Economic and Environmental Impacts of Closing the Minneapolis Upper Harbor

Monday, February 23, 2004 - 3:00pm

About the Event

A number of proposals have contemplated closing the Minneapolis Upper Harbor and converting the Mississippi River Corridor area above the St. Anthony Dams to housing, light industry, and recreational uses. Those plans would eliminate, or severely reduce, the barge movement of commodities to and from the Upper Harbor.

Several of these studies have assumed that elimination of the barge movements would eliminate movement of these commodities through the Upper Harbor area of Minneapolis. However, there would continue to be a need to move materials such as sand and gravel from Gray Cloud Island to Minneapolis; cement, steel products, and other construction materials into Minneapolis; and, scrap iron and waste metals from Minneapolis. In addition, truck movements of grain and fertilizer from/to northwest of Minneapolis would have to be rerouted to downstream harbors. The displacements of these movements, from barge to truck, would cause increased monetary and public externality costs that were not previously quantified.

This study was designed to determine the costs of the economic and environmental consequences of truck traffic that would result if barge traffic above the St. Anthony Dams was stopped and the existing freight was forced to switch to another mode. The impacts estimated include transportation costs, differences in fuel consumption, changes in air emissions, highway congestion impacts, highway accident impacts, and changes in highway maintenance requirements. Coefficients from the FHWA Highway Cost Allocation Study were used to monetarize the estimated public costs such air emissions and highway maintenance expenses.

Results from the “most probable” scenario indicate an addition of 66,000 truckloads traveling 1.2 million miles in the metro area each year. Annual increases in transport costs to shippers or customers exceed $4 million, while public cost increases exceed $1 million. 

Speaker(s)

Jerry Fruin, Applied Economics