The Montana Department of Transportation is about to open up parts of Montana’s scenic highways to massive oil equipment modules, referred to as “big rigs.” Unfortunately, the economic analysis used in MDT’s environmental assessment process does not recognize all costs that will be borne by Montana taxpayers and employers. Several major cost impacts are either assumed away or ignored. This lack of credible and comprehensive cost analysis is especially serious since MDT’s authorization of the project may be extended to other oil companies, establishing a de facto industrial transportation corridor along western Montana rivers and highways.
MDT is touting this proposal as a job creation stimulus; however, the environmental assessment (Kearl Transportation Module Project, www.mdt.mt.gov ) lacks credible, systematic analysis of the actual jobs that would be created for Montanans. The assessment estimates 150 Montana jobs from one-time-only modifications to highways and auxiliary shipment activities. The other job estimates are already employed workers, including those employed by out-of-state firms. MDT’s assessment fails to balance its claimed positive economic impact with significant associated costs to Montanans. It assumes no job or business revenue losses in Montana’s outdoor recreation and tourism industry; no costs due to big rig accidents, and no long-run costs for MDT’s review, supervisory and road maintenance expenditures on the project.
Jobs in Montana’s outdoor recreation and tourist industry are based on the attractions of our scenic outdoors, mountains, and forests. Tourist survey data show that visitors to Montana come for mountains and forest, open spaces and wildlife, and cold water streams full of trout. Surveys also show visitors give our state high scores for road conditions and environmental stewardship.
The mammoth oil equipment modules transported by a Dutch-based company will be up to 210 feet long, 30 feet high, and 24 feet wide and will, according to the MDT report, require significant highway construction and modifications along the scenic Loscha and Blackfoot river corridors. The report assumes no adverse effects on Montana’s streams or on the state’s outdoor recreation/tourism industry. Potential reductions in out-of-state visitors from the project would lead to job losses in the $4.3 billion outdoor recreation/tourism industry.
The loss of visitors will impact many western Montana businesses, including motels, restaurants and outfitters, and small employers that depend on recreation-tourism travelers. In Missoula County alone, outdoor recreation/tourist spending represents 2,200 jobs and
$34 million in payrolls annually. Such jobs and wages are assumed to be completely unaffected by the big rigs.
MDT assumes zero accident risk for the 170-ton big rigs. This no-accident assumption is particularly questionable since the 200 shipments, slated to begin this September, will run year-long over Lolo Pass, through Missoula, up the Blackfoot, over Rogers Pass and up along the Rocky Mountain Front to the Canadian border. Visualize a 170-ton big rig on Montana’s two-lane, rural highways in just a modest winter snow storm. A comprehensive analysis would allow for potential major accidents and adverse impacts on human life, wildlife and the environment. Accidents would impose cleanup costs, law enforcement and emergency responder costs and traffic routing issues on the two lane highways, costs that would fall on local governments and taxpayers.
A third omission is the lack of explicit cost accounting for MDT’s resources provided in the planning stage and a credible projection of such costs over the project’s timeframe. MDT is already spending taxpayer dollars which are not calculated in the environmental assessment. The analysis states that “MDT will cover costs of review of permit applications, review of the EA, construction oversight and normal obligations for road maintenance.” These costs are ultimately paid by Montana taxpayers with the “normal obligations for road maintenance” potentially becoming quite significant. These omitted costs paid by Montana taxpayers represent a subsidy to ExxonMobil’s tar sand operations in Canada.
A comprehensive, programmatic review of all social, economic and environmental impacts and their costs should be conducted. Such an analysis showing the costs and gains to Montana taxpayers must also include the costs of alternative transport routes through Canada. The inadequate assessment conducted thus far does not answer these questions and is insufficient to make a decision with such far reaching effects on our economy and environment.
Steve Seninger is a Ph.D. economist with more than 40 years of professional background in economic impact and cost analysis.