How investing Canalside money in clean water could help the economy

If the $139 million remaining in the Erie Canal Harbor Development Corporation fund gets spent on fixing Buffalo’s overflowing sewers rather than on parking ramps and commercial buildings for a Bass Pro that won’t come, the Buffalo regional economy will enjoy twice as great an economic impact, and have safer water, more walleyes, fewer fish with tumors, and less stink in Erie Canal Harbor.

That’s the preliminary result of plugging some numbers into IMPLAN, which is the standard modeling software used by economists and those who prepare environmental impact statements. (We will be posting the full, multi-page results on the website of the Buffalo State College Center for Economic and Policy Studies as soon as we make PDFs of the voluminous spreadsheets.)

Think of it. Jobs, paid for with public money, that result in actual public benefit. A 2009 analysis by the Clean Water Council, using the same input-output analysis technique, found that the “multiplier effect” of cleaning up wastewater problems all across the United States would produce anywhere from 20,003 to 26,669 direct and indirect jobs for each $1 billion invested. In the Buffalo analysis, we find that the economic impact will include over 1,000 jobs. (Also, by contrast with the proposed Canalside mall, which will be mainly tax-exempt, there will be taxes paid to local government as a result of public infrastructure work.) The jobs will be in construction, to be sure, but there will also be employment in making the cement, the pipes, the tools, the design and engineering and management, and in support services. Because it is public money for public works, there will be set-asides for minority and female small-business entities. Green infrastructure could enhance the impact: In Buffalo, where the sewers overflow into storm conduits whenever it rains, which further degrades waterways that have a century’s worth of industrial effluent and 50 years’ worth of suburban runoff in them, cost-avoidance by building green infrastructure could make the economic impact even better because the volume of effluent coming into the Buffalo Sewer Authority would be reduced, thus leaving excess capacity at its treatment plant that just might allow it to take in paying suburban customers.

By contrast, commercial construction as envisioned for the former Bass Pro project doesn’t leverage much at all in a marketplace already glutted with commercial construction. The longer-term economic impact of having clean water where there is now dirty water isn’t even in the calculation, but the Brookings Institution’s 2007 analysis indicated that increases in land values, which happen when waterways go from brown to clean, should be added in as positive impact. In a side-by-side comparison with the retail-focused Canalside proposal, there isn’t really any contest.

That’s why it was so refreshing this week when Buffalo Congressman Brian Higgins and Common Council President David Franczyk said what Buffalo has been waiting since 2007 for someone in authority to say: that Buffalo should stick to the original plan for Erie Canal Harbor, the plan that preservationists, a bipartisan consensus of legislators, the last governor to serve out a full term, and a federal judge all agreed was good. That original, history-oriented plan is pretty much fully built-out, except for restoration of the cobblestone streets of the old Canal District. Out of the $145 million allotted to this project by the State of New York, finishing up the cobblestone streets will cost about $6 million, which means that our state will still have at least $139 million cash-in-hand with which to do something else, because our money won’t have been squandered on Bass Pro or some other big-box retailer.

But there’s a catch. Sadly, the mere words of an elected member of Congress or from the elected Common Council president cannot in themselves change the plans of the appointed, un-elected leaders of the Erie Canal Harbor Development Corporation (ECHDC). Until and unless the Goldman v. Bass Pro lawsuit wins, or until a sitting governor appoints new members to the board of directors of ECHDC, the plan for a big-box suburban retail mall for the terminus of the Erie Canal will keep going forward. That is the present participle: The mall plan today is going forward, despite Bass Pro having said no. If you go downtown past the blank walls of HSBC tower, you will see ECHDC at work with your tax dollars and with your environmental-impact settlement money from the New York State Power Authority. ECHDC is busily working not on the original plan to restore the historic elements of Erie Canal Harbor; ECHDC is building parking garages for its retail mall.

Maybe the lawsuit will succeed. Maybe sensible political leadership and a growing sense of outrage will converge to stop the waterfront mall.

And then this community still has to make a choice—specifically, what should we do with all that money from the Power Authority?

