4. Assess Growth in Freight Demand4. Assess Growth in Freight Demand
5. Community, Environmental, & Economic Impacts 5. Community, Environmental, & Economic Impacts
6. Strategies for Improving Goods Movement6. Strategies for Improving Goods Movement
7. Mitigating the Effect of Goods Movement 7. Mitigating the Effect of Goods Movement
Building an Action PlanBuilding an Action Plan
MultiMulti--County Goods County Goods Movement Action Plan Movement Action Plan 8.8.
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MCGMAP Study AreaMCGMAP Study Area
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Task 2 Task 2 –– Outreach AssistanceOutreach Assistance
First round of surveys completedFirst round of surveys completed
Targeted stakeholder audienceTargeted stakeholder audience
159 surveys received to date159 surveys received to date
Validates many of the issues to be discussed todayValidates many of the issues to be discussed today
Another survey later in the study to focus upon Another survey later in the study to focus upon solutions and strategiessolutions and strategies
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Task 3 Task 3 –– Existing Conditions Existing Conditions and Constraintsand Constraints
Status UpdateStatus UpdateFinal Tech Memo to be delivered to TAC by July 31, 2006Final Tech Memo to be delivered to TAC by July 31, 2006
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Scenario 1: High Growth - Current Investment Levels
Scenario 2: Low Growth – Current Investment Levels
Scenario 3: Moderate Growth - Current Investment Levels
Scenario 4: High Growth - Full Investment Levels
Task 4 Task 4 –– Growth in Freight DemandGrowth in Freight Demand
SCENARIOS FOR STRATEGY EVALUATION
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Task 5 Task 5 -- Environmental & Community Environmental & Community ImpactsImpacts
Technical Memo 5b In-Progress
Incorporating What We Heard
Active Developments Ports Clean Air Action PlanSB 1266 – Highway Safety, Traffic Reduction, Air Quality, & Port Security Bond Act of 2006
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Agency Environmental PlansAgency Environmental Plans
Plan Focus
Cal/EPACal/EPA--BTH GMAPBTH GMAP
CARB Emissions CARB Emissions Reduction PlanReduction Plan
MCGMAPMCGMAP
Ports Ports CAAP CAAP
SCAQMD SCAQMD AQMP AQMP
Statewide GMStatewide GM
Study Area GMStudy Area GM
San Pedro Bay PortsSan Pedro Bay PortsEmissionsEmissions
South Coast Air BasinSouth Coast Air BasinEmissionsEmissions
Statewide Ports & GMStatewide Ports & GMEmissionsEmissions
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Agency Environmental PlansAgency Environmental PlansImplementation of Plans, Excluding MCGMAP
Cal/EPA-BTH Goods Movement Action Plan (Statewide GM)Preliminary Working List of Candidate ProjectsCost : $ 15BCommitted: $1.95B – previously committed public fundingProposed Bond (S.B. 1266)1:
$2B Trade Corridors Improvement projects (1:1 matching)$1B AQ improvements (no matching)
Other Funding Strategies: RegulationsIncentivesFederal fundingUser-based feesMarket-based approaches
CARB Emissions Reduction Plan is basis for Cal/EPA-BTH GMAP
1 Senate Bill 1266 revised the originally proposed Cal/EPA-BTH GMAP funding.
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Agency Environmental PlansAgency Environmental PlansImplementation of Plans – Continued
1 Economic benefits due to the avoidance of adverse health impacts in terms of cost.
CARB Emissions Reduction Plan for Ports & Goods Movement in California
Cost to Implement over 15 years: $6B to $10BEconomic-Health Benefits1 over 15 years: $34B to $47BCommitted: N/AFunding Strategies: Industry investment
State bond (pending)Container fees?
Federal fundingOther user feesMarket-based approaches?
SCAQMD Air Quality Management Plan (2003)Emission “budgets” for SIP conformityCost & Funding not addressedEmissions inventories resulting from MCGMAP strategies will not be incorporated into the 2007 AQMP2 due to timing issues.
2 2007 AQMP is currently in development. Public release of draft AQMP due October 2006 , Board action Feb/Mar.2007, and due to U.S. EPA June 2007.