The communities upstream of the massive power-generating facility in Niagara got money from the relicensing of the Power Project because, they argued, the Power Project created an environmental impact. (What really happened, of course, was politics: Higgins and then-County Executive Joel Giambra played good cop/bad cop and squeezed a big payday out of the Power Authority.) Some of the funds they obtained went into the Niagara Greenway. A much larger stream of revenue is, unless the Goldman v. Bass Pro lawsuit succeeds, in the control of ECHDC, which is a subsidiary of Empire State Development Corporation. When we got the money, the thought was, yes, let’s use some of it for economic development projects, like putting the old Aud to a new use. But there was this other thought, too: that environmental-impact money should be used to fix environmental problems.

And as a stack of recent studies and reports proves, Buffalo has a doozy of an environmental problem—a problem that could cost as much as $500 million to repair. Making our water less poisonous, and less excrement-filled, so that our water meets federal standards, so that the fish that live in it are worth catching, and so that people who touch that water don’t get sick, is a good idea in itself. Add in the economic impact, and it would seem a no-brainer.

Clean water, new jobs

Scientists at Buffalo State College produced a report in 2005 about just how tough the problem of pollution in the Buffalo River will be to deal with, because the pollution of the Buffalo River is partly about the dozens of sewer-overflow sites that dump into it, but also about the runoff from suburbs and farms way, way upstream.

Why should we care about pollution and overflowing sewers in the Buffalo River? Why does it matter that the Buffalo River is a federal “area of concern,” with report after report on toxic sediments, “bacterial loading,” and other problems? Reading some of these reports explains why, in depressing detail. Forget about swimming and fishing and rowing for a moment. It’s much more serious than recreation: Buffalo’s water supply originates at the Emerald Intake in Buffalo Harbor, which is what the Buffalo River empties into. Tonawanda’s water supply originates in the Niagara River. Our rivers, our Black Rock Canal and our Scajacuada Creek are all very disturbed places with very troubled waters.

There are 68 places where, when it rains, untreated Buffalo sewage flows directly into local bodies of water. A majority of those “outfalls” are on the Buffalo River, which empties into Buffalo Harbor, where the water intake is.

The federal Environmental Protection Agency and the State Department of International Treaty Organization have been saying for a decade that this needs to be dealt with. This fall, the Army Corps of Engineers will dredge some of the toxic gunk out of the Buffalo River and next year from the old City Ship Canal, which is the body of water that runs next to the General Mills plant where they make Cheerios.

But the big work is in fixing the sewers.

Buffalo Niagara Riverkeeper is working on a project, with foundation help, to bring some sensible, proven, cost-effective green engineering to bear on our problem. It seems that engineers for the EPA discovered that preventing storm water from overflowing in the first place might make it possible for old Great Lakes and Northeast cities to clean up their water without going stone broke. Here’s what green-engineered stormwater management means: It means, essentially, catching the rain. Catch it in barrels under your house’s downspouts. Catch it in parking lots that have holes in them, or gravel next to them, and the water won’t run off into the gutter. Put some dirt and some grass and some plants on top of the flat roofs of big institutional buildings, or on grocery stores or suburban malls, and less rain runs into the sewer system. Dig a ditch (but these days the green engineers call them “catchment areas”) and put some pretty plants in them and then surround the ditch with a little fence to keep Rover or Junior from falling in, and that’s that much less water that runs off into the sewers, making them overflow and sending Mr. Floatie in his yellow stream into our drinking water.

That conversation about what we want on our waterfront needs to happen. Some people are already organizing public meetings for this coming fall. I vote for soccer fields on the outer harbor, a string of green spaces on the Buffalo River connected by a new bike path, and for whatever private enterprise wants to set up shop in the Erie Canal Harbor. But in the meantime, we have a pot of money, a pressing chore and an economic opportunity, too. Spending the money on cleaning up our water will put a couple of thousand people to work. Let’s do it.

Bruce Fisher is a former deputy executive for Erie County and visiting professor of economics and finance at Buffalo State College, where he directs the Center for Economic and Policy Studies.