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Agency Environmental PlansAgency Environmental PlansImplementation of Plans - Continued
San Pedro Bay Ports Clean Air Action Plan5-Year Program – $194M to $2.6BCommitted: POLB $181M
POLA $177.4MSCAQMD $ 36M1
Developed jointly between Ports & SCAQMD
$1.6B Shortfall
1 Initial commitment with additional AQMD funding to be determined.
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Building an Action PlanBuilding an Action Plan
3. Compile and Collect Goods Movement Data 3. Compile and Collect Goods Movement Data
2. Outreach Assistance2. Outreach Assistance
1. Project Management / Administration1. Project Management / Administration
4. Assess Growth in Freight Demand4. Assess Growth in Freight Demand
5. Community, Environmental, & Economic Impacts 5. Community, Environmental, & Economic Impacts
6. Strategies for Improving Goods Movement6. Strategies for Improving Goods Movement
7. Mitigating the Effect of Goods Movement 7. Mitigating the Effect of Goods Movement
MultiMulti--County Goods County Goods Movement Action Plan Movement Action Plan 8.8.
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Draft Tech Memo 5a Draft Tech Memo 5a –– Economic Impacts of Economic Impacts of Goods MovementGoods Movement
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Two of Southern CaliforniaTwo of Southern California’’s s Major DifficultiesMajor Difficulties
Environmental & HealthSubject Discussed In Last Session
Falling Living Standards Of Those Without College TrainingSubject of Discussion Today
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1969
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
02468
101214161820
Source: Southern California Association of Governments
Exhibit 8.-Per Capita Income Rank, 1969-2003SCAG Rank of 17 Consolidated Metropolitan Areas
17th = worst
So. CaliforniaSo. California’’s Falling Economic Status Vs. Other U.S. Multis Falling Economic Status Vs. Other U.S. Multi--County AreasCounty Areas
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62.9%
49.4% 49.1% 47.2% 43.8%36.5% 36.0% 35.9%
Imperial (1) Riverside San BernardinoLos Angeles So. California Ventura Orange San Diego
(1) Imperial County for 2000, Not In Southern California AverageSource: American Community Survey, U.S. Census Bureau
Exhibit 1.-Schooling Ended At High School or LessAdults 25 & Over, Southern California Counties, 2004
Key Labor Force Issue: Key Labor Force Issue: Adults With High School Diploma or Less SchoolingAdults With High School Diploma or Less Schooling
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Why do Economists Why do Economists Study Income MobilityStudy Income Mobility
“Rich, Poor Living Poles Apart In L.A. as Middle ClassDwindles” Brookings Institute Study
LA Times July 23, 2006
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Keys To Upward Economic Mobility Workers Keys To Upward Economic Mobility Workers With High School Diploma or Less SchoolingWith High School Diploma or Less Schooling
1. Southern California Based Work
2. Good Entry Level Pay
3. Defined Skill Ladder
4. Move Up In Pay By Learning On The Job
5. Technology Using Sector
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Sectors with Few Training Barriers to Sectors with Few Training Barriers to Beginning EmploymentBeginning Employment
Mining $90,491Manufacturing $48,397Logistics $47,411Construction $42,714Gaming $29,785Retail Trade $28,108Hotel/Motel $24,108Agriculture $23,474
Blue Collar
MeanMeanAnnual IncomeAnnual Income
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$1,284,396,426
$909,813,831
($118,523,490)
Construction LOGISTICS GROUP Manufacturing
Sources: CA Employment Development Department, U.S. Railroad Retirement Board, U.S. Bureau of Economic AnalysisU.S. Bureau of Economic Analysis, 2002 Economic Census, U.S. Census Bureau
Exhibit 16.-Change in Blue Collar PayrollsSouthern California (7-Counties), 2001-2005
Total Payroll Growth:Total Payroll Growth:Main Blue Collar SectorsMain Blue Collar Sectors
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Manufacturing Jobs, 1990Manufacturing Jobs, 1990--20052005
Lost: 361,300 of 1,279,600 in 1990 = -28%
(84,500)(73,500)
(64,200)
(19,200)
7,60024,000
33,300 27,100
(13,500)(3,000)
(47,400)
(72,500)
(48,900)
(12,700)(13,900)
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005Source: CA Employment Development Department
Exhibit 4.-Manufacturing Employment ChangeSouthern California, 1990-2005
China & India Now Allowing Their Entrepreneurs To Compete
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Logistics Sector CharacteristicsLogistics Sector Characteristics
407,771
93,294
53,986
36,425
33,914
25,561
9,023
1,876
661,850
Wholesale trade
Truck transportation
Support activities for transportation
Warehousing and storage
Couriers
Air transportation
Rail transportation
Water transportation
LOGISTICS GROUP
Sources: CA Employment Development Department, U.S. Railroad Retirement Board, U.S. Bureau of Economic AnalysisU.S. Bureau of Economic Analysis, 2002 Economic Census, U.S. Census Bureau
Exhibit 11.-Employment By Logistics SectorSouthern California (7-Counties), 2005
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$71,871
$50,703
$49,011
$48,259
$47,411
$41,797
$39,802
$37,136
$36,317
Rail transportation
Wholesale trade
Support activities for transportation
Air transportation
LOGISTICS GROUP
Water transportation
Warehousing and storage
Couriers
Truck transportation
Sources: CA Employment Development Department, U.S. Railroad Retirement Board, U.S. Bureau of Economic AnalysisU.S. Bureau of Economic Analysis, 2002 Economic Census, U.S. Census Bureau
Exhibit 12.-Mean Average Pay Per Worker By Logistics SectorSouthern California (7-Counties), 2005
Logistics SubLogistics Sub--Sector PaySector Pay
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Logistics SubLogistics Sub--Sector Payroll GrowthSector Payroll Growth
23.3%
17.0%
15.8%
13.5%
13.4%
13.2%
13.1%
-1.0%
-29.7%
Support activities for transportation
Warehousing and storage
Wholesale trade
Truck transportation
Couriers
Rail transportation
LOGISTICS GROUP
Water transportation
Air transportation
Sources: CA Employment Development Department, U.S. Railroad Retirement Board, U.S. Bureau of Economic AnalysisU.S. Bureau of Economic Analysis, 2002 Economic Census, U.S. Census Bureau
Exhibit 14.-Percent Gain in Payroll by Logistics SectorSouthern California (7-Counties), 2001-2005
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Median Pay By EducationMedian Pay By EducationWholesale TradeWholesale Trade
7.50%6.30%4.70%1.20%4.50%5.60%
26.30%43.90%
100.00%80.60%
5.70%13.70%
Bachelor's Degree $27.87 Work Experience & Bachelor's or Higher $44.14
Associates Degree $21.05 Post-Secondary Vocational Education $19.85
Moderate-Term On-the-Job Training $21.49 Long-Term On-the-Job Training $27.80
Short-Term On-the-Job Training $11.65 Work Experience Related Occupation $20.37
No Schooling After High School $15.67 Wholesale Trade Sector $19.17
Bachelor's Or More $36.72 Trade or Community College $26.43
Entry Level
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Fixed Site Operations 30.30% $15.60 $32,446 Trucking or Field Operations 9.10% $14.87 $30,938 Administration & Admin Support 16.90% $19.19 $39,910 Sales & Customer Support 27.60% $23.17 $48,196 Craft & Repair 6.40% $19.60 $40,762 Finance & Information 9.60% $22.74 $47,307
Median Pay by FunctionMedian Pay by FunctionWholesale TradeWholesale Trade
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Square Feet Per Job NeededSquare Feet Per Job Needed
9211,095 1,033
1,167
885775
1,212994 1,015
1,263 1,309
650529 491
901
1994
1995
1996
1997
1998
1999
2000
1994
-2000
2001
2002
2003
2004
2005
2006
2001
-2006
Source: CB Richard Ellis, Grubb & Ellis, Cushman & Wakefield, Lee & Associates, IEEP, Economics & Politics, Inc.
Exhibit 26.-Square Feet Per JobManufacturing Sector, Inland Empire, 1994-2006
1,7321,872
2,165
1,675
2,034
2,434
1,8681,994
1,883
2,2792,400
2,5542,444
2,292 2,284
1994
1995
1996
1997
1998
1999
2000
1994
-2000 2001
2002 2003
2004
2005
2006
2001
-2006
Source: CB Richard Ellis, Grubb & Ellis, Cushman & Wakefield, Lee & Associates, IEEP, Economics & Politics, Inc.
Exhibit 27.-Square Feet Per JobLogistics Sector, Inland Empire, 1994-2006
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What Drives Demand?What Drives Demand?
1. Population Growth 2000-2030: 7.3 million
2. So. Calif. Retail Per Capita after inflation (1994-2004): +24.5%
3. E-Commerce (2000-2006): 27.9% per year
4. Inventory:Sales Ratio (1990-2005): 20.3% drop per $1 of Sales
5. Port Container Volume (2000-2005): +8.5% per year
6. Port Breakbulk Tonnage (1995-2005): +2.5% per year
7. Air Cargo Tonnage Forecast (2005-2030): +4.6% per year
8. Local Manufacturing: Only driver in decline
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Gold Mine Theory of Local EconomicsGold Mine Theory of Local Economics
Primary Tier
Secondary Tier
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Southern CaliforniaSouthern CaliforniaEconomic Impact, 2003Economic Impact, 2003
Logistics Alone: $90 billion or 6.6% of Economic Activity
687,837 or 6.1% of Jobs
$11 billion or 17.8% of Local Taxes & Fees
With Indirect/Induced: $170 Billion or 12.4% of Economic Activity
1,441,016 or 12.7% of Jobs
$15 billion or 23.5% of local Taxes & Fees
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MultipliersMultipliers
OverallEconomic Activity (Energy): 1.97Employment 2.19
SectorsActivity 1.95
Jobs 2.29Activity 2.05
Jobs 2.98Activity 1.82
Jobs 2.82Activity 1.85
Jobs 5.67Activity 2.11
Jobs 2.00Activity 1.89
Jobs 1.50Activity 1.84
Jobs 1.66
Truck Transportation
Couriers
Warehousing & Storage
Wholesale Trade
Air Transportation
Rail Transportation
Water Transportation
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Port: Multiplier ImplicationsPort: Multiplier Implications
1. Cargo Trucked To Warehouses or Transloading Facilities Generates Most Economic Impact & Jobs
2. On-Dock Loaded Rail Cargo Generates Little Economic Impact or Jobs as Quickly Leaves Region
Exception: If On-Dock Loaded Rail Cargo is Short HauledInland for Further Processing, Then Economic Impact & Jobs Created
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Next Steps (Economics) Next Steps (Economics)
1. 1. Establish Forecast Scenarios
2. Determine Economic & Job Impact of Logistics Changes
3. Determine Economic & Job Impact of Capital Projects
4. Determine Cost of Environmental Mitigation
5. Determine Economic & Job Impact of Mitigation
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Other Tasks in ProgressOther Tasks in Progress
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Task 6 Task 6 –– Identify and Evaluate Strategies Identify and Evaluate Strategies for Improving Goods Movementfor Improving Goods Movement
Working with project partners to identify potential Working with project partners to identify potential projects and environmental mitigationprojects and environmental mitigationFocus on identifying regional solutionsFocus on identifying regional solutions
Task 7 Task 7 –– Identify Strategies for Mitigating the Identify Strategies for Mitigating the Effect of Goods Movement on Local Communities Effect of Goods Movement on Local Communities
and the Environmentand the EnvironmentGoal: Maximizes both the economic opportunities Goal: Maximizes both the economic opportunities associated with goods movement, as well as opportunities associated with goods movement, as well as opportunities to reduce the associated environmental and community to reduce the associated environmental and community impactsimpacts
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End ProductEnd Product
>> WhatWhat –– Reach consensus on projects, strategies and Reach consensus on projects, strategies and options for implementationoptions for implementation
>> WhenWhen –– Fall 2006: Develop projects, strategies and Fall 2006: Develop projects, strategies and options for evaluationoptions for evaluation
Winter 2007: Complete MultiWinter 2007: Complete Multi--County Goods County Goods Movement Action PlanMovement Action Plan
>> HowHow –– Develop and maintain partnerships, seek Develop and maintain partnerships, seek innovative financing scenarios, complement innovative financing scenarios, complement State GM PlanState GM Plan
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Questions & AnswersQuestions & Answers
More Information: More Information: www.metro.net/mcgmapwww.metro.net/mcgmap
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